IGNOU MBA MS-05 Solved Assignments 2010

8/8/2019 IGNOU MBA MS-05 Solved Assignments 2010

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Mixed Strategy The strategies here could include combination of any of the following: Having a stable workforce but employ variable work hours (e.g., increase no. of shifts,flexible work schedules or overtime) Subcontracting / outsourcing

Changing inventory levels

Source: Dilworth, James B. Production and Operations Management: Manufacturing andServices . Fifth Edition. McGraw-Hill, Inc. 1993

What are the important considerations in selecting the production planning strategy?

Demand Chase Strategy

Specific Methods Costs Remarks

Hire additional workers as demand increases Employment costs for advertising, travel,interviewing, training, and others

Shift premium costs if additional shift is added Skilled workers may not be available when

neededLayoff workers as demand decreases Cost of severance pay & increases in unemploymentinsurance costs The company must have adequate capital investment in equipment for thepeak work force level

Level Production Strategy


Produce in earlier period and hold until product is needed Cost of holding inventory Serviceoperations cannot hold service inventory

Offer to deliver the product or service later, when capacity is available Delay in receipt of

revenue, at minimum; company may lose customers Manufacturing companies withperishable products often use this method

Exert special marketing efforts to shift the demand to slack period Advertising costs,discounts, other promotional programs Exemplifies the inter-relationship

among functions within an organization

Mixed Strategy


Work additional work hours without changing the workforce size Overtime premium pay Thetime available for maintenance work without interrupting production is reduced

Staff for high production levels so that overtime is not necessary Excess personnel wagesduring period of slack demand Work force may be used for deferred maintenance duringperiods of low demand

Subcontract work to outside firms Continuing company overhead; subcontractor's overheadand profits The capacity of other firms can be utilized, but there is less control of schedulesand quality levels

Revise make-or-buy decisions to purchase items when capacity is fully loaded Waste of


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company skills, tooling and equipment unutilized in slack periods These methods requirecapital investments sufficient for the peak production rate, that will be underutilized in slackperiods

How can you monitor effectiveness of your production plans?The important considerations in monitoring the effectiveness of your production plan areshown below:

Systems and Procedures

Consideration Present? Remarks

(if any)

Yes No

Is there a current documentation of production planning and control systems and

procedures? Has this been communicated to all concerned? Does production planning and control have a formal monitoring system to maintain andupdate master scheduling records?

Is there a system of coordination between sales forecasts to be prepared in sufficientdetail so that these maybe readily translated to specific production plans?

Production Planning


(if any)

Yes No Does production planning and control prepare a master production schedule with all theproduction assignments and time allocation?

Do the production schedules permit adequate planning of purchases and inventory levels?

Are there signs of significant lost time or low rate of worker productivity? Are the numbersof such orders appear to be significant?

Production Control


(if any)

Yes No

Can the status of any order or work in progress be readily determined?

Do actual production levels deviate significantly in comparison with planned schedules?

Do actual shipments of orders almost always occur according to schedule?


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Are essential production control records and reports maintained to cover current andfuture production loads?

Two - Wheelers Annual Review January 2009

Published by: CRISIL Ltd.

Published: Jan. 30, 2009 - 84 Pages

Table of Contents

Sections

Two-wheeler growth prospects affected by weak finance scenario and nearing urbansaturation

Executive summary

1.0 Demand review and outlook

2.0 Profitability - Review and outlook

Box


01 Methodology for forecasting long-term demand for two-wheelers

Chart



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01 CRISIL Researchs two-wheeler penetration methodology

Figures


01 Two-wheeler domestic sales trend

02 Two-wheeler Segmental growth trend

03 Two-wheeler Segmental share

04 Scooter segment growth trend Geared and ungeared

05 Motorcycle demand monthly trend

06 Scooter demand monthly trend

07 Motorcycle demand growth

08 Scooter demand growth

09 Urban and rural penetration

10 Share of rural and urban to total two-wheeler population

11 Two-wheeler demand trend

12 Motorcycle demand trend


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13 Share of urban and rural to total motorcycle demand

14 Scooter demand trend

15 Mopeds demand trend

16 Country-wise estimated two wheeler penetration in 2007

17 China Motorcycle sales and growth trend

18 Urbanisation to two-wheeler to car sales ratio

19 Two-wheeler export growth

20 Segment-wise export sales

21 Country-wise share of Indian exports - 2007-08

22 Share of India in major export markets

Figures


01 Operating profit trend

02 Product-mix trend


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03 Motorcycles Product-mix trend

