A REPORT

ON

CRITICAL ANALYSIS OF THE PRODUCTION

PLANNING SYSTEM AND METHODOLOGY
ADOPTED BY
SANGAM INDIA LIMITED, BHILWARA

By

PANKAJ KUMAR CHANDAK

A report submitted in partial fulfillment of

The requirement of MBA program of
Calcutta Business School

ACKNOWLEDGEMENT
I take the opportunity of submitting this dissertation to express my deep regards towards those
who have offered their invaluable assistance and guidance in the hour of need.
I sincerely acknowledge with a deep sense of gratitude and show inductance to Mr. Mayank
Sharma (DGM - PPC), and Mr. Mahesh Sharma (DGM - HR) of M/s. SANGAM INDIA LTD.
for encouragement they gave me during the initial phase of the project. I highly obliges to
production staff of SANGAM INDIA LTD for their guidance, advice and co-operation.
Mr. Mayank Sharma, and Mr. Mahesh Sharma and all my colleagues has been inspiring. And
without their inspiration, guidance, the project would have remained a dream. I would also like
to thank to Dr. Sabyasachi Patra and Prof. Sanjib Biswas of CALCUTTA BUSINESS SCHOOL
for their kind support, guidance and help for selecting this project and allowing me to go ahead
with this project.
Last but not the least, I would also like to thanks all my friends & family members, who had
directly or indirectly given their kind co-operation and encouragement. I admit that co-operation
and morality are keywords to success.

(PANKAJ KUMAR CHANDAK)

PLACE:
DATE:
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CONTENT
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PREFACE

I take an opportunity to present this project report on Critical Analysis of the Production
Planning System and Methodology adopted by the Sangam India Ltd., Bhilwara and put before
the readers some useful information regarding my project.
I have made sincere attempts and taken every care to present this matter in precise and compact
form, the language being as simple as possible.
I am sure that the information contained in this Report would certainly prove useful for better
insight in the scope and dimension of this project in its true perspective.
The task of completion of project though being difficult was made quite simple, interesting, and
successful due to deep involvement and complete dedication of my colleagues.

Executive Summary
The project has been developed to identify the need and importance of PPC i.e. Production
Planning and Control in manufacturing industry. Production planning is done with the objective
of coordination of materials with suppliers, efficient utilization of people and machines, efficient
Flow of materials, and communication with customers.
Various activities are supported by Production Planning and Control like- Materials Planning,
Purchasing, Raw Material, Inventory Control, Capacity Planning, Scheduling Machine and
People, WIP Inventory Control, Coordinate Customer Orders, Finished Goods Inventory Control.
Production planning and control facilitates in various ways like- optimum utilization of capacity,
inventory control, ensures quality, and economy in production time.
Production Planning is accompanied with Control Mechanism to ensure desired results. Results
are compared with plans, if any deviation is found revision of plan is done. Hence, Production
Control is an adjusting process, providing corrective measures for planned development.

OVERVIEW OF TEXTILE INDUSTRY

The Indian textile industry is one the largest and oldest sectors in the country and among the
most important in the economy in terms of output, investment and employment. The sector
employs nearly 35 million people and after agriculture, is the second-highest employer in the
country. Its importance is underlined by the fact that it accounts for around 4% of Gross
Domestic Product, 14% of industrial production, 9% of excise collections, 18% of employment
in the industrial sector, and 16% of the countrys total exports earnings. With direct linkages to
the rural economy and the agriculture sector, it has been estimated that one of every six
households in the country depends on this sector, either directly or indirectly, for its livelihood.
A strong raw material production base, a vast pool of skilled and unskilled personnel, cheap
labour, good export potential and low import content are some of the salient features of the
Indian textile industry. This is a traditional, robust, well-established industry, enjoying
considerable demand in the domestic as well as global markets.
Trends in Production
Yarn and fabric production has been growing annually at 1.9% and 2.7% respectively, since
2000. Yarn production has increased from 3,940 mn kg in 1999- 00 to 4,326 mn kg in 2004-05.
Man-made yarn has driven much of this, showing a robust growth of 4.3% in the last five years.
Spun yarn production and the cotton yarn sector have also grown, albeit less impressively,
recording growths of 2.4% and 0.6% respectively.

Fig. 1 | Source: Ministry of Textiles, GoI

Fabric production has been growing at 2.7% annually between 2000 and 2005, driven primarily
by the small scale, independent power loom sector. Growth in the 100% non-cotton segment
touched 5%, followed by cotton fabric at 1.5% and blended fabric at 0.3%. Fabric production
touched a peak 45,378 million sq. Mtrs in 2004-05, and in Nov 06, production recorded a robust
9% growth compared to the corresponding period in the previous year.

Fig. 2 | Source: Ministry of Textiles, GoI

ABOUT SANGAM GROUP

Established in 1984, Sangam India Ltd. is the flagship Company of Sangam Group, the group
today is a business giant with over 7,000 employees and aims to achieve a billion dollar turnover
by 2015. The Company holds business interests across diverse sectors, namely textiles, steel,
infrastructure, power and energy. Sangam India represents the textiles vertical. The Company is
promoted by first generation entrepreneurs Mr. RP Soni and Mr. SN Modani, Sangam (India) is
one of the largest manufacturers of polyester viscose dyed yarn in the country.
The Group has more than 200,000 spindles and 4000 rotors for producing PV dyed yarn, cotton
and OE yarn with an enviable reputation for quality, which is underlined by its ISO 9001:2008
certification. The Group is the largest producer of PV dyed yarn in Asia at single location. The
Group is a forerunner in manufacturing ready to stitch fabric with the annual capacity to produce
30 million meters of fabric and 40 million meters of denim.
Charting a steady growth path, Sangam Group has diversified into infrastructure, power and
recently the steel industry. The Group has introduced the world's largest medium frequency
induction melting furnace at its steel plant which is one of the largest steel manufacturing units
with the capacity to produce 0.5 million ton Steel per annum.
Apart from the activities which Sangam has carried out to be where it currently is, the company
firmly believes that its contribution to society plays an important role in its growth too. The
group is supporting charitable trusts which operates a 100 bed hospital for the needy people, An
University having world class infrastructure, and an IB world School in Bhilwara, Rajasthan.

