subham internship

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PRODUCTION PLANNING AND CONTROL IN THE AUTO-ELECTRICAL INDUSTRY A SUMMER INTERNSHIP REPORT Submitted by SUBHAM CHAUHAN Registration No: 11504778 In partial fulfillment of Summer Internship for the award of the degree of MASTER OF BUSINESS ADMINISTRATION (HONS) School of Business LOVELY PROFESSIONAL UNIVERSITY Phagwara, Punjab July, 2016

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Page 1: Subham Internship

PRODUCTION PLANNING AND CONTROL IN

THE AUTO-ELECTRICAL INDUSTRY

A SUMMER INTERNSHIP REPORT

Submitted by

SUBHAM CHAUHAN

Registration No: 11504778

In partial fulfillment of Summer Internship for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION (HONS)

School of Business

LOVELY PROFESSIONAL UNIVERSITY Phagwara, Punjab

July, 2016

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DECLARATION

I, Subham Chauhan, hereby declare that this internship project report entitled

Production planning and control has been completed based on actual study carried out

by me during my 45 days internship program at Lucas TVS Limited, Rudrapur.

I am presenting an authentic report of my work to School Of Business at Lovely

Professional University, Phagwara carried out at Lucas TVS Limited, Rudrapur for the

partial fulfilment of the requirement of the Master of Business Administration degree

programme of Lovely Professional University, Phagwara

This Study based report is original and information, data and fact furnished there in are

actual based on study carried out by me.

Signature

Subham Chauhan

11504778

Date- 31-07-2016

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ACKNOWLEDGEMENT

The satisfaction and euphoria that accompany the successful completion of any task

would be incomplete without the mention of the people made it possible and whose

guidance and encouragement.

The project is the part & parcel of M.B.A. Degree. It’s my great privilege to be

associated with Lucas TVS Limited - leaders in Automotive Filters and Auto-

Electrical Equipments. The kind of expression of Lucas TVS Limited. Global &

professional attitude is what, I desired before joining. I would like to take this

opportunity to thank all the people who helped in the completion my industrial training

& in the completion of this project.

I acknowledge my deepest thanks to Mr. D. D. Satyawali (Human Resource Head)

at Lucas TVS Limited, Rudrapur for all his care & encouraging words & giving

suggestions at the crucial stages of this project.

I deliberate my profound sense of gratitude of Mr. Sunit Kumar Chauhan

(Production Head), who have rendered constant guidance, advice and help as & when,

needed to complete this project work successfully.

I am thankful to Mrs. Neeru Sidana (Assistant Professor, School of Business) for her

exertions and persistent assistance during my internship at Lucas TVS.

I am deeply indebted to my dear parents, friends whose blessings and inspirations have

brought me up to this stage of my career.

Subham Chauhan

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EXECUTIVE SUMMARY

This report is mainly focused on production planning and control towards optimizing

the resources to enhance the productivity and effective labour utilisation and to

improve the quality for better customer satisfaction. In my summer training I have

targeted Alternator (SIA114) main assembly line in Lucas TVS Limited. Normally in

this internship important motive is to give information to the plant head of the

company and production manager. After giving information to the line in charge then

we ask some question for production planning and controlling purpose like what the

production losses and the quality problems in the assembly of alternator and from

where they tried to get the solutions and up to what extend they got their problem

troubleshooting in failure of production planning and corrective and preventive action

for the quality issues. Collection of data from the quality gate (Final Dispatch) and

pre-dispatch inspection used in this report is primary and secondary. Primary data of

this project is to explore awareness among the operators and supervisors about the data

of production losses and quality problems to discuss certain best practices towards

enhancing the productivity and effective labour utilization (ELU). Arising out of the

productivity loss and secondary objective of this project is, to aware the operators and

supervisor about the product quality towards customer satisfaction.

As per the study and feedback from the operators, they are not much aware about the

productivity losses and the customer dissatisfaction about the quality and delivery. But

after giving information to the operators and line in-charge they said it is very useful

for them and said whenever they get some problem regarding the productivity and the

quality or any loss in production they will definitely minimize the 4’M (Man, Machine,

Material & Method) losses and also many of the lines are facing the problems related

with the production and quality losses so there is large potential of the customer

dissatisfaction for Lucas TVS Limited.

As every other study, this study also has certain limitations. Some of the information

taken is secondary so the information taken can be wrong. The operators or supervisors

while providing the information may be bias.

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OBJECTIVE OF THE PROJECT

PRIMARY OBJECTIVE

To study the Need and Management of Supply Chain Management of the

organization and the potential benefits of doing so.

To identify the strategic, tactical, and operations issues in supply chain

management.

To define the term inventory and list the major reasons for holding inventories and

list the main requirements for effective inventory management.

To study the production planning and controlling process of Lucas TVS and the

techniques by which the former can enhance its productivity.

SECONDARY OBJECTIVE

To gain real world experience of production and operations within the organization.

To enhance the skills and gain experience of being a true professional.

To understand the day to day functioning of a department within the organization.

To deal with various problems of customer and their enquiry.

To apply the various theoretical concepts in practical way within the organization.

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TABLE OF CONTENTS

S.No CONTENTS PAGE No.

1 Profile Study of Organization 13-19

Industry Analysis 14

Preliminary Understanding of the industry 15-16

Nature of demand and supply 16-19

2 History of Company 20-26

Origin 21-24

Expansion 24-25

Global Expansion 25-26

3 Introduction of the Company 27-42

About 28-30

Mission and Vision 30-31

Infrastructure 32

Life and Work Culture 33-35

Specialized Products Lucas TVS Offers 36-40

Customers of Lucas TVS 41-42

4 Organization Structure 43-48

Organization Hierarchy Under Plant 44

Organization Hierarchy Under Production 45

Awards and Recognitions 46

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Quality Policy 47-48

5 Learning From the Internship 49-67

Supply Chain Management 50-52

Production Planning 53-55

Production Scheduling 55-57

Production Monitoring 57-59

Quality Control 60-61

Pre-Dispatch Inspection 61-65

Inventory management 65-67

6 SWOT Analysis 68-74

Competitors Analysis 71-73

Conclusion 73-74

7 Customer Satisfaction Towards Lucas TVS

Limited.

75-80

Introduction 76

Need of the Study 76

Objective of the Study 76-77

Review of the literature 77-78

Research Methodology 79-80

8 Data Analysis and Interpretation 81-94

9 Findings and Recommendations 95-97

10 Conclusions 98-99

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11 References 100-101

12 Questionnaire 102-104

LIST OF TABLES

S.No TABLES PAGE No.

Table 3.1 Customers of Lucas TVS 42

Table 4.1 Awards and Recognitions 46

Table 5.1 Suppliers of Lucas TVS 52

Table 5.2 Cell log Sheet 54

Table 5.3 Day-Wise Breakdown 55

Table 5.4 Shift Breakdown 56

Table 5.5 Production Monitoring 63

Table 5.6 4M’s Reason 63

Table 5.7 4M’s Breakdown 64

Table 5.8 Kaizen Result Layout 65

Table 8.1 Variables Validity 82

Table 8.2 Order Validity 82

Table 8.3 Order Quantity Validity 83

Table 8.4 Order Delivery Validity 84

Table 8.5 Order Fulfilment Validity 85

Table 8.6 Package Rating Validity 86

Table 8.7 Defected Items Per Lot Validity 87

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Table 8.8 Problems in AEC Validity 88

Table 8.9 Problems in EFIP Validity 89

Table 8.10 Component Rating Validity 90

Table 8.11 KMO’s Test Significance 91

Table 8.12 Communalities Extraction 92

Table 8.13 Variance Explanation 92-93

Table 8.14 Component Matrix 93

Table 8.15 Rotated Component Matrix 93

LIST OF FIGURES

S.No FIGURES PAGE NO

Fig 1.1 Engine Electrical Components 14

Fig 2.1 Customers Welcome in Lucas TVS 23

Fig 3.1 The Founder of Lucas TVS 28

Fig 3.2 Certifications 29

Fig 3.3 Plant Outlook 33

Fig 3.4 Plant Interior Layout 33

Fig 3.5 Health & Safety Policy 34

Fig 3.6 Energy Policy 34

Fig 3.7 Norms and Ethics 35

Fig 3.8 Alternator 37

Fig 3.9 Location of Alternator in Engine 37

Fig 3.10 Starter Motor 38

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Fig 3.11 Location of Starter Motor in Engine 38

Fig 3.12 Wiper Motor 39

Fig 3.13 Location of Wiper Motor in Car 39

Fig 3.14 Types of Filters 39

Fig 3.15 Air Filter 39

Fig 3.16 Various types of Oil Filters 40

Fig 5.1 Label of Master Sample (OK) 56

Fig 5.2 Label of Master Sample (Not OK) 56

Fig 5.3 Finished Goods Inventory of Alternators 59

Fig 5.4 Production Line 59

Fig 5.5 Packaging Department 62

Fig 5.6 Consignment to Ware House 62

Fig 5.7 Tube-Offset Checking Before Kaizen 65

Fig 5.8 Tube-Offset Checking After Kaizen 65

Fig 5.9 FIFO Clock in Inventory 66

Fig 5.10 Raw Material Inventory 66

LIST OF GRAPHS

S.No GRAPHS PAGE No.

Graph 8.1 Order Validity 83

Graph 8.2 Order Quantity Validity 84

Graph 8.3 Order Delivery Validity 85

Graph 8.4 Order Fulfilment Validity 86

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Graph 8.5 Package Rating Validity 87

Graph 8.6 Defected Items Per Lot Validity 88

Graph 8.7 Problems in AEC Validity 89

Graph 8.8 Problems in EFIP Validity 90

Graph 8.9 Component Rating Validity 91

LIST OF FLOWCHARTS

S.No TABLES PAGE No.

Flowchart 3.1 Product Range 36

Flowchart 4.1 Organization Structure in Plant 44

Flowchart 4.2 Organization Structure in Production 45

Flowchart 5.1 Supply Chain Management 51

Flowchart 5.2 Function in PPC 53

Flowchart 5.3 Assembly Line 57

LIST OF ABBREVIATIONS

EEC Engine Electric Parts

AAC Automotive Aftermarket Companies

OEM Original Equipment Manufacture

ECP Electronic Control Parts

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AEC Auto-Electrical Components

EFIP Engine Fuel Injection Parts

CTW/CTC Consignment to Ware House/Centre

F/G Finished Goods

R/M Raw Material

WIP Work In Progress

SCM Supply Chain Management

SRE Spring Return Extend

DE Di-Polar Extend

PPC Production Planning and Control

R & D Research And Development

CNG Compressed Natural Gas

PADI Padi Plant of Lucas TVS in Chennai

CHKN Chakan Plant of Lucas TVS in Pune

UT Sidcul Plant of Lucas TVS in Uttarakhand

MMLN Maraimalainagar Plant of Lucas TVS in Chennai

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CHAPTER – 1

PROFILE STUDY OF ORGANIZATION

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1.1 INDUSTRY ANALYSIS

Lucas TVS Limited is into the business of Auto-Electrical components and Filter. This

is the part of automotive industry which comes under the AAC (Automotive

Aftermarket Component). Auto-Electrical are electrically operated systems which are

used in road Vehicles, originated from the need to control engines. There are some

electrical pieces which are used to control the functions of an engine and known as

Engine Electrical Components (EEC). The Electrical components controls is used in

various automotive applications and the acronym EEC stands for " Engine Electrical

Components", took on the more general meaning and as result specific EEC's are

produced. Now, EEC's are modular. A modern car may have up to 30 EEC’s and a

commercial vehicle up to 15. A filter is a porous device for removing impurities or solid

particles from a liquid or gas passed through it. Lucas-TVS is the market leader in India

for Auto Electrical equipment and has 50 years of experience in design and

manufacturing these products. Our product range includes Starter Motors, Alternators,

and Wiping systems, Ignition Systems, Fan Motors, Small Motors and Automotive

Filters. We are the principal supplier of these products to India's OEM's in the

automotive sector.

jj

Fig 1.1 – Engine Electrical Components

Source: Internet

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1.2 PRELIMINARY UNDERSTANDING OF THE INDUSTRY

Auto-Electrical components provider is relatively a very old business domain it comes

under automotive industry. The exponential growth of the automotive industry has led

to the growth of AEC provider. The industry mainly comprises of vendors who provide

Auto-Electrical components and Filters providers who develops the EECs which could

be sold to any automobile manufacturing company.

Lucas TVS limited provides both Auto-Electrical components and Filters to its clients.

In Indian market there aren’t any such companies that provide both Auto-Electrical

components and Filters to its customers hence it could be categorized as a monopoly.

But there some large number of vendors who provide different types of Auto-Electrical

components at a very small scale but they could never be categorized as a competitor

to Lucas TVS limited because of their scale of operation is very less mostly confined

to its locality.

In the automotive industry most of the automobile manufacturing company have

contracted with Auto-Electrical components provider. These type of providers are

considered as automotive aftermarket suppliers and known as the secondary market of

the automotive industry, these type of suppliers are perturbed with the distribution,

manufacturing, remanufacturing, installation and retailing of all vehicle parts, ECPs,

EECs and various accessories, even after the sale of that particular automobile

assembled with the former items, by the original equipment manufacturer (OEM) to the

customer. The parts and accessories for the sale may be or may not be manufactured by

the Latter. Hence, such types of companies are working in B2B as well as B2C lane.

There was a report submitted by the executives of the Administration of International

Trade in the Department of Commerce, "There should be two categories of AAC i.e.

accessories and replaceable parts. Accessories are parts made for comfort, performance,

convenience, safety, or customization, and are designed for add-on after the sale of that

motor vehicle from OEM, while the Latter are the parts either built or remanufactured

to replace OE parts as they could damage.

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“New analysis from Frost & Sullivan, Strategic Analysis of the Indian Automotive

Aftermarket finds that total manufacturer-level parts revenue in India will grow by a

CAGR of 12.4 percent (2014-2021) to reach $16.5 billion by 2021. Demand for routine

maintenance parts such as motor oil, wiper blades and brake pads will increase at least

10 times faster across India than in North America and Europe.”