04 Comparison of raw material / unit with operating margins

05 Steel price trend

06 Aluminium price trend

07 Change in basic raw material cost vis- -vis change in raw material cost per unit

08 Selling expenses (advertisement and distribution)

09 Selling expenses (player-wise Rs per unit sold)

10 Two-wheeler industry RoCE trend

Tables


01 Two-wheeler demand growth


01 Trends in per unit raw material cost

Sections


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1.0 Player profile

Bajaj Auto Ltd

Hero Honda Motors Ltd

TVS Motor Co Ltd

Honda Motorcycles and Scooters India Ltd

Yamaha Motor India Pvt Ltd

Kinetic Motor Co Ltd

Suzuki Motorcycle India Pvt Ltd

2.0 Demand and market position

3.0 Costs

Raw material costs

Factors affecting raw material costs

4.0 Supply

5.0 Global coverage


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Global motorcycle production

Global motorcycle sales

Global two-wheeler markets

6.0 Government policy

Introduction

Investment policy

Import policy

Fiscal regulations

Excise duty

Other levies

Emission norms

Emission control laws

Safety laws

Figures

1.0 Player profile


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08 Executive segment - Major models

09 Premium segment - Player-wise share in domestic sales

10 Premium segment - Major models

11 Scooters - Player-wise share in domestic sales

12 Mopeds - Player-wise share in domestic sales

3.0 Costs

01 Two-wheeler industry - Cost structure

02 Trend in steel and aluminium prices

03 Two-wheeler industry - Raw material indigenisation

04 Selling and distribution expenses - Industry aggregates

05 Player-wise selling and distribution expenses

4.0 Supply

01 Two-wheeler industry - Trend in capacity utilisation

02 Gross fixed asset turnover of two-wheeler OEM vis- -vis car industry


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5.0 Global coverage

01 Global motorcycle production

02 Global motorcycle sales

03 China - Motorcycle sales

04 Indonesia - Motorcycles sales

05 Indonesia - Share of 4-stroke vs 2-stroke

06 Thailand - Motorcycle sales

07 Taiwan - Domestic motorcycle sales

08 Taiwan - Player market share

09 Vietnam - Motorcycle sales

10 Japan - Motorcycle sales

11 Europe - Motorcycle and moped production

12 Italy - Two-wheeler sales

13 Italy - Market share of different types of motorcycles


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14 Germany - Two-wheeler sales

15 US - Company-wise market share (2007)

16 Canada - Segment-wise sales (2007)

Tables

1.0 Player profile

01 Bajaj Auto Ltd

02 Hero Honda Motors Ltd

03 TVS Motor Co Ltd

04 Honda Motorycle and Scooters India Ltd

05 Yamaha Motors Ltd

06 Kinetic Motor Co Ltd

07 Suzuki Motorcycle India Pvt Ltd

2.0 Demand and market position

01 Two-wheelers: Player comparison (2007-08)

02 Two-wheeler player-wise distribution network (March 2008)


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03 Two wheelers: Major models launched (April 2006 onwards)

3.0 Costs

01 Two-wheelers - Trends in raw material cost

02 Raw material: Company-wise raw material cost break-up (2007-08)

4.0 Supply

01 Two-wheelers - Capacity and capacity utilisation of players (2007-08)

02 Two-wheelers - Capacity addition plans

5.0 Global coverage

01 Category of motorcycles

02 China - Market share by engine displacement

03 Indonesia - Segment-wise motorcycle sales

04 Thailand - Player-wise capacity share

05 Thailand - Segment-wise market share in 2007

06 Brazil - Motorcycle demand


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07 Italy - Segment-wise market share 2007

6.0 Government policy

01 Two wheelers - Basic customs duty structure (2008-09)

02 Key raw materials: Import tariffs

03 Two-wheelers and key raw materials - Excise duty

04 Two wheelers: Emission norms

Sections

1.0 Industry structure

Tables

1.0 Industry structure

01 Two-wheelers - Player-wise sales volumes

02 Two-wheelers - Segment-wise sales volumes

03 Two-wheelers - Segment and player-wise sales volumes

04 Two-wheelers - Segment and player-wise market share (in per cent)


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05 Two-wheelers - Segment and player-wise exports share (in per cent)

06 Two-wheelers - Player and segment-wise production

07 Two-wheelers - Player-wise operating margin trends (standalone)

08 Two-wheelers - Player-wise RoCE trends (standalone)

09 Two-wheelers - Financials of key players (2007-08)

10 Bajaj Auto Ltd - Unaudited results (standalone)

11 Hero Honda - Unaudited results

12 TVS Motors - Unaudited results (standalone)

13 Two-wheelers - Profit and loss account (standalone)

14 Two-wheelers - Aggregate industry balance sheet

Industry statistics

Abstract

This report is divided into three sections - The first section covers estimates, forecasts andelaborates on the factors, which have impacted the two-wheeler industry. It also takes alook at the key drivers of growth in the future. The second section evaluates the structuralcharacteristics affecting the two-wheeler industry by covering player profile and reviews inorder to understand their market share and hence their competitive position, futurestrategies, expansion plans and financial profile. Further, the second section provides acrisp coverage of cost structure in the industry, supply scenario, government policies andglobal market profile. The third section provides factual data on the player and segment-wise volumes, production and market share for players spread across two-wheelersegments.


