A Project Report on Operations

Management

Project Report on

‘Operations Management’

SUBMITTED BY:

Ameya Guhagarkar (14)

Deepa Kodag (23)

Hitendra Jain (37)

Anita S. Phaterpekar (38)

Suraj Purohit (40)

Viral Shah (48)

Pallavi Shetty (49)

Omkar Tulaskar (54)

Anita Anand (60)

Submitted in partial

fulfillment of the requirement

of 1st Semester of MMS course,

Mumbai University

Bharti Vidyapeeth’s Institute of Management Studies and Research 2008-2009

 A Project Report on Operations
Management

CERTIFICATE

I, Prof. N.K.Agarwal , hereby certify the below mentioned group of

BVIMSR of MMS-I (Division A) have completed the project on “Operation
Management” in the academic year 2008-2009.This information submitted is
true and original to the best of my knowledge.

Ms Anita S. Phaterpekar
Mr. Ameya Guhagarkar
Ms Anita Anand
Ms Deepa Kodag
Mr. Hitendra Jain
Mr. Omkar Tulaskar
Ms Pallavi Shetty
Mr. Suraj Purohit
Mr. Viral Shah

Signature Signature
Project guide Director
Prof. N.K.Agarwal Dr D.Y.Patil
 A Project Report on Operations
Management

DECLARATION

We, the group members of OM project hereby declare that we have visited
United Breweries, Taloja, and the information provided in the report is true to
best of our knowledge.
 A Project Report on Operations
Management

ACKNOWLEDGEMENT

We wish to express our deep gratitude towards all the persons who have contributed
towards this project and helped develop ideas and approach in writing this report. We
thank Mr. Ashok Katta, Senior HR Manager, and all officials of United Breweries plant
who guided us in this project.

We are grateful to Professor N. K. Agarwal, Faculty of subject Operations

Management, MMS-I, B.V.I.M.S.R. (Belapur, Navi Mumbai), for his guidance
throughout our project work.

We would like to thank Prof. Dr. D.Y Patil, the director of Bharti Vidyapeeth’s
Institute of Management Studies and Research, Belapur, Navi Mumbai for his
kind permission to carry on our project work and his co-operation.
Last but not the least we would like to thank all our college friends for their
encouragement and moral support.
 A Project Report on Operations
Management

Operations management is understood as the process whereby resources or

inputs are converted into more useful products.
Company Profile
United Breweries Limited, the flagship company of the UB Group, has an
association with the brewing dating back over five decades, starting with 5
breweries in South India in 1915. From bullock cart-loaded barrels or
'hogheads' of frothing ale, the Beer business has gone on to become the
undisputed 'king' in the Indian beer market.

Here, innovative, creative and aggressive marketing is complemented by a

strong distribution network. A management focused on building brand equity on
one hand and exploiting it to the hilt on the other. A concerted emphasis on
quality.

UBL today boasts an impressive spread of own and contract manufacturing

facilities throughout the Country.

Quality and hygiene are the key elements of the United Breweries'
manufacturing philosophy. To this end, the Central Scientific Laboratory (CSL),
headquartered at Bangalore sets standards for all its breweries. Quality
Management Systems laid out along the lines of ISO 9000 are strictly adhered
to, controlling quality at every stage of production, from raw materials to the end
product. Also, besides controlling the production process, the CSL analyses the
Company's beer taken off market shelves all over the Country, the competition's
beers and beers across the world. These beers are tested as per the standards
laid down by the European Brewery Convention on 40 different parameters. By
these standards, United Breweries' beers don't just equal, but even surpass,
several Dutch and American beers.

Its flagship brand 'Kingfisher', has achieved international recognition

consistently, and has won many awards in International Beer Festivals.
Kingfisher Premium Lager beer is currently available in 52 countries outside
India and leads the way amongst Indian beers in the International market. It has
been ranked amongst the top 10 fastest growing brands in the UK.

In addition, UBL has also entered into mutli-faceted strategic alliance with
Scottish & NewCastle Plc (S&N), an international brewery major, with $6 billion
in revenue and a market capitalization of $5.4 billion. This alliance, apart from
having a joint venture in India, will allow S&N to market it International brands
like Kronenbourg in India, while UBL will utilize S&N's global network to further
globalize its Kingfisher.
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Management

Division Profile: Taloja

The beer manufacturing unit of United Breweries is located in Maharashtra
Industrial Development Corporation (MIDC) at Taloja in Navi Mumbai.
The UB group has a state-of-the-art fully automated manufacturing unit at
Taloja in Navi-Mumbai. This plant maintains a very high standard of hygiene.
The division has comprehensive quality assurance system which ensures that
products are backed by the best of quality processes and ingredients, and
measure up to world - class hygiene standards.
The unit is spread over sprawling area of 22 acres and was the first green field
project of the UB group.

