4 IEJ April 2017 Issue

ISSN 0970-2555
VOLUME X & ISSUE No.4 Total No. of Pages 48 APRIL 2017

VOL. X & ISSUE NO. 4 April 2017
Industrial Engineering is concerned with Editorial Board
Editor-in-Chief
the design, improvement and installation Dr. Balkrishna Eknath Narkhede, V.J.T.I. Mumbai, INDIA
of integrated systems of men, Managing Editor
Prof. (Dr.) Bhaskar M. Bhandarkar, Director General IIIE.
materials and equipment. It draws upon Members
specialised knowledge and skill in the Dr. Angappa Gunasekaran, Charlton College of Bussi, Uni. of Massachusetts-Dartmouth,
MA02747-2300, USA
mathematical, physical and social Prof. Voratas Kachitvichyanukul, Asian Institute of Technology, Bangkok, THAILAND
Dr. R. P. Mohanty,Sr. Advisor, ICFAI Group, Hyderabad, INDIA
sciences together with the principles Dr. Omprakash K. Gupta, College of Business, MMBA, Uni. of Houston-Downtown Houston,
and methods of engineering analysis and TX77002, USA
Prof. Bopaya Bidanda, Ernest Roth Professor & Chairman, Department of Industrial
design to specify, predict and evaluate the Engineering, Professor of Business Administration, Katz Graduate School of Business
(courtesy), University of Pittsburgh, 1048 Benedum Hall, Pittsburgh PA 15261
results to be obtained from such systems. Prof. Prem Vrat, Pro-Chancellor & Professor of Eminence, Northcap University, Gurgaon,
INDIA
The Indian Institution of Industrial Prof. K C Sahu, Former Director, NITIE, Mumbai, INDIA
Prof. S. S. Mantha, Former Chairman, AICTE, New Delhi, INDIA
Engineering (IIIE) was founded in 1957 Prof. S. G. Deshmukh, Director, ABV-IIITM, Gwalior, INDIA
Dr. Huynh Trung Luong, Asian Institute of Technology, Bangkok, THAILAND
as a non-profit organisation and a Prof. Manoj Kumar Tiwari, IIT Kharagpur, INDIA
Registered Society for propagating the Dr. S. K. Mahajan, Director, Technical Education, M.S. Mumbai, INDIA
Prof. N. Sambandam, Chairman, AIBMS, AICTE, New Delhi, INDIA
profession of Industrial Engineering in Dr. Montalee Sasananan, Thammasat University Klong Luang, Pathumthani, THAILAND
Prof. K. P. Karunakaran, IIT Bombay, Mumbai, INDIA
India and is a Registered Public Trust Prof. L. Ganpathy, NITIE, Mumbai, INDIA
under the Bombay Public Trust Act, 1950. Dr. Pisut Koomsap, Asian Institute of Technology, Bangkok, THAILAND
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It is dedicated to the advancement of Prof. Sushil Kumar, IIM, Lucknow, INDIA
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Industrial Engineering Education and Prof. R C Gupta, SGSITS, Indore, INDIA
practice and to the application of such Dr. Dixit Garg, NIT, Kurukshetra, INDIA
Dr. Mukesh Kumar Barua, DoMS, IIT Roorkee, INDIA
scientific knowledge to assist in the Dr. Ashish Agarwal, IGNOU, New Delhi, INDIA
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management of all endeavours.The Dr. Balan Sundarakani, University of Wollongong in Dubai, Dubai, UAE
Institution has Thirty Four Chapters Dr. Md. Mamun Habib, American International University-Bangladesh (AIUB)
Dr. Tushar Desai, SVNIT, Surat, INDIA
established all over India. The Dr. V. K. Sunnapwar, LTCE, Mumbai, INDIA
Dr. Ravi Kant, SVNIT, Surat, INDIA
Graduateship Examination conducted by Dr. P Karthikeyan, Kongu Engineering College, Erode, Tamil Nadu, INDIA
the Institution is recognised by the Dr. V. S. Deshpande, RKNEC, Nagpur, INDIA
Shri D.V. Bhagat, RCF, Mumbai, INDIA
Government of India as equivalent to a Dr Arun Kumar, VIVA IoT, Mumbai, INDIA
Er. Harish Kutemate, AGC Networks Ltd., Nagpur, INDIA
Bachelor ’s Degree in Industrial Advisor
Engineering. The IIIE has Instituted Dr. A K Pundir, NITIE, Mumbai, INDIA
many honours and awards for various Advisor, Board of Examination
Dr. K Gopalakrishnan Nair, Formerly Dean (PG Students), College of Engineering, Trivandrum ,
achievement and outstanding INDIA
contribution to the IE Profession
q s
Plot No. 103, Sector - 15,
editor-iiiejournal@iiie-india.com
Hello Commander
Chaitra is considered an auspicious month in the most of the regions in India. In

this auspicious month of Chaitra, opening of four new chapters (Dharwad,
Jammu, Loneri& Chandigarh) is planned in the month of May 2017.Members
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Indian Institution of Industrial Engineering
03
VOL. X & ISSUE No. 4 April 2017
NATIONAL COUNCIL 2016-2017

PRESIDENT
Shri D Rajkumar 03. HELLO COMMANDER
CMD, BPCL Ltd., Mumbai
CHAIRMAN
Shri D V Bhagat
05. MESSAGE FROM THE EDITOR
VICE CHAIRMEN
Prof. Harish Kutemate
Shri G R Murthy
06. SUCCESS FACTORS TO SMART CITIES IN
HON. SECRETARY INDIA: AN EMPIRICAL INVESTIGATION
Dr. Vivek Sunnapwar Sachin K. Mangla, Sunil Luthra, Suresh Jakhar &
Yash Paul Singh Berwal
HON. JT. SECRETARIES
Dr. B Ravishankar
Dr. Rupesh Pais
13. REGRESSION MODEL FOR LOSS OF
HON. TREASURER GENERATION & FACTORS AFFECTING IT IN A
Dr. Tushar N Desai THERMAL POWER PLANT
MEMBERS Ravindra B Gohane & Dr. Sunil V Deshmukh
Dr. B E Narkhede
Prof. T R Sukumar
Shri Rajesh Kumar Madarkar 21. IMPROVING PERFORMANCE MANAGEMENT
Shri P. K. Jain IN AN IT INDUSTRY: A CASE STUDY
Dr. Ravikant Shreyas Lakhe
Shri M Satyanarayana
Dr. R A D Pillai
Shri H K Desai
29. A N A LY S I S O F E N A B L E R S F O R
CHAPTER NOMINEE IMPLEMENTATION OF VENDOR MANAGED
Prof. H B Goswami - Durgapur Chapter INVENTORY
Shri G. Madhuramani - Trichy Chapter Ms. Jyoti Bala Songar & Dr. A.C. Shukla
CO-OPTED MEMBERS
Shri K S Pratheep
Dr. P C Sehgal
35. FMEA TO ENHANCE QUALITY AND
Shri R Sampat EFFICIENCY OF CNC MACHINES: A CASE
CHAIRMAN, BOARD OF EXAMINATIONS S T U D Y I N VA LV E M A N U FA C T U R I N G
Shri Aspi Kolah INDUSTRY
Raj Kumar Salvi & Dr. S. Jindal
ADVISOR, IE JOURNAL
Dr. Ashok K Pundir
CONVENER, CENTRE OF EXCELLENCE 42. TEACHING LINEAR PROGRAMMING
Dr. R P Mohanty Dr. Utpal Kumar Bhattacharya
CONVENER, CONSULTANCY COMMITTEE
Cdr. K Y Narayana (Retd.)
EDITOR-IN-CHIEF
Dr. B E Narkhede
The Editorial Board or Indian Institution of Industrial
ADVISOR, BOARD OF EXAMINATIONS
Engineering will bear no responsibility for the publication or
Dr. K G K Nair
contents of a paper and the authors of such a paper will bear
DIRECTOR GENERAL full responsibility of issue arising if any due to infringement
Prof. (Dr.) Bhaskar M. Bhandarkar, Director General IIIE. of copyright or confidentiality of data
04
April 2017
INDUSTRIAL ENGINEERING JOURNAL
Message from the Editor
Dear Members as well as Readers,
Indian Institution of Industrial Engineering is happy to publish this issue

of Industrial Engineering Journal.
The First Paper of this issue “SUCCESS FACTORS TO SMART

CITIES IN INDIA: AN EMPIRICAL INVESTIGATION” has been
authored by Sachin K. Mangla, Sunil Luthra, Suresh Jakhar &
Yash Paul Singh Berwal. In this paper, the authors have presented an
empirical study on success factors to smart cities in India.
The Second Paper of this issue “REGRESSION MODEL FOR LOSS

OF GENERATION & FACTORS AFFECTING IT IN A THERMAL POWER PLANT” has been
authored by Ravindra B Gohane & Dr. Sunil V Deshmukh. In this paper, the authors have presented a
regression model for loss of generation & factors affecting it in a thermal power plant.
The Third Paper of this issue “IMPROVING PERFORMANCE MANAGEMENT IN AN IT

INDUSTRY: A CASE STUDY” has been authored by Shreyas Lakhe. In this paper, the author has
discussed a case study on performance management in IT industry.
The Fourth Paper of this issue “ANALYSIS OF ENABLERS FOR IMPLEMENTATION OF

VENDOR MANAGED INVENTORY” has been authored by Ms. Jyoti Bala Songar &
Dr. A.C. Shukla. In this paper, the authors have presented a study on enablers for implementation of VMI.
The Fifth Paper of this issue “FMEA TO ENHANCE QUALITY AND EFFICIENCY OF CNC
MACHINES: A CASE STUDY IN VALVE MANUFACTURING INDUSTRY” has been authored by
Raj Kumar Salvi & Dr. S. Jindal. In this paper, the authors have discussed a case study on application of
FMEA to enhance quality and efficiency of CNC machines.
The Sixth Paper of this issue “TEACHING LINEAR PROGRAMMING ” has been authored by
Dr. Utpal Kumar Bhattacharya. In this paper, the author has discussed how to teach linear
programming?
I express deep sense of gratitude to all those who have been involved directly and indirectly in bringing out
this issue in the present form. We are grateful to all the members of Editorial Board for giving useful
suggestions for improving the content of Journal. Our thanks are due to all reviewers for sparing their
valuable time for reviewing the manuscripts of these papers. The authors who have contributed their
papers to this issue deserve special thanks.
We expect to receive continued support from our esteemed readers, reviewers and authors.
Dr. BE Narkhede
Editor-in-Chief
05
April 2017
Vol. X & Issue No. 4 April - 2017
SUCCESS FACTORS TO SMART CITIES IN INDIA:

AN EMPIRICAL INVESTIGATION
Sachin K. Mangla
Sunil Luthra
Suresh Jakhar
Yash Paul Singh Berwal
Abstract:
Smart city is becoming buzz word in modern era. Smart Cities mainly focused on the natural resources and energy, transport and mobility, buildings,
living government, and economy of people. The idea of smart city is to enhance the lifestyle and generate employment from nations' contexts. For the
viewpoint of most developing countries like, India will become heavily populated country in the world and making home will be the biggest challenge
for everyone. In addition, for the perspective of India, several other major challenges could be – pollution and quality of air, deficiency of resources,
community welfare, waste disposal, etc. Therefore, this is the time to develop more sustainable cities and enhance the quality of life. However, there
are possibilities for the success/failure of the concept of smart cities, which are based on understanding of many factors related to developing the
smart cities. In the present work, an effort has been made to recognize and empirically analyze key success factors to develop smart cities. Initially, 20
key success factors were identified from extensive literature support. A questionnaire was developed to collect the data. The collected data was
analysed with the help of explanatory factor analysis. Results suggested the important five dimensions (People and communities; Infrastructure;
Proper use of resources; Transportation and Good Governance) of success factors to develop smart cities. The findings of present research would be
useful for regulatory bodies and policy makers to designing policies and proposing strategies to make smart cities mission realistic in India.
Keywords: Key success factors, Smart city, Empirical analysis, Questionnaire based survey, Explanatory Factor Analysis (EFA).
1. INTRODUCTION social and environmental aspects (Höjer and Wangel, 2015)”.

Smart city is becoming buzz word in modern literature. The By 2030, most developing countries like India will become
idea of smart city is to enhance the lifestyle and generate heavily populated country in the world and making home will
employment. Smart Cities mainly focused on the natural be the biggest challenge for everyone (Gopalan and
resources and energy, transport and mobility, buildings, Venkataraman, 2015). In addition, for the perspective of
living government, and economy of people (Meshram et al., India, several other major challenges could be – pollution and
2015). The concept of smart cities can be understood in a quality of air, deficiency of resources, community welfare,
number of ways. They include smart governance, smart waste disposal, etc. To deal with these challenges, policy
infrastructure, and smart basic facilities for the citizens, and makers should uncover smarter ways such as designing of
above all, a truly interconnected system with seamless smart cities in India (Chourabi et al., 2012). Further,
communication between the sources (Friess, 2013; Jin et al., designing of competitive, environment friendly and
2014). This concept has become more important with rapid sustainable smart cities can also help nation globally. In the
urbanization which is associated with rapid economic meantime, there are possibilities for the success and failure
growth (Neirotti et al., 2014). However, in late 1980s, the of the concept of smart cities, which are based on
concept of smart cities was linked with environmental understanding of many factors related to the smart cities. In
issues. Based on some interesting figures, around 60% of the recent years, researchers/scholars tried to address the concept
world's population is likely to be shifted in urban areas by of “smart city”, yet, still, an accurate understanding of this
2050 (UN, 2011). As a result, several considerable issues concept is required among practitioners/policy makers from
may emerge, specifically related to people welfare, its implementation viewpoints (Chourabi et al., 2012). Thus,
environmental degradation, resource depletion, living and an effort is required in understanding and analyzing the
travelling styles, and services etc. Thus, the agenda of probable key success factors to develop smart cities in India.
sustainable development forced the community as well as The main objectives of this paper are given as follows:
governments to think about smart cities smart cities and their (I) To identify the key success factors to develop smart cities
sustainability (Anttiroiko et al., 2014; Albino et al., 2015). in India;
According to the fifth convention of the Focus Group on (ii) To analyze key success factors to develop a research
Smart Sustainable Cities held in Genoa, the smart framework for efficiently developing smart cities in
sustainable cities is defined as: “A smart sustainable city is India; and
an innovative city that uses information and communication (iii)To draw managerial and practical implications of the
technologies and other means to improve quality of life, presented research framework
efficiency of urban operation and services, and To build a framework, a questionnaire based survey has been
competitiveness, while ensuring that it meets the needs of made to collect the useful information. The value of this
present and future generations with respect to economic, survey method is that huge information might be
06
April 2017
accumulated from a huge number of people in a small period increase in the urban population is already putting
of time in an economical manner. Explanatory Factor tremendous pressure on existing infrastructure and thus
Analysis (EFA) has been used to reduce large number of requires the expansion of infrastructure to accommodate the
original factors into a smaller set of new composite migrating population. In the coming years, India needs 500
dimensions with a smallest loss of information to refine plus cities to fulfill the requirement of the population.
research framework of key success factors to smart cities in Therefore, this is the time to develop more sustainable cities
Indian context. The remainder of this paper contains. The and enhance the quality of life (www.rvo.nl). According to
review of connected literature is discussed in Section 2. India's Prime Minister Mr. Narendra Modi "cities in the past
Section 3 proposes the research method. The data analysis were built on river banks; they are now built along highways.
and results are presented in Section 4. Results along with the But in the future, they will be built based on availability of
managerial and practical implications of the research are optical fiber networks and next-generation infrastructure
discussed in Section 5. Lastly, Section 6 provides (www.makeinindia.com)." The urban developments have to
conclusions, limitations and the scope for next work.
be comprehensive including the development of social and
2. LITERATURE ANALYSIS economic infrastructure, physical, and institutional.
This section is aimed at evolution of smart city concept, Comprehensive development is important for the
status of smart cities in India and identification of possible improvement, and increase the quality of life which attracts
key success factors to develop smart cities. the peoples to invest in the city for the development. The
2.1 Smart City Concept National Democratic Alliance (NDA), Government has
In the year 1992 the concept of smart growth was aimed and positively focused on India's awareness towards the
suggested as an alternative example to uplifting the lifestyle urbanization which is essential and got the "smart city"
of people. The idea provides the development of the cities concept buzzing (Rav et al., 2016).About 830 crores rupees
which are compact in design as well as in land use and are were sanctioned by the Government of India for Smart Cities
walk-able from the urban cities. During this time urban cities in their 2014-15 budgets. On the ground level, development
were re-planned and designed and this concept has gained actions were affected by the insufficient resources and the
popularity in 1990s. But after some time this concept
government was planning to boost up the new financial paths
vanishes and an innovative idea “Intelligent cities”
to the program (www.makeinindia.com). Today, most cities
appeared. Intelligent cities are those cities which show how
would like to become smart but many city planners don't
information technology and data can help the cities in proper
really know how to achieve this objective (World Smart City
functioning. The idea of smart city follows the growth of
intelligent cities. During that time many of the courses has Forum, 2016). Hence, need of hour is to recognize and
emerged which comprises of 'intelligent' and 'smart' analyze key success factors related efficiently developing
enterprises like CISCO, Siemens and IBM. Many other smart cities in India. In this sense, an effort is made in this
technology companies like Microsoft and Hitachi worked on study, which is important in terms of: I) understanding the
the 'smart' technologies in context of cities. MIT have one of concept of smart cities globally, and to know the status of
the renowned laboratories has that worked on smart cities smart cities in India;
concept (Harrison and Donnelly, 2011; Townsend, 2014). In ii) listing the success factors in developing smart cities in
2008, after the economic crisis the concept of smart cities Indian context.
gained eminent importance. During that period there was 2.3 Key Success Factors to Develop Smart Cities
extreme loss in the finances as well as social welfare which Literature from 2011 to 2017 has been searched and reviewed
then requires support of the private sector for providing new using Google and Google Scholar search engines by
services/aids to develop the urban sector (Paroutis et al., providing various keywords like, Key Success Factors/Key
2014). In this sense, the model of smart city was developed, Enablers/Success Factors and Smart Cities etc. Although,
in which the city is considered as a system that involves literature was not sufficient in Indian context, literature has
constant flow of information across its various functions. been taken from other countries; and similar situation has
This model set a goal for the city which increases the been assumed for Indian context. Initially, 19 key success
performance in different sectors including transport and factors to develop smart cities identified from extensive
health care etc. (Steiner & Veel, 2014). IBM has officially literature support. Further, a committee of four experts (one
given trademark of 'Smarter Cities' in 2011. Smart cities are IT expert, one member from Road Transport and Highways
still an emerging project which consists of different areas ministry, two academicians) made to validate/add/delete any
like digital city and intelligent city (Hollands, 2008; factor. From the brainstorming session, one key success
Chourabi et al., 2012). factor namely 'Effective communication with other states and
2.2 Status of Smart Cities in India related agencies' was added. These identified 20 key success
According to the survey, every minute 30 to 35 Indians are factors to develop smart cities are listed in Table 1.
migrating from rural area to urban areas. The unprecedented
07
April 2017
Table 1: Key success factors to develop smart cities
S. No. Key s uccess factors to develop smart References
cities
1 1. IT infrastructure Schaffers et al., 2011; Meshram et al.,
2015
2 Technology centric reform Nam and Pardo, 2011; Bifulco et al., 2016
3 Citizen centric reforms Kuk and Janssen, 2011; Nam and Pardo,
2011; Bifulco et al., 2016
4 Transparency Lee et al., 2014; Solano et al., 2017
5 Service and application integration Lee et al., 2014; Singh et al., 2014; Albino
et al., 2015
6 Security and privacy Elmaghraby and Losavio, 2014; Perera et
al., 2014; Li et al., 2016
7 1. Digital education Neirotti et al., 2014; Anttiroiko et al.,
2015
8 Quality of life Neirotti et al., 2014; Anttiroiko et al.,
2015
9 Accessibility Piro et al., 2014; Zanella et al., 2014
10 Tackling/bridging digital divides Cocchia, 2014; Nicholds et al., 2016;

