A Report

On
MATERIAL STORAGE LAYOUT AND INVENTORY
MANAGEMENT

By
Chirag Rakholiya
Batch:-2014-16

Submitted in partial fulfillment of

the requirements of
PGDM Program at
Jaipuria Institute of Management
Jaipur

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 Declaration

I Chirag Rakholiya hereby declare that this project entitled, MATERIAL STORAGE LAYOUT AND

INVENTORY MANAGEMENT at Kirloskar Brother Ltd, Dewas (M.P.) (21st April to 5th June)

has been completed by me and it is an original work. This report is being submitted for fulfilling the

requirement of Post Graduate Diploma in Management as a Summer Training Project, at Jaipuria Institute of

Management, Jaipur. and obtaining certification From Kirloskar Brother Limited, Dewas (M.P).

It has never been submitted nor been published elsewhere.

Chirag Rakholiya

Date: 5th Jun 15

Place: Dewas (M.P).

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 Certificate of Originality

To Whomsoever It May Concern

Date: 5th Jun 15

This is to certify that the Summer Internship Project Report entitled MATERIAL STORAGE LAYOUT

AND INVENTORY MANAGEMENT, submitted by Mr. Chirag Rakholiya, represents an original work

done by the student mentioned herein and has been submitted in partial fulfillment of the requirements of

the PGDM Programme (2014-16 Batch).

Name and Signature of Faculty Guide

Deependra Thakur

Kirloskar brother ltd, Dewas

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 TABLE OF CONTENT

S. No. Topic Page No.

1 Acknowledgement 5

2 Executive Summary 6

3 Introduction 8

4 Organization Overview 11

5 Industry Analysis 15

6 Layout Chart 19

7 Research analysis 24

8 PROCESS STORE MANAGEMENT 29

9 Inventory Management 31

10 SIP Experience and Key Learning 33

11 Conclusion 36

12 References 37

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 ACKNOWLEDGEMENT

It is with a deep sense of gratitude that I acknowledge the cooperation and support of Kirloskar
brother ltd. dewas which gave me the unique privilege of completing my project by visiting its
premises for 45 days and provided me with an opportunity to interact with the various personnel.

I am particularly grateful to Mr. Deependra Thakur (Purchase Head). He was indeed very
gracious of him to spare his valuable time and to give an elaborate insight into the functioning of
the company has also to answer all queries patiently. I sincerely express my gratitude to him.

Secondly I would like to thank Mr. Sushil Tiwari (Store Manager) and his team for showed
positive attitude towards my work, and always allowing me to question him and giving prompt
replies for my uncertainties and for extending their friendship towards me and making a
pleasure-training environment in the lab.

And finally I would like to thank Miss. Ragini Gureja and HR department of KIRLOSKAR
BROTHERS LIMITED, DEWAS for giving me the opportunity to have a precious and rewarding
experience of training in their plant.

I acknowledge with the deep sense of reverence, my gratitude to my faculty mentor Dr. Lokesh
Vijayvargy who through their experience and knowledge contributed their full efforts, I thank
him for his precious time he devoted to the project and also the confidence he showed in me.

I deeply gratified to all the employees of Kirloskar Brother Ltd. for their time and constant
support they gave from their busy schedule which helped me to complete my project.

Thanking you,

Chirag Rakholiya.

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 EXECUTIVE SUMMARY

Kirloskar Brothers Limited (KBL) is a world class pump manufacturing company with expertise

in engineering and manufacture of systems for fluid management. It is our constant endeavor to

enhance our customer satisfaction by identifying the industry needs and manufacturing product

that are of superior quality and service.

Enriching lives in the long journey, kirloskar relentlessly pursued a unique ethic in business that

always strives for customer delight that's the kirloskar way of enriching lives.

In any organization the raw materials plays vital role in manufacturing. A small saving in the raw

material will reflect a vital margin in profit of the organization. Raw material control means the

availability of right materials of right quantities coordinated with lead time. Each and every

component of raw material is important and managing the raw material to keep in an optimum

level is a must.

I have been doing my project on raw material department. Since raw material is the major part of

their cost of production there is a need for raw material control by way of reducing cost and

optimum utilization of materials. Though the company is having certain policies regarding this,

still it requires through study of their policy and systems to some extent to understand the raw

material management.

The present order quantity is very high with some items which cause the problem of over

stocking.

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 This leads to additional carrying cost Holding of stock is very high level Due to

confidentiality of the data.

The researcher could not able to collect the data required for this study.

As the company is a closely held one and its policy of disclosing data to the outsiders is

restricted. Hence the collection of full-fledged data could not be achieved.

