3. 3
CHAPTER-1
PAINT INDUSTRY-A SHORT INTRODUCTION
PAINT INDUSTRY
What is paint?
Paint is a liquid, when it applied to the substrate in form of thin layer; it is converted into the
solid thin film. The paints are most commonly used as the protective coating and to provide
color and texture to objects.
INDUSTRIAL DEPARTMENTS
Organization/Industry departments:
Organization/Industry Departments
PAINTS COMPOSITION
The formulation of the paint is the ingredients of four components; this formulation is balanced
in such a way to give good quality. They are as follows.1-Binder,2-Solvent, 3-Pigments, 4-
Additives
RESEARCH & DEVELOPMENT: It is an important department of any organization to
develop new products, trouble shooting and enhance existing products.
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PAINT INDUSTRY PRODUCT:
MISSION & VISION
Vision = The highest customer satisfaction and best quality is kept to sustain the leadership
position in the market.
Mission = We use the best innovative technology and research to provide cost-effective
solution, services and products for our customers.
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CHAPTER-2
STRATEGY
OPERATIONS STRATEGY
KEY FACTORS
1. External: economics, political condition, legal, technology, competition and market.
2. Internal: Human resources, equipment, financial resources, customers, Technology
used, suppliers
Businesses compete using operations
Product and service Design-Differentiation
Cost
Location
Quality
Quick response
SUPPLIERS: There must be multiple suppliers, so that the delay and stoppage may not affect
or stop the production.
PAINT INDUSTRY FACTORS
Differentiation =
1. Vast Paint Color = The vast variety of color ranges is available for the customer
to select. This is done through color matching technique.
2. Vast variety of paints type according to application = like distemper, plastic
emulsion, exterior, and interior paint, epoxy, water bone paints, etc
3. High Quality = The company is providing high-quality paints.
4. Customer service = The customer service is provided to the customer
5. Technical services= if any technical issues arrive during application the
technical staff is ready to assist
6. After-sales service = After-sales services like changing paints and other services
are provided.
7. High quality packaging= high-quality packaging will keep the best quality of
paint to long run
8. High rated tested paints in the lab= the paint is tested in lab for better paint
quality-the tests are as follows - Dispersion test, Panel test, Dry test, Hiding
power, viscosity
9. R & D -Best research and development with high-quality formulations
Quality
The quality is kept high to have customer satisfaction, develop high end product
and to have advantage over the competitors.
PORTER’S 5 FORCE MODEL
1. The threat of new entrants [moderate/high] = The paint industry requires less capital
investment to establish it. So the threat to new entrants is high. The raw material is
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easily available. However, competition with other high-quality brand names can cause
difficulties for newcomers.
2. The threat of substitution [high] = The substitute technology which is an alternative
to paints has become a threat to high-quality paint products. These substitutes are
cheaper compared to the expense of paints and can have a high product life. These
substitutes are tiles, wallpapers, distempers, and bricks.
3. Competitive rivalry [intense] = The other companies like Berger, ICI, master paints,
Jotun, nelson, and Nippon are competitors selling good quality low price
4. Bargaining power of buyer [high] = The other companies offer the same product at a
cheap price and unsatisfied customers can switch over. The other companies like
Berger, ICI, master paints, Jotun, nelson, and Nippon are competitors
5. Bargaining power of the supplier [low] = The paint industry sector is small as
compared to the other manufacturing sector. So the raw material suppliers are more. So
the companies have more choice to switch over to other suppliers.
SWOT ANALYSIS
STRENGTHS
Research & development = The business gives the research and innovative product, which
gives a strong competitive advantage, this gives the strong market position. The paint recipes
and formulation requires extensive research and development.
Vast color scheme = with proper research and development provides a vast range of color
schemes.
High quality= The high-quality product gives a competitive advantage.
Safety standards = The safety standards give the product, industry, and workforce safety.
Customer satisfaction = Through proper research and development, better products and
services. Customer satisfaction is increased.
WEAKNESSES
Experienced professional= Due to the high technical product range requires a highly skilled
workforce, technical staff, and sales force.
Need marketing and promotion = This highly technical product need trained sales staff with
proper advertising strategy.
