Industrial Engineering

(ME212)

Dr. Amit Kumar Singh, Assistant Professor

Mechanical Engineering Department
Sardar Vallabhbhai National Institute of Technology,
Surat -395007, Gujarat, India
 Distribution of Marks
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LTP 3 0 0
Credit 3
3 Lecture hours per week

Internal Assessments 20%

Mid Semester 30%

End Semester 50%

References:
 Jay Heizer, Barry Render ,Operations Management: Sustainability and Supply Chain
Management, Pearson publication.
 N.V. S. Raju, Industrial Engineering and Management, Cengage Learning, 2013.
 M. Mahajan, Industrial Engineering and Production Management, Dhanpat Rai &
Co. (P) Limited, 2015.

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 SYLLABUS
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Unit 1: INDUSTRIAL ENGINEERING AND PRODUCTIVITY

➢ Introduction, history, objectives, organization structure, scope, Productivity,

factors influencing productivity, Productivity measurement, causes of low
productivity and techniques of their elimination, Introduction to advance
industrial engineering techniques.

Unit 2: WORK STUDY AND ERGONOMICS

➢ History, Scope, Objectives, Overview, Method study Objectives and

procedure, Micro motion study, Method study tools, Time study procedure,
Performance rating, Allowances, Predetermined Motion Time Systems
(PMTS), Work Sampling, Ergonomics, Work science, Design factors, Effect
of environment, Man-Machine System, Workload and Fatigues.

Unit 3: PLANT LOCATION AND LAYOUT

➢ Factors affecting location decisions, Methods of evaluating location

alternatives, Layout types, Work cells, Repetitive and product-oriented layout,
Computerized layout design procedure 3
 SYLLABUS
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Unit 4: FORECASTING

➢ Steps, qualitative and quantitative approaches, Monitoring and controlling

forecast, Forecasting in service sector

Unit 5: INVENTORY CONTROL

➢ Managing inventory, Inventory models for independent demand,

Probabilistic models and safety stock, Single period model, Fixed period
model

Unit 6: PRODUCTION PLANNING AND CONTROL (PPC)

➢ Production Systems, Job, Batch, Mass and Continuous production system,
Objectives of PPC, Functions of PPC

Unit 7: HUMAN RESOURCE MANAGEMENT

➢ Functions of Human Resource Manager, Training and development, Job
evaluation and Merit rating, Wage and Wage Incentives, Grievance handling,
Discipline and welfare
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 Course Outcome
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5
 Introduction
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CHALLENGE Before Industries →

Manufacture Goods of the right quality in the right quantity at
the right time at minimum cost for their survival and growth.

This demands an increase in the productive efficiency of the

organizations.

Industrial Engineering (IE) is a branch of engineering that

focuses on optimizing complex systems, processes, and
organizations to improve efficiency, productivity, quality,
and safety.

The prime objective of industrial engineering is to increase· ·

productivity by eliminating waste and non-value-adding
(unproductive) operations and improving the effective utilization
of resources. 6
 Objectives of Industrial Engineering
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The basic objectives of industrial engineering departments are:

1. To establish methods for improving the operations and
controlling the production costs.
2. To develop programmes for reducing those costs.

Industrial engineering department exists primarily to provide

specialized services to production departments. The services
offered depend on the type of organisation. Normally the services
include such functions as method study, establishing time
standards, development of wage - incentive schemes, job
evaluation and merit rating.

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 TECHNIQUES OF INDUSTRIAL ENGINEERING
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The tools and techniques of industrial engineering aim to improve

an organization's productivity by maximizing the utilization of its
resources, namely men, materials, and machines.