ABOUT SANGAM INDIA LTD

Sangam's Textile Industries at Bhilwara, Rajasthan are one of the largest and most modernized
industries in the country. The Group's Spinning division is ranked amongst world's largest PV
Dyed yarn industry.
Totally integrated division is equipped to produce from yarn to fabrics. The diversified industries
include Spinning, Weaving, Processing, Denim Manufacturing and Knitting.
Being the core business of Sangam Group, The Textiles account for the major revenue sharing in
the group's earnings.
Sangam is distinctly known for shepherding a new era in fabrics. The flagship brands 'Sangam
Suitings' and 'Sangam Denim' are the most trusted brands of premium textiles in the Country.
With the commissioning of new investments in design, modern weaving, state-of-the-art
finishing equipments, Sangam continues to operate as one of the most modern textile complexes
in India.

Division
Spinning (Ring Spg)
Spinning (Open End)
Weaving
Denim
Processing
Knitting
Thermal & Wind Power

Production Capacity
201216 Spindles / 55000 MT PA
4028 Rotors/18000 MT PA
30 Million Meter Fabric PA
40 Million Meter Fabric PA
54 Million Meter PA
18 Machines /3000 MT PA
36 MW/ Hour

Yarn Division: The flagship division, Sangam Spinners is one of the largest manufacturers of polyester viscose
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dyed yarn in South Asia. An ISO 9001: 2008 organization is reckoned as market leader in PV
dyed yarn segment. The company today has more than 200,000 spindles and 4,000 rotors to
produce polyester, viscose dyed and its blended yarn and 100% cotton Yarn which gives annual
production of 73,000 M tons. Major part of the total yarn production consists of all varieties of
P/V dyed yarns used in the manufacture of suiting, shirting, knitting and carpet. The division is
also known for producing and exporting high quality cotton from S-6 Quality. Equipped with the
latest technology and driven by a dedicated team of professionals, the Company has been
maintaining its leadership position since over a decade.
Exporting to Major Countries:
We export to Argentina, Bangladesh, Belgium, Brazil, Colombia, Chile, Egypt, Germany, Iran,
Italy, Nepal, Poland, Portugal, Romania, South Africa, Spain, Switzerland, Turkey, Ukraine,
USA, Morocco, New York, Peru, Philippines, Syria, Canada, Egypt, Slovenia and Sri Lanka.
Global Edge:

Catering to more than 28 countries

3 star export house status

One of the largest PV Dyed yarn manufacturer in Asia.

Vertically Integrated Composite Mill leads to complete textile solution

Among India's Top 500 Global Organizations.

FABRIC DIVISION

The fabric division of Sangam is equipped with latest technology and state of art computerized
designing looms like high speed Air Jet looms (Models includes Somet Mythos, Toyota Tappet &
Jacquard, Picanol & Tsudakoma), P7100 Sulzer Tappet & jacquard Looms and Dornier Jacquard
Looms to produce one of the finest fabric in Polyester/ Viscose, Polyester/ cotton, Pure Cotton,
PV Lycra and Polyester woolen segment. The division has 251 LOOMS with Annual production
of 30 Million meter fabric.
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The Product range includes:

Polyester/ Viscose

Polyester/ cotton

PV Lycra

Polyester woolen

Processing: - Sangam Processors holds significant market share in processing PV, PC and cotton
fabric. The division is equipped with latest machinery like Automatic Jigger, Cold Pad batch
machine, Jet Dyeing & Beam Dyeing machines and Kier decatising and Super Finish machine.
The division has annual production capacity of 54 Million Meter Fabric.
There is virtually no shade, tint or hue that isn't enhanced by Sangam Processors, a vast range
from the softest pastels to the most vibrant hues. Sangam processors has also introduced many
specialized finishing like Teflon Finish, Chiller Finish, Enzyme Finish & Perfume Finish.

DENIM DIVISION
The modernized plant of denim with the annual production of 40 million meter fabric is
equipped with latest sheet dyeing ranges & finishing ranges. The plant is well equipped to
produce fabric like SBIT, IBST, Indigo of any caste, Pure Indigo shade of 0.5% to 4.5% &
sulphur dyeing.
The plant has a facility to produce over-dyed fabric as well as finishes like Flat finish or required
hand feel.
The fabric is available from 5 Ozs to 15 Ozs and contains OE slub, Ring slub, Silkies, Mix count,
multi count, stretch, and poly weft- all in international quality standards with well experienced &
knowledgeable technical team.

AWARDS & RECOGINATION

Among Indias Top 500 Global Organizations.

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3 star export house status.

Awarded Best Productivity award to Sangam Spinners [Dyed Yarn] in 2002.

Awarded for Textile Excellence in 2003 to Sangam Spinners, by Honble Shri Narpat
Singh Rajvi, Industries Minister, Government of Rajasthan.

Awarded Rajasthan State Award for Export Excellence in textile sector for the year
2008 by Honble Chief Minister of Rajasthan Smt. Vasundhara Raje.

Awarded Indias Power Brand Rising Star status by Indian Council for Market
Research (ICMR) and Planman Consultancy.

Awarded Rajasthan Energy Conservation Award for the year 2009-10 by Honble
Chief Minister of Rajasthan Sh. Ashok Gahlot.

Awarded Rising Entrepreneur of the Year Award for outstanding contribution to the
industry and India rising by Planman Consultancy.

Milestones
1984 Sangam India (SIL) was incorporated.
1985 SIL started its operations.
1993 Sangam India established northern India's first 'Rapier Weaving machines'
1995 The company increased its production capacity by installing a weaving machine. The
same year witnessed the merger of two closely held profit making companies.
Further, in the same year the company adopted backward integration strategy and forayed in the
spinning segment. It installed 17280 spindles that manufactured PV dyed yarn.
1996 SIL started commercial production of its spinning project
1997 The company expanded its spinning and weaving capacity.
1998 The company spinning division received ISO 9002 certification by Bureau of Indian
Standard.
Further, the company expanded its spinning capacity to 64032 spindles. Presently, SIL owns 127
imported weaving machines in its weaving division namely Shuttleless, Rapier and Airjet
Weaving Machines.