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 INTRODUCTION

MATERIAL STORAGE LAYOUT AND INVENTORY MANAGEMENT:

A layout is the physical arrangement of equipment and facilities within a Plant. Optimizing the

Layout of a Plant can improve productivity, safety and quality of Products. Un-necessary efforts

of materials handling can be avoided when the Plant Layout is optimized.

Plant layout techniques apply to the case where several physical means have to be located

in a certain area, either industrial processes or services.

The basic objective is to ensure a smooth flow of work, material, people and information.

There are probably two levels at which layouts are required. In one, the various

departments have to be sited, and in other the items of equipment within a department

need to be located.

Criteria for a good layout

Maximum co-ordination: Entry into, and disposal from, any department or functional

area should be in such a manner that it is must convenient to the issuing or receiving

departments. Layout requires to be considered as a whole and not partially.

Maximum use of volume: Facilities should be considered as cubic devices and maximum

use made of the volume available. This principle is particularly useful in stores, where

goods can be stacked at considerable heights without inconvenience, In offices, racking

can be installed to minimize use of floor space.

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 Maximum visibility: All the people and materials should be readily observable at all the

time; there should be no hidden places into which goods or information can get mislaid.

Maximum accessibility: All servicing and maintenance points should be readily

accessible. For example, equipment should not be placed against a wall in such a manner

that necessary maintenance cannot easily be carried out.

Minimum distance: All movements should be both necessary and direct. Handling work

adds to cost but does not increase value; consequently any unnecessary or indirect

movements should be avoided.

Minimum discomfort: poor lighting, excessive sunlight, heat, noise, vibration and smells

should be minimized and if possible counteracted.

Inherent safety

Purpose of a good layout:

The overall process time and cost will be minimized by reducing unnecessary handling

and movement.

Supervision and control will be simplified by the elimination of hidden corners

A feeling of unity among employees will be encouraged by avoiding unnecessary

segregation.

Two Approaches to done layout:

There are probably two levels at which layouts are required.

In one, the various departments have to be sited,

And in other the items of equipment within a department need to be located.

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Types of Layout:

Process

Product

Cellular

Fixed position

Hybrid (mixed)

Product Layout:

Product layouts are used to achieve a smooth and rapid flow of large volumes of

raw material.

Operations are arranged in the sequence required to make the product. For

instance, if a portion of a manufacturing operation required the sequence of

cutting, polishing, and painting, the appropriate pieces of equipment would be

arranged in that sequence.

Product layouts include RACKS. High Racks, FIFO Racks, Cartoon Racks.

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 ORGANIZATION OVERVIEW

Company Profile:

Kirloskar Brothers Limited (KBL) is a world class pump manufacturing company with expertise

in engineering and manufacture of systems for fluid MANAGEMENT.

Established in 1888 and incorporated in 1920, chairman & M.D of this company is Mr. Sanjay

kirloskar. KBL is the flagship company of the $ 2.1 billion Kirloskar Group.

KBL provides solutions for large infrastructure projects in the areas of water supply, power

plants, irrigation, oil & gas and marine & defense. We engineer and manufacture industrial,

agriculture & domestic pumps, valves and hydro turbines.

KBL has eight manufacturing facilities in India at Kirloskarvadi, Dewas, Kondhapuri, Shirwal

Ahmedabad, Coimbatore, Kolhapur and Karad. In addition, KBL has seven manufacturing and

packaging facilities in Egypt, South Africa, Thailand, The Netherlands, United Arab Emirates,

U.K, U.S.A. KBL has 12,700 channel partners in India and 80 overseas and is supported by best

in class network of Authorized All plants of KBL are ISO 9001 & ISO 14001, OHSAS 18001,

ISO 14000 Environment Standard certified. They apply Total Quality Management tools using

European.

KBL is the only pump manufacturing company in India and ninth in the world to be accredited

with the N and NPT certification by American Society of Mechanical

Engineers (ASME).

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 Kirloskar Corporate Overview:

What they do: kirloskar design and manufacturing pumps, valves and hydro turbines.

Kirloskar work with customers and assist them in optimum selection of pumping solution.

How they do it: KBL's expertise of designing and manufacturing custom designed pumps

developed over many years and sale to the dealers and export.

Kirloskar philosophy: kirloskar relentlessly pursued a unique ethic in business that always

strives for customer delight that's the kirloskar way of enriching lives. And promoting GREEN

initiatives and pursues programs.

Vision: we shall be known globally as a reliable, innovative and cost effective solution provider

in hydromantic, machines and system.

Mission: we shall be amongst the first five pump companies in the world by in the year 2015 by

becoming the preferred choice of customers as well as employees.