1.Method Study
2.Time Study (Work Measurement)
3.Motion Economy
4.Financial and Non-financial Incentives
5.Value Analysis
6.Production, Planning and Control
7.Inventory Control
8.Material Handling Analysis
9.Ergonomics (Human Engineering)
10.Operation Research Techniques

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 FUNCTIONS OF AN INDUSTRIAL ENGINEER
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1. Developing the simplest work methods and establishing one best
way of doing the work. (Standard Method)
2. Establishing the performance standards as per the standard
methods. (Standard Time)
3. To develop a sound wage and incentive schemes.
4. To aid in the development and designing of a sound inventory
control, determination of economic lot size and reducing work-in-
process for each stage of production.
5. Development of cost reduction and cost control programmes,
and to establish standard costing system.
6. Sound selection of site and developing a systematic layout for
the smooth flow of work without any interruptions.
7. Development of standard training programmes for various levels
of organization for effective implementation of various
improvement programmes.
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 HISTORY AND DEVELOPMENT OF
INDUSTRIAL ENGINEERING
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1. Frederick W. Taylor (1880-1911) : Frederick Taylor is

generally credited with being the father of industrial
management and industrial engineering. Taylor believed that a
scientific approach to management could improve labour
efficiency. He proposed the following actions:

(i) Collect data on each element of work and develop

standardised procedures for workers.
(ii) Scientifically select, train and develop workers instead of
letting them train themselves.
(iii) Strive for a spirit of cooperation between management and
workers so that high production at good pay is fostered.
(iv) Divide the work between management and labour so that
each group does the work for which it is best suited.
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 HISTORY AND DEVELOPMENT OF
INDUSTRIAL ENGINEERING
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The above principles over the periods, developed into method
study and work measurement, training, selection, placement
and Industrial relations. So, Taylor’s contributions are:
(i) Constitution of day's work
(ii) Wage payment system
(iii) Elimination of waste
(iv) Training of workers
(v) Understanding between managers and workers

2. Adam Smith (1776): Adam Smith through his book titled Wealth
of Nations laid foundation to scientific manufacturing. He
introduced the concept of "division of labour” his concept of
division of labour which included the skill development, time
savings and the use of specialized machine was able to influence
the factory system.
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 HISTORY AND DEVELOPMENT OF
INDUSTRIAL ENGINEERING
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3. Henry Gantt (1917): Known for developing the Gantt chart.
▪ Key Contributions:
➢ Created a visual tool for project scheduling and task management, still
widely used today.
➢ Emphasized the importance of planning and coordination in industrial
projects.
4. Frank and Lillian Gilbreth (1900-1920): Pioneers in Motion Study
and Ergonomics.
• Key Contributions:
o Developed techniques to reduce unnecessary motions in work,
improving efficiency.
o Introduced the concept of "therbligs," a system to analyze basic human
motions (1917).
o Lillian focused on human factors and workplace design, contributing to
early ergonomics.
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 HISTORY AND DEVELOPMENT OF
INDUSTRIAL ENGINEERING
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5. James Watt (1864) – The steam engine advanced the use of
mechanical power to increase productivity.

6. Henry Ford: Revolutionized mass production with the assembly

line.
Key Contributions:
➢ Developed the moving assembly line for automobile production, drastically
reducing manufacturing time and cost.
➢ Implemented standardization and interchangeable parts in production.

7. George Dantzig: Father of Linear Programming.

•Key Contributions:
• Developed the simplex algorithm, which is used to optimize resource
allocation in industrial operations.
• His work greatly influenced operations research and decision-making
processes in industries.
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 HISTORY AND DEVELOPMENT OF
INDUSTRIAL ENGINEERING
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8. W. Edwards Deming: Advocate of Quality Management
and Continuous Improvement.
•Key Contributions:
• Developed the PDCA (Plan-Do-Check-Act) cycle for process
improvement.
• Helped Japan achieve high industrial quality standards post-World
War II.

9. Walter A. Shewhart: Father of Statistical Quality Control

(SQC).
•Key Contributions:
• Developed the control chart, a fundamental tool in quality
management.
• His work laid the foundation for modern Six Sigma and Total Quality
Management (TQM).

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 Productivity
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➢ Productivity is the quantitative relation between what we

produce and what we use as a resource to produce them,
i.e. arithmetic ratio of amount produced (output) to the
amount of resources (input).

➢ Productivity can be expressed as:

➢ Productivity refers to the efficiency of the production

system.
➢ It is the concept that guides the management of
production system.
➢ It is an indicator of how well the factors of production
(Land, capital, labour and energy) are utilized.
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 PRODUCTION AND PRODUCTIVITY
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➢ Production is defined as a process or procedure to

transform a set of input into output having the desired utility
and quality.