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Sangam India is the largest producer of dyed yarn in India at a single location. It also has captive
power plant with 15.7 MW of capacity. Currently SIL produces 12 million meter of fabrics
annually.

BOARD OF DIRECTORS
1.
2.
3.
4.
5.
6.

Mr. R. P. Soni ( Chairman )

Mr. S. N. Modani ( Managing Director )
Mr. V. K. Sodani ( Executive Director )
Mr. Ramawatar Jaju ( Director )
Mr. A. Karati ( Director )
Mr. T. K. Mukhopadhyay ( Director )

GOALS OF THE COMPANY

The main Goals that enable the company to carry on its present activities are as follows:
1) To manufacture, sell, purchase, export, import or otherwise deal in Cotton, Synthetics and
Blended Yarn, Cloth, Synthetic Fiber, Textile materials, and/or any product from such raw
materials or Textile material.
2) To process, weave, comb, spin, due, bleach, finish, laminate and or make marketable any fiber
(Cotton or Synthetic), cloth, thread, yarn and more specifically Jute, hemp, silk, cotton, wool,
mesta, nylon, terrene, staple and or synthetic fiber or any description and varieties.
3) To manufacture, sell, purchase, export, import and or otherwise deal in all types of textile
chemicals, textile colours and other chemicals, including acids of all varieties and description.
3a) To undertake the business of manufacturing, trading, dealing, import, export, for its own use
or for others as sellers, traders, dealers, exporters, importers, developers, agents, stockiest,
distributors, processors, franchise holders, designers, repairers, maintainers, consultants of
computer systems, computer peripherals and accessories, computer compounds, computer

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consumables like floppy disks, diskettes, hard disks, ribbons, computer stationery, computer
hardware and software packages, computer education, computerized job work like multimedis,
internet services, web site, email, e-commerce etc. and telecommunication systems, electrical
and electronic items considered as integral part or supplement of computer systems.
3b) To set up and run College/University, electronic data processing centers and to carry on
business of data/word processors, development of management information system,
computerization feasibility study and to conduct, run or sponsor training, programs, courses,
seminars for imparting or spreading the knowledge and use of computers, research and
development computer programs and publishing and distributions of books, journals and course
materials and to purchase, sell these products both in India and abroad.
3c) To import general engineering and computer education, research and training to any
individual or body or firm or company or association or authority and to open one or more
centers for the purposes and to employ necessary personnels to run the same and to do all sort of
data processing jobs and to supply, arrange, provide and meet the requirements of computer
personnels of any individual or body or firm or company or association or authority, whether in
India or anywhere in the world.
3d) To invest in/ acquire/manage/assist overseas software companies for the fulfillment of above
objectives and to develop, design; own TV Channel, Media Company.
3e) To carry on business as manufacturer, distributor & trader of power & electricity,
telecommunication services etc.
3f) To carry on business as manufacturer, importers, exporters, dealers, traders, agents, stockiest
of Diamond, Stones and Jewelry of any metal and all types of commercial merchandise.
3g) To carry on the business as contractor or constructor providing all types of infrastructure
facilities including construction of Road, Bridges, Dams, Canals etc.

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3h) To carry on the business as manufacturer, trader, distributor, agent, stockiest of Dyes and
Chemical.
3i) To carry on the business of Horticulture, Floriculture, Sericulture, Agriculture and Marketing
of Bio-products etc.

COMPETITOR

Zodiac Clothing Company ltd.

Mandhana Industries Ltd.

Siyaram Silk Mills Ltd.

Nahar Industrial Enterprises Ltd

RSWM Ltd.

Maharaja Shree Umaid Mills Ltd.

Winsome Textile Industries Ltd.

Deepak Spinners Ltd.

Digjam ltd

KEY CUSTOMER

Reliance

Reid and Taylor

Donear

S Kumars

Raymond

Bossa, and

Grasim

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SWOT ANALYSIS OF THE COMPANY

Strengths
Integrated textiles manufacturer with a presence across the product value chain
Cost-competitiveness on account of economies of scale and wide presence in the textile value
chain
Proximity to the raw material centres as well as consumption centres
The largest manufacturer of PV dyed yarn in India with 25 per cent market share
Strong R&D focus supporting new design introduction and product innovation
About 75% of the gross block less than five years old
Successful record in the timely and low cost Implementation of expansion and modernization
projects.
Clientele include large and reputed customer brands within India and abroad
Production exibility for smaller to bigger size of lot from 600 kg to 100 MT size
Modern technology machines are less than 7 years
Weaknesses
No presence yet in garments
Lack of branding and comparatively small penetration in fabrics & home textile segment
Major raw material prices are volatile polyester depends on oil prices and viscose fibres are
pulp
Opportunities
Affordability and durability of PV fabrics opens a huge potential market for the company
Volatility in cotton prices is creating huge demand for PV fabrics
The great Indian retail revolution fuelling the demand for new customer segment fancy denim
even in rural and semi-urban areas
Growing fashion consciousness will widen the market for the companys products

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 Plans to move in to technical textile market

Partnering opportunities with foreign brand for garmenting
Threats
High debt-equity ratio
Fluctuation in forex market affects export demand tight polies by the Reserve Bank of India
may harden interest rates further
Availability of cost-effective labour has become an issue due to NR EGA
Power cost is vulnerable to fluctuating coal prices

CORE COMPETENCIES:
Facility to produce over-dyed fabric
Modernized industry in the country
Equipped with latest sheet dyeing ranges & finishing ranges.
Introduced many specialized finishing like Teflon Finish, Chiller Finish, and Enzyme
Finish & Perfume Finish.
Largest manufacturers of polyester viscose dyed yarn in South Asia.

CORPORATE GOVERNANCE
Corporate Governance at Sangam is based on the following main principles:

Constitution of a Board of Directors of appropriate composition, size, varied expertise

and commitment to discharge its responsibilities and duties.

Ensuring timely flow of information to the Board and its Committees to enable them to
discharge their functions effectively.

Independent verification and safeguarding integrity of the Company's financial reporting.

A sound system of risk management and internal control.