Principle:

Developing and working with mutual trust.

Building and nurturing team work.

Fairness in dealing with stakeholders.

Quality in everything.

Commitment towards environment.

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Code of Conduct:

KBL provides services that drive business value in ethical, honest and transparent manner

supported by strong governance framework. Code of Ethical business conduct is implemented

and employees are accountable.

Company has adopted Code of Conduct which defines what is considered as "right" in the

organization. That drives business value in ethical, honest and transparent manner supported by

strong governance framework. Code of Ethical business conduct is implemented and employees

are accountable.

Goal:

The goal is to help improve the ways in which they do business by continuously improving their

business processes through 5S and Lean principles and by the innovation use of technology. As a

service provider it strives to be a seamless extension the clients operations.

The Kirloskar Board:

A strong and independent board with illustrious and multi industry experienced directors.

Effective oversight to ensure adherence to corporate governance standards through various

committees.

Kirloskar A Sustainable Company.

As a responsible business entity focused on long term viability. Kirloskar has always considered

sustainability as an integral part of its future oriented strategy and daily decision making.

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KBL is the only pump manufacturing company in India and ninth in the world to be accredited

with the N and NPT certification by American Society of Mechanical Engineers (ASME).With

highest level of transparency and robust sustainability practices across the people economic and

environmental dimensions.

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 INDUSTRY ANALYSIS

Raw material Planning Analysis:

KIRLOSKAR provides end-to-end services and solutions across multiple segments like

including. Power, irrigation, water, gas, oil and defense industry, building & construction,

distribution, customer support and service their services include the following:

There are two important questions to ask here. How much of an item is needed? When is

an item needed to complete a specified number of units, in a specified period of time?

Determine the gross requirements for a particular item

Determine the net requirements and when orders will be released for assembly

Determines the dates when orders for those materials should be released, based on lead

times.

Kirloskar Helps With:

Enhanced Accuracy: Excellence in raw material planning starts with streamlining

master data, automating and standardizing processes and reducing rework.

Reduced Turnaround times: Smoother workflow and better management reporting

teams to make effective decisions and implement timely corrective actions.

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 Driving efficiencies: By reducing man work, improving penetration of standard

reports, and leveraging centralized data KIRLOSKAR transformation and outsourcing

solutions drive down cost and enhance the effectiveness of end-to-end process.

Automation: Utilizing customized tools such as reporting workflow and capabilities

within existing tools and the SAP improves the entire raw material planning and analysis

circle.

KIRLOSKAR team applies the proven principles of 5S team to drive greater speed, accuracy,

effectiveness, and efficiency of raw material to the manufacturing department. Proprietary Smart

SAP framework delivers deep impact and raw material process excellence, and complements its

technology and, naturally, team of more specialists.

SWOT ANALYSIS-

SWOT analysis is a strategic planning method used to evaluate the Strengths, Weaknesses,

Opportunities and Threats involved in a project in a business venture. It involves specifying the

objectives of the business venture or project, and identifying the internal and external factors that

are favorable and unfavorable to achieve those objectives.

Strength-

Abundant manpower.

Operational Excellence.

Technological Competitiveness.

Conducive business environment.

Dedicated Workforce.

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 Export to over 80 countries across 6 continents.

Business vertical like industry, building & construction, gas oil & defence, irrigation,

power, water resource management.

It has seven manufacturing plant Egypt, South Africa, Thailand, The Netherlands, United

Arab Emirates, and U.K, U.S.A.

Weakness-

The cost of pump and valves is much higher in India than in the US.

High Attrition rate.

NO English-speaking workforce.

Government taxes policies.

Cultural differences.

Opportunities-

Market potential.

Information Technology.

India can be branded as a quality outsourcing destination.

People.

Threats-

Competition.

Security Concern.

Billing Rates.

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Every new opportunity has got its own blessings and curses like the same industry has also got

its own opportunities and threats it depends on companies how well they are going to encounter

the threats and how well they are going to capitalize the opportunities.

Strategies to Fight:

1. IMPROVE INTERNAL WEAKNESSES BY USING EXTERNAL OPPORTUNITIES

(WO):

Cultural difference can be overcome by using upcoming generation.

To fight with government policies and other legal aspects,

High attrition rate can be reduced by employing new people, i.e. right person at right

job.

2. USE INTERNAL STRENGTHS TO AVOID EXTERNAL THREATS (ST):

To face the competition with other emerging markets it should use its round.

May use the Technological Competitiveness to secure the data of their clients.

3. THE STRATEGIES CREATED HERE WILL WANT TO AVOID THREATS AND

MINIMIZE WEAKNESSES (WT):

Government policies should be made in such a manner that it reduces the

impact of bill.