➢ Production refers to absolute output whereas

productivity is a relative term where in the output is
always expressed in terms of inputs.
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 PRODUCTION AND PRODUCTIVITY
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Productivity can be Increased

1. When production is increased without increase in

inputs.
2. The same production with decrease in inputs.
3. The rate of increase in output is more compared to rate
of increase in input.

Problem 1: A company produces 160 kg of plastic moulded parts

of acceptable quality by consuming 200 kg of raw materials for a
particular period. For the next period, the output is doubled
(320 kg) by consuming 420 kg of raw material and for the third
period, the output is increased to400 kg by consuming 400 kg of
raw material.

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 PRODUCTION AND PRODUCTIVITY
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 BENEFITS FROM PRODUCTIVITY
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 PRODUCTIVITY MEASURES
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1. Partial Productivity Measures (PPM)

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 PRODUCTIVITY MEASURES
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2. Total Productivity Measure (TPM)
It is based on all the inputs. This model can be applied to any
manufacturing organization or service company.

Total output = Value of finished goods produced + value of

partial units produced + dividends from securities + interest +
other income

Total input = Value of (human + material + capital + energy +

other inputs) used.

Productivity Index measures the ratio of present productivity to base period

productivity.

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 Course Outcome
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Problem 2: The following information regarding the output

produced and inputs consumed for a particular time period for a
particular company given below:
Output = Rs 10,000.
Human input = Rs 3,000.
Material input = Rs 2000.
Capital input = Rs 3000.
Energy input = Rs 1000.
Other misc. input = Rs 500.
The values are in terms of base year rupee value. Compute various
productivity indices

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 Productivity
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Q. Mark's Ceramics spent $4000 on a new kiln last year, in the belief that it would cut
energy usage 25% over the old kiln. This kiln is an oven that turns "greenware" into
finished pottery. Mark is concerned that the new kiln requires extra labor hours for its
operation. Mark wants to check the energy savings of the new oven, and also to look
over other measures of their productivity to see if the change really was beneficial.
Mark has the following data to work with:

Were the modifications beneficial?

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The energy modifications did not generate the expected savings; labor and capital
productivity decreased.

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The Dulac Box plant produces wooden packing boxes to be used
in the local seafood industry. Current operations allow the
company to make 500 boxes per day, in two 8-hour shifts (250
boxes per shift). The company has introduced some moderate
changes in equipment, and conducted appropriate job training, so
that production levels have risen to 300 boxes per shift. Labor
costs average $10 per hour for each of the 5 full-time workers on
each shift. Capital costs were previously $3,000 per day, and
rose to $3,200 per day with the equipment modifications. Energy
costs were unchanged by the modifications, at $400 per day.
What is the firm's multifactor productivity before and after the
changes?

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MFP before: 500 boxes / ($10x5x16 + $3000 + $400) = 500 / 4200 = 0.119 boxes/dollar
MFP after: 600 boxes / ($10x5x16 + $3200 + $400) = 600 / 4400 = 0.136 boxes/dollar

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 FACTORS INFLUENCING PRODUCTIVITY
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Controllable Factors (Internal Factors)
1. Product factor: In terms of productivity means, product is judged by its
usefulness. The cost benefit factor of a product can be enhanced by increasing
the benefit at the same cost or by reducing cost for the same benefit.

2. Plant and equipment: The increased availability of the plant through proper
maintenance and reduction of idle time increases the productivity. Productivity
can be increased by paying proper attention to utilisation, age, modernisation,
investments etc.

3. Technology: Innovative and latest technology improves productivity to a greater

extent.
Automation and information technology helps to achieve improvements in
material handling, storage, communication system and quality control. The
various aspects of technology factors to be considered are:
(i) Size and capacity of the plant, (ii) Timely supply and quality of inputs,
(iii) Production planning and control, (iv) Repairs and maintenance,
(v) Waste reduction, (vi) Efficient material handling system.