Timely and balanced disclosure of all material information concerning the Company to
all stakeholders.
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Transparency and accountability.

Compliance with all the applicable rules and regulations.

Fair and equitable treatment of all its stakeholders including employees, customers,
shareholders and investors.

COMPANY SOCIAL RESPONSIBILITY (CSR)

Sangam India Ltd. as part of Sangam Group has taken no. of initiatives in education, health care
and community development. Sangam group is running a most modern school, a well-equipped
hospital, engineering and management college in Bhilwara, which caters to the society at large.
The group has also recently started Industrial Training Institute for training of Industrial
Workers.

Smt Kesar Bai Soni Hospital:

Sangam Group's promoted, Soni hospital is the only multi-specialty hospital in southeast
Rajasthan having telemedicine facility. Super specialties of Apollo hospital around the world can
be contacted for their consultation. The other department in Soni hospital is Respiratory
medicine, General medicine, General & Laparoscopic Surgery, Obstetrics & Gynecology,
Orthopedics, pediatrics, ENT, and Radio diagnosis, Anesthesiology & Dentistry.
SMT. KESAR BAI SONI EDUCATIONAL FOUNDATION TRUST
The major objective of the trust is to provide scholarship to meritorious students especially from
rural background. Every year a large number of scholarships are distributed. Through Smt. Kesar
Bai Soni Education Foundation Trust, the group has been instrumental in providing books and
scholarships to poor children, organizing plantation campaigns, sports and cultural events,
holding blood donation camps and distributing medicines for benefits of the people in need.
BASIC TRAINING CENTRE
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The group is running a Basic Training Centre, as permitted by Govt. of India and Govt. of
Rajasthan under Apprenticeship Act, which is first and the only one in private sector of
Rajasthan, where around 500 workers are being trained in various textile trade and provided
employment.
The group has credited for opening the first Industrial Training Centre, SANGAM
INDUSTRIAL TRAINING CENTRE, and Bhilwara at Raila. It is the only training Centre in
India to get a Letter of Intent for running Spinning & Weaving Textile trades for workers training
and Rajasthan Govt.'s Rajasthan Mission on Livelihood [RMOL]
SANGAM UNIVERSITY
Sangam University, Bhilwara is conceived by Shri Rampal Soni, Chairman, Sangam Group as a
farsighted visionary project keeping in view the futuristic needs of the next generation in
Industrial and Professional arena. Sangam Group is one of the leading industrial groups of the
country which has carved a niche for itself in Spinning, PV and Dope-dyed units. In addition to
this the Group is also one of the market leaders in Denim, Cotton Thread and Textile products

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Fig. 3 | Company process chart

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Denim process start from purchasing of Yarns and Fabric.

WARPING
Warping is the process of transferring multiple yarns from individual yarn packages onto a single
package assembly. Normally, yarns are collected in a sheet form where the yarns lie parallel to
each other and in the same plane onto a beam, which is a cylindrical barrel with side flanges.
This is known as beam warping.

Beam Warping
Beam warping maintains the yarns in an open sheet form and winds the yarns parallel to each
other onto a slightly wider flanged beam. These yarns will not go through the rope indigo dye
range, but are left natural and will end up either slasher dyed or in an un-dyed fabric, which
can later be piece dyed, garment dyed, or left natural. Another option would be to beam dye the
yarns using a dye other than indigo.

Fig. 4 | Beam Warping

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INDIGO DYEING CUM SIZING

Next is dyeing technique that has been used for dyeing warp yarn for denim is beam dyeing. In
this technique, hundreds of individual yarns are wound parallel to each other around a perforated
core beam with flanges on each end. The beam is then loaded into a cylindrical dye vessel that is
sealed, so dye liquor can be pumped through the perforations in the beam and then through the
yarn. After dyeing, the yarn is washed, extracted, dried, and then it move to Sizing Section. The
main purpose for sizing warp yarns is to encapsulate the yarn with a protective coating. This
protective coating reduces yarn abrasion that takes place during the weaving operation and
reduces yarn hairiness preventing adjacent yarns from entangling with one another at the
weaving machine. Also, this protective coating keeps the indigo dye from rubbing off during the
weaving process.

Fig. 5 | INDIGO DYEING CUM SIZING MACHINE

WEAVING:
Denim fabrics are woven by interlacing two sets of yarns perpendicular to one another in fabric
form. Yarns in the machine direction are called warp yarns or warp ends, and these are interlaced
with filling yarns or picks. The sequence or order of interlacing the two sets of yarns can be

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varied to produce many different weave designs. The finished fabric construction is determined
by the number of warp and filling yarns per square inch or centimeter.

Fig. 6 | WEAVING MACHINE

SINGEING:
This process helps to produce a smooth surface finish on fabrics made from staple fibers first the
fabric surfaces are brushed lightly to raise the unwanted fiber ends. Then the fabric is singed with
or passed over heated copper plates or open gas flames. The fiber ends burn off. The fabric is
moved very rapidly, and only the fiber ends are destroyed. As soon as the fabric leaves the
singeing area, it enters a water bath or desizing bath. This stops any singeing afterglow or sparks
that might damage the cloth.

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Fig. 7 | SINGEING MACHINE

FINISHING:
Finishing refers to the processes that convert the Denim fabric into a usable material and more
specifically to any process performed after dyeing the yarn or fabric to improve the look,
performance, or "hand" (feel) of the finished textile or clothing.
Company also do different type of process and finishing namely:

Desizing

Mercerising

Shrinking (Sanforizing)

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Company recently introduce these type of process and finishing in there unit.

INSPECTION & PACKING:

INSPECTION
The acceptance level of the fabric depends on the customer preferences.
Inspection department uses 7 Kitamura Machine to find such defects in fabrics.
There are two inspectors to keep continuous watch on fabric for finding the defects. The 4-point
grading system indicates that as per customer requirement defects are allowable up to their
levels. We have observed that in VF brand the 4-point allowable are only 4 that is total 10 defects
per 100-meter.
4-point grading system is used for inspection of fabrics and this includes:
No penalty points are recorded for minor defects. Major Defects are classified as follows:-Major
woven fabric defects such as slubs, holes, missing yarn, conspicuous yarn variation, end out,
soiled yarn, and wrong yarn.- Major knitted fabric defects are mixed yarn, yarn variation, runner,
needle line, barre, slub, hole, press off.- Major dye or printing defects are print out, dye spots,
machine stop, color smear or shading.
PAC K A G I N G D E PAR T M E N T:
This department pack the fabrics in two ways:

Roll Packing

Bale Packing

This department also send some fabric to sampling department for making samples of the
fabrics. All Roll Packing and Bale Packing fabric send to finish godown.