1.3 NATURE OF DEMAND AND SUPPLY

There is a Chinese Saying, “Whenever the wind changes its blow, some people prefers

wall while others build the windmills”. And if you are engaged industry like (AAC)

automotive aftermarket sector, where you can feel a constant breeze of innovation, you

will have to develop an intuition for boundaries and opportunities, or in other words –

set up your windmill when the moment is right. The online retail market for the

automotive aftermarket parts industry and accessories continues to emerge as a

tremendous growth opportunity for the aftermarket parts industry. While estimated

sales volumes of the online parts industry vary, assessments range from $2 billion to $4

billion annually. In its March 2014 report, “Digital Disruption: e-Tailing in the

Automotive Aftermarket,” AASA reported that aftermarket e-tailing has grown

dramatically, with an estimated 60 percent of growth occurring in the past four years.

Because of that, Booz & Company estimated that by 2018, e-tailing market size could

reach 7.3 percent of market penetration. Aftermarket suppliers must have an effective

presence online in the purchase process to capitalize on the opportunities in DIY and

DIFM.

Over the last several years, the automotive aftermarket has adapted to and profited from

the overall trends in the automotive sector. Like the previous years, 2014 will again

mark a peak in the production of cars and the corresponding supplier industry. The high

demand for spare parts is connected to the old age of vehicles in the US (ca. 11 years).

Also, strong growth in emerging markets provides the automotive industry with a

significant amount of upward potential.

(https://www.frost.com/p7a0)

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From the aftermarket industry’s point of view, the continuity of this development

depends on the companies’ ability to further adapt to the upcoming automotive

aftermarket trends. The main driver behind these trends is technological change

1.3.1 Equalization of service levels in emerging markets

In the past, a service level of between 90 and 95 percent was the benchmark in the

automotive aftermarket. Today – partly as a consequence of higher requirements in the

digital age – a service level of 95 to 99 percent is the new standard in developed

markets. In emerging markets, like China or India, most of the time, the service level

does not climb higher than 80 percent. Increasing this value is the avowed goal of spare

parts management in the coming years. The most important challenge regarding this

matter is bridging the infrastructure gap in emerging markets. Even though ERP

systems are now widely available, the potential of these systems is limited. This fact

will promote further trends regarding inventory optimization strategies, in order to

achieve higher service levels.

1.3.2 E-commerce

E-commerce is a business model which has thrust itself into various business sectors.

Today, the transaction of relationships and sales processes between customers and

providers via the internet is the absolute standard in B2C business. This trend has now

affected spare parts management as well. In the US, the revenue in the online area of

spare parts vendors is estimated to amount to more than 5 billion dollars. In this specific

area, e-commerce shows a double-digit rate of increase – something the traditional

brick-and-mortar businesses can only dream of. But this shift comes with a price,

because the expectations of online customers are very high.

(BONUS: See our Special Report on "E-Commerce Reverse Logistics Framework

Strategy for The Automotive Aftermarket Industry" on the Automotive

Aftermarket Supplier's Association Website.)

Today, online mail-order advertises the concept of same-day-delivery, which implies

the arrival of goods only a few short hours after the order was made. In order to meet

these promises, a service level of 99 percent should be a standard. However, high stock

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levels cause high storage costs and bind capital which could be used in more sensible

ways. Companies should monitor both their service and stock levels and try to keep the

latter as low as possible. In this context, the balance of stock levels between the web

shop and the stationary retailers will play an important role in the future. The

coordination of these two poles, in terms of a multi-channel strategy, is one big

challenge the automotive aftermarket will face when implementing an e-commerce

business model.

1.3.3 3D printing

Aside from the demands of rigorous E-commerce delivery times, 3D printing also

represents a new trend in spare parts management. With 3D printing, companies found

a way to shift the production of spare parts from a central production facility to local,

previously non-productive subsidiaries. If a certain spare part is currently out of stock,

it can quickly be made available by printing it on-site. The most important thing about

this process is to have detailed specifications of the required objects. Because of its

complexity and data sensitivity, the procurement of this information is a massive

roadblock on the way to adopting this technology. While this currently prevents

widespread usage, the first companies, like Ford, are already moving in this direction.

One ongoing development of automotive aftermarket trends is suppliers are increasing

their ship-direct activity. They are shipping parts directly to the dealer, or they may ship

to a primary distribution center or field DC, bypassing the national distribution center.

This approach benefits the shipper during a surge in demand, because the inventory is

available throughout the network, so the supplier can quickly distribute it where it is

needed.

Another supply chain trend in the automotive aftermarket is same-day delivery.

Traditionally, dealers place their orders late in the afternoon on the day before delivery.

But today, suppliers place high-velocity parts in various select locations, allowing them

to ship to dealers in multiple daily deliveries. Dealerships can then provide much faster

service to their customers—repairs that once took two or three days, for example, can

now be completed within 24 hours. This strategy is prevalent in premium auto brands,

but is spreading to more mainline brands as well.

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Establishing high-velocity distribution centers represents a third auto aftermarket trend.

High-velocity DCs ship original equipment manufacturer (OEM) parts every day to

most or all of the automaker's dealerships. Some smaller auto brands ship less

frequently, typically delivering service parts two or three times weekly to the dealer.

Using high-velocity centers—either their own facilities, or ones operated by third

parties—allows companies that once delivered two or three times weekly to serve

customers five times per week. This approach could raise the level of inventory on

hand, but if companies strategically focus on turns and inventory placement, they may

not have to increase the amount of inventory in the system—they can just place it closer

to customers.

The Indian automotive component aftermarket industry is pegged at Rs 28,000 crore

and projected to touch Rs 37,000 crore by 2014-15. On the service side, the industry is

estimated at Rs 10,000 crore and projected to grow to Rs 13,000 crore by 2014-15. It is

such opportunities that are making big corporate houses like the Tatas and Reliance

strategise to grab a share of the pie. While the Tata Sons-promoted Tata AutoComp

Systems recently started offering a dozen-odd spare parts in the market a under a new

brand called ‘Autocomp’, Reliance Industries is stepping up its ‘Autozone’ business,

its maiden attempt in the auto retail business.

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CHAPTER – 2

HISTORY OF COMPANY

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2.1 ORIGIN

Lucas was established in 1872, the same year that the petrol engine was first patented.

The first Mercedes 'horseless carriage' was still 14 years away and the Ford Model T

wouldn't appear for a further 27 years. The business that Joseph Lucas founded in

Birmingham, still the global HQ of Lucas today, represents the consistency and

durability of Lucas products and has made Lucas one of the most successful automotive

brands in history. An official patent was obtained in 1880 for the "King of the Road"

bicycle lamp. In 1882, Joseph formed a private partnership with his son, Harry, trading

under the title of Joseph Lucas & Son. The "King of the Road" Lion became a trademark

in 1884 and remained a major feature of Lucas advertising for the next 80 years.

Business expanded dramatically in the bicycle boom of the time. A new factory was

built which later developed into the iconic Great King Street premises for the major and

successful Lucas Electrical business in Birmingham. By 1897 a public company,

Joseph Lucas Ltd, was formed with Joseph as Chairman. The company had now

achieved a leading position in its market and was perfectly positioned to move into the

infant automotive parts and accessories market.

Joseph Lucas died in 1902 to be succeeded by his son, Harry, as Chairman. Lucas was

perfectly positioned to take advantage of the expanding motor vehicle market which

was stimulated by a Parliamentary Act in 1903, which raised the speed limit above

walking pace, making the use of cars more attractive. The range extended to include

cycle, motorcycle and car accessories including oil, acetylene, and electric lamps. Great

King Street was expanded to meet increased demand.

By 1960 there were 57,000 employees and expansion across Europe was gaining

momentum. This included brake manufacturing in France and Germany, diesel

partnerships in France and Spain plus a significant development of the aftermarket

network. Lucas Service was by now a global enterprise. Lucas exported to over 130

markets with around 4,000 authorised outlets. Lucas began the 1970s as the 54th largest

company in the UK. The group was renamed as Lucas Industries in 1974 and a new

Lucas corporate identity, including the Lucas diagonal, was introduced in order to meet

changed national and international trading conditions. This resulted in the loss of the

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individual brands of Lucas (lion), Girling and CAV which had gained world-wide

recognition.

Lucas TVS was established in 1962 as Joint Venture between Lucas Plc. UK and TVS

Group, India. Lucas started operations in India from 1930 as Lucas Indian Service for

providing warranty and aftersales service to many of the imported vehicles which

carried Lucas parts. In the year 2001 Lucas TVS became a wholly owned company of

TVS Group, as Lucas the parent company ceased to exist worldwide. While this might

have created a technological challenge, Lucas TVS recognised this as an opportunity

and exploited successfully; today 75% of revenues are from products engineered and

developed locally by Lucas TVS. Lucas TVS is currently supplying to over 90% of

automotive manufacturers in India and also exporting to North America and Europe.

Initially with Starters, Dynamos and Distributor products, Lucas TVS, over the years,

commenced providing complete system solutions in Auto Electricals, specialized

motors for Air Compressors, Stop - Start systems, Engine Cooling modules, Ignition

products, Diesel Fuel Injection systems etc. Lucas TVS develops and integrates their

products in the vehicles and equipment, from the design stage onwards and carries out

application engineering, development, manufacturing and service. The company

developed innovative products, manufacturing systems and processes, which had

brought growth in business and this could result in Lucas TVS being one of the few

companies in the World to be awarded the Deming Application Prize and the Deming

Grand Prize, by Union of Japanese Scientists & Engineers and setting benchmarks in

the industry. Lucas TVS relies on investing in both people and infrastructure. Lucas

TVS has established R&D and Product Proving and Reliability testing facilities, which

have been recognised by the Government of India – Dept. of Science & Technology.

Lucas TVS products find applications in Two/Three Wheelers, Passenger Cars,

Commercial Vehicles, and Tractors & Stationery Engines. Through export partners,

Lucas TVS products are also integrated into some of the top global brands like Audi,

Mercedes-Benz, BMW, Porsche, Rolls Royce, etc.

While Starters and Alternators form the backbone of products, Lucas TVS established

new benchmarks, focusing on higher efficiency at lighter weight and costs, being the

present focus of automotive industry – e.g. the new SGM25 starter for 1.2L gasoline

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vehicles, high efficiency alternators (around 78% at lower speeds) to cater to the

increased power requirements of gadgets and gizmos used in the vehicles, 150A Bus

Alternator for the new luxury buses to run the air conditioners, on-board entertainment

and electronics and 180A bus alternators for battery less option. This contributes to the

Govt. of India ‘Make in India’ challenge.

Lucas TVS has developed Stop-Start Systems, Integral Starter Generators, Emission

Control products like Urea Pumps and Brushless Motor Technologies, to take care of

the growing need of environmental strategies of India.

Fig 2.1 – Customer’s red carpet welcome in the industry

Source: Internet

Lucas TVS has identified the need in the consumer industry, with synergy developed

by Lucas TVS over the years and is working with some of the leading consumer product

manufacturers in India to provide energy saving solutions using Brushless Motors and

Integrated Controls to meet the strict Energy Star Requirements of their products – e.g.

motors in refrigerators, air conditioners, air handling as well as basic high efficiency

home fans, pumping solutions, etc.

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Based on the capabilities and commitment to support the society, Lucas TVS has been

selected by the Government of India to partner with the prestigious Indian Institute of

Technology Madras in the next generation rural electrification pilot projects from the

infant stage itself. Looking into the future, Lucas TVS is able to fulfil the vision of

being a company that will be deeply involved in the field of auto electricals and

mechatronics as well as a significant player in consumer goods industry recognized for

quality, technology and energy savings worldwide.

2.2 EXPANSION

Since inception, Lucas-TVS has been focusing on meeting the needs of its customers

through a range of quality products. The company has been regularly coming up with

its new products for its OEM customers. This has contributed a lot to its success in the

domestic market, despite growing competition from multinationals. In order to meet the

mounting demand in developing countries like India for fuel-efficient vehicles which

are light in weight, with lower CO2 emissions, experts in Lucas-TVS continue

introducing new generation products with advanced technology. The company is

planning to expand its product portfolio by catering to CNG vehicles as well and is

working on developing CNG kits that offer complete solutions to customers.

Development of new products at the company is driven by its R&D team of highly

qualified engineers with years of experience and expertise in the field. Among some of

the new product developments, gear reduction starters have been well received in the

market, with the company planning to increase production capacity for the same in the

coming years. Lucas-TVS has developed a range of internal fan alternators with and

without vacuum pump for the passenger car, UV and CV segments. Amongst the new

technologies introduced by the company is the stop-start system while those under

development include the regenbraking and other electrical accessories such as electric

vacuum pump.

New Delhi: Auto component maker Lucas-TVS will invest up to Rs. 400 crore by next

two-three years in order to swell capability and product growth. It is also planning to

establish new constructing units in Indonesia and Thailand. Arvind Balaji, Lucas-TVS

Vice- President, said, “We will invest up to Rs. 400 crore over the next two-three years

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in R&D, manufacturing and capacity building.” Lucas-TVS already has seven operable

plants, comprising one in Iran, is also thinking over setting up new plants in Indonesia

and Thailand. Mr. Balaji told the company had commenced production in the Iran plant

through a joint venture with an investment of Rs 16 crore in which it holds the majority

stake. To spread out its existence, the company would launch its products in Germany

by next two years, besides anticipating inorganic growth chances. N. Ravichandran,

company President (Operations), “Lucas-TVS is looking out for domestic and

international acquisitions.”

However, Mr. Ravichandran declined to give details of the company’s acquisition plans

in future. On the domestic front, Lucas-TVS is about to frame-up a plant in Singur to

supply parts to Tata Motors for its Rs. 1 lakh car.

“We have acquired land in Singur for setting up a plant and will supply starters and

alternators to Tata Motors’ Rs. 1 lakh small car,” Mr. Ravichandran added. The

company that had revenue of $250 million in the last financial was looking to double

up the proceeds in the next four years.