Review tax policies and social policies

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 LAYOUT CHART

Existing Store Layout Chart:

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 Both store existing store and proposed store size was same in terms of area.

Racks size was so small in existing store. it was 6ft height.

Also, it does not include large racks. Only FIFO racks and small racks.

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Proposed Layout Chart of the Store:-

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What was objective of our project?

1. Proposed store includes larrge racks, fifo racks,small rackscartoon racks,

2. Save storage by 32% with existing area.

3. Go. Vertical storage instead of horizontal for area saving?

4. Minimization of material movement of material due to nearer to shop-floor.

5. By elimination/minimization of back tracking and duplicate handlingby more & more use

of system or SAP.

6. By utilzation of gravity of materital handling.

7. To employ mechanical aids instead of manual labour to accelerate material movements.

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store layout measurment it was published in kirloskar manufacturing department on notice board.

Save 7088 sq.ft Ex. 32%.

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 RESEARCH ANALYSIS

Research is important of all the business now a days but every industry do a minor research.

Some big industry do a large research of its product.so its results came in the form of data this

data should require analysis so it can know more about it.

Source of data: our project include primary data.it refers about stores and store layout. it

shows that how much raw material can contain more in new store then existing store. with the

measured data I came out on data.

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Data analysis & interpretation:

The interpretation is requiring of all data without data interpretation any cannot understand

easily. It became helpful for company to change the store because new store can contain more

raw materials then the existing store.

Objectives:

Minimize material handling cost by way of:

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 Save storage area by 32% with existing area

Go, vertical storage instead of horizontal for area saving?

Avoid zigzag motion for feeding of material from inward area to nearer to shop-floor.

By utilization of gravity for material handling.

To employ mechanical aids instead of manual labour to accelerate material movement.

Store measurement required thing and from it company can prediction that how much raw

material can contain more. Following pictures are showing the data of measurement.

Existing store have two floor from both store area around is 21963 Sq.ft

Volume is demonstrated in graph of different racks.

Existing store has no FIFO racks.

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 Area covered by new store is around 14785 Sq.ft.

Existing store cover mezzanine floor.

New store has no fabricated racks and C/BOX at ground.

In the place of fabricated racks and C/BOX at ground. High rich racks can be used.

Research Methodology:-

Study or Research Objectives:

a. To learn how the company keeps all the data of inventory perfectly.

b. To find out the composition of inventory.

c. To analyze the inventory management techniques used in the company.

d. To study the Inventory Control Techniques of the company.

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 Methods of Data Collection:

The data is collected from the respected persons of the company. The communication was

informal in nature.

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 PROCESS STORE MANAGEMENT

Material issue management:-

PRD release by
Central Planning

Receipt of PRD Preparation of issue slip storage wise and

cellwise from given to concern store keeper to issue

Verifying stock as per PRD release NOT OK

Checking stock against If found any
PRD - CC items discrepancy about
material inform
& verifying accordingly to buyer

FOUND OK

Physically pick the material of required quantity from BIN location

Put the picked material in suitable pallet, Trolly etc.

Shifting of picked material to SHOP-Floor from stores by as desire transportation mode like
fork lift, Trolly, pallets etc.

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 Stacking / Arrange the material operation wise at shop floor CELL location

Taking the acknowledgement of issued material from shop floor

Punching PRD in SAP as per mention Keeping record of

production order Number PRD

Punching PRD in SAP &

keeping record

Abbreviations
CP Central planning
Mfg. Manufacturing
Cc Cost Center
PRD Production release order

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 INVENTORY MANAGEMENT:-

Inventory Management

Inventory is a list for goods and materials, or those goods and material themselves,

held available in stock by a business.

A subsidiary ledger which is usually used to record the details of individual items of

stock. Inventories can also be used to hold the details of other assets of a business. There are

three types of inventory: Raw materials, work in process and finished goods. Raw materials are

materials and components that are inputs in making final products. Work in process also called

stock in process refers to goods in the intermediate stages of production finished goods consist of

final products that are ready for sale .inventory represents the second largest asset category for

manufacturing companies next only, to plant and equipment he proportion of inventory to total

assets generally consists of 15 to 30 percentage.

Nature of Inventories

Inventories are classified according to uses and point of entry in the alteration is as

follows:

Raw material

Work in process goods,

Finished goods

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 Raw Materials:-

Raw materials are those units that are converted in to finished production through

manufacturing process. Raw material inventories are those units which have been purchased and

stored for future. Under head of raw materials Kirloskar are maintained WEAR RING, STUD,

PUMP SHAFT, and PUMP CASING. Etc.