Wiig, 2016
11 Legislations and government supportive Mohammed et al., 2014; Neirotti et al.,
policies 2014; Zanella et al., 2014; Albino et al.,
2015; Meijer, 2016
12 Political commitment and formal leadership Chourabi et al., 2012; Mohammed et al.,
2014; Letaifa, 2015; Nicholds et al., 2016
13 Effective c ommunication with other states E xperts’ input
and related agencies

14 Use of renewable energy resources Bãtãgan, 2011; Naphade et al., 2011;
Suciu et al., 2013; Zanella et al., 2014;
Dameri, 2017
15 1. Use of effective and environmental Batty et al., 2012; Doll and Balaban, 2013;
friendly transportation methods (Metro Neirotti et al., 2014
rail, E- rickshaws etc.)
16 Effective utilization and management of Perera et al., 2014; Zanella et al., 2014;
waste Meshram et al., 2015
17 Arrangement of hospitals and education Nam and Pardo, 2011; Wu et al., 2017
institutes etc.
18 Rethinking city infrastructure themes Paroutis et al., 2014 ; Roche, 2014;

Schleicher et al., 2016
19 Innovation use of open spaces Schaffers et al., 2011; Mainka et al., 2016
20 Special purpose vehicles Huston et al., 2015; Calvillo et al., 2016
Further, a questionnaire based study has conducted to validate managers and policy makers to devise plans to monitor and
and analyze above identified key success factors to develop control these factors. Therefore, we felt the need of
smart cities. The proposed research methods have been categorization of these factors into several categories to have a
discussed in the next section. selective and focused control over them. In order to classify
them, we have used the factor analysis (a statistical technique to
3. RESEARCH METHOD
explain variability). We used exploratory factor analysis with
Based on the analysis of the extent literature, we identified 20
principle component analysis method. Exploratory factor
key success factors for smart cities agenda. Since we identified
Analysis (EFA) involves statistical procedures, which provides
the large number of success factors, it become difficult for
high accuracy in situations, where each common factor is
08
April 2017
signified by numerous measured variables in the study. EFA can bureaucrats, construction industry leaders, academicians
recognize the primary interactions/correlations between involved in policy making on 100 smart cities in India. This
measured variables (after knowing the number/nature of study followed Dillman's (2000) five-point contact protocol: I) a
common factors). In this paper, we identified 20 items (key first introductory telephone call; ii) and iii) two waves of postal
success factors for smart cities agenda) and then applied EFA. surveys; iv) a fax reminder; v) a final telephone call to promote
their contribution. Due to the language diversity within India,
4. DATA ANALYSIS AND RESULTS
we used an English-language version for data collection. Finally
We collected the data on five point Likert scale. One represents
we received 42 usable responses. The results of EFA are
not important at all to 5 represent most important factor for the
provided in Table 2. There are five large positive eigenvalues
success of the development of smart cities in India. We have
found (1.81; 1.67; 1.49; 1.32 and 1.06), which collectively
selected a sample of 60 decision makers which includes
represented for 84.9 percent of the total variance explained.
Table 2: EFA result for success factors for smart cities agenda
Item People and Infrastructure Proper Transportation Good
communities use of Governance
resources
Quality of life 0.75 0.08 0.11 0.06 0.12
Digital education 0.83 0.13 0.13 0.02 0.07
Accessibility 0.69 0.03 0.12 0.17 0.09
Citizen centric reforms 0.78 0.15 0.09 0.12 0.07
IT infrastructure 0.18 0.58 0.05 0.14 0.21
Security and privacy 0.04 0.68 0.17 0.15 0.21
Tackling/bridging 0.15 0.70 0.08 0.16 0.17
digital divides
Technology centric 0.06 0.75 0.14 0.21 0.01
reforms
Arrangement of 0.15 0.72 0.06 0.02 0.17
hospitals and education
institutes etc.
Rethinking city 0.17 0.74 0.03 0.05 0.08
infrastructure themes
Use of renewable 0.06 0.17 0.65 0.03 0.08
energy resources
Innovation use of open 0.14 0.08 0.72 0.09 0.05
spaces
Effective utilization 0.16 0.08 0.67 0.03 0.19
and management of
waste
Special pu rpose 0.02 0.05 0.13 0.71 0.23
Vehicles
Use of effective and 0.04 0.08 0.21 0.68 0.14
environmental friendly
public transportation
methods (Metro rail,
E- rickshaws etc.)
Transparency 0.12 0.01 0.21 0.19 0.65
Service and application 0.18 0.05 0.21 0.15 0.69
integration
Political commitment 0.19 0.02 0.12 0.08 0.72
and formal leadership
Legislations 0.15 0.05 0.18 0.06 0.75
Effective 0.02 0.07 0.12 0.21 0.67
communication with
other states and related
agencies
09
April 2017
Exploratory factor analysis result suggested five dimensions • Society perspectives

(People and communities; Infrastructure; Proper use of Smart city can integrate novel technologies and ecological
resources; Transportation and Good Governance) of success issues to present better living conditions to the people and
factors to make smart cities mission realistic. These proposed communities. This is based on the obvious concept that each and
dimensions are explained as below. every decision in smart cities concept has some concealed
Dimension 1- People and communities: This dimension human health, and social impacts and that can be minimized or
explains the role of people and communities in developing managed by taking its holistic view.
smart cities. People and communities dimension will focus on 5. CONCLUSION, LIMITATIONS AND FUTURE
key factors like improving Quality of life, Digital education, SCOPE
enhancing Accessibility and Citizen centric reforms to develop Indian is the fastest growing economy of the world. The labour
smart cities. force in India is growing by 270 million and 70% of the jobs are
Dimension 2- Infrastructure: This dimension explains the accounted by urban population. Life in the urban cities is
development of necessary technologies and infrastructure (IT constantly decreasing and remains to be less than 30% of the
infrastructure, Technology centric reforms, Arrangement of whole population. Migration of rural population to urban cities
hospitals and education institutes etc., Rethinking city in the searching of good life and job is increased by 15% every
infrastructure theme, solving Security and privacy issues, year, so the Government of India is facing many
Tackling/bridging digital divides and Rethinking city problems/challenges in the urban cities like; waste disposal,
infrastructure themes) to support smart city idea. people health, living conditions, etc. In the present work, an
Dimension 3- Proper use of resources: This dimension will effort has been made to recognize and empirically analyze key
focus on optimal use of resources and related innovation. Key success factors to develop smart cities. Initially, 20 key success
factors like Use of renewable energy resources, Innovation use factors were identified from extensive literature support. A
of open spaces and Effective utilization and management of questionnaire was developed to collect the data to
waste will play a key role in developing smart cities. develop/refine a research framework. Further, collected data
was analysed with the help of explanatory factor analysis. EFA
Dimension 4- Transportation: This dimension will focus on
results suggested the five dimensions (People and communities;
Use of effective and environmental friendly public
Infrastructure; Proper use of resources; Transportation and
transportation methods (Metro rail, E- rickshaws etc.) and
Good Governance) of success factors to develop smart cities.
development of new or alternative Special purpose vehicles to
The findings of present research would be useful for regulatory
improve transportation of the city
bodies and policy makers to designing policies and proposing
Dimension 5- Good Governance: This dimension is related strategies to make smart cities mission realistic. The present
with government role, formulating policies and related research work provided some interesting and initial insights.
governance to develop smart cities. This dimension will include But, this research has its own limitations, which will lay a strong
Political commitment and formal leadership, Effective foundation for further research. First, sample size was small. In
communication with other states and related agencies, future research, large and more geographically diversified
Legislations, Transparency and Service and application sample will be needed to get a more accurate picture to develop
integration. framework to make smart cities mission realistic. Further, the
4.1 Implications of the Research work may be extended to explore more dimensions which are
Smart Cities Awas Yojna Mission was launched by Sh. critical to develop smart cities. The identified dimensions can be
Narendra Modi, Prime Minister of India in June 2015. Smart more rigorously analyzed in the future work.
city can be distinguished as a future-oriented though. The smart
REFERENCES
city concept can be drawn into reality by considering its system
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April 2017
REGRESSION MODEL FOR LOSS OF GENERATION & FACTORS AFFECTING

IT IN A THERMAL POWER PLANT
Ravindra B Gohane
Dr. Sunil V Deshmukh
Abstract
Power sector is a very important sector for the development of any country. Coal based thermal power constitutes 70% of power generation in India
and is vital element in economic development of nation. With increased competition in electricity generation because of use non-conventional energy
sources, regulatory requirements and substantial growth of power stations, it has become imperative for thermal power stations to focus on cost of
generation and reduce the non-value adding activities. From this perspective all the power stations are focussing on reducing the loss of generation
because of many factors such as annual overhaul, wet coal, tripping's, non-availability of coal etc.This study focuses on identifying factors of loss of
generation and relationship between these factors through regression analysis. The data has been collected from 7 power stations for last 6 years and a
regression model is developed with the help of SPSS software to identify the relationship between loss of generation & factors affecting it. Thereafter,
guidelines for further improvement to reduce loss of generation are provided.
Keywords: Regression analysis, thermal power plant, SPSS, loss of generation
1. INTRODUCTION in the performance of power plants can be achieved by

Thermal power plant plays an important role in economy of any strengthening the Operation& Maintenance (O& M) practices,
country. With increasing demand of electricity in last decade, a coupled with required rehabilitation and life extension
large number of thermal power plants were started/installed interventions, as these are perhaps the quickest and least cost
across the length & breadth of India. However, due to stiff alternative for augmenting availability of power in the Indian
competition the thermal power plant have to generate electricity context. Further, they discussed the relation between the
at low cost as the selection of thermal power plant for supply to availability of the plant and Plant Load Factor (PLF). Based on
grid is now based on merit order dispatch (MOD). In order to the available literature it was decided to use regression analysis
meet this competition, thermal plants are trying to improve their to identify factors that contribute to influence performance of
efficiency and performance. For this, they are required to focus the thermal power plant, and the degree of correlation with it.
on factors affecting loss of generation so as to have maximum Behera S andDash A., (2010)has investigated the relative
generation with same resources. India has suffered a power performance of the coal fired power- generating plants in India
generation loss of over 11 per cent, in 2011—12, on account of and explored the key determinants of the inefficient units.
fuel shortage, transmission bottlenecks and an equipment Further, Behera and Dash studied non- parametric Data
problem. The loss of generation due to non-availability of Envelopment Analysis (DEA) to estimate the relative technical
thermal units due to forced outages is substantial is to the tune of efficiency and scale efficiencies of coal-based power plant in
14 per cent. Thispaper analyses various factors affecting loss of India. Data Envelopment Analysis (DEA) was used by Puneet
generation &establishes relation amongst these factors using C., (1999) to evaluate the operational inefficiencies of
multiple regression analysis. generating units. They considered three parameters viz.
2. LITERATURE REVIEW generation per unit of coal consumed, generation per unit oil
Lot of studies have been carried out by researchers to improve consumed and generation per unit of auxiliary power
the performance of thermal power plant. Also various consumption as indicators of performance (Behera S.,Dash A.,
techniques such as stochastic, data envelopment analysis, (2010)).Shanmugam K &Praveen K., (2005)used the stochastic
Markov model etc. have been used by researchers for this frontier production function methodologyto measure the
purpose. Some of the studies are listed below: technical efficiency of coal- based thermal power plants Puneet
Swarupa L., (2013) has identified certain management C., (1999).Gupta et al. (2005)developed a Markov model for
activities and provided stakeholders with information performance evaluation of coal handling unit of a thermal power
regarding the practices that will result in their plant plant using Probabilistic approach. Coal handling unit. This
performance enhancement using regression analysis technique. developed model is useful in comparative evaluation of
In this they specified that the objectives of the organization can alternative maintenance strategies.Garg et al. (2007)developed
be measured as effectiveness, so it becomes important to a methodology is named as multiple attribute decision making
identify factors that influences in getting the desired income (MADM) methodology and consists of elimination search
and their influence on the economic performance of the and technique for order preference by similarity to ideal
organization. According to Motghare V.SandDr. Cham R.K., solution (TOPSIS) approach for evaluation and selection of
(2015) the performance of a power plant can be expressed optimum power plant. (Refenes, A.N., et al. 1994).
through some common performance factors. The improvement
13
April 2017
The literature review is summarized in the Table 1.
Table 1
Literature review on regression analysis
Author/year Title Publication Model Result
Swarupa L., (2013) “Regression Summer Internship Standard Managerial
Analysis of Report, Administrative deviation, practices have a
Operational Staff College of India, measurement significant effect ,
Efficiency Bella Vista, scale, Ranking Lesser capacity
Variables on Hyderabad method, units are on the
Management regression lower side, Low
Practices of analysis quality of coal
Thermal Power behind non-
Plants performance of the
utilities
Motghare V.S., Dr. “Plant Load International Journal Availability factor Plant load factor is
Cham R.K., (2015) Factor-Key of scientific research directly
Parameter for and management dependent on
Evaluation of (IJSRM) availability of any
Performance of power plant
Thermal Power
Plant”.
Behera S.,Dash A., Performanceanalys Proceedings Non-parametric Average technical
(2010)Management isofcoalfiredpower ofthe2010International Data Envelopment efficiency is
plantinIndia ConferenceonIndustria Analysis (DEA) 83.2% , 38 plants
lEngineering below the mean
andOperations level
Shanmugam K., Efficiency analysis Int.J. Employs the Efficiency varies

Praveen K., (2005) ofcoal -based GlobalEnergyIssues stochastic frontier widely across
thermalpower gene production plants and regions,
rationinIndiaduring function while the
post-reformera methodology Technical
Effficiency is
time-invariant
GargR.K.,AgrawalV Coding,Evaluation ElectricalPowerandEn Multiple attribute A computer

.P.,GuptaV.K., andSelectionofThe ergySystem decision making software package
(2007) rmalPowerPlants-A (MADM) has been
MADMapproach methodology. developed to assist
(TOPSIS an inexperienced
user
Fechete F., Analysis of the International Regression Explanatory

Dr.Nedelcu A., Economic Conference of analysis, variables
(2014) Performance of an Scientific Paper correlation contributes to
Organization Using Afases analysis, ANOVA explaining the
Multiple and time series variation in sales
Regressions analysis. revenue.
Refenes, A.N., Stock Performance Neural Networks Neural networks Neural networks
Zapranis, A., Modelling Using can provide a
Francis, G. (1994) Neural Networks: reasonable
A Comparative explanation of
Study with their predictive
Regression Models behaviour and can
model their
environment more
convincingly than
regression models.
14
April 2017
3. LOSS OF GENERATION & FACTORS AFFECTING 3.5 Poor Coal Quality.