OPPORTUNITIES
The sales can be boosted by promotions
Need theme parks
High internet penetration
Increased mobile phone usage
Need the marketing
THREATS
Competitors = The competitor with the better or same product is a threat for high volume paint
sales
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Political instability = The political instability leads to the low sales
Economic instability = The economic instability leads to the low sales
Competition = High domestic and international competition
PRODUCTIVITY: The productivity is maximized by decreasing the inputs like –labor cost,
low raw material cost, Energy, reduced operation time, and increasing the outputs. To increase
productivity, the cost is lowered, quality is kept high, use advanced technology and proper
management.
Productivity = [Product produced] / [all inputs used during manufacturing]
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CHAPTER-3
PLANNING
LOCATION PLANNING
Need for location decision
Marketing strategy: Demand and make to retailers
Cost of doing business: Location should be of low cost
Growth: The location is selected by the growth potential of company
Depletion of resources
Making location decision
1. Decision criteria= cost of doing business
o Deciding factors
1. Regional factors:
o Raw material: The paint plant should be located or planned,
where the paint raw material is easily available. Otherwise, the
cost will increase. The plant is located new all the raw material
suppliers are available.
o Market location: The location is all around the city and industries
customers
o Labor factors: The area selected where employees and skilled
workers are easily available.
o Climate and taxes:
2. Community factors: The plant location should be selected in such a way
that utilities are easily available at a reasonable cost. Other community
factors are taxes, and people’s attitudes toward the product. The paint
products are made according to environmental regulations.
3. Site-related factors: The site selection is in such a way that the
transportation routes are available. The land should be of a type that easy
construction and production may be done. The legal issues should be
fulfilled for the land like lease and buying
4. Service and retail:
Cost- The product should be introduced in the market with lower
cost
Service and retail- convenience and low traffic
Demographic- customer and employee age, age, income, and
education.
Customer safety- Customer safety must be kept in mind
5. Retail factors
o Population area- high population area for retail shops
o Competition – nearby so can notice their strategy
o Traffic volume-low traffic volume area
o Customer access and parking; parking near shops
2. Identify important factors
Cost profit=
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fixed cost and variable cost
Plot total cost
Determine the lowest total costs
Cost volume analysis-Variable Cost can be added-low cost selected
Location Fixed cost Variable cost Total
City center - - -
City mid - - -
Outer city - - -
3. Develop location alternatives: These factors are selected for developing alternatives.
Cost factor
Energy and utilities
Labor and skilled employees’ cost
Legal and building leasing costs
Transportation
4. Evaluate the alternatives: The rating is given from scale 1-10
10 is highest and 1 be the lowest value
5. Evaluate and make a selection
Transportation model: -The supply chain model is simple; the industry distributes the
paints to the customer through the retailers.
Factor rating: in the table above
Distribution costs: The minimum distribution cost is noted for each route
Site selected: the site selected is the mid-city
FACILITY LAYOUT
The facility layout includes= diagram includes the product layout, process layout, fixed
position layout and combination layout
Factors rating Center city Mid Outer Total
Points
Cost factor 2 6 6 14
Energy and utilities 9 8 1 18
Labor and skilled employees’ cost 1 7 7 15
Legal and building leasing costs 3 4 8 15
Transportation 9 9 1 19
Total points to select site 24 34 23
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Warehouse layout
Normal paced environment
o Emergency exit: The new design contains the emergency exits which is an important
factor in designing a facility, the emergency exit path should be a clear area as shown
in the layout
o Folk lifters: The folk lifting and conveyer belt operation is used
o Receiving and shipping rack: There is a separate receiving and shipping rack for
incoming and outgoing goods. The building has proper incoming and outgoing doors
o Fast-paced goods: The fast-paced goods are placed at the center so that they can be
excessed and shipped easy
o The sorting, packing, and staging: are near to shipping rack Equipment's have
separate rack
PLANT PROCESS AND PRODUCT LAYOUT
This process layout is optimized and it reduces cost and accidents, the hazards are low, the
material flow is smooth
EQUIPMENT IN OPERATION AND PROCESS TYPE
Batch operations
There are different types of paint pigment grinding machines. This includes ball mill and
basket mill. High-speed mixers are used to mix the raw material and finished products.
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CHAPTER-4
OPERATIONS MANAGEMENT
PRODUCTION & MANUFACTURING
CAPACITY PLANNING
Providing the right amounts of paint at right time. For proper operations, it is important for
the manager to look for three things.
Capacity
Demand
Forecasting
The capacity is how much they make- To increase and decrease demand, it is important to
calculate the capacity. Capacity involves both the amount and the time.