2.3 GLOBAL EXPANSION

While new product innovations and overall quality policy have contributed to the

company’s sustained leadership in the domestic market, the current slowdown in the

automotive industry which has seen vehicle volumes plummeting to new lows has given

Lucas-TVS an opportunity to focus more on the aftermarket segment and also expand

its customer base in export markets. Says Executive Director, Lucas-TVS Pvt. Ltd.:

“Currently, our main focus is on the domestic aftermarket and exports where we see a

lot of potential for growth. We are aiming to increase our exports three-fold in the next

few years. In both the domestic and export markets, we remain committed to delivering

quality products through constant innovations and achieving high levels of customer

satisfaction, backed by excellent service.”

Today Lucas-TVS exports half-a-million compressor motors annually to WABCO’s

facility in Germany, with excellent PPM levels. WABCO supplies suspension parts

fitted with Lucas-Lucas TVSs to leading car manufacturers in Germany, including

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Mercedes, BMW and Audi. The company also supplies wiper motors to Commercial

Vehicle Group (USA), who supply the wiper system to truck OEMs in the North

American market. In the off-road segment, it serves all-terrain vehicle manufacturers

such as Artic cat and Polaris, among others.

In the domestic market, Lucas-TVS has a market share of nearly 45 per cent in the OEM

segment for products such as alternators, stop-start systems, brushless motors and wiper

motors. The company works with almost all leading OEMs in the country such as Tata

Motors, M&M, Daimler, Volvo, Ashok Leyland, VECV, MAN, Suzuki, Honda,

Hyundai, Renault and Cummins.

Lucas-TVS also caters to the huge two-wheeler market in the country. Nearly 70 per

cent of the two-wheelers come with an automatic start option which provides huge

opportunity for growth. The company supplies to leading two-wheeler makers in India

and is keen to enter the promising Indonesian market as well. It also supplies to tractor

manufacturers in the country, making it a truly full-range supplier in the automotive

space.

Lucas-TVS has been committed to its customers by following them geographically,

leading to better logistics efficiency. The company currently has seven manufacturing

units across the country – two each in Chennai and Puducherry and one each in Rewari

(Haryana), Chakan (Pune) and Uttarkand – thus having its presence in the major vehicle

manufacturing hubs in India. It has a sales and service network of around 800 dealers

and 2,000 sales outlets, one of the largest in the country.

The company clocked a turnover of Rs. 1,650 crores in FY13, of which Rs. 150 crores

came from exports, Rs. 200 crores from the domestic aftermarket and the rest from the

domestic OEM market. Nearly one half of sales is accounted for by the passenger car

and utility vehicle segments, with CVs and tractors contributing 20 per cent each and

two-wheelers the balance 10 per cent.

At Lucas-TVS, quality is not just conformance to drawings or specifications but

optimum customer satisfaction. The company has bagged a number of awards,

including the prestigious Deming Grand Prize and the Export Excellence Award, in

addition to several quality circle awards presented by its esteemed customers.

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CHAPTER – 3

INTRODUCTION OF THE COMPANY

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3.1 ABOUT

TVS Group is an Indian diversified industrial conglomerate with its principal

headquarters located in Madurai and presence across the Globe. Almost all holdings of

the group are private. The largest and most visible subsidiary is Lucas TVSs, the third-

largest two-wheeler manufacturers in India. TVS Group, with group revenue of more

than US$6 billion, is an automotive conglomerate company, specialized in

manufacturing of two-wheeler, three-wheeler, auto-electricals components, high tensile

fasteners, die casting products, dealership business, brakes, wheels, tyres, axles, seating

systems, fuel injection components, electronic and electrical components and many

more.

The founder

Fig 3.1 – Trichur Vangram Sundaram Iyengar

Source: www.lucas.com

The TVS Group traces its origins to a rural transport service, founded in 1911 in Tamil

Nadu, India. Today, this renowned business conglomerate remains faithful to its core

ideals of trust, values, service and ethics. The TVS Group is India’s leading supplier of

automotive components and one of the country’s most respected business groups with

a combined turnover of more than over $ 6.5 Billion, the TVS Group employs a total

workforce of close to over 39,000 employees. Charting a steady growth path of

expansion and diversification, it currently comprises around over 50 companies. These

operate in diverse fields that range from two-wheeler and automotive

component manufacturing to automotive dealerships, finance and electronics.

Uniting these multiple businesses is a common ethos of quality, customer

service and social responsibility.

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3.1.1 Lucas TVS Limited

Lucas TVS was established in 1962 as a joint venture between Lucas UK and T V

Sundaram Iyengar & Sons (TVS), India to manufacture Automotive Electrical Systems.

Lucas TVS, a wholly owned Indian company from 2001 onwards, is the Leader in Auto

Electricals in India, with over 50 years’ experience in design, manufacturing and supply

of products to OEMs in India and abroad. Lucas TVS is certified for compliance of

their Quality management system to ISO/TS16949 and the organization’s management

system to ISO 50001, ISO 14001 and BS OHSAS 18001:2007.

Fig 3.2 – Certifications (Source: www.lucas-tvs.com)

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The company today has 7 Auto Electrical plants across the country and Lucas TVS is

the only AEC that has a Class-100 Clean Room facility to ensure the quality of the EECs

and ECPs. Lucas TVS has established itself as a market leader with an experience of

over a decade.

Stellar has more than 1,00,000 satisfied customers and more than 300 OEM Customers

across 150+ countries including USA, UK, Germany, Spain, Italy, France, Australia,

U.A.E, Japan. They have reinforced their faith in Lucas TVS offerings. Lucas TVS has

a widespread partner network around the globe, which ensures comprehensive pre-sales

and post-sales support to its customers. Lucas TVS is also providing E-Tailing Services

to its customers.

• The brand Lucas TVS denotes Success, Perfection and Trust. It transcends

international borders and only Company in Indian Sub-continent having CLASS-100

Clean Room

• Extensive Research & Development, Use of Proprietary Tools

• Presence in PADI-Chennai, Maraimalainagar, Nettapakkam, Thiruvander koli,

SIDCUL-Rudrapur, Rewari, CHAKAN-Pune

3.2 Mission and Vision

We are committed to being a highly profitable, socially responsible, and leading

manufacturer of high value for money, environmentally friendly, lifetime personal

transportation products under the TVS brand, for customers predominantly in Asian

markets and to provide fulfilment and prosperity for employees, dealers and suppliers.

Vision Statement

Lucas TVS will be responsive to customer requirements consonant with its core

competence and profitability. Lucas TVS will provide total customer satisfaction by

giving the customer the right product, at the right price, at the right time.

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The Industry Leader

Lucas TVS will be one among the top two two-wheeler manufacturers in India and one

among the top five two-wheeler manufacturers in Asia.

Global overview

Lucas TVS will have profitable operations overseas especially in Asian markets,

capitalizing on the expertise developed in the areas of manufacturing, technology and

marketing. The thrust will be to achieve a significant share for international business in

the total turnover.

At the cutting edge

Lucas TVS will hone and sustain its cutting edge of technology by constant

benchmarking against international leaders.

Committed to Total Quality

Lucas TVS is committed to achieving a self-reviewing organization in perpetuity by

adopting TQM as a way of life. Lucas TVS believes in the importance of the process.

People and projects will be evaluated both by their end results and the process adopted.

The Human Factor

Lucas TVS believes that people make an organization and that its well-being is

dependent on the commitment and growth of its people. There will be a sustained effort

through systematic training and planning career growth to develop employees’ talents

and enhance job satisfaction. Lucas TVS will create an enabling ambience where the

maximum self-actualisation of every employee is achieved. Lucas TVS will support and

encourage the process of self-renewal in all its employees and nurture their sense of self-

worth.

Responsible Corporate Citizen

Lucas TVS firmly believes in the integration of Safety, Health and Environmental

aspects with all business activities and ensure protection of employees and environment

including development of surrounding communities. Lucas TVS strives for long-term

relationships of mutual trust and interdependence with its customers, employees, dealers

and suppliers.

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3.3 INFRASTRUCTURE

Since, 1962 Lucas TVS has been pioneer in developing its infrastructure in order to

benefit its clients. To match world standards Stellar has installed & commissioned

India’s first CLASS 100 Clean Room in all of its Ayton Electrical plant, it’s a controlled

recommended environment for all Read/write Head assembly transplants. For efficient

operations Lucas TVS maintains a strong inventory of more than 15000 child parts &

2500 EEC parts forming a wide range comprising of various makes, models &

capacities. Lucas TVS keeps on upgrading its inventory on a regular basis and also has

necessary infrastructure for repair capabilities OEM products.

At Lucas TVS, all of their EECs and EFIPs tools are indigenously developed &

supported by their strong R&D wing thus providing an edge over vendors engaged in

un-organized automotive industry. All of the tools used in Lucas TVS are backed-up by

constant research and upgrades.

Lucas TVS understands that apart from the technical capabilities it is equally important

to make the service window available in customer's location. At present Lucas TVS has

offered its services in 16 Strategic Locations (Ahmedabad, Bangalore, Chandigarh,

Chennai, Delhi, Gurgaon, Hyderabad, Kolkata, Mumbai, Noida, Pune and Vashi). Lucas

TVS also offer its services by allowing its customers to send media through courier.

The major capabilities of Stellar Data Recovery can be summarized as

Service location

Class-100 Clean Room

E-tailing

Safety Policies

Repair Equipment

Distribution Process

Poka-Yoke Involvement

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Fig 3.3 – Plant Outlook

Source: Lucas TVS

Fig 3.4 – Plant interior layout

Source: Lucas TVS

3.4 Work and Life Culture

In Lucas TVS Limited, Human Resource policies facilitate each individual to perform

towards own and Company's growth and success

Work Culture: Lucas TVS has always endeavoured to create a work-culture which is

open, positive and rewarding; where there are exciting growth opportunities for every

deserving Employee of Lucas TVS Family. Everyone is encouraged to learn new skills

on the job as well as through formal training programs. In Lucas TVS Recovery success

is not confined not only in monetary profits but also covering quality of products,

excellence of operations, growth, customer goodwill and leadership in business. Such a

success not only brings in a feeling of belongingness but also gives self-satisfaction.

Employee Motivation: Lucas TVS has invested heavily in progressive HR practices.

The company makes it a point to organize get together and Motivational events such as

Outbound Trip. These are an integral part of work culture in Lucas TVS. Also the

company does provide Infrastructure Support for conducive work environment.

Health: Employees and their dependents are covered under company paid health and

accident insurance schemes. These schemes also provide tie-ups with more than 200

hospitals across the country, thus ensuring quicker accessibility, discounts and easy-pay

option plans with guaranteed admission.

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Trainings: Several Training Programs are being conducted in Lucas TVS to ensure

better work performance and overall Personality Development. Structured workshops

are conducted once in a while,

Time Management

Communicating Effectively

Team Management

Customer Orientation

Project Management

Emotional Quotient

Autonomy & Empowerment: Lucas TVS encourage people to work with autonomy,

to challenge old ideas, to develop themselves & their Job, to question old ways, thus

move beyond their job description. Lucas TVS provides its employees with an

atmosphere where they can develop themselves & others to move towards jobs that

requires greater involvement. At the same time each individual is allowed to assume

responsibility of their personal growth.

Fig 3.5 – Health and Safety Policy

Source: Lucas TVS

Fig 3.6 – Energy Policy

Source: Lucas TVS

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Team Work: Individual technical skills and competence are essential but people also

need to learn to work as a team in-groups. Lucas TVS firmly believes that the primary

job of a leader is to facilitate rather than control. The team that produces the best result

is the one where the Leader actively supports its members in their performance. Lucas

TVS encourages teamwork between the employees in the organization. Hence, great

emphasis is given to the various Team Building Programs and the employees are

exposed to learn these skills through modern professional help.

Planned Career Path: Well-planned Career Charts for all the Employees in each

department which tells an employee where his/her career would reach in the

Organization.

Fig 3.7 – Norms and Ethics to be followed in the plant

Source: Lucas TVS

In the plant all the employees have to follow a dress code along with ankle boots

and that should be in proper way.

In the plant none of the employee is allowed to bring the mobile inside the working

zone, Smoking, running, mis-placing is not allowed in the working zone.

If someone is coming by a motorbike than he/she should have a helmet other wise

the gaurds will not give the permission to go inside the plant.

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3.5 Specialised Products of Lucas TVS

Product chart

Auto electrical

Wiper

Face lift wiper (tml)

Microbus rhd(tml)

Microbus lhd(tml)

Bolero wiper (m &m)

Ngc/ngicv (ashok leyland)

Sumo gold wiper(tml)

Penguin wiper(tml)

Starter

Sm82 (tml)

Dicor(tml)

Penguin(tml)

9m14 (ashok leyland)

6m14 (ptl & itl)

Alternator

Tata ace 3ha15 (tml)

Dicore alternator (tml)

Penguin alternator( tml)

Zener alternator (tml)

Iris bs4

Sa 28(ashok leyland)

A115(itl & ptl)

Filter

Air filter Oil filter

Fuel filter

Flowchart 3.1: Product Range

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3.5.1 Alternator

An alternator is an electrical generator that converts mechanical energy to electrical

energy in the form of alternating current. For reasons of cost and simplicity, most

alternators use a rotating magnetic field with a stationary armature. Occasionally, a

linear alternator or a rotating armature with a stationary magnetic field is used. In

principle, any AC electrical generator can be called an alternator, but usually the term

refers to small rotating machines driven by automotive and other internal combustion

engines. Alternators are used in modern automobiles to charge the battery and to

power the electrical system when its engine is running.

Until the 1960s, automobiles used DC dynamo generators with commutators. With the

availability of affordable silicon diode rectifiers, alternators were used instead. This

was encouraged by the increasing electrical power required for cars in this period, with

increasing loads from larger headlamps, electric wipers, heated rear windows and other

accessories.

Fig: 3.8 Alternator

Source: Lucas TVS Fig: 3.9 Location of Alternator in Engine

Source: Lucas TVS

3.5.2 Starter Motor

A starter (also self-starter, self, or starter motor) is an electric motor, pneumatic

motor, hydraulic motor, an internal-combustion engine in case of very large engines or

other device used for rotating an internal-combustion engine so as to initiate the engine's

operation under its own power.