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5) Define value engineering and analysis. Discuss atleast one method of theapproach for VE/VA.

Solution: Value Engineering is a systematic method to improve the "Value" of goods andservices by using an examination of function. Value, as defined, is the ratio of Functionto Cost. Value can therefore be increased by either improving the Function or reducingthe cost. It is a primary tenet of Value Engineering that basic functions be preserved andnot be reduced as a consequence of pursuing Value improvements. Value Engineering isa body of knowledge as a technique in which the value of a system's outputs is optimized

by crafting a mix of performance (Function) and costs. In most cases this practiceidentifies and removes unnecessary expenditures, thereby increasing the value for themanufacturer and/or their customers. Value Engineering uses rational logic (a unique"how" - "why" questioning technique) and the analysis of Function to identifyrelationships that increase Value. It is considered a quantitative method similar to theScientific Method, which focuses on Hypothesis - Conclusion to test relationships, andOperations Research, which uses model building to identify predictive relationships.

VALUE ANALYSIS -- The Job PlanValue Engineering is often done by systematically following a multi-stage Job Plan. IT ISa 8-step procedure , called the Value Analysis Job Plan. Others have varied the Job Planto fit their constraints. One modern version has the following eight steps:PREPARATIONINFORMATIONANALYSISCREATIONEVALUATIONDEVELOPMENTPRESENTATIONFOLLOW-UPFour basic steps in the VALUE ANALYSIS Job Plan are:Information gathering - This asks what the requirements are for the object. Functionanalysis, an important technique in value engineering, is usually done in this initial stage.It tries to determine what functions or performance characteristics are important. It asksquestions like; What does the object do? What must it do? What should it do? What couldit do? What must it not do?Alternative generation (Creation) - In this stage value engineers ask; What are the variousalternative ways of meeting requirements? What else will perform the desired function?


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Evaluation - In this stage all the alternatives are assessed by evaluating how well theymeet the required functions and how great will the cost savings be.Presentation - In the final stage, the best alternative will be chosen and presented to theclient for final decision.Value engineering is an approach to productivity improvement that attempts to increase

the value obtained by a customer of a product by offering the same level of functionalityat a lower cost.Value engineering is sometimes used to apply to this process of cost reduction prior tomanufacture, while "value analysis" applies the process to products currently beingmanufactured. Both attempt to eliminate costs that do not contribute to the value and

performance of the product (or service, but the approach is more common inmanufacturing). Value engineering, thus, critically examines the contribution made to

product value by each feature of a design. It then looks to deliver the same contribution atlower cost. Different types of value are recognised by the approach :Use value relates to the attributes of a product which enable it to perform its function.Cost value is the total cost of producing the product.

Esteem value is the additional premium price which a product can attract because of itsintrinsic attractiveness to purchasers.Exchange value is the sum of the attributes which enable the product to be exchanged or sold. Although the relative magnitude of these different types of value will vary between

products, and perhaps over the life of a product, VE attempts to identify the contributionof each feature to each type of value through systematic analysis and structured creativityenhancing techniques. Value engineering programs are best delivered by multi-skilledteams consisting of designers, purchasing specialists, operations personnel, and financialanalysts. Pareto analysis is often used to prioritise those parts of the total design that aremost worthy of attention. These are then subject to rigorous scrutiny. The team analysesthe function and cost of those elements and tries to find any similar components thatcould do the same job at lower cost.Common results are a reduction in the number of components, the use of cheaper materials, or a simplification of the process================================================VALUE ENGINEERING CAN BE APPLIED TO ANY MANUFACTURING,HERE IS AN EXAMPLE OF TRACTOR MANUFACTURINGFIRM IN THE FOLLOWING AREAS

1.TRACTOR DESIGN-make the design simple- easy to use-reduce COMPLICATED / expensive parts.---------------------------------------------------------2.TRACTORS RAW MATERIAL / PARTS PROCUREMENT-establish the demand planning system [ reduce the fluctuations in production]-establish the inventories of raw materials [ reduce the cost of stock holding]-establish the economic order quantity [ """"""""""""""""""""""""""""""]------------------------------------------------------------------------------3. TRACTORS PRODUCTION PLANNING