Work in Process goods:-

It is also called stock in process. It refers to goods in the intermediate stage of

production. These inventories are semi-finished products. It presents the products that need more

work before they become finished product for sale.

Finished goods:-

Finished goods consist of final products that are ready for sale. Finished goods are those

completely manufacturing products which are ready for sale. Stock of material and work in

process facilitate production, while stock of finished goods is required for smooth marketing

operation. Thus inventories serves as a link between production and consumption of goods.

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 KEY LEARNING

Kirloskar Brothers Limited (KBL) is a world class pump manufacturing company with expertise

in engineering and manufacture of systems for fluid management. and Operations including

those that are complex and industry specific.

Enriching lives in the long journey, kirloskar relentlessly pursued a unique ethic in business that

always strives for customer delight that's the kirloskar way of enriching lives.

It is our constant endeavor to enhance our customer satisfaction by identifying the industry needs

and manufacturing product that are of superior quality and service.

PLANT LAYOUT is a study used to analyze different physical configurations for a

manufacturing plant. I had completed project on store changing. Raw material department

ultimately has not proper place to arrange the raw material. It was necessary to change the store

because material arrangement was improper and space was less in the store.

Firstly i had started with measurement of the both store existing and proposal store. The key

process required to calculate the volume and area of the existing store and proposal store and to

find out whether the raw material should be required more space than existing store or not. There

are various stores like manufacturing, raw material, purchase, inventory department, etc.

I have been working in material receiving area (raw material). all the

material comes and goes through SAP of it. My work was basically to change the store at another

place in the company. So, firstly i measured the both proposal store as well as existing store.

From the measured data i found the area of the both store.it space was slightly difference

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between them in terms of area and volume. After i had drew the chart with the rack. And

demonstrated racks in the chart that how many racks shall require in new store. There were

different types of racks like that FIFO racks, CARTON racks, NORMAL racks, HIGH racks.

So result came of measured data I added FIFO racks in new store which was not in existing

store.so, 816 Sq.ft. places increased in new store. And cartoon racks eliminate from the new store

I dont added in new store. I eject normal racks from the store. High racks size I increased so raw

material could contain more. Overall place of the new store is increased and high increased.

Then after I shorting the data of the raw material like that here,

WINDING (stator, wound stator)

Size of packing (Control panel,

External fan, fan cover, impeller etc.)

HARDWARE (Washer spring, water deflector, wearing ring).

I measured height, length, width of stator on the basis of volume and area. I predict about store

that how much material should be containing more.

After it completed and I started on SAP firstly make the purchase order by purchase department

then after they order the goods of its particular industry and after being the GRN NO. Of the

receiving raw material when the raw material comes in the store. Then after material has entered

in the SAP.so its create GRN NO. After material were going in manufacturing department. It

also handled by the other assistant manager.

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My work:

Firstly I understand the store raw material process through different people after which they give

me 0right knowledge and I myself have to prepare whole layout process, which will be treated as

training model.

I worked upon these points-

Layout chart

Data shorting

Measurement raw material

SAP work of billing

Apart from layout chart I did reporting too:

This report is submitted to the company. I also did this reporting monthly as well as quarterly. In

this way I got to learn many things about shorting in excel.

Prepare working using data shorting separate the data like HARDWARE and DP shell.

Submission of data shorting and layout chart in 25 days. I started work on SAP i learnt about

how to made GRN no. of receiving goods.

This reporting includes areas of layout chart, data shorting, measurement of raw material, SAP

etc.

By doing this report one got to know how raw material should be contain more with less place.

Which new are added in business?

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 CONCLUSION

To understand what kirloskar stands for enriching lives. What all work it does in its major

domain area, its scope, processes etc. After that information accumulated regarding company its

major operation working was evaluated and practiced. Main topic layout chart which is done

through AUTOCAD training. In short its a pool of knowledge it up to us how much we can take

it.

Training Model- data sorting & store layout was executed which was treated as

training model for other trainees so that time will be saved. Inventory management and

fining the bottleneck of the operation and opting methodologies to optimize the time in

the production process.

Knowledge of employees was limited to share up to the work they are doing. For

example- If someone is preparing GRN no. of material receiving. Then he had full

knowledge of that area but not of another like planning department or any other area like

planning etc.

Store layout structure and capacity of the layout to hold raw material and its optimum

usage as per the requirement.

Learnt how generated GRN no. of material (new raw material coming) in the store.

Everyone is specialised in their own assigned work and managing the overall inventory

space and assembling of the raw material to procure the final product.

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 Reference

www.kirloskarpumps.com

www.wikipedia.com

www.google.com/kirloskar

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