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Engines are feedback systems which once started, rely on the inertia from each cycle to

initiate the next cycle. In a four-stroke engine, the third stroke releases energy from the

fuel, powering the fourth (exhaust) stroke and also the first two (intake, compression)

strokes of the next cycle, as well as powering the engine's external load. To start the

first cycle of engine's run session, the first two strokes must be powered in some other

way. The starter motor is used for this purpose and is not required once the system starts

running.

Before the advent of the starter motor, engines were started by various methods

including wind-up springs, gunpowder cylinders, and human-powered techniques such

as a removable crank handle which engaged the front of the crankshaft, pulling on an

airplane propeller, or pulling a cord that was wound around an open-face pulley.

Fig: 3.10 Starter Motor

Source: Lucas TVS Fig: 3.11 Location of Starter Motor in Engine

Source: Lucas TVS

3.5.3 Wiper and Wiper Motor

A windscreen wiper or windshield wiper is a device used to remove rain, snow, ice

and debris from a windscreen or windshield. Almost all motor vehicles, including cars,

trucks, train locomotives, watercraft with a cabin and some aircraft, are equipped with

such wipers, which are usually a legal requirement.

A wiper generally consists of a metal arm, pivoting at one end and with a long rubber

blade attached to the other. The arm is powered by a motor, often an electric motor,

although pneumatic power is also used in some vehicles. The blade is swung back and

forth over the glass, pushing water or other precipitation from its surface. The speed is

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normally adjustable, with several continuous speeds and often one or more

"intermittent" settings. Most automobiles use two synchronized radial type arms, while

many commercial vehicles use one or more pantograph arms.

The mechanism behind wipers is the windshield wiper motor, which provides the power

the wipers need. A linkage converts the rotational output of the windshield wiper motor

into the back-and-forth motion of the wipers. A worm gear controls the force that the

windshield wiper motor delivers to the drive arm by slowing down the speed of the

electric motor by 50 times while multiplying the torque by 50 times.

Fig: 3.12 Wiper Motor

Source: Lucas TVS Fig: 3.13 Location of Wiper Motor in Engine

Source: Lucas TVS

3.5.4 Filter

A particulate air filter is a device composed of fibrous materials which removes solid

particulates such as dust, pollen, mould, and bacteria from the air. A chemical air filter

consists of an absorbent or catalyst for the removal of airborne molecular contaminants

such as volatile organic compounds or ozone. Air filters are used in applications where

air quality is important, notably in building ventilation systems and in engines.

Fig: 3.14 Types of Filters

Source: Lucas TVS Fig: 3.15 Air Filter

Source: Lucas TVS

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An oil filter is a filter designed to remove contaminants from engine oil, transmission

oil, lubricating oil, or hydraulic oil. Oil filters are used in many different types of

hydraulic machinery. A chief use of the oil filter is in internal-combustion engines in

on- and off-road motor vehicles, light aircraft, and various naval vessels.

A fuel filter is a filter in the fuel line that screens out dirt and dust particles from the

fuel, normally made into cartridges containing a filter paper. They are found in most

engines. Fuel filters serve a vital function in today's modern, tight-tolerance engine fuel

systems. Unfiltered fuel may contain several kinds of contamination, for example paint

chips and dirt that has been knocked into the tank while filling, or rust caused by

moisture in a steel tank. If these substances are not removed before the fuel enters the

system, they will cause rapid wear and failure of the fuel pump and injectors, due to the

abrasive action of the particles on the high-precision components used in modern

injection systems. Fuel filters also improve performance, as the fewer contaminants

present in the fuel, the more efficiently it can be burnt.

Fig: 3.16 Various types of

Oil filters and Fuel Filters

Source: Lucas TVS

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3.6 Specialised Customers of Lucas TVS

CUSTOMERS PRODUCT SUPPLIER

Wipers & Wiper

Motors

Filters

Alternators

PADI

UT

Alternators

Starter Motors

UT

Alternators

Starter Motors

Filters

PADI

Alternators

Starter Motors

CHKN

Alternators

Starter Motors

Filters

MMLN

Alternators

Starter Motors

Wiper & Wiper

Motors

PADI

Alternators

Starter Motors

CHKN

Alternators

Starter Motors

UT

Alternators

Starter Motors

Filters

UT

PADI

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Alternators

Starter Motors

Filters

MMLN

Alternators

Starter Motors

Wiper & wiper Motors

CHKN

Starter Motors

Wiper & wiper Motors

Filters

PADI

MMLN

Alternators

Starter Motors

Filters

UT

CHKN

Starter Motors

Wiper & wiper Motors

Filters

UT

PADI

Starter Motors

Alternators

PADI

Starter Motors

Alternators

CHKN

Starter Motors

Alternators

PADI

Table 3.1: Customers of Lucas TVS

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CHAPTER – 4

ORGANIZATION STRUCTURE

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4.1 Organization Structure under the Plant

Flowchart 4.1: Organization Structure under the plant

The plant is headed by Mr. K. Parthsarthy and the types of organisation structure used

by Lucas TVS that face considerable environmental uncertainty that can be met through

a divisional structure and that also required functional expertise or efficiency.

This type of structure is used by multinational companies operating in the global

environment, for example, International Business Machines USA. This kind of

structure depends on factors such as degree of international orientation and

commitment. Multinational corporations may have their corporate offices in the

country of origin and their international divisions established in various countries

reporting to the CEO or president at the headquarters.

Plant head

K Parthsarthy

HR Head

D D Satyawali

Marketing head

Badri Prasad

Production Head (Filter) Rahul Bhatt

Production Head (Auto Elcetrical) Sunit Kumar

Chauhan

Methods and MSE jagdish rao

Maintenance

I S Patwal

Store head

Ravikant sharma

Quality Assurance Ajay Kumar Sharma

Material head

Rajesh saini

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While the focus is on international geographic structures, companies may also choose

functional or process or product departmentation in addition to geographic pattern while

at the head quarter’s the departmentation may be based on function.

4.2 Organization Structure under the Production Department

Flowchart 4.2: Organization Structure under the production Department

This the production department hierarchy followed by the Lucas TVS the production

Department is headed by Mr. Sunit Kumar Chauhan and the PPC Manager Mr. Sumanta

Das is the 2nd in Command. All the Four line Engineers of respective AEC component

works under him and all the line engineers heading their respective production line each

and every line has line operators having a team of employees more than 15. The

reporting criteria is direct and very hierarchical but for any other queries the employees

can go directly to the Production head.

Production Head

Auto Electrical

Sunit Kumar Chauhan

PPC

Sumanta Das

Wiper

Rajeev Ranjan

Anupam Shukla

Starter

Komal Singh

Aftab Alam Ansari

Jagdish Pandey

After Market

Kundan Negi

Jyoti Vist

(Field Coil)

Alternator

Vikas Raghav

Bhaskar Joshi

Hem Pathak

Dhirendra Bhatt

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4.3 Awards and Recognitions

International Recognition

Awards Institutions

Deming Grand Prize JUSE

Deming Application Prize JUSE

Excellence in Quality promotion

(ARE – QP)

Asian Network for Quality

JIT Innovation Award JIT Management Lab, Tokyo

JIT Grand Prix Award (3 times) JIT Management Lab, Tokyo

National Recognition

Awards Institutions

Excellence in Export Award

Technology Award

Gold Trophy for

manufacturing

Productivity Award

Automotive Component

Manufacturers Association of India

(ACMA)

Green Manufacturing Excellence

Award

Frost & Sullivan

Energy Conservation Award Government of India

Rajiv Gandhi National Quality

Award

Government of India

National HR Excellence Award

(Strong commitment to HR

Excellence)

Confederation of Indian Industry

(CII)

Certification of appreciation for Tax

compliance

Government of India

Export Excellence award Government of India

Table 4.1: Awards and recognitions

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4.3 Quality policy

We are committed to achieving ever increasing levels of satisfaction through continual

improvements to the quality of our products and services by continually improving the

effectiveness of quality management system.

It will be our endeavour to increase customer trust and confidence in the label “Made

by Lucas – TVS”

Objectives –

Achieving OE Customer Line Rejection less than 10PPM

Continual reduction of warranty returns

Providing warranty services to customers within 24 Hrs of receiving the

complaint

Delivering products to customers in right quantity on time, every time

Principles –

Quality begins with a comprehensive understanding of changing customer

needs

Quality means providing value to customer in the use of our products and

services

Quality is built into the design of products, processes and materials

Quality improvements lead to productivity and cost improvements

Quality means preventing defects and not detecting them only after occurrence

Quality demands commitment by all employees, suppliers and dealers

Quality is achieved through total employee involvement and training

Quality cycle begins again with a comprehensive understanding of customer

satisfaction levels

Practices –

Practices quality individually and as team

Do “right first time” on time and every time

Enhance employee performance through training, motivation and small group

activities

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Understand and increasing customer needs and expectations and satisfy them

Eliminate activities which do not add value

Standardise processes and systems with SOP and practice

Implement Systematic supplier/dealer development Programmes for improved

quality

Practice continual improvement as a way of life in all activities

Next process is your customer, satisfy him

Apply statistical tools extensively across the organization

Revision: 02

Date: 26.08.2009 MANAGING DIRECTOR

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CHAPTER – 5

LEARNING FROM THE INTERNSHIP

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5.1 Supply Chain Management

Supply Chain Management is the sequence of the organizations their facilities,

functions, and activities - that are involved in producing and delivering a product or

service. Unlike the others manufacture companies Lucas TVS is also having a typical

manufacturing SCM.

The supply chain of the Lucas TVS consists of all parties involved, directly or

indirectly, in fulfilling a customer request, supply chain not only includes the

manufacturer and suppliers, but also transporters, warehouses, retailers, and customers

themselves. Within each organization, such as manufacturer, the supply chain includes

all functions involved in receiving and filling a customer request. These functions

include, but are not limited to, new product development, marketing, operations,

distribution, finance, and customer service.

Such type of supply chain is dynamic and involves the constant flow of information,

product, and funds between different stages. Hence, Lucas TVS provides the product,

as well as pricing and availability information, to the customer. The customer transfers

funds to Lucas TVS and the Company conveys point-of-sales data as well as

replenishment order via trucks back to the store Lucas TVS transfers funds to the

distributor after the replenishment. The distributer also provides pricing information

and sends delivery schedules to Lucas TVS. Similar information, material, and fund

flows take place across the entire supply chain. That process involves an additional flow

of information, product, and funds between various stages of the supply chain.

This illustrate that the customer is an integral part of the supply chain in Lucas TVS.

The primary purpose from the existence of the supply chain is to satisfy customer needs,

in the process generating profits for itself. In Lucas TVS the supply chain activities

begin with a customer order and end when a satisfied customer has paid for his or her

purchase. In the organization, the term supply chain conjures up images of product or

supply moving from suppliers to manufacturers to distributors to retailers to customers

along a chain. It is important to visualize information, funds, and product flows along

both directions of this chain. Supply chain in Lucas TVS also imply that only one player

is involved at each stage. In reality Lucas TVS may receive material from several

suppliers and then supply several distributors. Thus, the supply chain is actually

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networks. It may be more accurate to use the term supply network or supply web to

describe the structure of most supply chains.

A typical supply chain may involve a variety of stages. These supply chain stages

include:

• Customers

• Retailers

• Wholesalers/Distributors

• Manufacturers

• Component/Raw material suppliers

Flowchart 5.1: Supply chain management of Lucas TVS

The above chart is the supply chain structure of the Lucas TVS. According to this chain

there are three main activities are carried out i.e. purchasing which involves purchasing

raw materials from the Suppliers after that production process in which the raw material

is stored in the stores followed by scheduled production than the Finished goods are

sent to F/G Stores, than the distribution process, Lucas TVS is a B2B as well as B2C

Supplier

Storage

Manufacture

Storage

Distributor

Reatailer

Customer

OEM Customer

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company so the company directly sent the F/G to the OEM Customers and to the

distributor transfers it the retailers and hence to the customers.

Supplier of the Lucas TVS

SUPPLIERS PARTS

PN DIE CASTING PVT LTD PROTECTIVE DISC

POLE SCREW

LUCAS-TVS LTD ( PADI DIVN ) INSUL BUSH

SEALING RING

SOLENOID FIXING STUD

WIPING SYSTEM ASSY

VENUS STAMPINGS PVT LTD SLIP RING MOULDING

WINDING COIL

KARNATAKA HYBRID MICRO

DEVICES LTD

RETAINER PLATE

PRIMARY LINK & SPINDLE AS

LIFELONG INDIA LTD BALL BEARING

BEARING BUSH

SKF INDIA LIMITED BALL BEARING SRE

TANDOM LINK & SPINDLE ASS

SPINDLE ASSY (DRIVER)

NISIKI INDIA PRIVATE LIMITED RETAINER PLATE

OSCILLATING LINK-MIDDLE

PRECISION PRESS PRODUCTS SLIP RING MOULDING

PRESSED CLAW - SA28

ASYMMETRIC FAN

RECTIFIER ASSEMBLY

LOCKING COVER

SSV HI-TECH RUDRAPUR P LTD 15TR REGULATOR ASSY

STATOR CORE

SRE BEARING

KAMBOJ POLYMERS PVT LTD SPONGE

SEMI-PERMEABLE PAPER

CREPE PAPER

Table 5.1: Suppliers of Lucas TVS

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Functions of Supply Chain Management

5.1.1 Production Planning

Production planning is done based on the demand supply trend in the market. The main

concept adopted is supply chain management. Supply Chain Management is the

management of upstream and downstream relationships between suppliers and

customers to deliver the best value to the customer at the least cost to the demand chain

as a whole. Supply chain management software tools bridge the gap between the

customer relationship management and the demand chain management. The

organization’s supply chain processes are managed to deliver best value according to

the demand of the customers. One of the factors that affects the production process is

the seasonality in business. Some sectors (not the end users) have a seasonality in

business which in turn is in direct co relation with the raw material production and

demand.