Adjusting capacity: The capacity measures the rate at which the inputs are converted into
outputs. The capacity involves the demand and providing.
Low capacity= Demand not fulfilled
High capacity = Waste of resources and high inventory
The resources in the system can expand the capacity. The capacity can be adjusted by the
number of methods and resources.
Introducing new material
Increasing the number of machines
An increasing number of hours
Capacity constraints:
It is a resource, which is less capable. The capacity is constrained by low moving parts.
Staff/skill level
Facilities technology
Availability of material
Mixing product or service
Storage
Scheduling
Measuring the capacity in paint industry and Calculations:
[For only black paint type batches]
Input measure of capacity: the measure selected by key inputs into the process
Output measure of capacity: it counts the output units produced
Design capacity = Capacity=Time available/time of task
The bottleneck point or step in the process, which is delaying the output. It is the grinding of
hard pigment.
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Design capacity: This is the output that an operation can produce without stopping.
Design capacity black paint = Capacity=Time available/time of task
[8 hr/day X 60 minutes per hour X 5 days]/240 minutes per batch = 10 batch per week
Effective capacity or available capacity: It is the long-run capacity. And includes stoppage
time
[6 hr/day X 60 minutes per hour X 5 days]/240 minutes per batch = 7.5 batch per week
This includes 2-hour stoppage time
Actual capacity: It is the capacity, which includes planned and unplanned losses.
The actual work is 6 batches of paint per week
Efficiency = actual output/effective capacity
=6/7.5= 80%
Capacity utilization: It is how much capacity is available.
Utilization = actual output / design capacity
= 6/10 =60%
Takt or cycle time: It is the maximum time that a unit can take to produce an output. it is
usually the output rate of the manufacturing unit.
Takt time = time available to work / time demand (units produced)
Minutes available in working shift to nonworking shifts
Time available to work = 8 hour shift - 1 hour lunch,-1 hour rest
=8-1-1=8-2=6 hours=360 minutes
Units produced = 2 batches per day=
Takt time = 360/2 = 180 minutes = 3 hours
Capacity planning method:
Capacity lead demand: Can provide capacity forecast ahead. The lead time capacity
calculations is used.
Capacity matches demand: Provides capacity as demand changes.
Capacity lag demand: respond after the demand is known
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Capacity timing horizon
1. Short term planning: 3-month period, It is short-term planning method of capacity
with paint demand.
2. Medium term planning: 3 to 18-month period
3. Long term planning: 12 to 18-month period
SCHEDULING
Production sequencing: For the proper sequencing of the production tasks and orders, the
Gannet charts are used, these Gannet charts are planned on MS Excel or MS Project.
SUPPLY CHAIN
o Supply system: The supply system may contain the supply of products from the
industry directly to the customer.
o Routing: Before sending the product to the customers, it is important to have the routing
of the product, deliver the product to the customers’ closers to each other and closer to
the industry
o Checklist: Before loading the product, have a checklist, of what is being loaded mark
that on the checklist, and also ‘’ hand over the checklist’’ to the customer what is being
delivered to the customer.
o Safety of supplied product: The product must be kept safely in the containers; lids must
be closed properly. During transportation, the product must be kept safely such that it
may not fall down and spilled.
Supply chain distributor network model.
The supply chain model is simple; the industry distributes the paints to the customer through
retailers.
INVENTORY PLANNING-ERP
Types of inventory in the paint industry
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Raw material for paint manufacturing
Partially finished goods
Finished paint inventories
Inventory management software: The inventory of paint product with a wide range of
colors need proper software for management, so ERP software is used
Inward materials = these are the raw materials purchased from the supplier
inward warehouse= when the material is delivered from the supplier it
is recorded as inward warehouse material in ERP software
Outward warehouse= when the raw material is taken out from the
warehouse, it is recorded as outward warehouse material in ERP
software
Outward materials = Finished Product =
inward warehouse= when the finished product is produced it is sent as
inward warehouse material in ERP software
Outward warehouse= when the finished product is delivered to the
customer, it is recorded as outward warehouse material in ERP
software
FORECASTING
Forecasting affects the whole organization, it affects all departments Finance, Human
resources, marketing, and operation management. The proper selection of the forecasting
method is very important to get revenue and optimized production. So it is very important that
the forecast is accurate and reliable. The industry uses the quantitative moving average forecast
method for production raw material estimation and sales.
o Moving Average Method
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Ft=Man= [At-n……At-2+At-1]/n
The higher the months included in the calculations, the higher will be smoothing of the curve
The moving average forecasting technique is chosen because of the daily usage of the raw
materials approximate same. The historical data is easily available. The accurate forecast
lowers the inventory level and improves customer service levels.