IT Coal quality heavily influences slagging and fouling which
Generation loss takes place because of various factors as itself influences boiler efficiency & also the combustion
follows: efficiency. The quality of coal is a major factor deciding the
· Annual overhaul. generation efficiency.
· Low system demand. 3.6 Wet Coal Problem.
· Water shortage. Moisture content of coal has been the centre of attraction for
· Coal shortage. researches as it affects the power plant performances on
· Poor coal quality. different scales, viz, boiler efficiency, and overall efficiency,
· Wet coal problem. working of machinery& operation & maintenance costs. This
· System problem. altogether leads to loss of generation. The problem is more
severe in rainy season.
· O& M factors
3.7 System Problem.
These factorsare discussed below: Thermal power plant being a cluster of different auxiliaries
3.1 Annual overhaul depends for its performance on various systems. There are some
The plant overhauls usually take 35 to 40 days per unit if there is practical challenges associated with thermal power plants which
no major repair involved. Major repairs include turbine casing, are:
turbine rotor damage and other damages that require 1. Heat loss to the surrounding in the connecting pipes of the
transporting the equipment to another location. The overhauls plant.
thus results in loss of generation due shut down of activities of a 2. Pressure drop in connecting pipelines.
power plant. 3. Turbine and pump do not work isentropic ally and hence,
3.2 Low System Demand. produce less work and consume more work respectively.
Electric energy cannot be stored and thus power plant has to 4. Liquid entering the turbine.
generate electricity as per the demand. For this the generating 5. Load on power-plant is typically varying and adjusting the
units go on or off line as per the demand of the grid. After shut operation of the power plant with varying load is a
down the generating units take a long time to come up to full challenge.(Fechete F., et al. 2014)
power and add to expenses. In recent years, many power plants 3.8 O&M Factors.
(eg.,Bhusaval, TPS, Paras TPS) are required to stop generation If there is any unintended system failure or collapse, which
due to low system demand and higher cost of generation involves inspection, servicing, repairing or replacing physical
3.3. Water Shortage. components of machineries, plant and equipment then it leads to
In countries around the world, meeting daily energy needs is shut down of activities resulting into loss of generation.
dependent on water. Finding and providing sufficient water
resources to produce the required energy, however, and then 4. RESEARCH METHOD
appropriately allocating the limited supply is difficult task. A Regression analysis is used to determine the correlation between
power plant where there is scarcity of water is required to close loss of generation & factors affecting it. In this study the loss of
down resulting in substantial loss of generation. There have generation is considered to be dependent variable and the factors
been numerous examples of these such as Parali thermal power affecting it as independent variable. Data is collected from 7
station. thermal power plants, month-wise, for six years related to
generation, loss of generation and loading of this on various
3.4 Coal Shortage. factors.
Coal is a limited natural resource that is required to produce the
energy. Insufficient supply may lead to system shut down which The general expression of a regression model can be written as:
results in loss of generation. Supply of coal depends on various Y= M+AX1+BX2+CX3+DX4+EX5+FX6+GX7+HX8
factors such as transportation system efficiency, mining In which y – dependent variable (Loss of generation),
efficiency and also the agreements between power plant and randomized; X- independent variables (factorial), non-
mines. Moreover keeping the stock of coal adds to inventory randomized; M– random variable error or residue. Random
and increases the cost of generation. Insufficient coal leads to variable M is the constant that defines the influences of variables
reduced generation and is factor in loss of generation on y not included in the model.
Table 2 presents the description of variables used in the
equation.
Table 2: Description of Variables
Variable Identity Description
Y Dependent variable Loss of Generation
X- Independent variables Factors contributing to loss of generation
M- Constant
A,B,C,D,E,F,G,H Coefficients Coefficients of respective factors

X1 Independent variable Annual overhaul
15
April 2017
X2 Independent variable Low system demand

X3 Independent variable Water shortage
X4 Independent variable Coal shortage
X5 Independent variable Poor coal quality
X6 Independent variable Wet coal problem
X7 Independent variable System problem
X8 Independent variable O & M factors
5. DATA COLLECTION & ANALYSIS % Loss Of
Data has been collected from various power stations of state Year
Generation
power stations from 2010-2016. The total data set available is
1428. The sample data is presented in Table3 which shows the 2010-11 38.70
generation & loss details of a thermal power plant for the year 2011-12 34.75077
2015-2016.
2012-13 37.95045
TABLE 3 :
GENERATION & LOSS DETAILS FOR THE YEAR 2015-16 2013-14 40.93458
(APR.15 TO MAR. 16 ) 2014-15 41.06
Unit (2 & 3) 2015-16 43.64191
S.NO. PARTICULARS MU % 2016-17 48.56562
A POSSIBLE GEN.(B+C) 3689.28 100.00
B ACTUAL GEN. 1728.03 46.84
EXCESS GEN. 0.00
C LOSS OF GEN. 1961.25 53.16
DETAILS OF LOSS OF GEN.
X1 ANNUAL OVERHAUL/ R&M 303.63 8.23
X2 LOW SYSTEM DEMAND 429.82 11.65
X3 WATER SHORTAGE 0.00 0.00
X4 COAL SHORTAGE 0.00 0.00
X5 POOR COAL QUALITY 195.82 5.31 Figure 2 : Percentage loss of generation for the years 2010-17
X6 WET COAL PROBLEM 6.56 0.18
Figure 3 shows the percentage loss of generation for all the
X7 SYSTEM PROBLEM 8.17 0.22 power stations for all the years. Power plant 4 witnessed the
X8 O&M FACTORS 246.13 6.67 maximum percentage of loss of generation.
TOTAL LOSS OF GEN. 1961.25 53.16 % LOSS of
POWER generation
The month wise data for the loss of generation is presented in
Annexure I at the end of this paper. Similar data has been STATION (2010-2017)
collected for all the power stations. Figure 1 depicts the graph of Power Plant 1 43.54
percentage loss of generation due to various factors obtained
Power Plant 2 37.57
from table 3.
Power Plant 3 30.35
Power Plant 4 53.63
Power Plant 5 27.09
Power Plant 6 27.24
Power Plant 7 51.55
Fig 1. Percentage loss of generation due to factors

This shows that loss of generation at this power plant was
majorly due the factor of low system demand taking into
account the data for the years 2010-16. Similar data set has
been generated & analysed for the other power plants as well.
power stations for a year. Year 2016-17 witnessed the maximum Figure 3: Percentage loss of generation for
percentage of loss of generation. all power stations (2010-17)
16
April 2017

months for all the power plants for all the years. Year 2016-17
witnessed the maximum percentage of loss of generation.
% LOSS OF GENERATION
MONTH (2010-17)
Apr 32.68
May 34.78
Jun 42.04
Jul 50.73
Aug 55.19
Sept 44.87
Oct. 35.81
Nov 31.92
Dec 28.98
Figure4: Percentage loss of generation for all power

stations month wise. (2010-17)
After obtaining the data the regression analysis was performed using SPSS software are tabulated in Table4, 5, 6, 7. Table 4
using SPSS software. The results obtained from analysis by indicates the input method used for the variables.
TABLE 4 : Variables Entered/Removeda
Model Variables Variables Method
Entered Removed
OMFACTOR,
SYSTEMPROB
LEM,
ANNUALOVER
HAULOTHERP
L,
1 LOWSYSTEM . Enter
DEMAND,
WETCOALPR
OBLEM,
POORCOAL Qu
ality
a. Dependent Var iable: Lossofgeneration

b. All requested variables entered.
Table 5 shows the summary of the Model. It shows the value Table 7 shows ththe coefficients of factors affecting loss of
of R, R square and Std. Error. generation.
TABLE 5: Model Summary Therefore the regression equation can be written as:
Model R R Square Adjusted R Std. Error of the TABLE 6: ANOVAa
Square Estimate
a
Model Sum of Squares df Mean Square F Sig.
1 1.000 1.000 1.000 .659
Regression 1367140.625 6 227856.771 524705.074 .000b
a. Predictors: (Constant), OMFACTOR, SYSTEMPROBLEM,
ANNUALOVERHAULOTHERPL, LOWSYSTEMDEMAND,
1 Residual 2.606 6 .434
WETCOALPROBLEM, POORCOALQUALITY Total 1367143.231 12
The degree of correlation intensity is represented by an indicator a. Dependent Variable: Loss of generationb.
b. P r e d i c t o r s : ( C o n s t a n t ) , O M F A C T O R ,
called as the coefficient of multiple determinations (R2) and it
SYSTEM PROBLEM, ANNUAL OVER HAUL OTHERPL,
measures the proportion of variation in y that is explained by the LOW SYSTEM DEMAND, WET COAL PROBLEM,
variables. The more value of R2means the model is better. POOR COAL QUALITY
Motghare V.S., et al (2015). Y= M+AX1+BX2+CX3+DX4+EX5+FX6+GX7+HX8
Table 6 shows the ANOVA analysis.
17
April 2017
TABLE 7: Coefficients a
Model Unstandardized Coefficients Standardized t Sig.

Coefficients
B Std. Error Beta
(Constant) .116 .216 .535 .612

ANNUALOVERHAULOTH
.997 .005 .213 203.699 .000
ERPL
LOWSYSTEMDEMAND 1.006 .086 .015 11.734 .000

1
POORCOALQUALITY 1.006 .014 .251 72.176 .000
WETCOALPROBLEM 1.006 .011 .138 93.724 .000

SYSTEMPROBLEM .709 .141 .004 5.024 .002
O & MFACTOR .999 .008 .438 131.847 .000
a. Dependent Variable: Loss of generation
Table 7 shows the values of the coefficients of factors affecting 2. The supply of coal to be monitored regularly. For this a
loss of generation. separate section for coal accounting to be created. Also the
Therefore the regression equation can be written as: avenues to be explored for reduction of transportation costs
and also the problem of wet coal.
Loss of generation = 0.116+ 0.997* ANNUALOVERHAUL
+1.006*LOWSYSTEMDEMAND+ 3. Shift wise monitoring of operating controllable parameters
and merit order operation concept to be implemented. The
0 * WAT E R S H O RTA G E + 0 * C O A L S H O RTA G E training to operating staff is required for efficiency and
+0.1.006*POORCOALQUALITY performance.
+1.006WETCOALPROBLEM+0.709*SYSTEMPROBL 4. The results of monthly performance monitoring of the
M +0.999*O&MFACTOR. station should be discussed in a meeting taken by the Head of
Simplifying the equation we get, the plant and remedial action plan including action on urgent
Loss of generation = 0.116+ 0.997*ANNUALOVERHAUL financial issues, should be decided in the meeting.
+1.006*LOWSYSTEMDEMAND 5. Installation of reliable rotary gravimetric feeders to ensure
+0.1.006*POORCOALQUALITY+1.006WETCOALPRO the coal quantity feed into the mill and indirectly to boiler to
BLEM get an online assessment of boiler performance.Up gradation
of C&I system to replace the obsolete technology and
+0.709*SYSTEMPROBLEM +0.999*O&MFACTOR.
installation of more close loop controls toavoid manual
The regression analysis & SPSS software analysis resulted into interference.
an R square value of 1.000. The R2value which is generated is 6. Provision of computer software for performance monitoring,
acceptable. This shows that the factors considered for loss of maintenance planning and for simulation studies at the plant
generation are influencing & has a measurable impact on loss of site may be considered. Spare planning and inventory
generation. These factors therefore cannot be neglected & management tools to be incorporated to avoidthe delay in
certain measures should be taken to improve the performance of maintenance duration and non-availability of spares.
these factors so as to minimize loss of generation. This
regression equation can be used for deciding the factors on 7. Annual overhaul of units and auxiliaries should be done
which to focus, if we set the limit for the loss of generation. regularly based on the performance deterioration.
Similarly for particular loss of generation, we can decide factors Assessment to be made before and after to access the techno
to focus in order to improve plant performance. economical gain as far as possible. Activities to, be planned
as far as possible on account of system demands.
6. SUGESSTIONS FOR REDUCING LOSS OF
GENERATION 8. One of the major causes for the poor performance is the poor
Following are some suggestions for reducing loss of housekeeping which needs immediate attention and close
generation: monitoring by top management. It has already proven that
this will reduce the maintenance cost and increase the
1. Regular planned preventive maintenance as per manual availability.
should be carried out. For this Manufacturer's maintenance
manuals for different equipment's and operating guide lines 9. Power station should adopt ISO 9001:2015, ISO 2014, and
should be available in plant office. Review of the plan OHSAS 18000 & ISO 50001 energy management system.
should be taken regularly. Moreover,predictive and reliable They should also comply with requirements of regulatory
centred maintenance should be undertaken. bodies & statutory & legal requirements.
18
April 2017
CONCLUSION 4. Puneet C., (1999)”A Data Envelopment Analysis Approach

The regression analysis & SPSS software analysis resulted into to Evaluation of an Operational Inefficiencies in Power
an R square value of 1.000. The R2value which is generated is Generating Units: A Case Study of Study of Indian Power
acceptable. This shows that the factors considered for loss of Plants”.IEEETransactionsonPowerSystem,Vol.14,No.2,
generation are influencing & has a measurable impact on loss of May1999.
generation. These factors therefore cannot be neglected 5. Shanmugam K., Praveen K., (2005)“Efficiency analysis of
&suggested measures should be taken to improve the coal-based thermal power generation in India during post
performance of these factors so as to minimize loss of reform era”. Int.J. Global Energy Issues, Vol.23,No.1,2005.
generation.
6. GuptaS., Tewari P.C., SharmaA.K:2005)“A Markov Model
REFERENCES for Performance Evaluation of Coal Handling Unit of a
1. Swarupa L., (2013)“Regression Analysis of Operational Thermal Power Plant”. Journal of Industrial and System
Efficiency Variables on Management Practices of Thermal EngineeringVol.3, No.2, 2005, pp85-96.
Power Plants”. Summer Internship Report, Administrative 7. GargR.K., AgrawalV.P., GuptaV.K., (2007)“Coding,
Staff College of India, Bella Vista, Hyderabad, Aug 2013. Evaluation and Selection of Thermal Power Plants-A
2. Motghare V.S., Dr. Cham R.K., (2015) “Plant Load Factor MADM approach”. ElectricalPowerandEnergySystem29,
Key Parameter for Evaluation of Performance of Thermal 2007, 657-668.
Power Plant”. International Journal of scientific research 8. Fechete F., Dr. Nedelcu A., (2014) “Analysis ofthe
and management (IJSRM) , Vol (3), Issue (1), 2015, pp Economic Performance ofan Organization Using Multiple
1904-1907 Regressions”. International Conference of Scientific Paper
3. B e h e r a S . , D a s h A . , ( 2 0 1 0 ) Afases 2014, Brasov, May 2014, pages 22-24.
“PerformanceanalysisofcoalfiredpowerplantinIndia”. 9. Refenes, A.N., Zapranis, A., Francis, G. (1994), “Stock
Proceedings of the 2010 International Conference on Performance Modelling Using Neural Networks: A
Industrial Engineering and Operations Management Comparative Study with Regression Models”, Neural
Dhaka, Bangladesh, January 9-10,2010. Networks, vol. 7, No. 2, 1994. pp 375-388.
ANNEXURE I
TABLE I
Details of loss of generation for Unit 2& 3 for year 2015-2016
S.NO. A B C I II III IV V VI VII VIII
BHUSA POSSI AC LOS ANNUAL ECONOM LOW COA POOR WET SYST O& TOTA
WAL BLE TU S OVERH IC/ SYST L COAL COAL EM M L
(U-2&3) GEN.( AL OF AUL RESERVE EM SHO QUALI PROB PROB FAC LOSS
2015-16 B+C) GE GE SHUTDO DEM RTA TY LEM LEM TOR OF
N. N. WN AND GE S GEN.
APR. 302.4 77.4 224. 0 151.2 60.73 0 9.09 0 1.327 2.603 224.95
47 953 3 3
% 100 25.6 74.3 0 50 20.08 0 3.01 0 0.44 0.86 74.39
1 9
MAY 312.48 0 312. 0 156.24 156.2 0 0 0 0 0 312.48
48 4
% 100 0 100 0 50 50 0 0 0 0 0 100
JUN 302.4 73.4 228. 0 151.2 67.76 0 8.452 0 0 1.493 228.91

88 912 7 2
% 100 24.3 75.7 0 50 22.41 0 2.79 0 0 0.49 75.7
JUL 312.48 115. 196. 0 156.24 4.48 0 14.265 0 0.228 21.36 196.58
9 58 7
% 100 37.0 62.9 0 50 1.43 0 4.57 0 0.07 6.84 62.91
9 1
AUG 312.48 111. 200. 0 156.24 5.15 0 14.426 5.949 0 18.80 200.57
91 57 5
% 100 35.8 64.1 0 50 1.65 0 4.62 1.9 0 6.02 64.19
1 9
SEP 302.4 121. 181. 151.2 0 2.583 0 15.111 0.614 0 11.49 181.00
395 005 7 5
% 100 40.1 59.8 50 0 0.85 0 5 0.2 0 3.8 59.86
4 6
OCT 312.48 98.0 214. 152.432 0 0.307 0 12.56 0 0.763 48.37 214.43
45 435 3 5
% 100 31.3 68.6 48.78 0 0.1 0 4.02 0 0.24 15.48 68.62
8 2
19
April 2017
NOV 302.4 210. 91.4 0 0 6.219 0 25.618 0 2.765 56.87 91.478