Flowchart 5.2: Function In Production Planning and control

Customer

Marketing

Team

• Production Planning

PPC

Departmrnt

HR Department

• Production Scheduling

PPC Department

Production Department

• Production Control

Production Process

Loss Identification

• Production Monitoring

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Thus, seasonality plays a vital role in the production process. Product development and

management is an aspect of the inorganic sales function of the organisation. It mainly

focuses on the development of newer applications of the existing products and to use

the raw material of polymer in newer environment friendly application to open up new

horizons. It deals with the planning of the efficient use of plastic as a product due to

constant opposition from government and other environmental organisations.

In July month the company’s marketing team received an order of 7,500 alternators

from TATA Motors, than the marketing team designed an outlaw of the orders and

transferred it to the PPC (production Planning and Control) Department. PPC, checked

the CTW if there were some alternator available or not. There were no alternator in the

CTW stock than the PPC department finalised the order for 7500 alternators and handed

over it to the Department there, the HR officer decided the advance payment and Post

payment. After that the Hr department allotted the man power requirement for the order

as per the time period mentioned by the TATA motors for the order. The HR department

designed a cell log sheet and transferred it to the PPC department than the PPC manager

checked the Inventory to get the information of raw materials, the raw material was not

enough to complete the order than the PPC manager gave the information to the

Production Head. From there the production head ordered the required raw material

from the respective supplier. After purchasing the raw material the material head

checked the quality of the raw material as per standard assigned by the Line engineers.

LUCAS TVS LIMITED DAILY PRODUCTION DETAIL

PANTNAGAR (UTTARAKHAND) DATE: PERI

OD:

ALTER

NATOR

PLA

N

MA

DE

REJ/

RET

EST

RECT

IFIED

PAS

SED

CTW

ACCE

PTED

F

O

R

P

DI

A

T

Q.

G.

CD

C

ST

OC

K

MTD

CTW

ACCE

PTED

MTD

DISP

ATC

H

SA15

TATA

ACE

2602

1352

TATA

IRIS

2602

1641

Table 5.2: Cell Log Sheet

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The raw material inventory for the 7,500 alternators was more than 50,000 (including

all the parts) and that was not possible for the material head to assure the quality in

such time tenure. Than the Inventory department took a random sampling of 100 of

each part and checked the each respective one in a machine named Accurate. There

they find that the raw material is good and proper for the production. *if the sample

will not be able to clear the standards i.e. more than 97.5 % than the company will

reject the raw material order and the supplier company will be penalised, rejection

phenomenon is called DRSM.

Product

Name

LTVS

PRO

NO.

Plan

QTY

Bala

nce

for

Sup

ply

01-

07-

201

6

02-

07-

201

6

03-

07-

2016

04-

07-

201

6

05-

07-

201

6

06-

07-

201

6

07-

07-

201

6

08-

07-

201

6

09-

07-

201

6

10-

07-

2016

SHIFT

Alternat

or

2602428

5B

7500 7500 325 300 SUN 325 325 300 325 300 300 SUN A

Mon

thly

plan

325 325 SUN 300 325 325 300 300 300 SUN B

300 325 SUN 325 300 325 325 300 300 SUN C

Actual 7500 950 950 0 950 950 950 950 900 900 0 Total

Table 5.3 : Break down of monthly plan into Day-wise Plan of Alternator

5.1.2 Production Scheduling

Scheduling is the process of arranging, controlling and optimizing work and workloads

in a production process or manufacturing process. Scheduling is used to allocate plant

and machinery resources, plan human resources, plan production processes and

purchase materials. It is an important tool for manufacturing and engineering, where it

can have a major impact on the productivity of a process. In manufacturing, the purpose

of scheduling is to minimize the production time and costs, by telling a production

facility when to make, with which staff, and on which equipment. Production

scheduling aims to maximize the efficiency of the operation and reduce costs.

After getting the information of the raw materials and the man power the PPC

department broke down the monthly plan into the day wise plan and assigned the man

power as per their respective position in the production line. The target had to be

achieved in 10 days which means that more than 750 alternator should be produced

daily and there were 3 shifts of the employees so more than 300 alternator should be

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produced per shift to fill the holiday gaps during production. There is only one

production line in the plant that is of U-Shaped for each shift, line operators are allotted

for monitoring and line engineers for guiding. There were 12 stops in the production

line and the main assembly line is consist of two sub-assemblies. Firstly the line

operators and employees produce a master sample for the alternator and checking the

quality of that alternator as per the parameter assign to the respective product, if the

master sample is found to be good than, the line operators will assign the task for that

shift i.e. scheduled production of alternators for that shift.

From 03-07-2016 TO 10-07-2016

Line Eng. C.C NO OPERATOR NAME Shift Emp. Under

Vikas Raghav

U0531 Rakesh Chandra A 15

U0500 Harish Singh Rana B 15

U6708 Subir Kumar C 12

Table 5.4: Shift Breakdown

Production scheduling tools greatly outperform older manual scheduling methods.

These provide the production scheduler with powerful graphical interfaces which can

be used to visually optimize real-time workloads in various stages of production, and

pattern recognition allows the software to automatically create scheduling opportunities

which might not be apparent without this view into the data. In Lucas TVS the

scheduling technique is, backward scheduling i.e. planning the tasks from the due date

or required-by date to determine the start date and/or any changes in capacity required.

Fig 5.1: When Master Sample is OK Fig 5.2: When master sample is not OK

The benefits of backward production scheduling include:

Process change-over reduction

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Inventory reduction, levelling

Reduced scheduling effort

Increased production efficiency

Labour load levelling

Accurate delivery date quotes

Real time information

5.1.3 Production Monitoring

Production Monitoring means an on-site Product Inspection performed every day of

your production. An inspector scrutinizes your factory, enforcing your specifications,

selecting units at random for inspection and identifying and eliminating defects.

Production head and PPC Manager examines the Produced alternators after every shift

and makes the report to check the gap between the actual and plan production.

Assembly line of Alternator

Flowchart 5.3: Assembly line of Alternators

De Side (Half Assembly) +Ve

Terminal

De – Bracket And Bearing

Assembly

Retainer Plate

De And Rotor Assembly

Fan And Pulley

De And Sre Assembly (Full

Assembly)

Cowl Assembly

PDI

Sre Side (Half Assembly) –Ve

Terminal

Sre And Stator Assembly

Rectifier Assembly

Regulator Assembly

Carbon Brush Assembly

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At every section of the assembly line, line-operators always check and guide the

employees. In each section of the assembly line there is one person and after every two

hours there is scheduled inspection is being done line Engineers. There are some section

where the employees required more guidance and instructions. Hence, in each section

the company has installed Japanese Software “POKA-YOKE”, is a Japanese term that

means "mistake-proofing" or “inadvertent error prevention”. The key word in the

second translation, often omitted, is "inadvertent". There is no Poka Yoke solution that

protects against an operator’s sabotage, but sabotage is a rare behaviour among people.

A Poka-yoke is any mechanism in a lean manufacturing process that helps an equipment

operator avoid (yokeru) mistakes (poka). Its purpose is to eliminate product defects by

preventing, correcting, or drawing attention to human errors as they occur. The concept

was formalised, and the term adopted, by Shigeo Shingo as part of the Toyota

Production System. It was originally described as baka-yoke, but as this means "fool-

proofing" (or "idiot-proofing") the name was changed to the milder poka-yoke.

In Lucas TVS, Poka-yoke is implemented at many steps in production process where

something can go wrong or an error can be made. For example, a fixture that holds

pieces for processing might be modified to only allow pieces to be held in the correct

orientation, or a digital counter might track the number of spot welds on each piece to

ensure that the worker executes the correct number of welds.

There are three steps of Poka-yoke followed in Lucas TVS

The contact method identifies product defects by testing the product's shape, size,

colour, or other physical attributes.

The fixed-value (or constant number) method alerts the operator if a certain number

of movements are not made.

The motion-step (or sequence) method determines whether the prescribed steps of

the process have been followed.

Either the operator is alerted when a mistake is about to be made, or the Poka-yoke

device actually prevents the mistake from being made. In Lucas TVS, the former

implementation would be called a warning Poka-yoke, while the latter would be

referred to as a control Poka-yoke

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Lucas TVS argued that errors are inevitable in any manufacturing process, but that if

appropriate Poka-yokes are implemented, then mistakes can be caught quickly and

prevented from resulting in defects. By eliminating defects at the source, the cost of

mistakes within a company is reduced. A methodical approach to build up Poka-yoke

counter measures has been proposed by the Applied Problem Solving (APS)

methodology, which consists of a three-step analysis of the risks to be managed:

Identification of the need

Identification of possible mistakes

Management of mistakes before satisfying the need

This approach can be used to emphasize the technical aspect of finding effective

solutions during brainstorming sessions. There are several benefits of Poka-yoke which

are availed by Lucas TVS.

Less time spent on training workers;

Elimination of many operations related to quality control;

Unburdening of operators from repetitive operations;

Promotion of the work improvement-oriented approach and actions;

A reduced number of rejects;

Immediate action when a problem occurs;

100% built-in quality control.

Fig 5.3: F/G inventory Alternators Fig 5.4: Production Line of

Alternator

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5.1.4 Quality Control

Quality control, or QC for short, is a process by which entities review the quality of

all factors involved in production. ISO 9000 defines quality control as "A part of quality

management focused on fulfilling quality requirements". Controls include product

inspection, where every product is examined visually, and often using a stereo

microscope for fine detail before the product is sold into the external market. Inspectors

will be provided with lists and descriptions of unacceptable product defects such as

cracks or surface blemishes for example. The quality of the outputs is at risk if any of

these three aspects is deficient in any way.

In Lucas TVS, Quality control emphasizes testing of products to uncover defects and

reporting to management who make the decision to allow or deny product release,

whereas quality assurance attempts to improve and stabilize production (and associated

processes) to avoid, or at least minimize, issues which led to the defect(s) in the first

place. For contract work, particularly work awarded by government agencies, quality

control issues are among the top reasons for not renewing a contract.

In Lucas TVS, for Alternator there are several performance checking parameters, to

uncover the defects which can affect the car engine.

Performance Parameters

Regulating voltage

Speed

Current

Sound

Vibration

After checking the alternator on these parameters, the line engineers will check them

on the basis of defect phenomenon (Rejection Technique) this is and physical and visual

test to check whether the alternator is working like the master sample or not and having

the same properties as the master sample have.

Defect phenomenon

Stator wire touch with SRE

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Stator wire punch

Warning lamp uncertainty

5.1.5 Pre-Dispatch inspection

Pre-Dispatch inspection, or PDI, is a part of supply chain management and an important

quality control method for checking the quality of goods clients buy from suppliers.

According to Lucas TVS, PDI is a vital part of SCM, which ensures that production

complies with specifications of the buyer and/or the terms of a purchase order or letter

of credit. After PDI in Lucas TVS there is final random inspection (FRI), which checks

finished products when at least 80% of an order has been produced and export-packed.

Samples are selected at random, according to standards and procedures. Pre-Dispatch

inspection can diminish risks inherent to Internet commerce like phishing and fraud.

In Lucas TVS, the pre-Dispatch inspection is agreed upon between Customer and

former, and it can be used to initiate payment for a letter of credit. In the plant PDI is

performed at different stages before Dispatch, such as checking the total amount of

goods and packing, controlling the quality or consistency of goods, checking of all

documentation, as for example test reports, packaging list, or verification of compliance

with standards of the destination country like ASME, CE mark and import duties.

There are three Steps of PDI carried out in Lucas TVS

Initial Production Inspection the objective of Initial Production Inspection, or Pre

Production Inspection (PPI), is to identify defective materials or components prior to

the production process, thereby minimizing the risk of non-conformities and allowing

for timely corrections where necessary. IPI

During Production Inspection the Production Inspection (DUPRO or DPI), or In-line

Product Inspection (IPI), checks semi-finished or finished goods part-way through the

production process. Generally, this takes place when between 40% of your order has

been produced and 20% export-packed. Doing so improves your control over

production and allows for timely correction of defects and improvements to quality.

DUPRO or DPI

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Final Random Inspection It ensures that the production complies with your

specifications and/or the terms of your purchase order or letter of credit. The Final

Random Inspection (FRI), or Pre Dispatch Inspection (PDI), checks finished products

when at least 80% of your order has been produced and export-packed. Samples are

selected at random, according to standards and procedures. FRI

Consignment to ware house

After the PDI Finished goods are sent to CTW (Dispatch Centre) to identify the

production quantity after every shift and each daily plan. CTW Person handed over the

goods to Packaging department for packing of the goods. When the complete order has

been packed, the goods than transferred to CDC for the invoice.

Fig 5.5: Packaging Department Fig 5.6: CTC

Production head will examine the goods and if there is a gap between the planned

quantity and the actual, he/she will determine the productivity losses and the reason

behind the gap. The respective line operator and line engineer will prepare Delivery

adherence report to determine the gap and hand over it to the Production head. The

formers incharges will give the reasons of productivity losses (4M’s Losses) Production

Head will breakdown the delivery adherence report into the 4M’s Losses and give the

report to the HR department.

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Percentage vary between plan vs actual

Prod

uct

Name

LTV

S

PRO

NO.

Plan

QTY

Balan

ce for

Suppl

y 01

-07

-2016

02

-07

-2016

03

-07

-2016

04

-07

-2016

05

-07

-2016

06

-07

-2016

07

-07

-2016

08

-07

-2016

09

-07

-2016

10

-07

-2016

Pla

nn

ed

QT

Y

Actu

al

QT

Y

Gap

Pla

n V

s A

ctu

al

Alter

nator

26024

285B 7500 7500 325 300 SUN 325 325 300 325 300 300 SUN

7500 7375 125 2

%

Monthly plan

325 325 SUN 300 325 325 300 300 300 SUN

300 325 SUN 325 300 325 325 300 300 SUN

Daily Plan

Table 5.5: Production Monitoring

Loss identification (4m)* to management

Reason behind the Productivity Losses

4M

Man

04-07-2016 (A) Flood in the City, hence the employees reached

very late

06-07-2016 (C) Heavy Downpour during Shift C in the night 7

employees were present out of 12

Machine 08-07-2016 (B)

09-07-2016 (B)

During shift B in both the days in the rectifier

section assembly there was a heating effect of the

current, so the employees were working after a

periodic rest for the cooldown of the machine.