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FINISH GODOWN
From finish godown fabrics are dispatch to the customer. Any type of return inwards from
customer will come to finish godown.

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PRODUCTION PLANNING AND CONTROL

INTRODUCTION:
Principle of Production Planning and Control:
The highest efficiency in production is obtained by manufacturing the required quantity of a
product, of the required quality, at the required time by the best and cheapest method PPC is a
tool to coordinate all manufacturing activities in a production system.
Production planning and control essentially consists of planning production in a manufacturing
organization before actual production activities start and exercising control activities to ensure
that the planned production is realized in terms of quantity, quality, delivery schedule and cost of
production.
Production planning involves the organization of an overall manufacturing / operating system to
produce a product.
The various activities involved in production planning are designing the product, determining the
equipment and capacity requirement, designing the layout of physical facilities and material and
material handling system, determining the sequence of operations and the nature of the
operations to be performed along with time requirements and specifying certain production
quantity and quality levels.
Objective of production planning is to provide a physical system together with a set of operating
guidelines for efficient conversion of raw materials, human skills and other inputs into finished
products.

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Production Function
After taking decisions about the type of business, its location, layout etc. the entrepreneur steps
into the shoe of production manager and attempts to apply managerial principles to the
production function in an enterprise. Production is a process whereby raw material is converted
into semi-finished products and thereby adds to the value of utility of products, which can be
measured as the difference between the value of inputs and value of outputs.

A Typical Manufacturing Systems

SUPPLIERS
Raw Materials

Materials
Machines
People

CUSTOMERS
Finished Products

Production function encompasses the activities of procurement, allocation and utilization of

resources. The main objective of production function is to produce the goods and services
demanded by the customers in the most efficient and economical way. Therefore efficient
management of the production function is of utmost importance in order to achieve this
objective. Production management involves the managerial decisions regarding design of the
product and design of the production system i.e. determination of production processes and
production planning and control.

Production Planning and Control

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Once the entrepreneur has taken the decisions regarding the product design and production
processes and system, his next task is to take steps for production planning and control, as this
function is essentially required for efficient and economical production.
Planned Production is the ability to look ahead, organize and coordinate and having plenty of
driving force and capacity to lead and ability to supervise and coordinate work and simulates his
associates by means of a programme of human relation and organization of employees.
Production Planning and Control involve generally the organization and planning of
manufacturing process. Especially it consists of the planning of routing, scheduling, dispatching
inspection, and coordination, control of materials, methods machines, tools and operating times.
The ultimate objective is the organization of the supply and movement of materials and labour,
machines utilization and related activities, in order to bring about the desired manufacturing
results in terms of quality, quantity, time and place.
Production planning without production control is like a bank without a bank manager, planning
initiates action while control is an adjusting process, providing corrective measures for planned
development. Production control regulates and stimulates the orderly how of materials in the
manufacturing process from the beginning to the end.

Factors determining Production Planning Procedures:

The production planning used, varies from company to company. Production planning may begin
with a product idea and a plan for the design of the product and the entire production/operating
system to manufacture the product. It also includes the task of planning for the manufacturing of
a modified version of an existing product using the existing facilities. The wide difference
between planning procedures in one company and another is primarily due the differences in the
economic and technological condition under which the firms operate. The three major factors
determining production-planning procedures are:

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Volume of Production:

The amount and intensity of production planning is determined by, the volume and
character of the operation and the nature of the manufacturing processes.
Production planning is expected to reduce manufacturing costs. The planning of
production in case of custom order job shop is limited to planning for purchase of
raw materials and components and determination of works centers, which have the
capacity of manufacturing the product.
Nature of Production Processes:

In job shop, the production planning may be informal and the development of work
methods is left to the individual workman who is highly skilled. In high volume
production, many product engineers are involved and they put enormous amount of
effort in designing the product and the manufacturing processes.
Nature of Operation:

Detailed production planning is required for repetitive operation. For example in

case of continues production of a single standardized product. The variants in
manufacturing approach are: Manufacturing to order, which may or may not be
repeated at regular intervals. Manufacturing for stock and sell (under repetitive
batch or mass production). Example: Manufacture of automobiles, watches,
typewriters etc.

Objectives of Production Planning and Control

30

 To deliver quality goods in required quantities to the customer in the

required delivery schedule to achieve maximum customer satisfaction and
minimum possible cost.
To ensure maximum utilization of all resources
To ensure production of quality products
To minimize the product through-put time or production/ manufacturing
cycle time
To maintain optimum inventory levels.
To maintain flexibility in manufacturing operation.
To co-ordinate between labour and machines and various supporting
departments
To plan for plant capacities for future requirements
To remove bottle neck at all stages of production and to solve problems
related to production
To ensure effective cost reduction and cost control

STEPS IN PRODUCTION PLANNING AND CONTROL (PPC)

31

Production Planning and Control (PPC) is a process that comprises the

performance of some critical; functions on either side, viz., planning as well as

P ro d u c t io n P la n n in g a n d
c o n tro l

control.

Planning

Production
Planning

Routing
Scheduling
Loading
Dispatching

Production
Control

Following up
Inspection
Corrective

Fig. 8 | STEPS IN PPC

Production planning

32

Production planning may be defined as the technique of foreseeing every step in a long series of
separate operations, each step to be taken at the right time and in the right place and each
operation to be performed in maximum efficiency. It helps entrepreneur to work out the quantity
of material manpower, machine and money requires for producing predetermined level of output
in given period of time.
Routing
Under this, the operations, their path and sequence are established. To perform these operations
the proper class of machines and personnel required are also worked out. The main aim of
routing is to determine the best and cheapest sequence of operations and to ensure that this
sequence is strictly followed. In small enterprises, this job is usually done by entrepreneur
himself in a rather
adhoc manner. Routing procedure involves following different activities.
(1) An analysis of the article to determine what to make and what to buy.
(2) To determine the quality and type of material
(3) Determining the manufacturing operations and their sequence.
(4) A determination of lot sizes
(5) Determination of scrap factors
(6) An analysis of cost of the article
(7) Organization of production control forms.

