A STUDY ON MATERIAL MANAGEMENT

OFINTEGRAL COACH FACTORY,

LOCATED AT CHENNAI.

Submitted byA.SUDHAN

Register No: 11309631046

Need for material managementThe raw materials can be used in an effective manner.The wastage of materials can be reduced.It would help in completion of projects in short span of time.The specialized person can be appointed to the optimum machinery.The dumping of materials can be reduced.

Scope for material management

Primary objective:-

To study in detail about the materials utilized and how they are maintained in an organization.

Secondary objective:-

To focus on optimum use of resource available. To study on purchase of raw materials in ICF. To examine whether to make or buy the headstocks. To forecast the dispatch of materials for the future. To dispose the scraps in the industry.

SCOPE AND SIGNIFICANCE OF THE STUDY

The main purpose of the study is to study about the material management techniques used in an organization and to deal with reducing the cost of the materials.

To substantiate, this study is focused to Reducing the cost of materials Dispatch of coaches with regards to time period Dispose scraps after the production process To differentiate the materials based on the cost.

The study intended to analyze the materials utilized in an organization, the cost

involved, the storage process, the dispatch of goods and the disposal of scraps.

Features of ICF Today the coach factory produces more than 1600

coaches of more than 170 varieties. Nearly 1336 coaches are manufactured every year,

and 6 coaches are manufactured per day. It employs about 13,000 persons. The factory is based on the job shop model of

production system.About six coaches are produced in a day.

REVIEW OF LITERATURE ICF is an ISO 9001 certified organization, manufacturing different types of

coaching stock for the Indian Railways, and other customers. The raw materials and components required for the manufacture of coaches is procured by the Materials Management Department, through tenders. The Department is headed by the Controller of Stores. In the year 2008-09, the total value of procurement by ICF was in the region of Rs.1139 crores.

Normally all tenders are issued as e-tenders in IREPS website. The Bulletin

Tenders are issued to all registered suppliers of ICF. For registration with ICF, the suppliers are required to furnish the required information in the prescribed form, available with the Registration Section of the office of the Controller of Stores/ICF. The suppliers meeting the conditions mentioned in the form are registered for the item groups applied for. Initial registration is for two years and on satisfactory performance, the registration is made permanent.

Materials management is an important element in project planning and control. Materials represent a major expense in construction, so minimizing procurement or purchase costs presents important opportunities for reducing costs. Poor materials management can also result in large and avoidable costs during construction.

• First, if materials are purchased early, capital may be tied up and interest charges incurred on the excess inventory of materials. Even worse, materials may deteriorate during storage or be stolen unless special care is taken. For example, electrical equipment often must be stored in waterproof locations. Second, delays and extra expenses may be incurred if materials required for particular activities are not available. Accordingly, insuring a timely flow of material is an important concern of project managers.

• Materials management is not just a concern during the monitoring stage in which construction is taking place. Decisions about material procurement may also be required during the initial planning and scheduling stages. For example, activities can be inserted in the project schedule to represent purchasing of major items such as elevators for buildings. The availability of materials may greatly influence the schedule in projects with a fast track or very tight time schedule: sufficient time for obtaining the necessary materials must be allowed. In some case, more expensive suppliers or shippers may be employed to save time.

• Materials management is also a problem at the organization level if central purchasing and inventory control is used for standard items. In this case, the various projects undertaken by the organization would present requests to the central purchasing group. In turn, this group would maintain inventories of standard items to reduce the delay in providing material or to obtain lower costs due to bulk purchasing. This organizational materials management problem is analogous to inventory control in any organization facing continuing demand for particular items.

• Materials ordering problems lend themselves particularly well to computer based systems to insure the consistency and completeness of the purchasing process. In the manufacturing realm, the use of automated materials requirements planning systems is common. In these systems, the master production schedule, inventory records and product component lists are merged to determine what items must be ordered, when they should be ordered, and how much of each item should be ordered in each time period. The heart of these calculations is simple arithmetic: the projected demand for each material item in each period is subtracted from the available inventory. When the inventory becomes too low, a new order is recommended. For items that are non-standard or not kept in inventory, the calculation is even simpler since no inventory must be considered. With a materials requirement system, much of the detailed record keeping is automated and project managers are alerted to purchasing requirements.

RESEARCH METHODOLOGY

RESEARCH DESIGN: The study is intended to analyze the

material management in the premises of integral coach factory. An attempt is made to study in depth about the material requirement in a factory and how to reduce the cost of materials. The research design selected for study is analytical in nature.

ANALYTICAL RESEARCH: The purpose of using analytical type

of research is to provide accurate and valid description of variables involved in the research as the data’s are already procured.

Secondary Data Collection Method:The secondary data are those which have already collected and

stored. Secondary data easily get those secondary data from records, journals, annual reports of the company etc. It will save the time, money and efforts to collect the data. Secondary data also made available through trade magazines, balance sheets, books etc.

Secondary data collected through five years annual report of the company, supported by various books and internet sites. The data collection was aimed at study of material management of the company.

Project is based on Annual report of Integral coach factory 2005-06 Annual report of Integral coach factory 2006-07 Annual report of Integral coach factory 2007-08 Annual report of Integral coach factory. 2008-09

AREA OF STUDY: The research was

collected from the premises of ICF especially from the material planning office and the headstock shed in ICF job shop.

DATA COLLECTION MODEL: As the survey is to find out

purely the aspects regarding material management data’s are collected from secondary method of data collection. The researcher with the help of the trainer collected the data’s from ICF.

LIMITATION OF THE STUDY:

• Area of the study for material management is confined to ICF perambur.

• Time factor can be considered as a main limitation.

• Findings of the research may change due to time, cost of materials, age condition of economy etc.

• Inadequate data found in the premises.