Benefits of MIDC

Water Supply
MIDC has, over the years, created a vast, robust and reliable water supply
system. The system caters to the water needs of the industries within MIDC
industrial areas and also those outside, in the adjoining areas. Not only that, the
system caters to the needs of many large and small local bodies all over the
State which in turn serve their domestic and commercial consumers.

MIDC supplies treated, potable water to all industrial units.

Some facts about MIDC's water supply systems:

Total Installed Capacity of the system: 1940 MLD
Current Utilization: 1286 MLD

Consumer Base:
Industrial: 26564 MLD
Domestic: 2829 MLD

MIDC's sources of water:

Irrigation dams: 65%
MIDC dams: 34%
Others: 1%

Total Reservation available

Domestic: 12485 MLD
Industrial: 4055 MLD
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Management

The above reservation figures indicate the extent to which MIDC has rights to
draw water from rivers, irrigations project and other sources. The reservation
figures indicate that MIDC still has large unutilized rights, which can be used for
future expansion of its water supply systems.

Superior Infrastructure:
The following gives a snapshot of MIDC's water supply infrastructure:

No. Of Schemes 69
No. Of Dams 05
Capacity of pump system 7787 HP
Length of Pipelines 2864 Kms

Drinking Water Standards:

 A Project Report on Operations
Management

CHARACTERISTICS

World Health
Organisation-
1971

Highest
Desirable
Maximum
Permissible

Turbidity

5.0
25.00

Taste and Odour

Nothing
Disagreeable
Color (Pt Scale)
A Project Report on Operations
Management

Capacity Determination

To determine capacity a strategic decision in a facility planning is needed. The

decision is important because
pH

• These have a long term impact

• Capacity determines selection of appropriate technology, type of labor
and equipments etc.
• Right capacity ensures commercial viability of the business venture
• Capacity influences the competitiveness of a firm.

Capacity Planning Decisions involves activities like

• Solids
Total Assessing existing capacity
• Forecasting future capacity needs
• Identifying alternative ways to modify capacity
• Evaluating financial, economical and technology capacity alternatives
• Selecting a capacity alternative most suited to the strategic mission of
the firm

Estimating an organization’s capacity is a complex process. Capacity planning

decisions are critical to the organization’s success as they commit significant
resources. Capacity provided should provide to meet the demand level in the
Total hardness (as
most optimized manner. Capacity of machines and departments needed to
CaCo3)
determine the capacity of a system. Increase in capacity can be achieved by
increasing the capacity of the bottlenecks.
Magnesium
A Project Report on Operations
Management

Iron (Fe)
Production Capacity of UB Ltd. at Taloja
Capacity – Kegs (as per market requirement)

Cans (18000 cans per hour)

Bottles (30000 bottles per hour and which can be increased to

36000)

Currently the plant is operating at 80% capacity

Location
Objective
Manganese
To minimize sum of all costs affected by location, not only presently but in the
long run even

Type of Plant Location

• Industrial Plant Location
• Multi Plant Location
• Off Shore Location
• Warehouse Location
• Service Facility Location

Steps involve while selecting Plant Location

National Decision
Copper
• Within or Outside country

Selection of Region
• Nearness to market
• Availability of Raw Material
• Government Policy , other….

Selection of Locality or community

 A Project Report on Operations
Management
• Availability of labour
• Civic amenities for workers
• Existence of complementary & competing industries
• Finance & research facilities
• Availability of water and fire fighting services , others…..
Sulphate (as SO4)

Selection of Exact Site

• Soil, size & topography
• Disposal of waste

UBL plant for Beer manufacturing is located at MIDC Taloja, Raigad

Lay Out
Plant Layout help in determining a floor plan and arranging the desired
machinery and equipment of a plant: It permits
• The quickest flow of materials in processing the product
• From the receipt of the raw materials to the shipment of the
Phenolic substances
finished product
• At the lowest cost and with the least amount of handling

Objectives

• Provide enough production capacity

• Reduce material handling cost
• Reduce congestion impeding movement of men and material
• Reduce hazards to working personnel
• Utilise labour efficiently
• Increase employee morale
• Utilise available floor space efficiently and effectively
Fluoride *• Reduce accidents
• Provide for volume and product flexibility
• Provide ease of supervision and maintenance
• Facilitate co-ordination and face-to-face communication
• Provide for employee safety and health
• Allow high machine utilisation
• Improve productivity

Critical Factors to be considered

Nitrate
 A Project Report on Operations
Management
• Materials
• Product
• Workers
Zinc • Machinery
• Type of industry
- Synthetic
• Constituent elements combining to make the final product
e.g. Chemical industry
- Analytical
• Conversion of raw materials into various elements e.g.
Petroleum industry
- Conditioning
• Changing in shape / form or physical properties e.g.
Foundry, metal working industry
- Extractive
• Involving separation of one element from the other e.g.
Metal from iron ore
Arsenic
Each of above further classified into