Material -

Raw material and WIP material was sufficient

for the production in all the days during every

shift and there was continuous supply of

material.

Method -

The work done by the employees was impressive

and they were properly guided by the Poka-yoke

and line engineers.

Table 5.6: 4M’s reason for productivity losses

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4M’s Losses Breakdown

Planned Qty Actual Qty Gap Plan Vs Actual

7500 7375 125 2%

Breakdown In 4M's Losses

4m

4m Planned Actual

Gap

Plan Vs

Actual

Man

04-07-2016 (A) / 325 294 31 9.5%

06-07-2016 (C) / 325 276 49 15.1%

Machine

08-07-2016 (B) / 300 277 23 7.6%

09-07-2016 (B) / 300 278 22 7.3%

Material - - - -

Method - - - -

Table 5.7: 4M’s Breakdown

Kaizen philosophy

Kaizen, Japanese for "improvement." When used in the business sense and applied to

the workplace, kaizen refers to activities that continuously improve all functions and

involve all employees from the CEO to the assembly line workers. It also applies to

processes, such as purchasing and logistics and cross organizational boundaries into the

SCM. It has been applied in healthcare, psychotherapy, life-coaching, government,

banking, and other industries. In Lucas TVS, there are various places where they have

implied kaizen theory and it proved to be very beneficial reducing time, enhance quality

and very less productivity loss. Lucas TVS have won Deming Award because of

applying Deming Cycle (PDCA) in a very short period of time.

Due to increased customer expectations and global competition, the automotive

component manufacturing companies are desperately trying to improve productivity at

lower cost and still retain excellent product and service quality. Under these

circumstances, the implementation of lean tool kaizen, improves the production

environment with moderate investment. This case study carries evidence of genuine

advantages when applying lean tools to the manufacturing shop floor

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Fig 5.7: Before Kaizen Fig 5.8: After Kaizen

Tube off-set checking method

S.No Activity Time Before

Kaizen (s)

Time after

Kaizen (s)

1 Tube off-set checking 300 30

2 Lifting the previous fixture 240 80

3 Moving the unloaded fixture 150 60

Table 5.8: Kaizen result layout

5.1.5 Inventory management

Inventory management is the overseeing and controlling of the ordering, storage and

use of components that a company will use in the production of the items it will sell as

well as the overseeing and controlling of quantities of finished products for sale. A

business's inventory is one of its major assets and represents an investment that is tied

up until the item is sold or used in the production of an item that is sold. It also costs

money to store, track and insure inventory. Inventories that are mismanaged can create

significant financial problems for a business, whether the mismanagement results in an

inventory glut or an inventory shortage.

In Lucas TVS, the objective of the inventory management is to achieve satisfactory

levels of customer service while keeping inventory costs within reasonable bounds.

Lucas TVS’s Inventory management system is very effective because the system is

keep tracking on inventory regularly which helps for a reliable forecast of demand.

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Hence, it is very successful inventory management because it involves creating a

purchasing plan and that will ensure that items are available when they are needed (but

that neither too much nor too little is purchased) and keeping track of existing inventory

and its use. In the plant the inventory department is using FIFO which stands for first-

in, first-out, meaning that the oldest inventory items are recorded as sold first but do

not necessarily mean that the exact oldest physical object has been tracked and sold. In

other words, the cost associated with the inventory that was purchased first is the cost

expensed first.

Fig 5.9: FIFO in inventory Fig 5.10: Inventory Store

Inventory Counting

In Lucas TVS the inventory is counted on monthly basis that is periodic system

counting, at every beginning of the month the employees will physically count the

inventories in the stores and make a report which will handed over to inventory manager

and the inventory manger will transfer the information to production head. The

production head will identify the inventory with respect to the data present in the

inventory management software, to determine the gaps and losses. After that the

production head will find the adherence gap between actual inventory and the present

inventory. Than the report is transmuted to HR Department.

In the Plant the Inventory department is using ABC Classification technique to

determine the need of inventory. This technique is used for Classifying inventory

according to some measure of importance and allocating control efforts accordingly.

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Class A: High cost items. Very tight control & tracking. (5%)

Class B: Medium cost items. Tight control & moderate tracking. (15%)

Class C: Low cost items. No or little control & tracking. (80%)

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CHAPTER – 6

SWOT Analysis

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6.1 Swot Analysis

6.1.1 Strength

Lucas TVS Limited has a worldwide presence. And has more than 150 satisfied

OEM Customer and 1 Million clients. It is the only private company that has class

100 clean room in India. The other class 100 clean room available is in IIT Bombay,

Powai which is specifically used for research purpose that too only under strict

norms and regulations. The company guarantees 100% customer Satisfaction as per

the assessment report which is generated within 24 hours of submission of faulty

AEC Parts.

The company has its own proprietary tools and techniques for replaceable

accessories others who use 3rd party service providers for replaceable accessories.

The company provides employment for over 150 engineers, Lucas TVS has

inventory with 10,000 EECs, ECPs and EFIPs parts and child parts. Lucas TVS

ensures that every AEC part being available in the market are being stocked into its

inventory so that in specific cases of damages, the spare part of exact same

configuration is available in its inventory. The daily man power of the plant is more

than 200 per shift and there are 3 shifts in a Day.

The location of the plant is very nearby to the most of its customers as well as the

suppliers which reduces the transportation cost and the time as well. Hence, it help

to both the companies in SCM. The company is using Poka-Yoke technology which

is playing a vital role in the productivity. In India Lucas TVS has won Deming

Award because of its Deming cycle, is the shortest and improved the productivity

with a very moderate investment.

6.1.2 Weakness

The major weakness of the company is its pricing policy which is 2-3 times higher than

the market rates at which 3rd party vendor provides services for replaceable accessories.

Lucas TVS has a priority service plan which enables users to have their devices to have

a higher priority. In cases of mass damage of AEC Parts as in cases of a natural calamity

or accidental damage, strict adherence to priority service could backfire as customers

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may go for other service providers who may offer flexible priority plans. Lucas TVS is

yet to start an aggressive marketing campaign, which could increase the brand

awareness about stellar among the potential customers. Lack of man power in the

Aftermarket sales force could also be considered to be a weakness of the company.

The man power of the Lucas TVS is more than 750 but the point of concern is that in

the higher level management, Lucas TVS prefers only experienced and South Indian

people because of the Head plant presence is in Chennai. So the employees are not able

to communicate with them. In the plant the first aid facility is far away from the plant

and there is only vehicle assigned for that, in case of serious incident or accident this

can create a huge issue.

Hazardous scrap is piled out on an open area and the company is storing that waste 15

days after they send it for recycling to reduce the transportation cost, but hazardous

material present in scrap causes death, injury, or environmental damage. Toxic

materials such as asbestos or metals such as beryllium, cadmium, or mercury may pose

dangers to personnel, as well as contaminating materials intended for metal smelters.

6.1.3 Opportunities

Optimization of fuel-driven combustion engines Parts and cost efficiency programs are

good opportunities for the Lucas TVS. Emerging markets will be the main growth

drivers for a long time to come, and fuel efficient cars are the need of the hour so the

EECs and EFIPs. Making strategic alliances can be a smart strategy for Lucas TVS, by

using specialized capabilities & partnering with other companies, they can differentiate

their offerings.

Three powerful forces are rolling the auto industry. Shift in consumer demand,

expanded regulatory requirements for safety and fuel economy, and the increased

availability of data and information. Also with the increase in nuclear families there has

been increase in demand of two-wheelers & compact cars and this will grow further.

And hence the demand for OEM components increases. Entering new markets like

Asian & BRIC nations will result in upsurge in demand of vehicles. After these markets,

other markets are likely to emerge soon.

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Given the increase in electronic content, Lucas TVS need to collaborate with suppliers

and experts outside the traditional auto industry. Accomplishing this will require

changes in the way of function. Lucas TVS Should look to their top suppliers to co-

invest in new global platforms & this will be the driving force in the future.

6.1.3 Threat

At least for the passenger segment fluctuations in the fuel prices remains the

determining factor for its growth. Also government regulations relating the use of

alternative fuels like CNG. Shell gas is also affecting the inventories. Electronic

vehicles are coming to the market by which the demand ECPs is going down as there

are some 3rd party vendors supplying respective components at very cheaper rates.

Macroeconomic uncertainty, Recession, un-employment etc. are the economic factors

which will daunt the automobile industry for a long period of time. Due to the fact that

mature markets are already overcrowded, industry is shifting towards emerging markets

by building facilities, R & D centers in these markets. But the ROI out of these decisions

is yet to be capitalized.

6.2 Competitors Analysis

JBM Group

JBM Group is a focused, dynamic and progressive organization that provides customers

with value added products, services and innovative solutions. The Group has a

diversified portfolio to serve in the field of automotive, engineering & design services,

renewable energy and education sectors and has an infrastructure of 35 manufacturing

plants, 4 engineering & design centres across 18 locations globally.

With turnover of USD 1.2 billion, JBM Group has broadened its horizons by focusing

on quality delivery, solutions approach, product development processes, flexible

manufacturing systems and contract manufacturing.

JBM Group is primarily a tier- 1 supplier to the automotive OEM industry and caters

services to esteemed clients that include Ashok Leyland, Bajaj Auto Ltd, Fiat, Ford,

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General Motors Corporation, Honda, Hero, JCB, Mahindra, Maruti Suzuki, Renault,

Nissan, TATA, Toyota, TVS, Volvo-Eicher, Volkswagen and many more.

The Group has alliances with more than 20 renowned companies globally and the

associations include Arcelor Mittal, Cornaglia, Dassault Systems, JFE Steel

Corporation, Magnetto (CLN Group), Ogihara, Sumitomo and many more. The

organization’s structure enables each business unit to chart its own future and

simultaneously leverage synergies across its competencies.

The organization believes that success depends on collective competencies, technical

abilities and commitment of human capital. The core strength and value asset of JBM

Group is the dedication of 20,000 employees, who synergize to deliver quality results

to the clients.

JBM Group is a true global corporate citizen with ‘pause for a cause’ mantra.

Commitment towards the upliftment and development of the society, the group

executes large gamut of activities through its corporate social responsibility arm - Neel

Foundation. The organization believes to enrich the quality of life of the community

and prevails to preserve its ecological balance as well as its cultural heritage.

Bosch India

In India, Bosch is a leading supplier of technology and services in the areas of Mobility

Solutions, Industrial Technology, Consumer Goods, and Energy and Building

Technology. Additionally, Bosch has in India the largest development center outside

Germany, for end to end engineering and technology solutions.

The Bosch Group operates in India through nine companies, viz, Bosch Ltd., Bosch

Chassis Systems India Pvt. Ltd., Bosch Rexroth India Ltd., Robert Bosch Engineering

and Business Solutions Pvt. Ltd., Bosch Automotive Electronics India Pvt. Ltd., Bosch

Electrical Drives India Pvt. Ltd., BSH Home Appliances Pvt. Ltd., ETAS Automotive

India Pvt. Ltd., and Robert Bosch Automotive Steering India Pvt. Ltd. In India, Bosch

set up its manufacturing operation in 1953, which has grown over the years to include

15 manufacturing sites, and seven development and application centers. Bosch Group

in India employs over 29,000 associates and generated consolidated revenue of about

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₨.15,250 crores* in 2014 of which ₨. 10,800 crores* from third party. The Group in

India has close to 12,000 research and development associates and has filed for around

150 patents in 2014.

In India, Bosch Limited is the flagship company of the Bosch Group. It earned revenue

of over ₨. 9,570 crores in 2014.

Denso India

DENSO is a leading global supplier of advanced automotive technology, systems and

components, for all the world's major automakers. With over 130,000 employees in

more than 35 countries, our global turnover places us amongst some of the largest

companies in the world. This lead could be achieved due to our continuous keenness

for anticipating the needs of automakers and closely partnering with customers right

from the start. Our teams work promptly and diligently to manufacture products that

show a commitment to quality, safety and environment. Our successful practices

through the years are due to continuous Kaizen and PDCA as highlighted by our

employees.

DENSO started its operations in India from 1984 onwards and since then has been

continuously supplying superior quality products to its customers. With current

workforce of over 3000 associates in India DENSO caters to almost all the Major

Automakers in India.

6.3 CONCLUSION

Significant growth in automotive aftermarket industries has caught the eyes of

many. Now there is so many companies into OEM Market. Some of them are in

EECs, some are Producing ECPs while some of them are making EFIPs, but Lucas

TVS is in all the three domains. Each and every company is providing the OEM

Components and Accessories replacements. Important point to be noted is that

Lucas TVS is the only company, which has class 100 clean room. Which states that

the R & D department of Lucas TVS has great efficiency.

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Class 100 clean room is manufacturer referred standard environment, where in a

AECs are produced and recovered in a very proper manner. In Class 100 clean room

size of dust particle is less than 100 micron. Considering rarest of rare cases wherein

dust particle would settle on the plates (Retainer) then also it would not create any

Damage on the components.

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CHAPTER – 7

CUSTOMER SATISFACTION TOWARDS

AUTO ELECTRICAL COMPONENTS

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7.1 INTRODUCTION

In the last few years, the Indian Automotive industry has been spectacular growth the

country stands next to china and Japan in terms of production and sales respectively.

Majority of Indians especially the youngster prefer motorbikes rather than cars.

Capturing a large share in the two wheelers industry, bikes and scooters cover major

segment. Bikes are large variety of two wheelers that are available in the market, known

for the most recent technology and improved mileage Indian bikes, mopeds stand for

style and class for everyone in India. Auto-Electrical components are the Backbone of

any automotive industry.

Lucas TVS has the monopoly in the automotive aftermarket industry though there are

certain areas where the plant lags in terms of production. Customer satisfaction is about

relationships between the customer and product or service and the provider of a product

or service. High customer satisfaction ratings are widely believed to be the best

indicator of company’s future profit. Satisfaction can be broadly characterized as a post-

purchase evaluation of product quality given pre-purchase expectation. Customer

satisfaction can be experienced in a variety of situations and connected to both goods

and services. It is a highly personal assessment that is greatly affected by customer

expectations.