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-establish an effective / efficient production planning system [ cost savings]------------------------------------------------------------------------------4.TRACTORS PRODUCTION-establish a lean production [ cost effective]----------------------------------------------------------------------

5. TRACTORS TOTAL QUALITY ASSURANCE.-set up quality assurance system to reduce quality problems/ rejections][ cost savings ]-------------------------------------------------------------6.TRACTORS FINISHED GOOD INVENTORY-match the finished stock inventory to market demand / sales requirements][ cost saving in stock holding ]--------------------------------------------------------------------7.TRACTORS CUSTOMER SERVICE-provide effective customer order processing/order service/timely despatch to customers.

[ adds value to customers / reduces distribution cost]----------------------------------------------------------------------------8.TRACTORS AFTER SALES SERVICE-offer warranty/ after sales service to customers[ adds value to the product and increases sales ]============================================TRACTORS MANUFACTURER CAN ADD VALUE/ REDUCE COSTBY APPLYING THE VALUE ANALYSIS -JOB PLAN TO EACHOF THE ABOVE LISTED 8 STAGES OF TRACTORS MANUFACTURING.==============================================================================================================================

6) Explain how the system concept can be used in explaining the term waste andWaste management

Solution: Waste management is the collection, transport, processing, recycling or disposal of waste materials. The term usually relates to materials produced by humanactivity, and is generally undertaken to reduce their effect on health, aesthetics or amenity. Waste management is also carried out to reduce the materials' effect on theenvironment and to recover resources from them. Waste management can involve solid,liquid or gaseous substances, with different methods and fields of expertiseforeach.

Waste management practices differ for developed and developing nations, for urban andrural areas, and for residential and industrial, producers. Management for non-hazardousresidential and institutional waste in metropolitan areas is usually the responsibility of local government authorities, while management for non-hazardous commercial andindustrial waste is usually the responsibility of thegenerator. Waste management methodsfor vary widely between areas for many reasons, including type of waste material, nearbyland uses, and the area available.


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Disposing of waste in a landfill involves burying waste to dispose of it, and this remains acommon practice in most countries. Historically, landfills were often established indisused quarries, mining voids or borrow pits. A properly-designed and well-managedlandfill can be a hygienic and relatively inexpensive method of disposing of waste

materials. Older, poorly-designed or poorly-managed landfills can create a number of adverse environmental impacts such as wind-blown litter, attraction of vermin, andgeneration of liquid leachate. Another common byproduct of landfills is gas (mostlycomposed of methane and carbon dioxide), which is produced as organic waste breaksdown anaerobically. This gas can create odor problems, kill surface vegetation, and is agreenhouse gas. Design characteristics of a modern landfill include methods to contain leachate such asclay or plastic lining material. Deposited waste is normally compacted to increase itsdensity and stability, and covered to prevent attracting vermin (such as mice or rats).Many landfills also have landfill gas extraction systems installed to extract the landfill

gas. Gas is pumped out of the landfill using perforated pipes and flared off or burnt in agas engine to generate electricity.

Many local authorities, especially in rural areas, have found it difficult to establish newlandfills due to opposition from owners of adjacent land. As a result, solid waste disposalin these areas must be transported further for disposal or managed by other methods. Thisfact, as well as growing concern about the environmental impacts of excessive materialsconsumption, has given rise to efforts to minimize the amount of waste sent to landfill inmany areas. These efforts include taxing or levying waste sent to landfill, recycling waste

products, converting waste to energy, and designing products that use less material.

Incineration is disposal method that involves combustion of waste material. Incinerationand other high temperature waste treatment systems are sometimes described as "thermaltreatment". Incinerators convert waste materials into heat, gas, steam, and ash.

Incineration is carried out both on a small scale by individuals, and on a large scale byindustry. It is used to dispose of solid, liquid and gaseous waste. It is recognised as a

practical method of disposing of certain hazardous waste materials (such as biologicalmedical waste), though it remains a controversial method of waste disposal in many

places due to issues such as emission of gaseous pollutants.

Incineration is common in countries such as Japan where land is more scarce, as thesefacilities generally do not require as much area as landfills. Waste-to-energy (WtE) or energy-from-waste (EfW) are broad terms for incinerator facilities that burn waste in afurnace or boiler to generate heat, steam and/or electricity.

The process of extracting resources or value from waste is generally referred to asrecycling, meaning to recovery or reuse the material. There are a number of differentmethods by which waste material is recycled: the raw materials may be extracted andreprocessed, or the calorific content of the waste may be converted to electricity. New


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methods of recycling and are being developed continuously, and are described briefly below.