 Intermittent industries
 Continuous industries

• Location
• Managerial policies

Types of Process Layout

 Process layout Functional layout or Job shop layout

• Grouping together of similar machines in one department
Cyanide • Material moves from one group of machines to the other
• Movement over longer distance and along criss-cross paths
• May also involve part finished inventory waiting

 Product / Line processing or flow line layout

• Machines arranged in a line depending upon sequence of
operations
– Material product standardisation
• CM is a subset of GT concept
– A close grouping of equipments for processing a sequence
of operations in multiple units of a part or a family of
parts,called manufacturing cell
– Flow of parts within a cell can take many forms.
Lead
 A Project Report on Operations
Management
Selenium – Use of cells reduces the distance moved by parts between
machines
• moves in a line from the first machine to the finished product on
the last machine.
• Investment higher as compared to process layout

 Fixed position / Static layout

• Movement of men & machinery to the product
• Product remains stationary
– Cost of moving product is high,being bulky

Hexavalent Chromium
 Cellular Manufacturing (CM) or Group Technology (GT)
layout
• A form of production that has been developed recently
• In GT,the products or components being manufactured are placed
in families or groups and separate manufacturing cells are used
for manufacturing these groups
– GT enables production of a wide variety of parts in small
batches to achieve economies of line-flow production
without
– Transportation costs reduced as parts do not have to
moved in large batches
– Reduction in w-i-p inventory, and the manufacturing cycle-
time or through-put time
– Most common application in automobile spare parts
manufacturing

 Combination / Hybrid layout

• Combination of product & process layout with an emphasis on
either
• Generally adopted in industry
• In fabrication plants including assembly, fabrication tends to
employ process layout while assembly areas employ product
layout
– Soap manufacturing industry employs product line for
manufacturing of soap, but ancillaries such as heating,
 A Project Report on Operations
Management
manufacturing of gleycerine, power house etc. Are
arranged on functional basis.

Plant Lay Out of UBL

Plant layout at mfg unit is well designed and very systematic, it is continuous
flow starting from the introduction of Raw Materials to final product which is
Beer.

Plant Lay Out : Hybrid Layout

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Management

Image No 1: Plant Lay Out of UBL at Taloja

Functional Groups
Since its a Mfg unit, only functional group present there is Production
Department. This department comprises of

• 25 Managers

• 35 Technical Staff,

• 70 Workers

• 50 Other Contract Labor.

Material Management

Bailey and farmer define Material Management as management of the flow of

materials into a Organisation to the point, where , those materials are converted
into the firms end product
 A Project Report on Operations
Management
Objectives of Material Management

• Obtaining the best possible raw material at the least possible price

• Low inventory increases efficiency since less capital is blocked. This

results high return on investment

• Efficient handling and storing of materials reduces the cost of

procurement

• Continuous supply reduces cost that may arise due to disruptions

• Consistent quality of raw material ensures high quality product

• Maintaining cordial relations with suppliers benefits the buyer in more

than one way

Material Management at UBL

Since mfg unit is highly automated and continuity of supply is of prime

importance. the cost in such units is highly rigid.

Raw material ‘Malt’ is stored in Silo:

This is the component where raw malt is stored. It comprises of two tanks with
a capacity of 200 metric tones each. Daily consumption of barley malt is 20
metric tones. Every 10 ten days the new stock is added to the silo. Barley can
be stored for about 6 months without being spoilt. In silo the malt is aerated
with dry air throughout.

Capacity of Silo: 200 M tones

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Management

Image No 2: Silo and Loading of Malt in Silo

Ingredients – Barley, Rice Flakes, Sugar, Hops and Water.

Barley- Patiala (own fields)

Malt:

Image No 3: Malt before loading for Mill

Rice Flakes- From Delhi and Karnataka.

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Management

Image No 4: Rice Flakes

UBL obtains malt required in the mfg in Patiala and it purchases Rice Flakes
from Delhi

Sugar- M 30 sugar quality

Hops- The most important ingredient. Imported from Germany because the
climatic conditions are favourable for plantation of Hops and adds to the bitter
taste and the aroma of the beer. The Hops reported from Germany is of the
best quality.

There are 3 forms of Hops

Image No 5: Hopes in the form of Flakes

1. Pellets
2. Oil &
3. Liquids

Process of Beer Manufacturing

 A Project Report on Operations
Management

Image No 6: Flow-Process of Beer Manufacturing

Process Flow at UBL

Image No 7: Process of Beer Manufacturing

 A Project Report on Operations
Management
Malt Mill
In this process barley is cleaned using dry air blower so as to remove dust
particles and disintegrated malt. During this process dust & foreign particles are
separated and the usable barley of unique size is acquired. They grind it to
form a powder form of malt.