Scheduling
It means working out of time that should be required to perform each operation and also the time
necessary to perform the entire series as routed, making allowances for all factors concerned. It
mainly concerns with time element and priorities of a job. The pattern of scheduling differs from
one job to another which is explained as below:

33

Production schedule:
The main aim is to schedule that amount of work which can easily be handled by plant and
equipment without interference. Its not independent decision as it takes into account following
factors.
Physical plant facilities of the type required to process the material being scheduled.
Personnel who possess the desired skills and experience to operate the equipment and

perform the type of work involved.

Necessary materials and purchased parts.

Master Schedule:
Scheduling usually starts with preparation of master schedule which is weekly or monthly breakdown of the production requirement for each product for a definite time period, by having this as
a running record of total production requirements the entrepreneur is in better position to shift
the production from one product to another as per the changed production requirements. This
forms a base for all subsequent scheduling acclivities. A master schedule is followed by operator
schedule which fixes total time required to do a piece of work with a given machine or which
shows the time required to do each detailed operation of a given job with a given machine or
process.
Manufacturing schedule: It is prepared on the basis of type of manufacturing process involved. It
is very useful where single or few products are manufactured repeatedly at regular intervals.
Thus it would show the required quality of each product and sequence in which the same to be
operated
Scheduling of Job order manufacturing:
Scheduling acquires greater importance in job order manufacturing. This will enable the speedy
execution of job at each center point.
As far as small scale industry is concerned scheduling is of utmost importance as it brings out
efficiency in the operations and s reduces cost price. The small entrepreneur should maintain four
types of schedules to have a close scrutiny of all stages namely an enquiry schedule, a production
schedule, a shop schedule and an arrears schedule out of above four, a shop schedule is the most

34

important most suited to the needs of small scale industry as it enables a foreman to see at a
glance.

The total load on any section

The operational sequence
The stage, which any job has reached.

Loading
The next step is the execution of the schedule plan as per the route chalked out it includes the
assignment of the work to the operators at their machines or work places. So loading determines
who will do the work as routing determines where and scheduling determines when it shall be
done. Gantt Charts are most commonly used in small industries in order to determine the existing
load and also to foresee how fast a job can be done. The usefulness of their technique lies in the
fact that they compare what has been done and what ought to have been done.
Most of a small scale enterprise fails due to non-adherence to delivery schedules therefore they
can be successful if they have ability to meet delivery order in time which no doubt depends
upon production of quality goods in right time. It makes all the more important for entrepreneur
to judge ahead of time what should be done, where and when thus to leave nothing to chance
once the work has begun.
Production control
Production control is the process of planning production in advance of operations, establishing
the extract route of each individual item part\ or assembly, setting, starting and finishing for each
important item, assembly or the finishing production and releasing the necessary orders as well
as initiating the necessary follow-up to have the smooth function of the enterprise. The
production control is of complicated nature in small industries. The production planning and
control department can function at its best in small scale unit only when the work manager, the
35

purchase manager, the personnel manager and the financial controller assist in planning
production activities. The production controller directly reports to the works manager but in
small scale unit, all the three functions namely material control, planning and control are often
performed by the entrepreneur himself production control starts with dispatching and ends up
with corrective actions.
Dispatching
Dispatching involves issue of production orders for starting the operations. Necessary authority
and conformation is given for:
1. Movement of materials to different workstations.
2. Movement of tools and fixtures necessary for each operation.
3. Beginning of work on each operation.
4. Recording of time and cost involved in each operation.
5. Movement of work from one operation to another in accordance with the route sheet.
6. Inspecting or supervision of work
Dispatching is an important step as it translates production plans into production.
Follow up
Every production programme involves determination of the progress of work, removing
bottlenecks in the flow of work and ensuring that the productive operations are taking place in
accordance with the plans. It spots delays or deviations from the production plans. It helps to
reveal detects in routing and scheduling, misunderstanding of orders and instruction, under
loading or overloading of work etc. All problems or deviations are investigated and remedial
measurer are undertaken to ensure the completion of work by the planned date.
Inspection: This is mainly to ensure the quality of goods. It can be required as effective agency
of production control.

36

Corrective measures: Corrective action may involve any of those activities of adjusting the route,
rescheduling of work changing the workloads, repairs and maintenance of machinery or
equipment, control over inventories of the cause of deviation is the poor performance of the
employees. Certain personnel decisions like training, transfer, demotion etc. may have to be
taken. Alternate methods may be suggested to handle peak loads.
Inspection
This is mainly to ensure the quality of goods. It can be required as effective agency of production
control.
Corrective measures
Corrective action may involve any of those activities of adjusting the route, rescheduling of work
changing the workloads, repairs and maintenance of machinery or equipment, control over
inventories of the cause of deviation is the poor performance of the employees. Certain personnel
decisions like training, transfer, demotion etc. may have to be taken. Alternate methods may be
suggested to handle peak loads.

37

OBJECTIVES OF THE STUDY

To study the production process of Sangam India Ltd. Used for producing
Denim product.
To study the production planning and control system & methods applied by
Sangam India Ltd.
To study and analyze the Yield generation and the critical factors influencing
the production achievement.
To recommend suitable measures to improve Yield generation and resource
utilization whatever and wherever required under the scope of the study.

SCOPE OF THE STUDY

The study was conducted at the Bilwara Plant, Sangam India Ltd. on the existing
system, methods and products only. The source of informationis also confined to
the company records only.

38

DESCRIPTION OF DATA
PPC - 6 MONTHS - ORDER STATUS
DEC-13
Sort no.