The popular meaning of recycling in most developed countries refers to the widespreadcollection and reuse of everyday waste materials such as empty beverage containers.

These are collected and sorted into common types so that the raw materials from whichthe items are made can be reprocessed into new products. Material for recycling may becollected separately from general waste using dedicated bins and collection vehicles, or sorted directly from mixed waste streams.

The most common consumer products recycled include aluminium beverage cans, steelfood and aerosol cans, HDPE and PET bottles, glass bottles and jars, paperboard cartons,newspapers, magazines, and cardboard. Other types of plastic (PVC, LDPE, PP, and PS:see resin identification code) are also recyclable, although these are not as commonlycollected. These items are usually composed of a single type of material, making themrelatively easy to recycle into new products. The recycling of complex products (such as

computers and electronic equipment) is more difficult, due to the additional dismantlingand separation required.

Waste materials that are organic in nature, such as plant material, food scraps, and paper products, can be recycled using biogical composting and digestion processes todecompose the organic matter. The resulting organic material is then recycled as mulchor compost for agricultural or landscaping purposes. In addition, waste gas from the

process (such as methane)can be captured andused for generating electricity. Theintention of biological processing in waste management is to control and accelerate thenatural process of decomposition of organic matter.

There are a large variety of composting and digestion methods and technologies varyingin complexity from simple home compost heaps, to industrial-scale enclosed-vesseldigestion of mixed domestic waste (see Mechanical biological treatment). Methods of

biological decomposition are differentiated as being aerobic or anaerobic methods,though hybrids of the two methods also exist.

An example of waste management through composting is the Green Bin Program inToronto, Canada, where household organic waste (such as kitchen scraps and plantcuttings) are collected in a dedicated container and then composted. The energy contentof waste products can be recycled by using them as fuel. Recycling through thermaltreatment ranges from using waste as a fuel source for cooking or heating, to fuel for

boilers to generate steam and electricity in a turbine. Pyrolysis and gasification are tworelated forms of thermal treatment where waste materials are heated to high temperatureswith limited oxygen availability. The process typically occurs in a sealed vessel under high pressure. Pyrolysis of solid waste converts the material into solid, liquid and gas

products. The liquid and gas can be burnt to produce energy or refined into other products. The solid residue (char) can be further refined into products such as activatedcarbon. Gasification is used to convert organic materials directly into a synthetic gas


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(syngas) composed of carbon monoxide and hydrogen. The gas is then burnt to produceelectricity and steam.

Another important method of waste management is the prevention of waste material being created. Methods of avoidance include reuse of unwanted products, repairing

broken items, designing single-use products to be reusable, and designing products thatuse less material to achieve the same purpose. Waste collection methods vary widely between different countries and regions. Domestic waste collection services are often provided by local government authorities, or by private industry. Some areas, especiallythose in less developed countries, do not have a formal waste-collection system.

For example, in Australia most urban domestic households have a 240-litre (63.4 U.S.gallon) bin that is emptied weekly from the curb using side- or rear-loading compactor trucks. In Europe and a few other places around the world, a few communities use a

proprietary collection system known as Envac, which conveys refuse via undergroundconduits using a vacuum system. In Canadian urban centres curbside collection is the

most common method of disposal, whereby the city collects waste and/or recyclablesand/or organics on a scheduled basis. In rural areas people often dispose of their waste byhauling it to a transfer station. Waste collected is then transported to a regional landfill.

There are a number of concepts about waste management which vary in their usage between countries or regions. This section presents some of the most general, widely-used concepts. The waste hierarchy refers to the "3 Rs" reduce, reuse and recycle, whichclassify waste management strategies according to their desirability in terms of wasteminimization. The waste hierarchy remains the cornerstone of most waste minimizationstrategies. The aim of the waste hierarchy is to extract the maximum practical benefitsfrom products and to generate the minimum amount ofwaste. Extended Producer Responsibility (EPR) is a strategy designed to promote the integrationof all costs associated with products throughout their life cycle (including end-of-lifedisposal costs) into the market price of the product. Extended producer responsibility ismeant to impose accountability over the entire lifecycle of products and packagingintroduced to the market. This means that firms which manufacture, import and/or sell

products are required to be responsible for the products after their useful life as well asduring manufacture. The Polluter Pays Principle is a principle where the polluting party

pays for the impact caused to the natural environment. With respect to wastemanagement, this generally refers to the requirement for a waste generator to pay for appropriate disposal of the waste.

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IGNOU MBA MS-05 Solved Assignments 2010