922 78 6
% 100 69.7 30.2 0 0 2.06 0 8.47 0 0.91 18.81 30.25
5 5
DEC 312.48 236. 75.9 0 0 22.42 0 26.917 0 2.146 24.41 75.906
574 06 7 6
% 100 75.7 24.2 0 0 7.18 0 8.61 0 0.69 7.81 24.29
1 9
JAN 312.48 254. 58.1 0 0 35.17 0 22.451 0 0 0.508 58.135
2016 345 35 6
% 100 81.4 18.6 0 0 11.26 0 7.18 0 0 0.16 18.6
FEB 292.32 223. 69.1 0 0 27.74 0 22.088 0 0 19.30 69.144

2016 175 45 9 7
% 100 76.3 23.6 0 0 9.49 0 7.56 0 0 6.6 23.65
5 5
MAR 312.48 204. 107. 0 0 40.98 0 24.84 0 0.942 40.88 107.65
2016 825 655 9 4 5
% 100 65.5 34.4 0 0 13.12 0 7.95 0 0.3 13.08 34.45
5 5
TOTAL #### #### #### 303.632 771.12 429.8 0 195.818 6.563 8.171 246.1 ####
2015-16 2 29
% 100 46.8 53.0 8.23 20.9 11.65 0 5.31 0.18 0.22 6.67 53.07
4 7
AUTHORS Dr. Sunil V Deshmukh, Principal, Suresh Deshmukh College

Ravindra B Gohane, Chief Engineer, Mahagenco Thermal of Engineering, Selukute, Wardha.
Power Station Email Id: svd4@rediffmail.com
Email Id: rbgohane@gmail.com
20
April 2017
IMPROVING PERFORMANCE MANAGEMENT IN AN IT INDUSTRY:

A CASE STUDY
Shreyas Lakhe
Abstract
Software development and maintenance enterprises constitute an extremely complex, varied, and poorly understood class of organizations. This is
due to the newness of the technology, the dynamic nature of the field & complexity of human-machine interactions. The prospect of improving software
business processes can be daunting. Often it's unclear that which areas should be targeted for improvements. In this paper, we share a proven
approach for evaluating and implementing process improvement in an IT company and provide a case study demonstrating its success. The approach
includes mechanisms for Gap & SWOT Analysis, documentation, developing key performance indicators, management information system and using
this information to plan specific improvements to the environment.
1. INTRODUCTION this approach is to carry out GAP analysis of existing

The role that organizational design plays in the software organizational working with reference to the good practices.
industry is different from its role in nearly any other business. Next, a SWOT (Strength, Weaknesses, Opportunity, & Threats)
The processes which constitute software development present analysis is to be carried out to identify the weaknesses & threats
an awkward blend of completely automated tasks, steps that for which strategic improvement can be planned. The third step
require human-machine interaction, and some purely creative of PBIA model is to orient the organization from the plan-Do-
activities. An IT company involves multiple tasks and also Check-Act (PDCA) approach. Next step is to identify the
requires multi-skilled workforce. It requires to have an processes (Input-Output-Enablers-Controls) & decide the
organisation structure which is flexible, with fewer barriers and organizational structure for its management, documentation
ensures free and fast communication. Moreover, the process required (SOP/Work Instructions/Formats), internal & external
orientation is required to ensure proper execution of the communications requirement and plan for monitoring and
software development project [1,2,3,4]. The Process Based review. In the next step Key Performance Indicator (KPI) which
Improvement Approach (PBIA) is based on the Plan, Do, Check will set goals and objectives for the processes and the
and Act (PDCA) cycle and integrates the goals and objectives individuals should be set and the management program for
(Key Performance Indicators KPI) with Management achieving these goals and objectives should be prepared. The
Information System (MIS) for management. This paper resources required, is to be provided by the management. The
describes the PBIA model and its implementation in an IT Management Information System (MIS) should be set in order
company for process improvement. to get periodic review about the effectiveness and performance
of the processes. A thorough process audit, thereafter, provides
2. PROCESS BASED IMPROVEMENT APPROACH
an opportunity to identify the deviation and plan the further
(PBIA)
improvement program. Corrective and preventive action
The process based improvement approach is a tool which can be
provides input to the PDCA for continual improvement. The
applied to improve performance management of an
process based improvement approach, therefore, will help the
organization. The name itself suggests that approach is based on
organization to have comprehensive integration of all the
certain processes within the organization. Figure 1 outlines the
activities and the functions for continual improvement.
proposed process based improvement approach. The 1st step in
Figure 1-Process Based Improvement Approach (PBIA Model)
21
April 2017
3. MAJOR COMPONENTS OF PBIA 4. CASE STUDY OF IMPLEMENTATION OF PBIA IN

Following are the major components of PBIA. AN IT COMPANY.
a. GAP Analysis Study: This requires a comprehensive GAP A case study was conducted in an IT company (M/s ABC
analysis study to be carried out for understanding the deviations Computers Ltd) to study the effect of implementing PBIA [8, 9].
from the good practices. For this, the standards such as SEI The detailed case study is presented here.
CMM, ISO9001 etc can be referred. 4.1Introduction about Company
b. SWOT Analysis: This can be carried out by the senior M/s ABC Computers. Ltd., located in Central India, is one of the
members of the management in a brainstorming session to find fastest growing and dynamic IT Company, with deep industry
out the strengths, weaknesses, opportunities and threats. For and functional expertise in space of ERP & Legal CRM. ERP &
this, considerations should be given to the contextual issues, Legal CRM Solution of the company is accepted worldwide for
internal and external, such as economic, technical, legal etc. its ease of use & easily configurable features. It is backed by an
SWOT will provide the management to bank on its strengths excellent young team of 100+ professionals, having 500+ years
and improve upon its weaknesses. Moreover, it can explore the of manpower experience. ABC Computers' ERP Solution
opportunities and plan to eliminate the threats. focuses on Retail, Trading, Sales & Distribution, whereas its
Legal CRM Solution focuses entirely on Legal Fraternity. ABC
c. PDCA Cycle: PDCA Cycle, as proposed by quality guru Computers' expertise is in providing innovate solutions by
Deming [5],is fundamental for improvement. PDCA cycle is as seamlessly blending a core group of specialties having an
follows:- extensive knowledge, traditional values, ethos and domain
· Plan: Establish the objectives and processes necessary to experience with a management team that understands client
deliver results in accordance with customer requirements satisfaction.
and the organizations policies. 4.2Problems Faced by the Company
· Do: Implement the processes With the growing competitions, global policy changes and
increase in service cost made the ABC Software company
· Check: Monitor and measure processes and product against conscious of its processes and started analyzing the problems
policies, objectives and requirements for the product and faced. Some of the critical problems identified are as follows:
report the results.
· Increasing trend in customer Complaints.
· Act: Take actions to continually improve the processes. · Delays in completing the projects.
d. Process Management: Process orientation of an · Increasing Costs of projects every day.
organization can be explained by a change of focus, i.e. from · No Performance measurement of Employees.
functions to processes and also when an organization's different · Employees complaining of getting over loaded
workflows and processes are identified and modelled, the · Unrest amongst employees.
characteristic for a process is that it is a repetitive standardised
flow, i.e. it is performed multiple times. [6,7]. Due to these 4.3 Approach for performance Improvement
mappings of processes the dependencies between activities Considering the problems, ABC Software Company started a
become clearer, forming a foundation for organizational new process approach, PBIA, for improvement as follows:
development and strategic management decisions. Process · Gap Analysis Study and SWOT Analysis of the company
orientation then deals with designing and improving the · Meetings & Reviews with individual departments.
standardised flow. Being standardised, also making it easier to · Process Mapping
measure. Process orientation is often a big change and · Identification of Value added and Non-Value added activities
demands a full commitment from the management. Without this · Eliminating Non-Value added activities
commitment process orientation initiatives often fail to deliver · Streamlining Organization Structure &Defining
the expected results. Responsibilities
e. Organisational System: This requires establishing the · Training need identification and training the team
flexible organisation structure with well-defined · Deciding the Key Performance Indicators(KPIs)
responsibilities for multi-skilled task force. It also involves · Designing Management Information System(MIS)
developing the documentation system involving policy, · Audit & Corrective Actions.
objectives, manuals, procedures, work instructions and
formats. A mechanism for monitoring of the processes will help 4.4Gap Analysis
reviewing the system. Initially, a Gap Analysis was carried out for the company. Gaps
identified in current situation against the expected performance
f. Measuring and reporting System: Establishment of Key level are as follows:
Performance Indicators (KPI) sets the objectives and goals for
each function and individuals and the performance can be Gap Analysis Salient Points: Improvement Areas
captured in Management Information System(MIS) report to be 1) Identification& unique numbering system to-
submitted by the functions periodically. a) Streamline Document Control.
b) Assets.
g. Audit: A process audit explores the deviations from the c) Files, Register, Books, Manuals and other records.
standard practices and provides opportunity for improvement d) Project Documents (review, updation & standardization).
through corrective and preventive actions. 2) Infrastructure & Work Environment -
h. Feedback: A feedback mechanism helps continual a) Provision of separation for server and power board and
improvement of the organization. environment required as per operational manual needs to
be ensured.
22
April 2017
b) Fire extinguisher, display of location map, mock drill d) Functional process flow (for standardize activities) to be
needs to be maintained. drawn.
c) Provision of First aid box, suggestion portal, and e) KPIs for each function needs to be prepared
information/knowledge portal can be made. f) Risk Analysis Function and sub-function wise needs to
3) Display of- be carried out & controls over it needs to be ensured.
a) Vision, Mission, Policy, Objectives, Values. g) Project lessons after end of each project needs to
b) Achievements of the organizations. maintained & communicated amongst the organization.
4) Standardization of protocols/Procedures function 8) HR
wise/department wise needs to be maintained. a) Organization chart and department chart followed by
roles, responsibilities & authorities needs to be prepared.
5) For sales enquiry, call prioritization policy to be decided. b) Internal training needs assessment considering field
E.g. after many follow up calls and fresh call, which call to knowledge requirements, plan & related training records
be selected. needs to be carried out. Evaluation of Effectiveness of
6) Timely disposal of e-scrap as per applicable norms to be Training.
followed. Records of same with legal license (if any) needs c) Overall licensing of the organization can be reviewed.
to be maintained. d) Organisation code of conducts, HR procedures needs to
7) Project wise (work in hand) (for all dept.) monthly planning be shared with staff.
& achievements needs to be maintained. e) Performance monitoring needs to be reviewed & should
a) What activities are planned in next month/3 months be more objective.
needs to be maintained centrally and communicated to 4.5 SWOT Analysis
concerned interlinked departments. Management members carried out SWOT Analysis (Table 1)
b) Monthly plan of the project & clarity in communication through repeated brainstorming and the results of the same are as
of instructions needs to be evident. follows:
c) Project released planning (for next 3 months) to be
carried out and shared with interlinked departments.
Table 1- SWOT Analysis
Strength (S) Weakness (W)

Strong Technology Backup Very Small Team
Young and Motivated Team Lack of Experience
Nil Borrowing Weak Marketing
Quick Decision Making High Inventory
Strong Customer Focus Limited customer based
Opportunity (O) Threat (T)
Lean Organization leads to- High Technology Imports
Flexibility in Product
Quick Response to Customer Needs Skill Development Velocity
Low level of Competition Technology Leakage
High Growth Potential Attrition
4.6 PDCA Cycle and Process Approach view of understanding and improving the process flow and
Plan-Do-Check-Act was initiated in all the processes and establishing inter departmental co-relation. Following is the
process orientation was provided. Process mapping was done sample Input and output process diagram (Fig.2).
for overall company and also for individual departments in
Figure 2 PDCA cycle
23
April 2017
4.1 Organisational System 7. Key Performance Indicator

Based on this gap analysis following documentation structure 8. Criteria for measuring project performance
was proposed. 9. Corrective & Preventive Action
· Proposed Documentation Structure 10. Improvements & Innovations
o Organization Structure 11. Management Information System(MIS)
o Roles, Responsibility, Authority Standardized check list was given for preparing the
o Job Profile documentation to all departments as a task. Documentation for
o Process Flow Chart all departments was prepared.
o KPIs · Key Performance Indicator (KPI)
o Risk Analysis Following Guide lines on Key performance indicator was given:
o Standardization o tools used for reference o A Business metric evaluate factors that are crucial to the
o Resource used Business.
§ Software used for development/testing/functioning o KPIs differ per organization; business KPIs may be net
o Work plan sheet revenue/ customer loyalty metric.
o Corrective Action Sheet o All processes & Sub-processes and every individual should
be covered.
· List of Documents Every Department has to Prepare o KPI should not be more than 2/3 ….Maximum 5.
Document preparation guide lines for all the departments o KPI should be SMART:
1. Departmental Structure
§ S-Specific/ M- Measurable/ A-Attainable/ R-Relevant/ T
2. Roles and responsibilities
Time Bound.
3. Job Profile
o Based on this following KPIs were identified for one of the
4. Competence Matrix
section.
5. Resource Used
6. Process Flow
Table2: KPI report
KPI – Key Performance Indicators EMPLOYEE EMPLOYEE EMPLOYEE EMPLOYEE
5. Excellent; 4. Good; 3. Average; 2. A B C D
Fair, 1. Poor (1-5) (1-5) (1-5) (1-5)
Self-Improvement
Understanding of the duties and
responsibilities
Competency in required job skills
and knowledge
Knowledge of the current field
Productivity/Getting Things Done
Uses tools and resources effectively
& learns and applies new skills
Works with minimal supervision
Is able to manage a fair workload &
manages overlapping/multiple task s
and projects
Work is of a consistently high quality
Knowledge
Has exceptional knowledge of the job
& processes.
Is thoroughly informed of all phases
of the job & processes.
Does not need more training or
experience to exceed perf ormance
levels
Does not need frequent guidance &
supervision on routine jobs
Feedback & Reporting
Provides continuous feedback
without fail, reports on a daily basis.
Provides feedback and takes
corrective measures if required
Other
Inter-personal skills
24
April 2017
Communication
Staff Management & Leadership
Team Work & Co -operation
Discipline
Overall Rating
ES-Expectations Surpassed; E -
Excellent; VG-Very Good; ES E E MI
G- Good; F -Fair; MI -Must Improve;
NA-Not Acceptable
4.8 Management Information System (MIS) conducted.MIS template(fig 3) was suggested.

Awareness training program for Process improvement was
Figure 3- Suggested Template for MIS
MIS Template
Work Targeted and Completed.
Analysis of delayed/ pending work.
Report on KPI
Resource or any other concern.
Improvement carried out in the month.
Improvements planned.
Plan & Target for next month
Things gone Right(TGR)/ Things gone Wrong (TGW)
Major Concerns & issues where management action is required.
Overall self-rating
*Expectations Surpassed *Excellent *Very Good
*Good *Fair *Must Improve *Not Acceptable
Based on these guide lines MIS system was regularized. MIS of One of the
departments is as given in Appendix 1:
4.9 Audit audit was conducted for the company and the report was
After completing the process of documentation and review an submitted.(Table 3)
Table 3- Process Improvement Audit
ABC Computer Pvt Ltd.
PROCESS IMPROVEMENT AUDIT
Function/Department:
Auditor: JVD
Auditee: BH
Sr. No. Audit Findings Remarks
Name of the department net Dot is creating confusion .Proper realigning is needed to be
1 done. ERP & Services may be separated for b etter clarity for . Documentation to be updated Suggestion.
accordingly.
2 Similar clarity needs to be created between ERP & Quality. Suggestion.
Proper aligning of Job role clarity to be addressed in ERP function for Product Manager,
3 Improvement Point
Product analyst, Developer & Technical writer.
4 Skill sets to be defined for product head/ERP Head. Improvement Point
For a ddressing interdepartmental training, H.R needs to be kept in loop and training need
5 Improvement Point
identification and fulfillment to be addressed.
6 Competence matrix to be addressed designation wise instead of name wise. Improvement Point
25
April 2017
7 Resource used to be updated. Improvement Point

Product development check list is prepared properly. To be revisited periodically in v iew of
8 Good Point
continual improvement
Document numbering system to be addressed at organization level, logic to be defined and
9 Improvement Point
to be uniformly followed for all functions.
KPI are not SMART. (Specific/ Measurable /Achievable /Rele vant /Time bound). Need to
10 Improvement Point
be addressed.
MIS for June was prepared . However, all parameters need to be addre ssed. In case of
11 Improvement Point
confusion or overlapping of certain points, management to offer clarity
4.10 Benefits Accrued 2014. vol. (1), Issue-3 pp. 424-429.