Order Qty

3052

50,000

51,733

3927

175,000

3141

Produced Qty

Balance to Prod/Variance

Mtrs

Comp
1,733

103.5%

173,250

(1,750)

99.0%

125,000

64,389

(60,611)

51.5%

3910

275,000

284,538

9,538

103.5%

3704

210,000

198,533

(11,467)

94.5%

3958

210,000

194,520

(15,480)

92.6%

3737

210,000

215,098

5,098

102.4%

3046

210,000

176,852

(33,148)

84.2%

3914

210,000

184,620

(25,380)

87.9%

3711

210,000

194,633

(15,367)

92.7%

3923

210,000

215,399

5,399

102.6%

3924

100,000

96,258

(3,742)

96.3%

3164

200,000

178,525

(21,475)

89.3%

3148

15,000

1,625

(13,375)

10.8%

3158

15,000

17,652

2,652

117.7%

3995

50,000

51,236

1,236

102.5%

3957
Total

150,000
2,625,000

165,896
2,464,757

15,896
(160,243)

110.6%

39

93.9%

JAN-14
Sort no.

Order Qty

3141
3704
3910
3120
3169
7020
3958
3046
3164
3914
3916
3923
3924
3711
3706
PD-498-M
9445-M
Total

50,000
175,000
125,000
275,000
210,000
210,000
210,000
210,000
210,000
210,000
210,000
100,000
200,000
15,000
15,000
50,000
150,000
2,625,000

Balance to
Produced Qty
51,123
184,620
112,809
261,855
235,743
210,193
229,414
150,802
216,768
184,000
181,693
98,671
189,948
13,852
14,879
62,523
165,141
2,564,034

Prod/Variance Mtrs
1,123
9,620
(12,191)
(13,145)
25,743
193
19,414
(59,198)
6,768
(26,000)
(28,307)
(1,329)
(10,052)
(1,148)
(121)
12,523
15,141
(60,966)

% Comp
102.2%
105.5%
90.2%
95.2%
112.3%
100.1%
109.2%
71.8%
103.2%
87.6%
86.5%
98.7%
95.0%
92.3%
99.2%
125.0%
110.1%
97.7%

FEB-14
Sort no.
3141

Order Qty
35,000

Balance to Prod/Variance
Produced Qty
33,984

40

Mtrs

% Comp
(1,016)

97.1%

3910

250,000

235,821

(14,179)

94.3%

3169

150,000

153,158

3,158

102.1%

3958

150,000

148,611

(1,389)

99.1%

3052

150,000

135,931

(14,069)

90.6%

9809

150,000

136,984

(13,016)

91.3%

5006-M

150,000

145,814

(4,186)

97.2%

3739

150,000

148,526

(1,474)

99.0%

3046

150,000

136,582

(13,418)

91.1%

3914

150,000

146,258

(3,742)

97.5%

3923

250,000

254,833

4,833

101.9%

3924

250,000

233,994

(16,006)

93.6%

3983

150,000

169,523

19,523

113.0%

3984

150,000

169,525

19,525

113.0%

PD-744M

45,000

27,552

(17,448)

61.2%

2,277,096

(52,904)

97.7%

Total

2,330,000

MAR-14
Sort no.
3141
3910
3923
3924

Order Qty
126,000
250,000
250,000
150,000

Produced Qty
102,205
208,230
235,821
126,232
41

Balance to

Prod/Variance Mtrs
(23,795)
(41,770)
(14,179)
(23,768)

Comp
81.1%
83.3%
94.3%
84.2%

3052
3927
3834
3957
3995
3705
3999
3761
3743
3717
3782

150,000
150,000
126,000
130,000
125,000
100,000
125,000
100,000
100,000
125,000
125,000

121,883
126,234
102,202
109,836
101,381
95,822
101,380
85,240
80,879
105,742
101,378

(28,117)
(23,766)
(23,798)
(20,164)
(23,619)
(4,178)
(23,620)
(14,760)
(19,121)
(19,258)
(23,622)

81.3%
84.2%
81.1%
84.5%
81.1%
95.8%
81.1%
85.2%
80.9%
84.6%
81.1%

3947
3977
3750/3748
3751
3752

100,000
50,000
125,000
125,000
125,000

85,244
39,877
105,746
101,376
105,748

85.2%
79.8%
84.6%
81.1%
84.6%

2,531,000

2,140,251

(14,756)
(10,123)
(19,254)
(23,624)
(19,252)
(390,749)

TOTAL

84.6%

APR-14
Sort no.
3141
3910
3923
3924
3052
3927
3870
3834
3957
3995
3705
3999
3761
3743
3717
3782
3947
3977

Order Qty
126,000
225,000
250,000
250,000
200,000
200,000
35,000
126,000
130,000
100,000
45,000
50,000
50,000
35,000
50,000
50,000
50,000
35,000

Balance to Prod/Variance
Produced Qty
103,760
184,785
255,439
227,787
173,438
177,789
27,593
107,391
107,936
97,377
22,935
36,795
32,434
42,656
44,156
45,656
41,432
17,301

42

Mtrs
(22,240)
(40,215)
5,439
(22,213)
(26,562)
(22,211)
(7,407)
(18,609)
(22,064)
(2,623)
(22,065)
(13,205)
(17,566)
7,656
(5,844)
(4,344)
(8,568)
(17,699)

% Comp
82.3%
82.1%
102.2%
91.1%
86.7%
88.9%
78.8%
85.2%
83.0%
97.4%
51.0%
73.6%
64.9%
121.9%
88.3%
91.3%
82.9%
49.4%

3750/3748
3751
3752
3759
5009
3716
3799
3169
3941
3170
TOTAL

35,000
40,000
50,000
50,000
50,000
50,000
50,000
160,000
32,000
35,000
2,559,000

12,931
22,303
35,957
36,987
49,585
55,862
55,369
165,952
35,963
36,999
2,254,568

(22,069)
(17,697)
(14,043)
(13,013)
(415)
5,862
5,369
5,952
3,963
1,999
(304,432)

36.9%
55.8%
71.9%
74.0%
99.2%
111.7%
110.7%
103.7%
112.4%
105.7%
88.1%

May-14
Sort no.