“Satisfaction based on the customer’s experience of both contacts with the

organization and personal outcomes”

7.2 NEED OF THE STUDY

The scope of the study is confined within Lucas TVS the study is emphasized on

customers’ attitude towards different components provided by Lucas TVS and their

satisfaction level. The study seeks to help other automotive aftermarket company to

realize the value of Customer satisfaction and how to create value for them.

7.3 OBJECTIVE OF THE STUDY

To study the Customers’ satisfaction towards the quality Auto-Electrical

Components of Lucas TVS Limited.

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To identify the factors which influences the customers most to purchase AECs

and EFIPs.

To Study the Socio-Economic condition of the customers.

To find out the relationship between perceived quality of AECs and patient

satisfaction and what influences patients to go to Lucas TVS Again.

7.4 SCOPE OF THE STUDY

The present study is conducted to find whether the targeted segments of customers are

satisfied with AECs and EFIPs performance. This study also tries to analyse the

influence of perception in the consumers mind and how this information can be used

successfully by marketers to gain entry into the minds of the consumers. This study is

restricted to Lucas TVS.

7.5 REVIEW OF LITERATURE

Mahapatra, kumar and Chauhan (2010) mentioned a study on “customer

satisfaction, dissatisfaction and post purchase evaluation: an empirical study on small

size passenger cars in India” with the main objectives to examine the satisfaction and

impact on future purchase decision and explore the performance of different attributes

in auto-mobile in giving satisfaction to customer with the sample size of 150 customers

and they revealed from this study that customers are highly satisfied with the

performance of attributes like pickup, wipers, etc. and other attributes like pollution,

engine, battery performance, and pick up influence the consumer future purchase

decisions and consumer give the more importance to these factors.

Rao and Kumar (2012) revealed study on “Customer satisfaction towards Tata Motors

A study on Passenger cars in Warangal district of Andhra Pradesh” with the objectives

to study the customer satisfaction with the usage of vehicles, after sale service, key area

of strength, pricing affects, service and quality. They take the sample of 100

respondents and used the percentage technique. They concluded from the study that

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majority of customers are satisfied with the safety, dealer service, customer relationship

and availability of spares etc.

M Abdul Haneef, M Edwin Gnanadhas, Mr. BA Abdul Karim,Mr. Vikas Singhal

(2006): In his study of automobile industry sector he has mentioned that the two

wheeler segment has recorded significant change in the past 4-5 years. The market for

motorcycles is growing and its sale rose by 27 percent annually during the last four

years. He pointed out that while the market for motorcycles is growing that for mopeds

and geared scooters is shrinking. This change in the taste of the consumers is possibly

due to the technological change. Also most of the manufacturers like Hero Honda, Bajaj

and TVS had reduced the prices of their entry level motorcycles in order to capture a

bigger share of the market.

Prasanna Mohan Raj, studied the factors influencing customers brand preference

of the economy segment SUV’s and MUV’s. Data collection was made through direct

interaction and customer intercept survey using questionnaire. Descriptive analysis was

used to transform data into understand format and factor analysis was used for

identification of factors influencing customer preference. In light of study findings, the

preference of a given brand can be explained in terms of six factors namely Product

reliability, monetary factor, trendy appeal, frequency of non-price promotions offered,

trustworthiness and customer feeling or association towards brand. There is need for

marketers to take these factors into consideration when crafting product innovations

in the SUV segment of Automobile market.

K.Vidyavathi, the study throws light on various aspects that the manufactures should

concentrate on to attract the prospective buyers. The demand for the small Automobile

segment is increasing because of the growing number of nuclear families as well as

parking problems. Hence the manufactures should find out the needs, wants, tastes and

preferences of consumers in order to design the products. Also fuel economy and

driving comfort are the most important parameters followed by availability of spares

and their price.

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7.6 RESEARCH METHODOLOGY

Research Design:

We will conduct descriptive research method to find satisfaction level of customers by

the Components provided by Lucas TVS, Data will be collected through questionnaires

which will be a primary data for our study.

Sampling Design:

We will prefer Cluster sampling method is adopted in this study where production

department will be approached of respective company which used to buy the

components of Lucas TVS and requested to fill the questionnaire because of population

is confined to Lucas TVS only and it will save time and money for data collection.

Data Collection Methods:

Primary data: It includes Questionnaire with question designed according to the

objective of the study, a structured questionnaire will be prepared for the respondents

to collect data.

Secondary Data: It included various information sources form Internet, journal of

marketing and automotive, newspaper, books, magazines, and publish reports by

various institution.

Sample Design:

Study is confined to Lucas TVS only, it study the respondents in view of satisfaction

level towards AECs and EFIPs provided by Lucas TVS. The sample Size will be 24

only.

Scaling Technique:

We will be using Likert scale, Dichotomous and Multiple Choice questions in

questionnaire.

1. Primary Scale (for personal information)

2. Ordinal Scale (for Preference)

3. Interval Scale ( for Satisfaction, will be used as per need )

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Sampling Unit:

Customers of Lucas TVS

Sample Size:

It refers to the number of people to be surveyed for the study, the sample size will be

24.

Analysis Technique:

Descriptive Stastics and Factor Analysis (SPSS Tool)

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CHAPTER – 8

DATA ANALYSIS AND INTERPRETATION

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8.1 Data Analysis and Interpretation

Stastics V

ari

ab

les

Co

mp

on

ent

Mo

st O

rder

ed

Fro

m L

uca

s

TV

S

Ord

er Q

ua

nti

ty

Wh

eth

er o

rder

Del

iver

ed

wit

hin

tim

e

Fu

lfil

men

t O

f

Pa

rtia

l O

rder

Pa

cka

ge

Rati

ng

Def

ecte

d I

tem

s

Per

Lo

t

Co

mp

on

ent

Pro

ble

m A

EC

Co

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on

ent

Pro

ble

m E

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Co

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on

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Ra

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uca

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Va

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24 24 24 24 24 24 24 24 24

Mis

sin

g

0 0 0 0 0 0 0 0 0

As per the questionnaire there were 9 variables on which the customers of Lucas TVS

give their responses shown in the table. All of them give their responses for all the 9

variables.

Component Most Ordered From Lucas TVS

Frequency Percent Valid

Percent

Cumulative

Percent

Valid Starter

motor

7 29.2 29.2 29.2

Wiper &

Motors

5 20.8 20.8 50.0

Alternator 7 29.2 29.2 79.2

Filter 5 20.8 20.8 100.0

Total 24 100.0 100.0

Table 8.2: Order Validity

Lucas TVS offers 3 types of Auto-Electrical components i.e. Starter Motor, Wiper &

Wiper motors and Alternators and 1 Engine Fuel Injection Components i.e. filter. Out

of all the four components alternators and starter motors are mostly ordered from the

Lucas TVS as they both are the necessary parts of the Engines. It also depicts that

demand for the AECs is increasing because the demand for the automobiles is

increasing.

Table 8.1: Variables Validity

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Order Quantity

Frequency Percent Valid

Percent

Cumulative

Percent

Valid 2,500-5,000 4 16.7 16.7 16.7

5,000-75,00 9 37.5 37.5 54.2

7,500-10,000 9 37.5 37.5 91.7

10,000-

12,500

2 8.3 8.3 100.0

Total 24 100.0 100.0

Table 8.3: Order Quantity Validity

Most of the customers of Lucas TVS order the quantity from 5,000 to 10,000 because

as an engine this quantity can be considered as class “A” inventory for the Customers

and can be stored for long time. Ordering the optimal quantity of the components will

reduce the transportation cost, instead of ordering smaller lots companies are going for

a large lot of components. It also predicts that the demand for the components lying

from 5,000 to 10,000 are the consistent and major players of automotive industry.

Starter Motor, 7

Wiper & Wiper Motor, 5

Alternator, 7Filter, 5

Starter Motor, 29.20%

Wiper & Wiper Motor, 20.80%

Alternator, 29.20%

Filter, 20.80%

Starter Motor

Wiper & Wiper Motor

Alternator

Filter

0 1 2 3 4 5 6 7 8

Component Most Ordered From Lucas TVS

Graph 8.1: Order Validity

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Graph 8.2: Order Quantity Validity

Whether order Delivered within time

Frequency Percent Valid

Percent

Cumulative

Percent

Valid Yes 20 83.3 83.3 83.3

No 4 16.7 16.7 100.0

Total 24 100.0 100.0

Table 8.4: Order Delivery Validity

The customers of the Lucas TVS get their order quantity at the time mostly, but

sometimes they were not be able to complete the order in time because of the

productivity losses and the reasons behind may be 4M losses.

2500-5000, 4

5000-7500, 9

7500-10000, 9

10000-12500, 2

2500-5000

5000-7500

7500-10000

10000-12500

0 1 2 3 4 5 6 7 8 9 10

Order Quantity

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Graph 8.3: Order Delivery Validity

Fulfilment Of Partial Order

Frequency Percent Valid

Percent

Cumulative

Percent

Valid Same Day 3 12.5 12.5 12.5

Next Day 4 16.7 16.7 29.2

More Than 2

Days

1 4.2 4.2 33.3

N/A 16 66.7 66.7 100.0

Total 24 100.0 100.0

Table 8.5: Order Fulfilment Validity

If the company is not able to complete the order on the scheduled date, this data depicts

that the company either complete the order on the same day or within 1 day. This means

that the ordered quantity may be 100 or 150 they were lacking behind. Which is not the

point of concern for the customers and the Lucas TVS So far.

Yes, 20

No, 4

Yes

No

0 5 10 15 20 25

Whether order Delivered within time

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Graph 8.4: Order Fulfilment Validity

Package Rating

Frequency Percent Valid

Percent

Cumulative

Percent

Valid Good 5 20.8 20.8 20.8

Excellent 19 79.2 79.2 100.0

Total 24 100.0 100.0

Table 8.6: Package Rating Validity

Packaging can be described as a coordinated system of preparing goods for transport,

warehousing, logistics, sale, and end use. Packaging contains, protects, preserves,

transports, informs, and sells. From the above data, clearly seen that the packaging of

the Lucas TVS is quite impressive and 80% of the customers thinks that the packaging

is very safe for the components.

Same Day, 3

Next Day, 4

More Than 2 Days, 1

NA, 16

Same Day

Next Day

More Than 2 Days

NA

0 2 4 6 8 10 12 14 16 18

Fulfilment Of Partial Order

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Graph 8.5: Package Rating Validity

Defected items Per Lot

Frequency Percent Valid

Percent

Cumulative

Percent

Valid 0% 10 41.7 41.7 41.7

0%-1% 10 41.7 41.7 83.3

1%-5% 4 16.7 16.7 100.0

Total 24 100.0 100.0

Table 8.7: Defected Items per lot Validity

From the overall ordered quantity the damaged or defected in the total lot (i.e. 7500

Max) may be 60 or 70. That will not be serious point of issue for the customers these

components can be replaced within the time tenure and if they finds than Lucas TVS

will replace the components and will not charge any transportation cost from the

customers. Overall quality and quantity sent to their customers id very good as from

their feedback.

0

0

0

4

19

0 2 4 6 8 10 12 14 16 18 20

Worst

Poor

Normal

Good

Excellent

Package Rating

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Graph 8.6: Defected Items Per lot Validity

Component Problem AEC

Frequency Percent Valid

Percent

Cumulative

Percent

Valid Voltage

Regulation

7 29.2 29.2 29.2

Current 8 33.3 33.3 62.5

Speed 4 16.7 16.7 79.2

N/A 5 20.8 20.8 100.0

Total 24 100.0 100.0

Table 8.8: Component Problem AEC Validity

In the defected or damaged items in the lot the problem occurred in the AECs are mostly

of Voltage and current. It is because the voltage and current has direct proportional

relationship, if the current flow is more than the approved limit, the voltage will exceeds

its limit and vice-versa. Well it is not a serious issue customers can make them proper

by their own or can go to Lucas TVS for replacements.

0%, 10

0%-1%, 101%-5%, 4

5%-10%, 0

0%

0%-1%

1%-5%

5%-10%

0 2 4 6 8 10 12

Defected items Per Lot

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Graph 8.7: Component Problem AEC Validity

Component Problem EFIP

Frequency Percent Valid

Percent

Cumulative

Percent

Valid Leakage 1 4.2 4.2 4.2

Choking 1 4.2 4.2 8.3

Irregular

Shape

3 12.5 12.5 20.8

N/A 19 79.2 79.2 100.0

Total 24 100.0 100.0

Table 8.9: Component Problem EFIP Validity

In the Filters the most obvious problems occurred is choking and leakage, but in the

components of the Lucas TVS it is very less which is very good for the company

because these problem are highly defective they may ruin the whole Engine fuel

Injection chamber the point of concern for the company is irregular shape means that

the filters are still working but not so efficiently.

7

8

4

5

0 1 2 3 4 5 6 7 8 9

Voltage Regulation

Current

Speed

NA

Component Problem AEC

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Graph 8.8: Component Problem EFIP Validity

Component Rating Lucas TVS

Frequency Percent Valid

Percent

Cumulative Percent

Valid Satisfied 11 45.8 45.8 45.8

Highly

Satisfied

13 54.2 54.2 100.0

Total 24 100.0 100.0

Table 8.10: Component Rating Validity

At the end the customers of the Lucas TVS are very happy and satisfied with their goods

and components. As shown in the data the ratings that the Lucas TVS got are very

impressive which depicts that Lucas TVS has been committed to its customers by

following them geographically, leading to better logistics efficiency. Lucas-TVS has

been focusing on meeting the needs of its customers through a range of quality products.

True to the TVS culture of “Customer is King” that marks it off from others over the

last so many years, Lucas-TVS strives to display this in its new AECs venture. The

company aims to be a significant player in the automotive market and is in the process

of establishing the network for the same.

1

1

3

19

0 2 4 6 8 10 12 14 16 18 20

Leakage

Choking

Irregular Shape

NA

Component Problem EFIP

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Graph 8.9: Component Rating Validity

Factor Analysis

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .567

Bartlett's Test of

Sphericity

Approx. Chi-Square 73.828

df 36

Sig. .000

Table 8.11: KMO’s Test Significance

The Factor Analysis is an explorative analysis. Much like the cluster analysis grouping

similar cases, the factor analysis groups’ similar variables into dimensions. This

process is also called identifying latent variables. Since factor analysis is an explorative

analysis it does not distinguish between independent and dependent variables.