1. All the processes are now stream lined.
2. The complete process is structured and standardized. 3. Anupriya. S, “Performance Management System Design,
3. The bottle necks were identified and resolved. Implementation and Outcomes in Indian software
4. Key Performance Indicators (KPI) was established.
5. Inter-relationship of processes was established. organizations: a perspective of H.R. managers”, South
6. Management Information Report (MIS) was established. Asian Journal of Management, vol. (19), April-June 2012,
7. Working was simplified.
8. No more day to day problems. pp. 99-120.
5 CONCLUSIONS 4. Denise. T (2007),” Leadership, National culture and

This paper presented a Process Based Improvement Approach
Performance Management in the Chinese software
(PBIA), with the help of a case study in an IT company to
industry”, International Journal of Productivity and
improve significantly its processes and remove the bottlenecks.
Performance Management, 56(4), May 2007, pp. 270-284.
A process orientation approach presented has worked as a
solution for organisation effectiveness. Thus, a clear allocation 5. Deming, W.E. (1982),”Quality, Productivity & Competition
of activities in processes facilitates or is a condition for the Position”, Massachusetts Institute of Technology, Centre of
development work to be carried through in an effective manner. Advanced Engineering Study, USA. 1982.
One can conclude that one of the main prerequisites for a drastic 6. Tony. C. A. (2006), “Case Study in Performance
improvement of an organisation is to understand the bigger Management, A Guide”, Willey, New Jersey, USA 2006.
picture. An integrated, holistic and systematic approach will be
7. Chen, Y-C, Wang. W. C, Chu. Y. C (2011), “A Case Study on
essential to organizations of the future. In this new age, quality
the Business Performance Managementof Hilton Hotels
will finally be used, as it was initially intended, as an integral
Corp”, International Business Research, vol. (4), 2011, pp
part of the business management philosophy and organisational
213-216.
fabric.
6 REFERENCES 8. Bassey. B. E and Benjamin, J. I. (2009), “A Case for
1. Hassan. D. A &Shakeel. S (2010), “Improving Performance Performance Managementin the Public Sector in Nigeria”,
Management Practicesin IT firms of Pakistan”, Journal of International Journal of Business & Management, 2009,
Management Research, Macrothink Institute, Las-Vegas, vol. (4), pp. 98-105.
vol. (2), 2010, pp 1-15.
9. Athanasios. G(2015),” Performance Management as a
2. D. B. Bagul, (2014),” A Research Paper on Study of Process of Promoting Innovation in software Industry”, 3rd
Employee's Performance Management System”, An International Conference on Strategic Innovative Marketing
International Peer Reviewed Scholarly Research Journal (IC-SIM 2014), vol.(175), 12 February 2015, pp 401-407.
for Humanity, Science & English Language, April-May,
26
April 2017
APPENDIX 1: MIS FOR DEPARTMENT

Table of Contents
Sr. no. Title
1. Work targeted & completed (1) 4.Improvement performance (4)
2. Analysis of delayed/pending work (2) 5.Plan & Target for Next Month (5)
3.Major concerns & issues (3) 6.Things gone Right/ Things gone wrong (6)
Table 1-Work Targeted & Completed

Project / Category Description Manager Status
Client
All Customization Transaction Prints for many clients as per their Employee A Completed
requirements
All Enhancement Sales VAT Summary Employee A Completed
All Enhancement Purchase VAT Summary Employee A Completed
K Customization To show Create PDI Details link in Purchase Receipt Employee A Completed
K Enhancement Buy Back of Item from Single Step Sale Invoice Employee A Completed
P Customization Required Supplier wise Item filter in SSPI Employee A Completed
A Enhancement SO to SI flow using PO, PR and PI. Employee B WIP
A Enhancement Parent Transaction filtering based on Process flow used Employee B Completed
by the customer
A Customization Token Clearing System Employee B WIP
B Bugs Add "Show Items With Zero Stock" check box in Stock Employee C Completed
Position Analytics Company/Branch, Sale Position
Analytics Report
K Bugs Add discount / quantity on sale POS screen Employee C Completed
(functionality)
D Customization Implementation support & development for Employee C WIP
requirement
including enhancement, customization, print, bugs, data
configuration, import , etc.
D Enhancement Finance enhancement with respect to Multi currency Employee C WIP
P Misc. ABC Computers. Ltd. Server TFS installation Employee C Completed
T Customization Delete Outward since created two inward for single Employee C Completed
outward. This is bug
R Enhancement Approval Process for Inter Branch Contra Employee D Completed
R Enhancement Provision to accept Advance Payment against sale Employee D WIP
Order in POS screen.
R Enhancement Reports: Sale In Sale Through, Inward & Outward Employee D Completed
Register, Vender wise Sale Purchase Register, Purchase
Register with GRN & PI Data.
R Issues Onsite Issue for Insp, Ven, Nya Employee D WIP
27
April 2017
Table 2-Analysis of Delayed/Pending Work
Product / Category Description Manager Remarks
Project
A Enhancement Budget management report as per client AC Pending due to high
requirement priority print layouts
DI Customization Implementation support & development for BH
requirement including enhancement,
customization, print, bugs, data configuration,
import , etc.
DP Enhancement Finance enhancement with respect to Multi BH
currency
R Enhancement Cover all Report to Dev Ex PHP Control MG
R Enhancement Print Footer, Header Repeat & Full Page Issue MG
R Enhancement IL Balance Updation on save Remove & Auto MG
Sync IL Balance table after day close process
/Mid night
Table 3- Major Concerns & Issues

Department Suggested
Manager Remarks (Concerns, Suggestion) Priority Status
/ Category Solution
AC Concern Resource Availability Urgent
Speed of MPI goes live status. It has to be completed in
Jun 16 but failed because of client, and internal team.
We have completed development less than
MG Concern implementation duration. Urgent
Table 4-Improvements Performed & Planned

Manager Category Performed Planned
AC Started Scrum Meeting every day with Respective QA & Functional Member to
share plan and derivable
All Professional Corporate Training by Guest Lecture
Table 5- Plan & Target for Next Month

Product /
Manager Project Category Description
Buyback process to be included in Single Step Sale Invoice
AC Ki Motors Customization itself
AC Al Fat Customization Budget management report as per client requirement
MG R ERP-Web Enhancement Auto Emailing on Schedule Basis
MG R ERP-Web Enhancement Implementation of Schemes
MG Ven Customization Hold Cold For Contra Process
MG Nya Customization Alerts On Dashboard for Approvals
BH MPI Implementation MPI Must go on Live for Sale, Purchase, Inventory & Finance
Table 6- Things gone Right / Things gone Wrong

Category Things Goes Right Things Goes Wrong
Development is going on Failed to achieve go live date
MPI Timely Major changes in Customer Requirement, Suggestion
AC is handling Complete Finance module of ERP; and now-a-days he
Resource is allocated on other Department
Misc. TFS Not working for 15 days
AURTHOR Quality Improvement and Machine Learning. He has worked

Shreyas Lakhe is Final Year B-Tech (CS) student of COEP, successfully on open sources and has won many competitions
Pune. He has interest in Artificial Intelligence, Data Mining, and hackathons.
28
April 2017
ANALYSIS OF ENABLERS FOR IMPLEMENTATION OF

VENDOR MANAGED INVENTORY
Ms. Jyoti Bala Songar
Dr. A.C. Shukla
Abstract
The purpose of this paper is to provide a quantitative and qualitative analysis of the enablers to implement the Vendor Managed Inventory (VMI). The
research design is divided into three phases; first, the enablers were identified through an extensive literature review; second, a questionnaire based
survey was conducted among six organizations which are using vendor managed inventory system. Based on data collection statistical tests have
been conducted. Moreover, the factors are also analyzed by categorizing the surveyed organizations into two classes i.e. according to industry's
annual turnover and according to type of industry. Overall it is observed that the 'committed top management' is emerged as the major enablers of
Vendor Managed Inventory(VMI) implementation. This study provides VMI implementation index which shows the gap between the findings and
requirement. This index contains eight different attributes based on which VMI is performed. On the basis of researcher's observation all eight
attributes are prioritized and different weightage has been given to different attributes by using Expert choice Software. Vendor managed inventory
system is slowly but steadily gaining importance and in time to come it will have a wide spared impact on the way inventory is managed in
organization.
Keywords: VMI, Enablers, manufacturer, Pair wise comparison, Expert choice software,
1. INTRODUCTION 2. LITERATURE REVIEW

In recent years the disciplines of supply chain management Vendor-managed inventory (VMI) is a business model in
and logistics have gained considerable increase in scholarly which the buyer of a product provides certain information to a
attention. Such attention is due to the fact that both areas vendor or the supplier of that product and the supplier takes
focus on creating top- as well as bottom-line improvements full responsibility for maintaining an agreed inventory levels
by streamlining the flow of material and information across of the material, usually at the buyers preferred location or
the supply chain (Christopher, 1992). VMI is a unique store(Daughterly, 1999).
approach, in that focal firm stresses the responsibility of VMI can be used to address certain types of dysfunction,
vendors in inventory management. Benefits emanating from particularly ones that include inefficiencies in inventory
this concept include but are not limited to higher selling space replenishment and placing of orders. The dysfunctions
productivity, increased sales per store for retailers and an usually arise from the custodian's lack of infrastructure and
improved control of the bullwhip effect (Waller, et al, 1999; resources, a lack of inventory management capability, as well
Angulo, Nachtmann & Waller, 2004). Vendor managed as low levels of staff motivation. VMI address these
Inventory is a collaborative process between inefficiencies and can generate mutual benefits for both the
manufacturer/retailer/distributor and supplier/ manufacturer, VMI partner and the custodian, which may strengthen the
where the manufacture gains access to the demand and retail industry. VMI provides benefits for both vendors and
inventory information at the retailer and uses this information their customers. Under VMI, supply chain inventory levels
to better managed the retailer's inventory. VMI start as a pilot and the associated costs of that inventory—handling costs,
program in retail industry between Procter& Gamble and opportunity costs of capital, obsolescence costs, etc.—have
Wal-Mart in 80's and that result in significant benefits, such decreased, profitable sales have increased, and distribution
as lower inventory levels, fewer stock-outs and increased and production costs have decreased (Aberdeen Group 2004;
sales, and also has been adopted by many other supply chain Achabal et al. 2000). In some cases, customers and vendors
such as Dell's, Barilla's or Nastle's. Research on inventory have created interdependencies that make these supply chain
management in general and on VMI in particular has improvements sustainable and they position themselves for
intensified during the recent decade (Williams & Tokar, further improvements (Hammond 1995; Lee, Clark, and Tam
2008). Despite this increased focus and VMI's ostensible 1999).
benefits, the concept has, however, not gained the popularity A number of research papers have been found in many
that was expected since its successful introduction and journals on vendor managed inventory system. Selection of
application in US retail stores, such as Wal-mart and K-mart research paper is done with focus on identifying different
in the early 1990's (Blatherwick, 1998). This paper attempts enablers. Table 1 listed the contributions of various authors
to identify the enablers of Vendor Managed Inventory (VMI) related to vendor managed inventory along with their research
in Indian retail industry and priortise these enablers for paper title. Various enablers to vendor managed inventory are
successful implementation of VMI. identified through extensive literature review and are
presented in Table 2.
29
April 2017
Table: 1 Findings from various research papers on VMI
Author (year) Title Contribution

The study described here used data from a retailer
of soft goods and house wares to evaluate
Restocking inventory in
Buffa P. Frank various inventory grouping methods and to
Groups: A transport inventory
(1986) determine an optimal method
case
considering inventory, transportation and
consolidation costs.
JIT has reduced product cost, and improved
C. Das, S.K. productivity, product quality and delivery time.
Avendor 's View of the JIT
Goyal The role of vendor in JIT system must be properly
Manufacturing system
(1989) evaluated and efforts should be made to make
them more co-operative.
Inventory management as a tool to improve
Lee HsuHua, customer satisfaction. Suggests that satisfying
Inventory management in the
Kleiner H. Brian customer needs results in increased revenues,
women’s clothing industry
(2001) greater liquidity, lower inventory levels and
improved returns on investment.
Urban The interdependence of
The effect of displayed inventory on retail sales is
L. Timothy inventory management and
widely recognized in the logistics.
(2002) retail shelf management
Reddy Malla
Vendor managed inventory
& Vrat Prem Various attributes related to cost control.
model and case study
(2007)
Exploring the benefits of The capacity restrictions of suppliers
Sari Kazim
VMI
(2007)
In these found that current inventory status and
sales forecasts are the most important kinds of
Vigtil Astrid Information exchange in
information to be made available to the supplier
(2007) inventory managed inventory
in a VMI relationship
.
Kauremaa Jouni,
Patterns of vendor-managed
Småros Johanna, It is Using the conceptualization, potential VMI
inventory: findings from a
Holmström Jan adopters can set more realistic and explicit
multiple-case study
(2009) implementation targets
It is observed that both large and small industries
Borade Atul in India have started adopting VMI for improving
study of vendor managed
B, Satish V. the business performance. Results clearly indic ate
inventory: practices in Indian
Bansod that adoption factors are different in large and
industries
(2010) small industries.
The paper contributes a generic framework for

assessing the implementation of VMI in se ven
Sebastian Stanger Vendor managed inventory in
steps. The research proposed that hospitals
H.W. the blood supply chain in
hesitate to enter a VMI relationship for critical
(2013) Germany
resources such as blood. Hospitals fear losing
control over critical resources.
The case study reports on how both financial and
Frederik Vendor managed inventory
nonfinancial drivers of performance are utilized
Zachariassen :Why you need to talk t o your
in order to create satisfying solutions for both
(2014) supplier
parties in the cooperation.
Barriers to Effective
Vincent The study concluded that economic order quantity
Implementation of Vendor
Ochieng1, Daniel and procurement costs are affected by VMI
Managed Inventory among
Wanjihia2(2014) thereby affecting organizational performance.
Supermarkets in Kenya
30
April 2017
The applicability of the proposed model and

Multi-objective p roduction -
Amir Hossein solution methodologies are demonstrated under
distribution planning based
Niknamfar several problems. A sensitivity analysis indicates
on vendor-managed inventory
(2015) the market scale and demand elasticity have a
strategy in a supply chain
substantial impact on the total cost of the
manufacturer in the proposed P-D VMI.
S.M.Sohel Rana,
VMI can be challenging unless clear
Abdullah Osman Retail Supply Chain and
collaboration and communication between the
and Mb. Aminul Vendor Managed Inventory
manufacturer and supplier is established to ensure
Islam System
success.
(2015)
Measuring the benefits of The analysis res ults suggest ERP users are more
Yung -Yun
ERP on supply mature than non-ERP users in three key
Huang , Robert B
management maturity model: indicators: strategic sourcing, category
Handfield
a “big data” method management, and supplier relationship
(2015)
management.
Mauro This study demonstrates that
Performance outcomes and
Falasca, John F. industrial vending implementation success is
success factors of
Kros, S. Scott strongly tied to the amount and quality of the
industrial vending solutions
Nadler information shared between the relationship
(2016) partners.
Table: 2 Identified enablers of VMI
Code Main criteria Reference
Sahay (2003), Burt et al. (2004), Bianchi and
E.1 Trust among members
Saleh (2010)
Frank P. Buffa
E.2 Transportation time and cost
(1986)
HsuHua Lee, Brian H. Kleiner
E.3 Performance of vendor
(2001)
Sebastian H.W. Stanger
E.4 Technical capabilily
(2013)
Various attributes related to cost Malla reddy
E.5
control Prem Vrat(2007)
Kazim Sari
E.6 Reduced the labour
(2007)
Astrid Vigtil
E.7 Information exchange
(2007)
Timothy L. Urban(2002), HsuHua Lee, Brian
E.8 Improve level of inventory
H. Kleiner (2001)
3. METHODOLOGY • Define the problem and determinethe kind of knowledge
To analyses the vendor managed inventory system in select sought.
organizations we have used interviewing technique, • Structure the decision hierarchy from the top with the goal of
questionnaire technique and data analysis is done using Expert the decision, then the objectives from a broad perspective,
Choice Software. An interview technique is a conversation through the intermediate levels (criteria on which
where questions are asked and answers are given verbally to subsequent elements depend) to the lowest level (which
transform the information from interviewee to interviewer, usually is a set of the alternatives)
although information transfer can happen in both directions. A • Construct a set of pair wise comparison matrices. Each
questionnaire is a research instrument consisting of series of element in an upper level is used to compare the elements in
questions and other prompts for the purpose of gathering the level immediately below with respect to it.
information from respondents. The priorities (weights) of • Use the priorities obtained from the comparisons to weigh
various enablers are calculated based on the technique of pair the priorities in the level immediately below. Do this for
wise comparison as done in Analytic Hierarchy Process (AHP), every element. Then for each element in the level below add
(T.L. Saaty, 2008). The technique involves making a its weighed values and obtain its overall or global priority.
hierarchical structure of the parameters affecting the objective Continue this process of weighing and adding until the final
function and comparing them for the contribution towards priorities of the alternatives in the bottom most level are
achieving the goal. The paired comparison technique helps us in obtained.
identifying the weights of the factors in this case enablers of This steps are carried out in the expert choice software is shown
implementation of VMI. The comparison evaluation is done on in the Figure 1. Expert Choice Software is decision making
the scale of 1 to 9 as suggested by Saaty (2008). The following software that is based on multi criteria decision making. The
steps are involved methodology examines various enablers and finds crucial
outcomes.
31
April 2017
Figure 1: Steps followed in the Expert Choice Software
4. DATA COLLECTION AND ANALYSIS The weightage of the attributes is obtained using paired
To bring out different enablers to implementing the VMI in a comparision and normalization such that ∑ Xi=1 and Xi ≥ 0
holistic manner, an instrument for data collection was required. VMI implementation index is calculated by multiplying the
Based on literature and by guidance of the mentor six page mean of the attribute to the respective weightage of that enabler
instruments including a cover page was developed. The for each organization.
instrument i.e., questionnaire was categorized into two parts:
'personal information and company characteristics' and 5. RESULTS & DISCUSSIONS
'enablers to VMI'. A total of 54 closed end questions were The results of the level of implementation of VMI are shown in
framed in the instrument, which were classified into 08 the Table 3. The table shows all the factors included, mean of
benefits. The contribution of each attribute was assessed on a these factors, weightage given to each factor and the VMI
five-point Likert scale that ranged from 1 = strongly Implementation Index is calculated. All 8 attributes are first
disagree,through 3 = almost agree, to 5 = strongly agree. A pilot prioritise before the weightage is calculated in the expert choice
survey among researchers and expert was conducted to ensure software. The priority given to the factors are based on the
the clarity of content, accuracy, and the ease of use. Their observation made during the visits and meetings held with the
feedback was used to modify the survey instrument. This organization heads. The result is calculated for six different
prepared questionnaire was being filled by departmental heads organization separately that is show in the Table 3.
to know more and taking their views about VMI on the scale of · In organization A, the weightage of communication attribute
5. Data collected from the questionnaire is analysed to priorities (0.29) is important than other attributes and VMI
on the basis of researcher's observation. The weightage to Implementation index of this organization is 3.82.
enablers are found using Expert choice software, where pair · In organization B, the weightage of reduction in labour
wise comparison is done among each attribute on that software attribute (0.25) is important than other attributes and VMI
to give different weightage to different attributes and then six Implementation index of this organization is 4.09.
organization has been compared on the scale of 5. · In organization C, the weightage of cost control attribute
Total eight attributes are used and mean has been calculated (0.32) is important than other attributes and VMI
from the questionnaire which is used for calculating the score. Implementation index of this organization is 3.46.
· In organization D, the weightage of communication attribute
Mean of attributes(M.O.A.):- (0.24) is important than other attributes and VMI
Sum of all the values obtained from the Implementation index of this organization is 3.99.
filled section in questionnaire · In organization E, the weightage of cost control attribute
Number of questions responded by the respondents (0.28) is important than other attributes and VMI
Implementation index of this organization is 3.58.
· In organization F, the weightage of trust attribute (0.26) is
important than other attributes and VMI Implementation
index of this organization is 3.82.
32
April 2017
Table: 3 VMI Implementation Index
Attribute Organization A Organization B Organization C Organization D Organization E Organization F