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 FACTORS INFLUENCING PRODUCTIVITY
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4. Material and energy: Efforts to reduce materials and energy consumption
brings considerable improvement in productivity.
1. Selection of quality material and right material.
2. Control of wastage and scrap.
3. Effective stock control.
4. Development of sources of supply.
5. Optimum energy utilisation and energy savings.

5. Human factors: Productivity is basically dependent upon human

competence and skill. Ability to work effectively is governed by various factors
such as education, training, experience aptitude etc., of the employees.
Motivation of employees will influence productivity.

6. Work methods: Improving the ways in which the work is done (methods)
improves productivity. Work study and industrial engineering techniques and
training are the areas which improve the work methods, which in term enhances
the productivity.
7. Management style: This influence the organizational design, communication in
organization, policy and procedures. A flexible and dynamic management style is
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a better approach to achieve higher productivity.
 FACTORS INFLUENCING PRODUCTIVITY
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(B) UN-CONTROLLABLE (OR EXTERNAL) FACTORS
1. Economic and Social Changes:
a) Economic Factors like Inflation, recession, or economic booms affect the cost of
raw materials, labor, and overall demand for products and services.
b) Social Factors like social customs and traditions influence attitudes towards
work and job. For instance, bias on the basis of caste, religion, etc., inhibited the
growth of modern industry in some countries.

2. Natural resources: Natural factors such as physical, geographical, and climate

conditions exert considerable influence on productivity, particularly in extreme
climates (too cold or too hot) tend to be comparatively low. Natural resources like
water, fuel, and minerals influence productivity.

3. Technological Changes: Rapid technological advancements may render current

processes or machinery obsolete.

4. Government Policies and Regulations: Changes in taxation, labor laws, or

environmental regulations can increase operational costs or limit production.
5. Global Events: Pandemics, geopolitical tensions, or wars affect trade, labor
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availability, and resource accessibility.
 Productivity Improvement Techniques
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 Productivity Improvement Techniques
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(A) TECHNOLOGY BASED
1. Computer Aided Design (CAD), Computer Aided Manufacturing (CAM), and
Computer Integrated Manufacturing Systems (CIMS):

i. Computer-aided design: CAD involves using software to create, modify, analyze,

or optimize a design.

• 3D modeling of products and components.

• Simulation of product performance under various conditions.
• Accurate design and drafting with minimal errors.
Productivity Benefits:
• Faster Design Cycle: Reduces the time required for creating and modifying designs
compared to manual drafting.
• Error Reduction: Identifies design flaws early, reducing costly manufacturing
errors.
• Collaboration: Enables designers and engineers to work on the same model,
improving communication and reducing rework.
• Customization: Quickly adapts designs to meet customer specifications
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 Productivity Improvement Techniques
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ii. Computer Aided Manufacturing (CAM) uses computer software and

machinery to automate and optimize the manufacturing process.
Applications:
• Automated generation of toolpaths for CNC machines.
• Simulating machining processes before production.
• Precise control of cutting, milling, and drilling operations.
Productivity Benefits:
• Increased Accuracy and Precision: Ensures components are manufactured to exact
specifications.
• Reduced Waste: Optimizes material usage, minimizing scrap.
• Faster Production: Reduces machining time through efficient toolpath generation.
• Automation: Decreases dependence on manual labor and reduces human error.

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 Productivity Improvement Techniques
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iii. Computer integrated manufacturing: CIM integrates all aspects of