Order Qty

Produced Qty

Balance to Prod/Variance

Mtrs

Comp

3834

126,000

136,820

10,820

108.6%

3957

130,000

142,583

12,583

109.7%

3995

100,000

75,696

(24,304)

75.7%

3705

150,000

143,520

(6,480)

95.7%

3999

150,000

131,963

(18,037)

88.0%

3761

150,000

174,521

24,521

116.3%

3743

125,000

132,699

7,699

106.2%

3717

100,000

92,684

(7,316)

92.7%

3782

125,000

135,225

10,225

108.2%

3947

125,000

118,576

(6,424)

94.9%

3977

125,000

135,221

10,221

108.2%

3750/3748

125,000

125,753

753

100.6%

3751

125,000

118,574

(6,426)

94.9%

5602-M

75,000

56,278

(18,722)

75.0%

5604-M

75,000

65,943

(9,057)

87.9%

5610-M

75,000

84,269

9,269

112.4%

5608-M

100,000

75,212

(24,788)

75.2%

SD-925D

100,000

(100,000)

0.0%

SD-928D

100,000

84,699

(15,301)

84.7%

SD-929D

100,000

92,486

(7,514)

92.5%

5605-M

100,000

76,993

(23,007)

77.0%

3790d/94

100,000

98,541

(1,459)

98.5%

43

3170
TOTAL

100,000

105,694

5,694

105.7%

2,581,000

2,403,950

(177,050)

93.1%

Above data were provided to me by the HOD of the Production Planning & Control Department,
Sangam.
In sample data Sort no. identifies different varieties of fabric which company produced.
Company use sort no. to differentiate its one quality of fabric from the other. Order Quantity is
quantity of fabric they have to produce in that particular month whereas Produced Quantity is the
quantity company produce against their order quantity. Order Quantity is derived by consulting
with marketing department head on the basis of the demand. Balance to Production implies the
difference between the Order Quantity and Production Quantity. Percent of Completion is the
percentage of the production completion against order.

44

ANALYSIS OF DATA
The below table shows the monthly planning and monthly production and their deficient.
Table: 1
MONTH

PLANNING

PRODUCTION

DEFICIENT

DEC

2625000

2464757

-160243

JAN

2625000

2564034

-60966

FEB

2330000

2277096

-52904

MAR

2531000

2140251

-390749

APR

2559000

2254568

-304432

MAY

2581000

2403950

-177050

3000000
2500000
2000000
1500000
1000000
500000
0

DEC

JAN

FEB

MAR

APR

MAY

-500000
-1000000

Fig. 9
The above chart (Fig. 9) shows how much of the planning is not achieved in production. The big
block show how much company is going to produce in that particular month where the another
block beside the planning block shows how much company produced against its planning and the
blocks below 0 level show the deficient which the company cant produce during that month.

45

Table: 2
MONTH

PLANNING

PRODUCTION

DEC

2625000

2464757

JAN

2625000

2564034

FEB

2330000

2277096

MAR

2531000

2140251

APR

2559000

2254568

MAY

2581000

2403950

PLANNING VS PRODUCTION
3000000
2500000
2000000
1500000
1000000
500000
0

Fig. 10 | Planning VS Production

46

It is clearly seen from Data that, there is a mismatch between Plan and production. As a result of
that following problems are generated:

1.

Overall Yield is poor:

One-Sample Statistics
Mean
Std. Deviation

N
YIELD

122

.9033

Std. Error Mean

.18584

.01683

One-Sample Test
Test Value = 0
Sig. (2-tailed)
Mean

Df

95% Confidence Interval of the

Difference

Difference
Lower

YIELD

53.684

121

.000

H0: YIELD = 1
H1: YIELD < 1

INTERPRETATION:

47

.90326

.8700

Upper
.9366

Since, Significance value is 0.000 (less than 0.05) the decision is to accept the Alternative
Hypothesis and reject the null Hypothesis. As the data accept the alternative hypothesis and
concludes that the yield of the company is below 1.

Not meeting the customer demand or production target

2.

Paired Samples Statistics

Mean
Pair 1

Pair 1

Std. Deviation

Std. Error Mean

ORDER

116803.8070

57

61406.29515

8133.46249

PRODUCED

110562.1053

57

61034.22083

8084.18004

Paired Samples Correlations

N
ORDER & PRODUCED
57

Mean

Pair ORDER 1

Correlation
.980

Paired Samples Test

Paired Differences
Std.
Std.
95% Confidence
Deviatio

Error

Mean

175

1719

11

H0: Production > Order

H1: Production < Order

48

.000

df

Sig. (2tailed)

Interval of the

Difference
Lower
Upper
6241.70 12106.8 1603.587 3029.330 9454.072

PRODUCED

Sig.

76

75

3.892

56

.000

INTERPRETATION:
Since, Significance value is 0.000 (less than 0.05) the decision is to accept the Alternative
Hypothesis and reject the null Hypothesis. As the data accept the alternative hypothesis and
concludes that the companys production is less than its order.

49

FINDINGS
Significant mismatch of planning and actual production resulting into poor
Yield generation.
Improper planning system for production.
Piling up of excess inventory due to poor yield.
Improper material issue system and handling.
Improper space utilization as most of the spaces being occupied by excess
raw materials or finished goods.
Considerable wastage due to improper planning.
Overall misuse of man-Hr. and low employee morale.
Change over time is high.

50

RECOMMENDATION
1. Changes required in the planning method:
Instead of daily planning, at least three days rolling plan should be
fixed and circulated to the production department.
Similar way, total month plan should be broken down fortnightwise and week-wise taking into account volume mix as well as
product mix.
For each variety of products, manpower distribution planning,
critical factors etc. to be done in a standardized way.
For every product, total materials required for production should be
divided into common and model specific categories and
accordingly common materials should be issued on a rolling basis.
Whereas, the specific materials should be issued before the actual
production.
At least, for two consecutive production run, the materials should
be provided to the production dept.
Daily cross functional meeting consisting of planning dept.
production dept. maintenance dept. and SCM dept. should be in
place.
Inventory management and monitoring should be done based on the
progress of production in line with the demand, at least, for nonexclusive items.

51

2. A mini Material store is to be created beside the production floor for easy
access of materials.
3. All the mechanical set ups should be transformed into external quick fit set
up phase wise to avoid delay in changeover.

CONCLUSION

52