M.O. Wt. Score M.O Wt. Score M.O Wt. Score M.O Wt. Score M.O. Wt. Score M.O. Wt. Score
A .A .A .A A A
Trust 4.00 .173 .69 4.00 .094 .36 3.50 .220 .77 4.17 .167 .66 3.17 .054 .17 4.17 .262 1.08
Transportation 3.20 .057 .18 4.40 .229 1.0 3.00 .090 .27 4.00 .078 .28 3.80 .156 .57 3.60 .077 .27
Vendor 3.67 .087 .31 3.67 .072 .26 2.67 .049 .13 4.00 .075 .30 3.33 .078 .25 3.67 .079 .28
performance
matrix
Technical 2.67 .029 .07 4.17 .141 .58 3.00 .078 .23 4.17 .139 .54 3.33 .081 .26 2.83 .032 .09
capability
Cost control 4.00 .147 .58 3.25 .050 .16 3.75 .327 1.38 4.00 .083 .33 4.00 .286 1.12 3.75 .098 .36
Reduction in 3.80 .146 .55 4.40 .256 1.12 3.00 .076 .22 4.20 .194 .79 3.60 .149 .50 3.80 .119 .45
labour spend
Communicatio 4.14 .290 1.2 4.29 .135 .57 3.14 .132 .40 4.29 .241 1.03 3.86 .174 .66 4.00 .195 .78
n
Level of 3.50 .070 .24 2.75 .022 .06 2.25 .027 .06 2.75 .022 .06 2.50 .022 .05 3.75 .137 .51
inventory
Total 3.82 4.09 3.46 3.99 3.58 3.82
6. CONCLUSIONS transportation system. This study provides the comparison
The implementation of VMI in retail industry is a possible way among all six organizations and shows the scope of
to improve supply chain performance and access to desired improvement in all organizations. It should be noted that all six
product in a cost effective manner. But the application of VMI is organization need to improve in 'Inventory level'. This paper
not been used by the retail industry in the wide manner. And if provides a framework to the research community and present
VMI implementation is attempted then retail industries unable upto date literature for the study. Improvement is a slow and
to execute it properly. So the degree of implementation of VMI continuous process hence it may take long time.
need to be calculated which is called “VMI implementation
7. LIMITATIONS AND FUTURE WORK
index”. In this study a questionnaire is prepared for the survey
The research suffers from some limitations that further study
in six different retail industry and this information is used to
could overcome. The first is that overall only six organizations
calculate 'VMI implementation index' with the help of Expert
participate in this type of survey. Secondly, the numbers of
Choice Software. This VMI index indicates the retail industry
interviewees were limited person interested to convey
their position how well they are implementing VMI. Since
information about the VMI. The third is that this study is limited
being a renowned retail industry they are willing to implement
to Indian context. Moreover number of surveyed organizations
it but there are certain difficulties they have to overcome. This
and interviewees could be increased in future research.
study provides a clear view to their difficulties and remedies for
these difficulties have been suggested in this study specifically REFERENCES
to each retail industry on the basis of score obtained by them in
1. Astrid , (2007) “Information exchange in vendor managed
VMI implementation index. The score of organization A is 3.82
inventory” International Journal of Physical Distribution
on the basis of attributes in the questionnaire. Similarly, the
& Logistics Management, Volume: 37 Issue: 2
score of organization B, organization C, organization D,
organization E, and organization F are 4.09, 3.46, 3.99, 3.58, 2. Blatherwick, A.,(1989). Vendor managed inventory:
and 3.82 respectively. All these VMI index are found on the fashion fad or important supply chain strategy? Supply
scale of 5. On the basis of our result, we conclude that chain management
organization B is better based on stated attributes followed by
3. C. Das, S.K. Goyal, (1989) “A vendor 's View of the JIT
organisations D, A, F, E and C respectively for implementing
Manufacturing system” International Journal of
the VMI. Among six organisations B is most efficient and
Operations & Production Management, Volume: 9 Issue: 8,
effective due to better implementation of transportation system
and reduction in labour spend. Organization D is at second 4. Darya Monnigmann, (2011) “Optimization of a vendor
place and need to improve much in the attribute inventory level managed inventory supply chain with guaranteed stability
and they need to adopt inventory management models to and robustness” Int. J. Production Economics 131 (2011)
improve. Organization E and C are at bottom on the basis of 727–735
VMI index. Organization E has high scope of improvement in
5. Falasca Mauro, Kros John F, Nadler S. Scott, (2016) “
the attribute 'Trust'. Trust is an important aspect in the retail
Performance outcomes and success factors of
industry and need to improve by improving more in
industrialvendingsolutions” International Journal of
communication with the vendors and readjusting the things to
Operations & Production Management, Volume: 36 Issue:
be better in this aspect. The organization C needs to improve
10
more in attribute vendor performance matrix and therefore they
need to review their vendor performance and take actions 6. Frank P. Buffa, (1986) “Restocking Inventory in Groups: A
accordingly. Organizations A and F are in the middle and have Transport Inventory Case” International Journal of
equal index. Both organization have scope of improvement in Physical Distribution & Materials Management, Volume:
Technical capability and Transportation system which suggest 16 Issue: 3
to be more adaptive to current technologies and better
33
April 2017
7. Frederik Zachariassen, (2014) “Vendor managed management performance? Lessons learnt from the UK
inventory :Why you need to talk to your supplier” Journal blood supply chain”Supply Chain Management: An
of Industrial Engineering and Management International Journal, Volume: 17 Issue: 2
8. Hsu-Hua Lee, Brian H. Kleiner, (2001) “Inventory 16. Sohel Rana S.M., Osman Abdullah and Islam Mb. Aminul,
management in the women's retail clothing industry” (2015) “Retail Supply Chain and Vendor Managed
Management Research News, Volume: 24 Issue: 3/4 Inventory System” International Journal of Business and
Technopreneurship Volume 5, No. 1, Feb 2015
9. Huang Yung-Yun , Handfield Robert B, (2015)
“Measuring the benefits of ERP on supply management 17. Thomas L. Saaty (2008) “Decision making with the
maturity model: a “big data” method” analytic hierarchy process” Int. J. Services Sciences, Vol.
1, No. 1, 2008
10. Kazim S, (2007) “Exploring the benefits of vendor
managed inventory” International Journal of Physical 18. Timothy L. Urban, (2002) “The interdependence of
Distribution & Logistics Management, Volume: 37 Issue:7 inventory management and retail shelf management”
International Journal of Physical Distribution & Logistics
11. Niknamfar Amir Hossein, (2015) “Multi-objective Management, Volume: 32 Issue: 1
production -distribution planning based on vendor
managed inventory strategy in a supply chain, Industrial 19. Wan Hasrulnizzam Wan Mahmood, Nurulain Mat Tahar,
Management & Data Systems, Volume: 115 Issue: 6 Mohd Nizam Ab Rahman, Baba,Md Deros, (2011) “
Supply chain enhancement through product and vendor
12. Ochieng Vincent, Wanjihia Daniel, (2014) “ Barriers to development programme” Journal of Modelling in
Effective Implementation of Vendor Management, Volume: 6 Issue: 2
13. Managed Inventory among Supermarkets in Kenya” AUTHORS
International Journal of Science and Research, Volume: 3
Issue: 4. Ms. Jyoti Bala Songara, Research Scholar, Industrial
Engineering & Management, Ujjain Engineering College,
14. Sebastian H.W. Stanger, (2013) “Vendor managed Ujjain, M.P., India
inventory in the blood supply chain in Germany: Evidence
from multiple case studies” Strategic Outsourcing: An Dr. A.C. Shukla, Associate Professor, Department of
International Journal, Volume: 6 Issue: 1 Mechanical Engineering, Ujjain Engineering College, Ujjain,
M.P., India
15. Sebastian H.W. Stanger, Richard Wilding, Nicky Yates, Sue Email: jyotiparmar03@gmail.com
Cotton, (2012) “ What drives perishable inventory
34
April 2017
FMEA TO ENHANCE QUALITY AND EFFICIENCY OF CNC MACHINES:

A CASE STUDY IN VALVE MANUFACTURING INDUSTRY
Raj Kumar Salvi
Dr. S. Jindal
Abstract
Failure Mode and Effects Analysis (FMEA) is a systematic method of identification and preventing products and process' problems before it occur.
FMEAs focus on preventing defects, enhancing safety and increasing customer satisfaction. It is precisely an analytical methodology used to ensure
that potential problems have been identified and addressed through the product and process development cycle. In this work, the goal is to reduce the
potential failures of CNC machines in industry through the FMEA approach reducing the downtime. Various possible causes of failure and their
effects on sub systems have been evaluated for improving the reliability of the CNC machines. The FMEA needs to define parameters such as Severity
(S), Occurrence (O), Detection (D) and Risk Priority Number (RPN). On the basis of the parameters some of the suggestions are proposed for
avoiding the possible risks and ultimately reduce the loss to the industry in terms of time, money and quality.
Keywords: CNC machine, Failures, Severity, Occurrence, Detection, RPN.
1. INTRODUCTION oscillations, motion of parts, output failures and inaccurate re

Failure Mode and Effect Analysis (FMEA) is a widely used home have more negative impacts on the feed system. A study on
engineering technique for identifying and prioritizing potential the expert judgment of failure mode analysis method, where the
failure modes in systems, designs, processes and services possible distribution of the attribute of the judgment were
before they occur, with the intent to eliminate them or minimize established and the information fusion of the possibility
the risk associated with them. FMEA is an inductive approach distribution were implemented, was performed by Li et al
to support risk assessment studies and the principle of FMEA is (2016) using the Comprehensive Analysis Method. The values
to identify potential hazards along the focused system and to are assigned to the weights which combines the variation
prioritize the required corrective actions or strategies. When it coefficient method and the subjective weighting method. The
is used for a criticality analysis, it is referred to failure mode and possibility values of the RPN are calculated on a machining
its effects. It is essential that such an effective analysis must be centre and then ranked. Different maintenance strategies for
carried out for improving various mechanical processes so that each failure mode of functionally significant item of
the demand of the customers can be satisfied on time. conventional milling machine are described by Gupta and
2. LITERATURE REVIEW Mishra (2016). The study aims at reliability-centered
Wu et al (2016) conducted a study on Computer Numerical maintenance with fuzzy logic and its comparison with
Control (CNC) machine's performance using are Multi-Criteria conventional method where Failure Mode and Effect Analysis
Group Decision Making (MCGDM) technique based on the were introduced integrated with fuzzy linguistic scale method.
Fuzzy VIKOR method. Linguistic variables represented by The results for risk priority number were based on weighted
triangular fuzzy numbers were used to reflect the preferences of Euclidean distance formula and centroid defuzzification where
decision maker for the criterion importance weights and the the criticality ranking was decided, and appropriate
performance ratings. After the individual preferences are maintenance strategies were suggested for each failure mode.
aggregated or after the separation values are computed, they are 3. METHODOLOGY
then defuzzified. Yang et al (2010) described a new fuzzy In the present work, the data related to failures in CNC machines
FMEA model integrated with fuzzy linguistic scale method for have been collected from GG Valves Industry, Udaipur and
the analysis of a type of CNC lathe. The model proposed a risk analysis of has been performed using conventional FMEA
space diagram to exhibit the relationship of Severity (S), approach. The specification of CNC machines used in GG
Occurrence (O) and Detection (D) where the Risk Priority Valves industry, for the data collection is given in Table 1. The
Number (RPN) is calculated by weighted Euclidean Distance data of CNC machine failures at the regular interval of time has
formula and centroid defuzzification based on Alpha-level. The been collected.
results indicated that the fuzzy FMEA used in CNC lathe is a
The following parameters are used for collecting failure data of
reasonable method corresponding to the manufacturing with a
the CNC machines:
supporting plan for manufacturing. The Failure Mode Effects Ø Failure date and time
and Criticality Analysis (FMECA) proposed by Wang et al Ø Failure phenomenon
(2016) do not take opinions of different team members when Ø Cause analysis
considering the assignment of criticality. In this paper, Ø Repairing process of failure
improved criticalities (ICR) were calculated and failures of feed Ø Downtime of machine
systems were prioritized by FMECA based on the failure data of
the feed system. It is observed in the results that vibration or
35
April 2017
Table 1: Specification of CNC machines
Specification
Max. Max. Length No. of
Machine Name of Turning
turning turning between tools
No. CNC Lathe speed
length Dia. centers on
(RPM)
(mm) (mm) (mm) Turret
Daewoo
L-01 525.8 370.8 525.8 10 35-3500
Puma 10-HC
LMW-
L-02 250 320 350 8 45-4300
P20T.L3
LMW-
L-03 440 380 550 8 35-3500
P20T.L5
The traditional Failure Mode and Effect Analysis (FMEA) Step 1: Identification of components and associated functions
approach is a pro-active quality method for evaluating potential Step 2: Identification of failure modes
failure modes and their causes. It helps in prioritizing the failure Step 3: Identification of effects of the failure modes (Severity,
modes and recommend corrective measures for the avoidance S): The severity of the failure is estimated using an evaluation
of catastrophic failures and improvement of the quality of scales from 1-10 for machine downtime in hours shown in Table
product. 2.
Table 2: Criteria for ranking Severity (S)
Effect Severity Criteria Ranking
Hazardous without Very high severity ranking: Affects
10
warning operator, plant or maintenance personnel
High severity ranking: Affects operator,
Hazardous with warning 9
plant or maintenance personnel
Very high downtime Downtime of more than 8 hours. 8
High downtime Downtime of more than 4-7 hours. 7
Moderate downtime Downtime of more than 1-3 hours. 6
Low downtime Downtime of 30 minutes to 1 hour. 5
Downtime up to 30 minutes and no
Very low 4
defective parts
Process parameters variability exceeds
Minor effect 3
upper/lower control limits
Process parameters variability within
Very minor effect 2
Process parameters variability within
No effect 1
(Source: Degu and Moorthy, 2014)
Table 3: Criteria for Ranking Occurrence (O)
Probability of
Possible Failure Rates Criteria Ranking
Occurrence
Very high: Failure is MTBF of less than 1 hour. 10
almost inevitable MTBF of less than 2 to 10 hours. 9
MTBF of 11 to 100 hours. 8
High: Repeated failures
Moderate: Occasional
failures
Low: Relatively few MTBF of 3001 to 6000 hours. 3
failures MTBF of 6001 to 10,000 hours. 2
Remote: Failure unlikely MTBF greater than 10,000 hours. 1
Step 4: Identification of cause of the failures (Occurrence, O): ranking levels resulting in a scale from 1 to 10. After deciding
The occurrence is based on knowledge of the failure mode and the Severity, Occurrence and Detection numbers, the RPN was
prioritizes for an evaluation scale as 1-10 for Mean Time calculated by multiplying Severity (S), Occurrence (E) and
between Failure (MTBF) in hours shown in Table 3. Detection (D) scores.
Step 5: Current Design Control (Detection, D): The use of R PN = S × O × D
evaluation scale is shown in Table 4. The small value of RPN is always better than the high value of
Step 6: Calculate Risk Priority Number (RPN): RPN is the RPN. According to the values of RPN, the failure mode was
indicator for the determination of proper corrective action on categorized and then proper remedial action was suggested for
the failure modes. The Severity, Occurrence and Detection are the CNC machine's failures with high level of risks.
36
April 2017
Table 4: Criteria for Ranking Detection (D)
Detection Detection by Design Controls Ranking
Absolute Very high remote chance a Machine controls will not or
10
uncertainty cannot detect potential cause of failure mode
Very remote chance a machinery/design control will
Very remote detect a potential cause/mechanism and subsequent 9
failure mode.
Remote chance a machinery/design control will detect a
Remote 8
potential cause/mechanism and subsequent failure mode.
Very low chance a machinery/design control will detect
Very low a potential cause/mechanism and subsequent failure 7
mode.
Low chance a machinery/design control will detect a
Low potential cause/mechanism and subsequent failure mode. 6
Machinery control will prevent an imminent failure.
Moderate chance a machinery/design control will detect
Moderate a potential cause/mechanism and subsequent failure 5
mode.
Moderately high chance a machinery/design control will
Moderately
detect a potential cause/mechanism and subsequent 4
high
failure mode.
High chance a machinery/design control will detect a
High 3
potential cause/mechanism and subsequent failure mode.
Very high chance a machinery/design control will detect
Very high a potential cause/mechanism and subsequent failure 2
mode. Machinery controls not necessary.
Design control will almost certainly detect a potential
Almost
cause/mechanism and subsequent failure mode. 1
certain
Machinery controls not necessary.
4. RESULTS AND DISCUSSIONS failure mode with lower frequency has lesser effect on the
For the present work CNC machine failure data were collected production process as compared to the failure modes with
from GG Valves Industry for a period of 1 year (from 11th July, higher frequency. The failures of which frequencies were more
2014 till 10th August, 2015). A number of failure modes were than 20% of the highest frequency were considered as major
obtained and their failure frequencies were calculated. It can be failures shown in Fig. 1 and rest were ignored considering these
seen that failures in some of the failure modes occur repeatedly as minor failure.
during a year while some of the failure modes are rare. The
Fig. 1 Frequency of major failure modes