manufacturing through computers, including design, planning, production, and quality
control.
Applications:
• Linking CAD and CAM systems to create a seamless workflow.
• Real-time monitoring of production processes.
• Automated material handling and assembly lines.
Productivity Benefits:
• Streamlined Processes: Reduces the time lag between design, manufacturing, and
quality control.
• Improved Flexibility: Allows quick adjustments to production schedules and product
designs.
• Data-Driven Decisions: Real-time data from production lines improves decision-
making and process optimization.
• Cost Reduction: Integrates systems to reduce overhead costs and increase overall
efficiency.
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 Productivity Improvement Techniques
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(B) EMPLOYEE BASED
1. Training and Development: Skill Enhancement, Cross-Training
2. Clear Goal Setting and Feedback: (SMART Goals: Set Specific, Measurable,
Achievable, Relevant, and Time-bound goals for employees. Regular
Feedback: Constructive feedback helps employees improve and stay aligned
with organizational objectives.)
3. Financial and non-financial incentives at individual and group levels.
4. Worker participation in decision-making
5. Employee promotion
6. Providing the Right Tools and Technology
7. Health and Wellness Programs
C) MATERIAL BASED
1. Material planning and control
2. Purchasing, logistics
3. Procure materials from sustainable sources, ensuring a consistent and
reliable supply.
4. Just-In-Time (JIT) Inventory
5. Use technologies like laser cutting, additive manufacturing (3D printing), or
powder metallurgy to optimize material usage.
6. Implement processes to recycle scrap material and reuse it in production. 35
 Productivity Improvement Techniques
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D) PROCESS-BASED
1. Methods Study and work simplification
2. Lean Manufacturing: Focuses on eliminating waste (non-value-adding
activities) in processes (5S, Kaizen).
3. Six Sigma: A data-driven methodology to eliminate defects and
minimize process variability (DMAIC: Define, Measure, Analyze,
Improve, Control).
3. Ergonomics: Human factors engineering

(E) PRODUCT BASED

1. Value engineering: Systematically analyzing product features to
improve functionality while reducing costs.
2. Reverse Engineering: Analyzing existing products to improve design
and functionality.
3. Total Quality Management (TQM): An organization-wide approach to
continuous quality improvement.
4. Standardisation and simplification
5. Reliability engineering
6. Product promotion. 36
 Productivity Improvement Techniques
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(F) TASK-BASED
1. Management style
2. Communication in the organization
3. Work culture
4. Motivation

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 Organization Structure
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An organization is an entity—such as a company, an institution, or an
association—comprising one or more people and having a
particular purpose.

Organizational structure (OS) is the systematic arrangement of human

resources in an organization to achieve common business objectives. It
outlines the roles and responsibilities of every member of the organization
so that work and information flow seamlessly, ensuring the smooth
functioning of an organization.

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 Organization Structure
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1. Hierarchical org structure
This is a type of centralized organizational structure. There is a hierarchy of
workers with leaders at the top, the workers below, and supervisors placed in
between to get the work done. It is more of a linear OS where the delegation of
power emanates from the top management.

Pros
•Better defines levels of authority and
responsibility Cons
•Shows whom each person reports to or •Can slow down innovation
whom to talk to about specific projects •Can cause employees to act in interest of
•Motivates employees with clear career paths the department instead of the company as a
and chances for promotion whole
•Creates friendship and trust between •Can make lower-level employees feel like
employees within the same department they have less ownership and can’t express
their ideas for the company 39
 Organization Structure
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2. Horizontal or Flat org structure

No one commands or controls the employees. Instead, decisions are made at every
level of management. Therefore, it is usually used in small companies with few
employees or new startups. However, with time and business growth, some form
of hierarchy creeps into the organization; otherwise, it may cause chaos and
inefficiency in the organization.

Cons
Pros •Can create confusion since employees do not
•Gives employees more responsibility have a clear supervisor to report to
•Fosters more open communication •Can produce employees with more
•Improves coordination and speed of generalized skills and knowledge
implementing new ideas •Can be difficult to maintain once the company
grows beyond start-up status 40
 Organization Structure
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3. Functional org structure
The functional organizational structure creates a fixed set of departments based on
certain functions like HR, accounts, marketing, etc. It segregates the workforce
based on the requirements of each department.

Pros
•Allows employees to focus on their role
Cons
•Encourages specialization
•Can create silos within an organization
•Help teams and departments feel self-
•Hampers interdepartmental
determined
communication
•Is easily scalable in any sized company 41
 Organization Structure
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4. Divisional
This type of organizational structure comes into play when a firm has grown
exponentially to become a giant in its sector. In divisional organizational
structures, a company’s divisions have control over their own resources,
essentially operating like their own company within the larger organization.

Pros Cons
•Helps large companies stay flexible •Can easily lead to duplicate resources
•Allows for a quicker response to industry •Can mean insufficient communication
changes or customer needs between the headquarters and its divisions
•Promotes independence, autonomy, and a •Can result in a company competing with itself
customized approach 42