17. 17
CHAPTER-5
HUMAN RESOURCE MANAGEMENT - HRM
HUMAN RESOURCE MANAGEMENT
JOB DESIGN
Content Engineer Workforce
What be done Machine
operation
Guiding work
force
Running of machine
Who will do Machine
operation
x
How it will be done Machine
operation
Using proper SOP’s
Where the job will be
done
Machine
operation
In the production floor
Job design task “machine operations”
Team and leadership: Proper teamwork is used in the production of the paints. This
gives the benefits of high quality, high productivity, and more workers satisfaction.
Working condition
o Personal safety: Use of proper PPE [personal protective equipment]-These
include glasses, hard helmets, gloves, masks, aprons, and safety shoes.
o Industrial conditions: Proper cleaning, safety marking, and ventilation are
very important in the industry.
o Fire protection: It is a very important part of the safety of the industrial unit.
Fire protection signs and equipment are used in the industry. Fire protection
equipment includes fire extinguishers and water sprinklers. The training is very
important aspect of fire protection.
o Material safety: Material safety is done using MSDS-Material safety data
sheets.
o Equipment safety: Proper operation techniques and safety of equipment give
up to the mark product .in the paintball mill proper cooling is important follow
the SOP’s.
o Building safety: For building safety the paint and proper maintenance are
important
Quality of work life
o Compensation plan: Time-based system: The compensation plan is time-based
when there is a huge load on the production, the workforce will have to work
overtime and they are paid for it.
o Rewards: The employees are given rewards on best performance.
Job enlargement, rotation & enrichment: By using these the employees have
responsibility and authority in their jobs.
JOB ANALYSIS
Flow process charts – the flow charts are used to design the employees/operators and
machine movements.
o DEVELOPING WORK METHODS- For the proper output, it is important to develop
the work method.
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Eliminate unnecessary motions
Combine activities
Reduce fatigue
Improve the arrangement of the workplace
Improve the design of tools and equipment
o WORK MEASUREMENT: Determining how long it should take to do a job.
Standard time: The standard time method is used to determine the qualified
worker to complete the time of paint processing
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CHAPTER-6
QUALITY MANAGEMENT
QUALITY:
Quality control is an important aspect of production and customer satisfaction. This is done by
proper inspection on site of input materials and output products. The time and place of the
inspection are also taken into consideration. The quality of the paint’s raw materials and the
finished product is done in the quality control lab. The basic paint tests are dispersion, spray,
and viscosity tests. The quality of the daily operations is done by check sheets, SOP’s and
tables.
LEAN PRODUCTION: Lean production is the quality management technique used
to reduce waste in the process. The basic techniques used in lean production are 5S,
fishbone diagram, poke yoke, kaizen and PDCA etc
SIX SIGMA: It is a statistical process control technique. It uses the control charts for
the proper operation of the machines and time control of the paint machines. This
includes the following steps: Define, measure, analyze, improve and control
QUALITY DOCUMENTS: The quality documents are those documents in which the
quality standards are being written. These standards may contain viscosity, SOP‘s
operating temperatures, etc. So the whole company follows these quality documents
standards.
QUALITY STANDARDS: ISO quality standards and documents are used.
INSPECTION: The inspection of the
ANALYSIS: The analysis of the problems in the paint industry is done by using FTA
(fault tree analysis) and ETA (event tree analysis).
VOICE OF CUSTOMER-(QFD): The voice of the customer is included in the
product formulation to the product delivery.
REFERENCE
Stevenson, W. J, Operations management. (14th ed). McGraw-Hill-Mcgraw-Hill (2021)
![1
OPERATION MANAGEMENT
PROJECT
AN INDUSTRIAL OPERATIONS OF PAINT INDUSTRY
[A CASE STUDY]
BILAL MASOOD
Course = Operation management
MS ENGINEERING MANAGEMENT](https://image.slidesharecdn.com/operationmanagement-220926053707-ad7612e9/85/OPERATION-MANAGEMENT-paint-project-backup-pdf-1-320.jpg)