The downtime of failure modes were obtained from the Finally, S, O and D values are calculated using Table 2, Table 3
company database which are shown in Table 5. The Mean Time and Table 4 respectively and FMEA worksheet was developed
Between Failure (MTBF) was calculated from the obtained which is shown in Table 6.
data and are shown in Fig. 2.
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April 2017
Table 5: Machine Downtime
S. No. Parts Description Failure Mode Downtime (Hours)
1 Turret head Alignment disordered 13-14
2 dismantling Play in coupling 11-12
3 Low pressure of coolant 5-6
Coolant tank
4 Improper work of pump 2-3
5 Feed Servo Parameter disordered 3-4
6 System Power fluctuated 5-5.5
7 Changing table turn slowly 3-3.5
Hydraulic system
8 Oil leaks from cylinder 3-3.5
From Table 6, it can be seen that the 'play-in coupling' failure detected moderately high, so ranking was 5. The calculated
mode of turret head has machine downtime of 11-12 hours, so RPN value is 225. This value is the highest RPN of all the
severity ranking was given 9; MTBF was calculated 1542 machine failures.
hours, so occurrence ranking was 5; and the failure was
Fig. 2: Mean Time Between Failure (MTBF) of failure modes
The 'alignment disorder' failure mode of turret head has 'Improper work of coolant pump' has machine downtime of 2-3
machine downtime of 13-14 hours, so severity ranking was hours, so severity ranking was given 7; Mean Time Between
given 9; MTBF was calculated 778 hours, so occurrence Failure was calculated as 1848 hours, so occurrence ranking
ranking was 6; and the failure was detected moderately high so was 5; and the failure was detected moderately high, so ranking
ranking was 4. The calculated RPN value is 216. This value is was 4. The calculated RPN value is 140. This value is the third
the second highest RPN of all the machine failures. highest RPN of all the machine failures.
Fig.3: Cause having highest Risk Priority Numbers (RPN)
38
April 2017
Similarly, 'change table turns slowly' of hydraulic table has was almost certain with chance of control of the failure mode, so
machine downtime of 3-3.5 hours, so severity ranking was ranking was given 2. The calculated RPN value is 60. This value
given 6; Mean Time Between Failure was calculated 1707 is the lowest RPN of all the machine failures. The Risk Priority
hours, so occurrence ranking was 5; and the failure detection Numbers (RPN) for all modes are shown in Fig. 3.
Table 6: Worksheet for CNC Machine Failures of GG Valves Industry
Part Failure Potential Potential Current

Sub system S O D RPN
name mode effects cause controls
Turret
Gun metal Replacing
Mechanical Head Alignment Improper
bush dam- 9 6 Gun-metal 4 216
system dismantlin disorder fitment
age bush
g
Coupling
Turret Jerk Replacing
bearing
Mechanical Head Play in /accident, all
damage & 9 5 5 225
system dismantlin coupling lubrication damaged
loose
g oil bearing
fasteners
Low Remove
Low Blockage
Coolant Coolant viscosity chips
pressure of 7 coolant 5 3 105
system Tank lubricant present in
coolant flow line
changed lubricant
Burn motor
Coolant Coolant Improper winding & Faulty rewinding
7 5 4 140
system pump work contactor supply motor coil
relay
PLC unit
Faulty
Feed reorder & replacing
Electronic Parameter supply,
Servo I-/O 8 6 contactor 2 96
system disorder contactor
System parameter relay
relay burn
change
Oil pipes Ensure the
Oil leak cleaned, Leakage in proper
Hydraulic Hydraulic
from Damaged 6 hydraulic 5 checking 3 90
system function
cylinder oil seals cylinder hydraulic
replaced flow line
Connect- Faulty Replacing
Feed
Electrical Power ions & sup- supply, the
Servo 7 5 2 70
system fluctuated ply unit stabilizer stabilizer
System
checked burn card
Damage oil Ensure the
Change Damaged seal, proper
Hydraulic Hydraulic
table turns oil seals 6 leakage in 5 checking 2 60
system table
slowly replaced hydraulic hydraulic
flow line flow line
For the individual failures, industry can monitor and control This work would help the concerned industry and the related
these failures according to Risk Priority Number to reduce the industries which rely majorly on the CNC machines for their
amount of failure in the machine components. With prioritized manufacturing process. The ranking can be used for the decision
risks, the resources in maintenance can be optimally utilized making managers, arranging the inspection and maintenance of
and the schedules for preventive maintenance can be planned the equipment properly, which can optimize the maintenance
effectively to reduce accidents and damages to parts and resources and avoid the risk.
components.
39
April 2017
5.RECOMMENDED MAINTENANCE SCHEDULE FOR CNC LATHE MACHINE

Table 7: Maintenance Schedule for CNC Lathe Machines
Part Failure
Daily Weekly Monthly 6 month or 1000 hours
Description mode
Check O-ring, Grease tool changer
Check for guide pin, Gun fittings, Add /replace
Alignment
abnormal noise metal bush, drawbar oil, Check rotary
disordered
or vibration replace if gear oil, add if necessary
Turret head
necessary
dismantling
Verify machine
Grease tool-changer
Play in Clean chips from level, Remove
fittings
coupling way covers sediment from
coolant tank
Check coolant
level, top off
Replace coolant and
Low with water if Check/ clean chip Remove sediment
thoroughly clean coolant
pressure of necessary, Check auger filter from coolant
tanks, Replace air
coolant way lube tank tanks.
regulator filter
Coolant tank level, Fill if
necessary
Improper Check input
Check all hoses and lube
work of voltage, Inspect
lines for damage/leaks
coolant ground connection
pump
Verify operation of
Check input
Parameter Verify operation auto lube system,
voltage Parameter disordered
disordered of ESTOP Verify control
Feed Servo
setting
System
Verify operation of
Power Check input
auxiliary safety Power fluctuated
fluctuated voltage
devices
Verify operation of
Clean chips from auto lube system,
Changing Check rotary gear oil, add
tilt-table and tool Maximum
table turns if necessary
changer, Empty pressure, time to
Hydraulic slowly
chip/swarf tray build to max
system
pressure
Oil leaks
Check all hoses and lube
from
lines for damage/ leaks
cylinder
Table 7 presents a guide for the maintenance of the CNC Lathe. 6. CONCLUSION
There is no maintenance schedule available at GG Valves Pvt. The aim of present work is to synthesize the multidisciplinary
Ltd., Udaipur for maintaining the CNC machines. Therefore, nature of CNC machine failures from a performance perspective
maintenance schedule for the effective and efficient operation and highlight some of the more important aspects. The method
of the CNC machines are proposed. It is advised that this was presented for calculating Risk Priority Number based on
maintenance schedule is attached in the front cover of the FMEA, which can be used to prioritize failure modes of CNC
machine LOG BOOK so that it may refer to each time the machines. The principal approach that has been proposed
machine is operated. Based on the study, it is recommended that throughout this work is to increase production rate performance
the machines must be maintained annually or on completion of through the prioritization of the failures occurring in CNC
2000 hours by replacing rotary gear oil, fan filters on electrical machines.
cabinet, way oil filter and air regulator filter. With the failure Recommended Actions
modes analysis, the ranking can be developed to be used by the For the individual failures, industry needs to work on the certain
decision making managers for arranging the inspection and step that can reduce the amount of failure in machine
maintenance of the equipment properly. Optimization of components. The steps are:
maintenance resources can also be done to avoid the risk. a) Play-in coupling failure mode is the part of turret head and is
given the highest priority and it plays an important role in
the CNC machine. So, to avoid abrupt accident, bearings of
40
April 2017
high quality should be used along with the periodic 6. Salvi R.K., Agarwal C., Nandwana B.P. & Saloda M.A.,
maintenance schedule. (2016), “Implementation of Machinery Failure Mode and
b) Failure mode of hydraulic system can be checked by proper Effect Analysis for CNC Machines in Valve Manufacturing
monitoring of hydraulic chamber, supplying cleaned and Industry”, International Journal of Mechanical Handling
filtered hydraulic oil and periodic maintenance of chamber. and Automation, Vol. 1(1), 2016, pp 10-15.
c) The alignment disorder of turret head can be improvised by 7. Thakore R., Dave R. & Parsana T. (2015), “A Case Study:
providing less defective casting pieces. All casting pieces A Process FMEA Tool to Enhance Quality and Efficiency
should be tested through Ultra-sonic process which avoids of Bearing Manufacturing Industry”, Scholars Journal of
abrupt accidents. Engineering and Technology, Vol. 3(4B), 2015, pp 413-
7. ACKNOWLEDGEMENT 418.
The authors acknowledge the support by manufacturing 8. Wang X., Zhang Y. & Shen G. (2016), “An improved
industry GG Valves Pvt. Ltd. Udaipur, Rajasthan for carrying FMECA for feed system of CNC machining center based
out the study. on ICR and DEMATEL method”, The International
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using interval type-2 fuzzy sets”, Expert Systems with framework based on fuzzy VIKOR approach for machine
Applications, Vol. 42, 2015, pp 4000–4015. tool selection with linguistic information”, Applied Soft
Computing, Vol. 42, 2016, pp 314-324.
2. Degu Y.M. & Moorthy R. S. (2014), “Implementation of
Machinery Failure Mode and Effect Analysis in Amhara 10. Yang Z., Xu B., Chen F., Hao Q., Zhu X. & Jia Y. (2010), “A
Pipe Factory P.L.C., Bahir Dar, Ethiopia”, American new failure mode and effects analysis model of CNC
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63. Conference on Information and Automation, Vol. 32,
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3. Gupta G. & Mishra R.P. (2016), “A Failure Mode Effect
and Criticality Analysis of Conventional Milling Machine 11. Zhou Q. & Thai V.V. (2016), “Fuzzy and grey theories in
Using Fuzzy Logic: Case Study of RCM”, Quality and failure mode and effect analysis for tanker equipment
Reliability Engineering International, Vol. 06, 2016, pp failure prediction”, Safety Science, Vol. 83, 2016, pp
125-136. 74–79.
4. Li H., Chen F., Yang Z., Wang L. & Kan Y. (2016), “Failure AUTHORS
Mode Analysis on Machining Center Based on Possibility Raj Kumar Salvi, M.Tech Scholar (CAD/CAM), College of
Theory”, International Conference on Electrical Technology and Engineering, Maharana Pratap University of
Engineering and Automatic Control, Vol. 367, 2016, pp Agriculture and Technology, Udaipur-313 001, (Rajasthan)
627-636. E-mail: rajkumar.salvi@gmail.com
5. Salvi R.K., Agarwal C., Nandwana B.P. & Saloda M.A., Dr. S. Jindal, Udaipur Chamber and Professor, Department of
(2016), “Failure Mode and Effect Analysis for CNC Mechanical Engineering, Maharana Pratap University of
Machines Used In GG Valves Industry”, International Agriculture and Technology, Udaipur-313 001, (Rajasthan) I
Journal of Fracture and Damage Mechanics, Vol. 1(1), E-mail: sjindals@gmail.com / (Mob) 094141 64420
2016, pp 22-33.
41
April 2017
TEACHING LINEAR PROGRAMMING

Dr. Utpal Kumar Bhattacharya
INTRODUCTION hand side are referred to as functional constraints (or structural