Brew House
After the barley is separated and cleaned it is then sent to the brew house
department. In the brew house the following processes take place
1. Mash Kettle
2. Lauter Tun
3. Wort Kettle
4. Whirlpool &
5. PHE (Plate Heat Exchanger)
6. Yeast Room
7. Fermentation Tank
8. Lagering Process
9. Filtration Process

Mash Kettle
Here the barley malt is mixed with rice flakes and water and boiled for one hour
(till certain specifications based on transparency of Wort). The temperature is
maintained at 102 deg C. There are two separate Mash Kettle each of capacity
of 25000 litres.

Lauter Tun
Wort (mother liquor) is pumped into lauter tun and water is added to form a
proper mixture. It is then mixed for one hour using blades at 1000 C. And it is
allowed to settle and form a filter bed made of husk and undissolved flakes.
Then the filterate is pumped to wort kettle.

Wort Kettle
Sugar and Hops is added manually at this stage. Then the wort is mixed to
dissolve sugar and hops for one hour and at the end of process the
temperature comes to 90 deg C.

Whirlpool
The wort is vortexed which enables and undissolved particles to settle at the
bottom. The temperature reduces to 65-70 deg C.

Plate Heat Exchanger

 A Project Report on Operations
Management
Since yeast cannot be added at 70 deg C the wort is reduced to 6-7 deg C and
pumped to fermentors.

Fermentation
the final mixture is moved to fermentor where it is mixed or pitched with Yeast
which will convert the mixture of malt and hops into Beer. The Yeast converts
ingredient Sugar and Proteins into Alcohol. The temperature maintain at 4 to 6
deg. C. till the fermentation the desired concentration of alcohol is reached.
CIP: Cleaning In Process, fermentors are cleaned using automated CIP.

Laggering
After fermentation the temperature of beer is lowered to 0 deg. C and let it
matured for a period of one week and then transferred to packaging unit.
Fermentation and Laggering is carried out in same fermentor.

Image No 8: Fermentor Capacity of 25,000 lit.

Capacity of fermentors at plant: 6 tanks of 50,000 lit.
12 tanks of 1,00,000 lit.
6 tanks of 1,50,000 lit.
4 tanks of 2,50,000 lit.

Packaging
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Management

Image No 9 : Packaging Plant at UBL of Cans and Bottles

There are 3 types of packing media

1. Keg
2. Cans
3. Bottles

Keg – Keg is a barrel like container which is used to store unpasturized beer. It
is available in varying capacities of 10, 20, 30 and 50 litres. Unpasturized beer
has a very short shelf life of approximately 5-6 days. The beer is produced in
the morning and dispatched in the evening. It has only produced in the required
quantities and not in excess. This beer is supplied to pubs, bars and five star
hotels.

Cans – The cans are imported from Thailand, UAE and Singapore. UB now
procures its cans from a local unit Raxem Industries which is located in Taloja
itself. This helps UB to reduce its overhead costs involved in the manufacturing
of beer. Each can has a capacity of 330ml.

Image No 10: Can of Beer of 330 ml.

 A Project Report on Operations
Management
Bottles – UB group doesn’t produce bottles but they obtain second hand bottles
from local scrap dealers. They then recycle these bottles and they are
thoroughly cleaned before the actual bottling process.

Image No 11: Bottle of Beer 650 ml.

Quality Management
Quality and hygiene are the key elements of the UB groups’ manufacturing
philosophy. To this end the Central Scientific Laboratory(CSL) headquartered at
Bangalore sets standards for all its breweries.Quality Management Systems
laid out along the lines of ISO 9000 are strictly adhered to, controlling quality at
every stage of production.

Quality of the beer is checked electronically at the end of each process and the
quality of the final packaged product is manually checked.

Work Measurement – As the process is entirely automated there is no incentive

scheme for increase in productivity.

Environmental Management
1. Provisions for Pollution Control
• ETP (Effluent Treatment Plant) – The waste water released after
the manufacturing process is treated at the ETP which is located
within the plant. The treatment process takes 6-7 days on an
average and the treated water is utilized for cleaning purposes.
• Recycled Bottles – Kingfisher contributes to the environment by
using recycled bottles.
• ISO 9001:2000
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Management

Image No 12: Effluent Treatment Plant

 A Project Report on Operations
Management
Value Engineering
There is a resident R&D team which works for continuous improvement in the
product as well as the production process. The R&D team examines the quality
of the raw material as well as a sample of the end product.

General Safety Standards

The company believes that its Human resources are its main important assets
and therefore, gives highest priority to safety and health of its employees as
well as contractors workmen, including the environment management at work.

Image No 13: Certificates of Safety and ISO

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Management

Production Unit Safety Standards

Image No 14: Safety equipments

Employees at packaging units are provided with Face Masks, Helmets,

Goggles, Gloves, Gas Mask, Gumboots