KMO & Bartlett’s Test of Sphericity is a measure of sampling adequacy that is

recommended to check the case to variable ratio for the analysis being conducted. In

most academic and business studies, KMO & Bartlett’s test play an important role for

accepting the sample adequacy. While the KMO ranges from 0 to 1, the world-over

0

0

0

11

13

0 2 4 6 8 10 12 14

Highly Dissatisfied

Dissatisfied

Neutral

Satisfied

Highly Satisfied

Component Rating Lucas TVS

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accepted index is over 0.5. Also, the Bartlett’s Test of Sphericity relates to the

significance of the study and thereby shows the validity and suitability of the responses

collected to the problem being addressed through the study. For Factor Analysis to be

recommended suitable, the Bartlett’s Test of Sphericity must be less than 0.05.

As shown in table and according to the test the sampling adequacy is more than 0.5 that

means the responses collected throughout the study is valid and suitable and the

significance level is less than 0.05 in the Bartlett’s test of Sphericity.

Communalities

Initial Extraction

Component Most Ordered From Lucas TVS 1.000 .885

Order Quantity 1.000 .732

Whether order Delivered within time 1.000 .693

Fulfilment Of Partial Order 1.000 .822

Package Rating 1.000 .819

Defected Items Per Lot 1.000 .680

Component Problem AEC 1.000 .883

Component Problem EFIP 1.000 .859

Component Rating Lucas TVS 1.000 .812

Table 8.12: Communalities Extraction

Factor Analysis reduces the information in a model by reducing the dimensions of the

observations. This procedure has multiple purposes. It can be used to simplify the data,

for example reducing the number of variables in predictive regression models. The

above table shows that the how much a variable is important for the company by the

extracted value varying from least important to most important. The values in this

column indicate the proportion of each variable's variance that can be explained by the

retained factors. Variables with high values are well represented in the common factor

space, while variables with low values are not well represented.

Total Variance Explained

Comp. Initial Eigenvalues Extraction Sums of Squared

Loadings

Rotation Sums of Squared

Loadings

Total % of

Variance

Cumulative

%

Total % of

Variance

Cumulative

%

Total % of

Variance

Cumulative

%

1 2.735 30.385 30.385 2.735 30.385 30.385 2.527 28.082 28.082

2 2.062 22.915 53.301 2.062 22.915 53.301 1.754 19.485 47.568

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3 1.346 14.955 68.256 1.346 14.955 68.256 1.625 18.052 65.620

4 1.042 11.581 79.837 1.042 11.581 79.837 1.280 14.218 79.837

5 .662 7.356 87.193

6 .481 5.347 92.541

7 .353 3.923 96.464

8 .197 2.192 98.656

9 .121 1.344 100.000

Table 8.13: Variance Explanation

The initial number of factors is the same as the number of variables used in the factor

analysis. However, not all 9 factors will be retained. In this example, only the first 4

factors will be retained (as we requested). Eigenvalues are the variances of the

factors. Because we conducted our factor analysis on the correlation matrix, the

variables are standardized, which means that the each variable has a variance of 1, and

the total variance is equal to the number of variables used in the analysis, in this case,

9. The first factor will always account for the most variance (and hence have the highest

eigenvalue), and the next factor will account for as much of the left over variance as it

can, and so on. Hence, each successive factor will account for less and less variance.

Table 8.14: Component Matrix Table 8.15: Rotated Component Matrix

Component Matrix - This table contains the unrotated factor loadings, which are the

correlations between the variable and the factor. Because these are correlations,

Component Matrix

Component

1 2 3 4

Component Most

Ordered From Lucas

TVS

-

.777

Order Quantity .629

Whether order

Delivered within time

.503 .631

Fulfilment Of Partial

Order

-

.541

.519

Package Rating -

.579

.513

Defected Items Per

Lot

.619

Component Problem

AEC

-

.813

Component Problem

EFIP

.800

Component Rating

Lucas TVS

-

.574

.517

Rotated Component Matrix

Component

1 2 3 4

Component Most

Ordered From

Lucas TVS

.912

Order Quantity .807

Whether order

Delivered within

time

-

.629

Fulfilment Of

Partial Order

.896

Package Rating .549 .604

Defected Items

Per Lot

-

.729

Component

Problem AEC

.935

Component

Problem EFIP

-

.834

Component

Rating Lucas

TVS

.885

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possible values range from -1 to +1. On the /format subcommand, we used the

option blank (.30), which tells SPSS not to print any of the correlations that are .3 or

less. This makes the output easier to read by removing the clutter of low correlations

that are probably not meaningful anyway.

Rotated component Matrix - This table contains the rotated factor loadings (factor

pattern matrix), which represent both how the variables are weighted for each f actor

but also the correlation between the variables and the factor. Because these are

correlations, possible values range from -1 to +1. On the /format subcommand, we

used the option blank (.30), which tells SPSS not to print any of the correlations that

are .3 or less. This makes the output easier to read by removing the clutter of low

correlations that are probably not meaningful anyway.

For the customer satisfaction there are three main factors that the company should focus

more and these are the Component order, Problem related to AEC and EFIP because as

per the rotated component matrix these three are having the highest co-relation value

are the most influencing factors for the customers.

Limitations

I have done this research through online mode, and the result may vary a little bit.

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CHAPTER – 9

FINDINGS AND RECOMMENDATIONS

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FINDINGS

A huge growth in vehicle population and higher customer awareness about vehicle

upkeep, periodic maintenance and demand for add-on services so, Lucas TVS

Should prepare itself for 24/7 breakdown assistance and extended warranty covers.

There are lots of OEM Clients and customers who are facing the problems related

with the AECs and EFIPs so there is large potential market for Lucas TVS Limited.

It has also been found generally in the case of AECs Repair by the local vendors

they are able to repair only Speed and Lamp related issues, but the cases related to

Voltage and Current cannot be recovered by local vendors.

It has been also found that the charges which are charged by local vendors are less

than the Lucas TVS so Customers prefer local vendors. Many OEM Clients in the

corporate sector also feels that they have paid higher prices for the AECs.

Now a days there are so many E-vehicles have been introduced in the automotive

market so, the demand for the ECPs is increasing day by day at a very rapid rate.

So, it is the right time for the Lucas TVS to pull the socks.

The key driver for the potential growth of Lucas TVS in the automotive aftermarket

will be DIFM (do it for me) segment, which constitutes a majority of the aftermarket

size due to the increasing complexity of repair requirements and the after-sales

service mechanism brought about by the greater use of electronic components in

advanced vehicles.

The after-market is highly competitive for components due to price sensitivity and

tolerance for lower quality products. A major channel of marketing and distribution

for this sector is the typical roadside mechanic.

The growing automotive aftermarket presents a large opportunity for Lucas TVS

across the value chain. However, with the market demand for parts and services set

to double over the next 5 years, being able to satisfy this demand is a significant

challenge.

The main challenges for Lucas TVS - dealership service centres, spare parts retailers

and independent service workshops - has been the tightening of margins due to

rising operating costs, employee and real estate costs. Only large independent

national distributors have managed to increase their return on capital because of

operational efficiency.

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RECOMMENDATIONS

Lucas TVS will have to double their capacity across its value chain, as well as

enhance its capabilities to produce parts for and service a wider variety and

complexity of vehicles. This will require significant additional investments in

capital.

It was estimated aftermarket contributes around 24 per cent in revenues of OEMs,

but a sizable 55 per cent to profits. Lucas TVS along with its OEM Customers

should develop branded generics to capture the cost advantage in the growing

independent market, which is worth around Rs 3,000-4,000 crore.

Lucas TVS should expand OEM service networks aggressively, Structure

exclusivity contracts on manufacturing and distribution with distributors as well as

suppliers.

Lock-in customers for a longer tenure through increasing warranty periods on

vehicles, Counter the threat of branded generic parts by launching second brands

that are cheaper and potentially useable across all makes.

However, except for large automotive aftermarket companies in the industry have

faced margin pressure in the last few years. This trend is likely to continue, as most

players in the Indian aftermarket are still sub- scale and will be at risk of margin

decline due to the pricing pressure as well as reducing costs. So, Lucas TVS should

penetrate fast moving niches as these offer high margins, e.g. branded generic parts

and auto-electronic gadgets/accessories for safety and navigation. Another thing

Lucas TVS have to explore forward integration along the value chain, for e.g.

independent distributors can integrate into retail and multi-brand service.

If Lucas TVS would be able to enhance the customer awareness of vehicle

maintenance alongside sufficient infrastructure and services, aftermarket players

that are able to expand into India, both autonomously or through joint ventures, will

succeed and support India in gaining the expected strong aftermarket growth.

In order to satisfy the customers, the foremost criteria for Lucas TVS would be to

clearly define and identify the various segments, and specialized analysis is carried

out in each segment to understand where the break down is happening. The analyses

needs to understand that perspectives on importance and priority differs with each

customer and one needs to primarily meet their basic needs and expectations

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CHAPTER – 10

CONCLUSION

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CONCLUSION

Two major issues that plague the current automobile scenario are service and

maintenance. These need to be dealt with in the most efficient and satisfactory way

possible. In spite of companies trying their best to satisfy the customers’ need after the

sales is done, their satisfaction is still not reached exemplar benchmarks. When these

two parameters of service and maintenance are observed, the company concentrates on

quality as well as time and financial constraints to ease these off the customers’ backs.

Dealers need to strike the right balance between the various priorities and find the

perfect mix of quality, technology, features, vehicle type, warranty period, and service

delivery time. One important aspect which could dictate this market though is heavily

constrained by the OEM workshops is the warranty period.

However, today most customers are able to make informed, intelligent decisions

towards best maintenance options and service centre availability. Although, there is a

major lack of assistance technically available in their locality. This is the major reason

why most authorised service centres and large workshops today perform poorly.

As technology advancements have made huge strides forward, revise cost also varies

along with it. Though technology has given rise to more long lasting and fast moving

parts, maintenance cost as well as labour costs incurred in the same boggle the

customer. This sort of expenses will only hinder the customers’ financial limitation.

Hence, it becomes essential to understand few major parameters for satisfying the

customer after sales.

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CHAPTER – 11

REFERENCES

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REFERENCES

Journal Articles

Haneef, M Abdul & Gnanadhas, M Edwin & Karim, Ba Abdul & Singhal, Vikas

(2006): Iran”. Global Journal of Automotive Services and Maintenance, Vol. 2 No.

1; April 2006, Pg. 121-122.

Mahapatra, V, Kumar, A & Chauhan, N (2010) “Customer Satisfaction,

Dissatisfaction and Post Purchase Evaluation: An Empirical Study on Small Size

Passenger Cars in India” (Vsrdtntj, Vol. I (4), 2010, 198-206).

Prasanna, Mohan Raj (2014) – “Study Of Factors Influencing Customers Brand

Preference Of The Economy Segment SUV’s And MUV’s”, Indian Journal of

Automotive Aftermarket, Vol. 25, No. 7, Dec 2014 Pg. 630-632.

Rao, Krishna & Kumar, Munesh (2012) Revealed Study On “Customer Satisfaction

Towards Tata Motors A Study On Passenger Cars In Warangal District Of Andhra

Pradesh” ,Ijmbs Vol. 2, Issue 3, July - Sept 2012

Vidyavathi, K (2003) - “A Study On The Manufactures Should Concentrate On To

Attract The Prospective Buyers’ ”, Managing Service Quality, Vol. 13 Iss: 4, Pg.

290-299

Websites

http://badmforum.blogspot.in/2012/08/factor-analysis-kmo-bartletts-test.html

[viewed 18/06/2016].

http://www.asiainspection.com/production-monitoring [viewed 23/06/2016].

http://www.autobei.com/autoreports/automotive/indian-automotive-aftermarket-

trends-challenges-a-report/ [viewed 29/06/2016].

http://www.autoelectricsupplies.co.uk/category/101 [viewed 11/07/2016].

http://www.livemint.com/Industry/p5zqWcJrxzgt6TpDuWAPdI/Indian-

automotive-aftermarket-to-grow-10-annually-CII-McK.html [viewed 12/07/2016].

http://www.lucaselectrical.co.uk/ [viewed 12/07/2016].

http://www.lucas-tvs.com/ [viewed 12/07/2016].

https://en.wikipedia.org/wiki [viewed 18/07/2016].

https://www.glassdoor.co.in/Reviews/Lucas-TVS-Reviews-E445525.htm [viewed

19/07/2016].

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CHAPTER – 12

QUESTIONNAIRE

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QUESTIONNAIRE

I am a student of Lovely Professional University, conducting a study on "Customer

Satisfaction Towards Auto-Electrical Components" as a part of my summer internship

program.I hereby request you to spare some of your valuable time to provide me the

information. Your information will be used for academic purpose only. Your

participation is completely voluntary and all responses will be anonymous.

1. Check the components you mostly order to Lucas TVS.

Starter Motor

Wiper & Wiper Motor

Alternator

Filter

2. What is the order quantity for the component?

2500-5000

5000-7500

7500-10000

10000-12500

3. Do you get the order in the mentioned time period?

YES

NO

4. If the order quantity is not delivered in the given period, how long do they take?

Same Day

Next Day

More than 2 days

NA

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5. How will you rate the packaging of the products of Lucas TVS?

1 2 3 4 5

1: worst, 2: Poor, 3: Normal, 4: Good, 5: Excellent

6. How much percent on an average have you got defective items?

0%

0% - 1%

1% - 5%

5% - 10%

7. What kind of problem occurs in the components of Lucas TVS?

Voltage Regulation Current Speed

AEC

Leakage Chocking Irregular Shape

EFIP

9. How will you rate the components of Lucas TVS?

1 2 3 4 5

1: Highly Dissatisfied, 2: Dissatisfied, 3: Neutral, 4: Satisfied, 5: Highly Satisfied

Company’s Name – __________________

Respondent’s Name – ___________________

Designation – ___________________