Linear Programming is one of the most widely used techniques constraints), and the inequality in the bottom row is non-
of Operations Research and Management Science. Its name negativity constraints. Another common form for a linear
means that planning (Programming) is being done with the programming model is to minimize the objective function,
mathematical model where all the functions in the model are subject to functional constraints with signs, and some with =
linear type. In 1947, George B Dantzig and his associates while signs, and some with = signs. Non-negativity constraints
working in the U.S. department of Air Force, observed that, a always have a signs, but it occasionally in appropriate to
large number of military programming and planning problems delete this type of constraints for same or all of the decision
could be formulated as maximizing/minimizing a linear from of variables.
profit/cost functions whose variables were restricted to values
satisfying a system of linear constraints ( a set of linear MODEL FORMULATION
equations/inequations) Basic steps of the mathematical formulation of the linear
programming problem.
Linear Programming involves determining the best mix of
activities, where the decision variables represent the levels of Step-1 Write down the decision variable of the problem.
the respective activities. Some of the application areas are as Step-2 Formulate the objective functions to be optimized as a
given below: linear function of the decision variables.
I. In Financial Planning ( Portfolio selection, capital Step-3 Formulate the other conditions of the problem such as
budgeting, financial mix strategy) resource limitations, market constraints, interrelation between
ii. Marketing Analysis (Market research in the segment of the variables etc as linear equation or in equation in terms of
market, advertising planning etc). decision variables.
iii.Production Planning (Product mix problem or blending
Step-4 Add non-negative constraints.
problem)
iv. In addition to manufacturing, these kinds of production Test Problem-1: Formulation
planning applications also arise in agriculture planning, The Suminns Garment Company manufacturers' men shirts and
health care management, the planning of military women blouses for Neelcent Discount stores. Neelcent will
operations, policy development for the natural resources etc. accept all the production supplied by Suminns. The production
To explain the model in linear programming, consider the process includes cutting, sewing and packaging. Suminns
problem of determining the most profitable mix of products for employs 25 workers in the cutting department, 35 in the sewing
a manufacturer. Let n be the number of possible products. For department and 5 in the packaging department. The factory
each j (j=1,2,..n), a decision variable Xj is introduced to works are 8 hours shift, 5 days a week. The following table gives
represent the decision on its production rate. Let cj be the profit the time requirements and profits per unit for the two garments.
per unit of product j produced and let Z be the total rate of profit Minutes per unit
resulting from the product mix. This choice is constrained by Garment Cutting Sewing Packaging Unit Profit($)
Shirts 20 70 12 8.00
the limited capacities of the production facilities available for Blouses 60 60 4 12.00
these products. Let m.be the number of different types of Exhibit-1: Data
facilities needed. For each type i (i=1,2,…m ) let bi be the
a) Determine the optimal weekly productions schedule for
amount of capacity available per unit of time and let aij be the
Suminns. Formulation: Let x1 be the number of shirts to be
amount of capacity used by each unit produced of product
manufactured and x2 be the number of blouses to be
j(j=1,2,….,n). The resulting LP model then is to choose x1,
manufactured. Objective function formulation: Production of
x2....xn so as to Maximize Z = c1 x1 + c 2 x 2 + ... + c n x n
one unit of shirt gives profit of $ 8. Thus production of x1 units
a11 x1 + a12 x 2 + ... + a1n x n £ b1 of shirts will give profit of $ 8x1. Similarly profit for x2 units
a 21 x1 + a 22 x 2 + ... + a 2 n x n £ b2 of blouses will be $ 12x2. Thus total profit function is $ (8x1
+12x2). This profit function is to be maximized.
...
Constraints formulation: One unit of shirt needs 20 minutes of
a m1 x1 + a m 2 x 2 + ... + a mn x n £ bm cutting time. Thus x1 units of shirts need 20 x1 minutes of cutting
And the non-negativity restrictions time. Similarly for x2 units of blouses cutting time requirement is
60 x2. Thus total cutting time is (20 x1 +60 x2 ). This cutting time
x1 ³ 0, x 2 ³ 0,..., x n ³ 0.
must be less than or equal to the total available cutting time.
The linear function being maximized is called the objective Total available cutting time is 60000 minutes. Thus the cutting
function. The m inequalities with a linear function on the left time constraint is 20 x1 + 60 x2 £ 60000.
42
April 2017
Similarly sewing and packaging time constraints are 70 x1 Test Problem 3: Formulation
+60 x2 £ 84000, and 12 x1 +4 x2 £ 12000 respectively. Finally The Bank of West Asian is allocating a maximum of $ 200,000
the number of shirts and blouses to be manufactured must be for Personal and Car Loans during the next month. Bank charges
non-negative. 14% for Personal Loans and 12% for Car Loans. Both types of
So the final linear programming formulation is as given loans are repaid at the end of 1- year period. Experience shows
below that about 3% of personal loans and 2% of car loans are never
LPP: Maximize Z= 8 x1 + 12 x2 repaid, both as principal and interest. The bank usually allocates
Subject to at best twice as much to car loans as to personal loans. Formulate
the LPP so as to allocate the fund between the two loans and the
20 x1 + 60 x 2 £ 60000 net rate of return on all the loans.
70 x1 + 60 x 2 £ 84000 Formulations:x1= Personal loan amount in $, x2 = Car loan
12 x1 + 4 x 2 £ 12000 amount in $
Objective function formulation: Bank charges 14% for
x1 , x 2 ³ 0
personnel loans. Also 3% of personal loans are never repaid
Test Problem 2: Formulation back. Thus interest from personal loan is (0.14 (0.97)x1).
Modern equipment can advertise its products on local radio and Similarly interest from car loans is (0.12 ( 0.98)x2). Thus total
television (TV), The advertisement budget is limited to $ 10000 interest function is 0.14(0.97)x1+0.12 (0.98)x2. Thus the net
a month. Each minute of radio advertisement costs $15 and each profit is 0.14(0.97)x1+0.12 (0.98)x2-0.03x1-0.02x2. This net
minute of TV commercials cost $300. Modern equipment likes profit function is to be maximized.
to use radio advertisement at least twice as much as TV. In the Constraint formulation: Total allocation of loans is 200000.
meantime, it is not practical to use more than 400 minutes of
radio advertisement a month. Past experience shows that TV Thus x1+x2 £ 200000.
Advertisement is estimated to be 25 times more effective than Also bank usually allocates at least twice as much to car loans as
that of radio. to personal loans.
a) Determine the optimal allocation of the budget to radio and x2
x1 ³ 2.
TV advertisements. Thus
Formulation: Finally amount of personal and car loans must be non-negtive.
Let x1 = minutes of radio advertisement, x2 = minutes of TV Hence the final linear programing formulation is as given
advertisement. below.
Objective function formulation: TV advertisement is estimated LPP Maximum Z = 0.14 ( 0.97) x1+0.12 (0.98) x2 -0.03 -0.02
to be 25 times more effective than that of radio. Thus total
effectiveness function is (x1+25x2). This effectiveness function Subject to,
is to be maximized. x1 + x 2 £ 200000,
Constraint formulation: One minute of radio advertisement cost x1
$ 15. Thus x1 minutes of radio advertisement cost $ 15x1. ³ 2, x1 , x 2 ³ 0.
Similarly TV advertisement cost is $ 300x2. Hence total x1
advertisement cost function is (15x 1 +300x 2 ). This Test Problem 4: Formulation
advertisement cost function must be less than the amount of Levince grocery store sells two types of soft drinks: The brand
advertisement budget available per month. Thus the name A1 Cola and the cheaper store brand Levince Cola. The
advertisement budget constraint is 15x1+300x2£10000. margin of profit for A1 is about 5 cents per can and that of
Modern equipment likes to use radio advertisement at least Levince is 7 cents per can. On the average, the store sells no
twice as much as TV. Hence x1 ³ 2 more than 500 cans of both the colas a day. Although A1 is a
x2 1 recognized brand names customers tend to buy more levince,
Also it is not practical to use more than 400 minutes of radio because it is considerably cheaper. It is estimated that at least
advertisement per month. Thus x1 £ 400. 100 cans of A1 are sold and then Levince outsells A1 by a margin
of at least 2:1. Formulate the problem as a Linear Programming
Finally number of radio and TV advertisement minutes must be so as to find the number of cans per day of each brand that the
non-negative. Thus the complete LP formulation is store should carry to maximize profit.
LPP: Maximize Z= x1+ 25x2 Formulation:
Subject to Let x1 be the number of Levince Cola, x2 be the number of A1
Cola
15 x1 + 300 x 2 £ 10000,
Objective function formulation: One unit of Levince cola gives a
x1 2 profit of 7 cents. Thus x1 units of Levince cola cans give profit of
³ , 7x1 cents. Similarly profit from A1 cola is 5x2 cents. Thus the
x2 1
total profit function is (7x1 +5x2) cents. This profit function is to
x1 £ 400, be maximized.
x1 , x 2 ³ 0.
43
April 2017
Constraint formulation: Store sells no more than 500 cans of 2. Determination of the optimum solution from among all
both the colas a day. Thus x1 +x2 £500. feasible points in the solution space.
It is estimated that at least 100 cans of A1 are cold. Thus x2 £ 100. General solution algorithm can be demonstrated as follows.
Also Levince outsells A1 by a margin of atleast 2:1 . Thus Step-1:The non-negativity constraint will restrict the solution
x1 2 space area to the first quadrant.
£ Step-2: Consider the inequality constraints as equation. Plot the
x2 1
equation on the graph
Finally number of A1 cola cans and number of Levince cola Step3 : Shade the feasible region.
cans must be non-negative.
Step4: Choose the convenient value of Z (say=0) and plot the
Thus the final linear programming formulation is. objective function line.
LPPMax Z = 7 x1 + 5x2 Step 5-Find out the direction of the objective function in which it
maximizes and take the point at which the objective function is
s.t.x1 + x2 £ 500, x2 ³ 100, x1, x2 £ 0 maximum and beyond that it will go out of the feasible region.
Similarly for minimization case consider the decreasing
GRAPHICAL SOLUTION METHOD direction of Z and find out the extreme point at which it is
For two variable problems, we can easily demonstrate solution minimum.
and sensitivity analysis by graphical method. The graphical Step-6: Read the co-ordinates of the extreme points selected at
procedure includes two steps: step5 and find the MAX or MIN value of Z.
1. Determination of the solution space that defines all feasible Graphical representation of solution for test problem-1 is as
solutions of the model. given below (TORA output)Exhibit-.
Exhibit-2: Solution output for test problem-1
44
January 2013 April 2017
GRAPHICAL SENSITIVITY ANALYSIS

Sensitivity analysis gives the dynamic dimension that
investigates the impact of making changes in the model
parameter on the optimal solution. The procedure is referred as
sensitivity analysis because it studies the sensitivity of the
optimal solution to changes made in the model. It is a key part of
linear programming studies, that address a variety of what if
type of questions of interest to the decision makers. The purpose
is to explore various scenario's about future condition that may
deviate from the initial model. A key part of post optimality
analysis, which involves investigating the parameters, and
determining which ones are sensitive parameters (those that
change the optimal solution if a small change is made in the
value of the parameter, and exploring the implications). For
certain parameters. The decision maker may have same control
over the value (e.g. the amount of a resource to be made
available), in which case sensitivity analysis guides the
decisions on which value to choose. An extension of sensitivity
analysis called parametric programming enables systematic
investigations of simultaneous changes in various parameters Exhibit-3: Changes in the objective function Coefficients
over ranges of values. In LP, constraints directly or indirectly, represent the usage of
There are two cases of sensitivity analysis based on the limited resources. In this case right hand side can be thought of
graphical LP solution: representing limits on the availability of resources. Here we
investigate the sensitivity of the optimum solutions to making
I. Changes in objective function coefficients.
changes in the amount of available resources. For cutting time
ii. Changes in the right hand side of the constraints. Although in constraint: As long as the Point-C, intersection between cutting
graphical study the scope is elementary and limited, but it time line and sewing time line, move along the line from E(0,
does provide the fundamental insight into the development 1400) to B ( , ), as given in Exhibit-4, the current solution
of sensitivity analysis.
CHANGES IN THE OBJECTIVE FUNCTION remain feasible. So the feasibility range for the first constraint is
COEFFICIENTS 40363.6 to 84000. This result shows that MI the cutting time
Suminns Garment Company (Extension) The general objective resource, can be decreased by as much as 19636.4 minutes from
function in a two variable LP problem can be written as the current level of 60000 minutes and increased by as much as
maximize or minimize Z= c1x1+c2x2 24000 minutes from the current level while guaranteeing that the
optimal solution point will be given by the intersection of the
Changes in the coefficients c1 and c2 will change the slope of Z lines associated with M1 & M2. The associated general
and possibly the corner point. However, there is a range of solutions in terms of M1 (the first resource constraint) is as
variation for both c1 and c2 that will keep the current optimum follows:
solution unchanged.
X1 = M1+ 4200
If we change the objective function to Z= c1x1+c2x2, then the
solution at C will remain optimal as long as the slope of Z lies X2 = M1+ 1400 where 40363.6
between the slopes of the two lines interacting at C. Details
given in Exhibit-3
The general relationship
3 ----(1) , or ----(2)
Above relationships arise as follows. Write the cutting time

constraints function and sewing time constraints as y= mx+c
farm, where m is the slope and c is the intercepts. The solutions
at C will remain optimal as long as slope of Z is greater than the
slope of sewing time constraint function and less than the slope
of the cutting time function constraint. Simplification will give
the relationship (2). Similarly write the constraints in x= my+d
form and proceed as usual you can get the relationship (1).
By using the above condition after taking c2 as constant at 12,
you will get range of c1 between 4 to 14. Similarly by taking c1 as
constant at 8, you will get range of c2 as c 2 24 thus as long
as 4 and c2 24 current optimum solution
remains unchanged. Exhibit-4: Feasibility range of cutting time constraint
45
April 2017
January 2013
Feasibility range of sewing time constraint from the current level while guaranteeing that the optimal
Sewing time constraint: As long as the solution point C moves solution point will be given by the intersections of the lines
from D (0, 1000) to F (3000/4, 3000/4), as given in Exhibit-5, associated with M1 & M2. Similarly the associated general
the intersection point between cutting time and packaging time solution in terms of M2 (the sewing time resource constraint) is
constraint remain feasible. So the feasibility range for the as follows:
sewing time constraint is 60000 to 97500. Thus M2 can be X1 = + 1200
decreased by as much as 24000 minutes from the current level
of 84000 minutes or increased by as much as 13500 minutes X1 = M2+ 1400 where ³ M2 ³ 60000
Exhibit-5: Feasibility range of sewing time constraint
DUEL PRICE model in which the limited resources represent the input and the
The duel price actually represents the unit worth of a resource. It value of the objective function summarizes the output. It is
gives the contributions to the objective function resulting from defined as the rate of change in the optimum objective value that
a unit increase or decrease in the availability of a resource. The results from making changes in the available amount of current
name dual price arose from the mathematical definition of the of resource.
dual problems in linear programming. Other less common If yi represent the worth per unit of resource I, the associated
names for the dual price include shadow price or simplex formula for computing this measure is
multipliers. LP model can be thought of as an input- output
Change in value of Z corresponding to the feasible range of resource i

y =
i feasible range of resource i
Change in O.F. from E to B

y
y1=
?
Change in M1 from E to B
Thus
5238
? ?0.12 60 $7.20
? ?
43636.7
46
And
Change in O.F. from D to F

y
y2 =
?
Change in resource 2 constraint from D to F

? $4.80
The third resource constraint is not binding at the optimum maximum hourly rate Suminns should pay for overtime are $
solution. Or left hand side of the packaging resource constraint 7.20 and $4.80 for cutting and sewing departments respectively.
is less than the r.h.s value. Thus the optimal solution to the REDUCED COST
corresponding dual variable is equal to zero. Thus the worth per An LP variable is regarded as an economic activity that
unit of cutting, sewing and packaging are 0.12, 0.08,0 consumes (input) resources for the purpose of producing
respectively for cutting, sewing and packaging. If overtime is (output) profit. We have
used in both the cutting, and the sewing departments, then
If the activity's reduced cost per unit is positive, then the cost of output (unit profit) equals the input (unit cost of resources). Thus
the consumed resources per unit is higher than its profit per unit, for the test problem 1 both1x and 2xhave zero reduced cost
and the activity should not be undertaken. This means that the because both are positive in the optimum solution.
value of its associated variable in the optimum solution should Details of all dual prices, ranges of profits constants, reduced
be zero. Alternatively, an activity that is economically attractive costs are as given in Exhibit-6 (TORA output) below.
will have a zero reduced cost in the optimum solution,
signifying an equilibrium point has been reached at which the
Exhibit-6: General solution

AUTHOR Indian Institute of Management (IIM) Indore, Prabandh Sikhar,
Dr. Utpal Kumar Bhattacharya, Associate Professor, Indore – 453 556, (MP)
Operations Management & Quantitative Techniques Area,
RNI No.MAHENG/2008/29684 Publishing Date: 15th April 2017
Regd. No. NMB/88/2017-19 Date of Posting: 15th April 2017
Office of Posting: Mumbai PC Stg.
(IIIE)
I N S P I R I N G INDUSTRIAL
INNOVATIONS EFFECTIVELY

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ISSN 0970-2555

VOLUME X & ISSUE No.4 Total No. of Pages 48 APRIL 2017

Chaitra is considered an auspicious month in the most of the regions in India. In

NATIONAL COUNCIL 2016-2017

Message from the Editor

Dear Members as well as Readers,

Indian Institution of Industrial Engineering is happy to publish this issue

The First Paper of this issue “SUCCESS FACTORS TO SMART

The Second Paper of this issue “REGRESSION MODEL FOR LOSS

The Third Paper of this issue “IMPROVING PERFORMANCE MANAGEMENT IN AN IT

The Fourth Paper of this issue “ANALYSIS OF ENABLERS FOR IMPLEMENTATION OF

Vol. X & Issue No. 4 April - 2017

SUCCESS FACTORS TO SMART CITIES IN INDIA:

1. INTRODUCTION social and environmental aspects (Höjer and Wangel, 2015)”.

10 Tackling/bridging digital divides Cocchia, 2014; Nicholds et al., 2016;

and related agencies

Suciu et al., 2013; Zanella et al., 2014;

18 Rethinking city infrastructure themes Paroutis et al., 2014 ; Roche, 2014;

20 Special purpose vehicles Huston et al., 2015; Calvillo et al., 2016

Exploratory factor analysis result suggested five dimensions • Society perspectives

International Journal of Public Sector Management, Urban Technology, 18(2), 39-52.

Vol. X & Issue No. 4 April - 2017

REGRESSION MODEL FOR LOSS OF GENERATION & FACTORS AFFECTING

1. INTRODUCTION in the performance of power plants can be achieved by

Shanmugam K., Efficiency analysis Int.J. Employs the Efficiency varies

GargR.K.,AgrawalV Coding,Evaluation ElectricalPowerandEn Multiple attribute A computer

Fechete F., Analysis of the International Regression Explanatory

3. LOSS OF GENERATION & FACTORS AFFECTING 3.5 Poor Coal Quality.

X- Independent variables Factors contributing to loss of generation

A,B,C,D,E,F,G,H Coefficients Coefficients of respective factors

X2 Independent variable Low system demand

Fig 1. Percentage loss of generation due to factors

Figure 4 shows the percentage loss of generation for all the

Figure4: Percentage loss of generation for all power

a. Dependent Var iable: Lossofgeneration

Model Unstandardized Coefficients Standardized t Sig.

B Std. Error Beta

(Constant) .116 .216 .535 .612

LOWSYSTEMDEMAND 1.006 .086 .015 11.734 .000

WETCOALPROBLEM 1.006 .011 .138 93.724 .000

CONCLUSION 4. Puneet C., (1999)”A Data Envelopment Analysis Approach

JUN 302.4 73.4 228. 0 151.2 67.76 0 8.452 0 0 1.493 228.91

NOV 302.4 210. 91.4 0 0 6.219 0 25.618 0 2.765 56.87 91.478

FEB 292.32 223. 69.1 0 0 27.74 0 22.088 0 0 19.30 69.144

AUTHORS Dr. Sunil V Deshmukh, Principal, Suresh Deshmukh College

Vol. X & Issue No. 4 April - 2017

IMPROVING PERFORMANCE MANAGEMENT IN AN IT INDUSTRY:

1. INTRODUCTION this approach is to carry out GAP analysis of existing

3. MAJOR COMPONENTS OF PBIA 4. CASE STUDY OF IMPLEMENTATION OF PBIA IN

Strength (S) Weakness (W)

4.1 Organisational System 7. Key Performance Indicator

4.8 Management Information System (MIS) conducted.MIS template(fig 3) was suggested.

Figure 3- Suggested Template for MIS

7 Resource used to be updated. Improvement Point

4.10 Benefits Accrued 2014. vol. (1), Issue-3 pp. 424-429.

5 CONCLUSIONS 4. Denise. T (2007),” Leadership, National culture and

APPENDIX 1: MIS FOR DEPARTMENT

Table 1-Work Targeted & Completed