1. Material
Management
Prof. Dr. Basavaraj K. Nanjwade M. Pharm., Ph. D
Department of Pharmaceutics
KLE University College of Pharmacy
BELGAUM-590010, Karnataka, India.
E-mail: nanjwadebk@gmail.com
Cell No.: 00919742431000
There are thousand reasons for failure, but only one way to success,
‘HARD WORK’
3. Contd..
Contents
Value analysis
Purchasing
Vendor development
Buying techniques
Purchasing cycles and procedure
Advantages of material management
19 July 2012 KLE College of Pharmacy, Nipani. 3
4. Definition
It is defined as an organizational concept,
which has the authority and responsibility of
all activities, concerned with the flow of
materials in the organization.
19 July 2012 KLE College of Pharmacy, Nipani. 4
5. Objectives and importance
• Efficient use of the working capital.
• Lowering inventory investment and increasing
the inventory turnover.
• Responding to the market changes related to
any product.
• Ensuring the cooperation of all departments.
• Providing best services to the king of the
market i.e customer.
19 July 2012 KLE College of Pharmacy, Nipani. 5
6. Principles of material handling
• Least handling is the best handling.
• Lengths and number of move to be
minimized.
• Unit loads
• Minimize the distance.
19 July 2012 KLE College of Pharmacy, Nipani. 6
7. Principles of material handling
• The design of the container.e.g. shippers
are used for storing finished bulk. & for
raw materials as per the property of
materials they are stored- plastic
containers ( light weight containers)
• Re-handling and back tracking of the
materials should be avoided.
• The materials handling service should not
interfere with the production flow.
19 July 2012 KLE College of Pharmacy, Nipani. 7
8. Classes of materials
• Raw materials:- These are materials that
are used in the product which is in an
unprocessed condition.
• Purchased Parts:- These are the items
used in the assembly of the product.
19 July 2012 KLE College of Pharmacy, Nipani. 8
9. Classes of materials
• In-progress materials:- They are called
‘work in progress’ inventories. These
goods require further processing.
• Finished materials:- These are fully
manufactured goods, inspected and ready
for delivery to the customers.
• Supplies:- These are consumable goods
used in the process of manufacturing.
19 July 2012 KLE College of Pharmacy, Nipani. 9
11. Materials-Quality & Quantity
• Four factors affecting the purchase of raw
materials are
1) Quality :- The suitably of an item to
accomplish the intended work.
The raw materials should satisfy the
following requirements.
i. Efficiency of the material.
ii. Cost and the shelf –life.
iii. For equipments, power consumption and
power requirement.
19 July 2012 KLE College of Pharmacy, Nipani. 11
12. Quantity
• From the inventory point of view, quantity
standards are decided on the following
parameters;
i. Maximum inventory
ii. Minimum inventory
iii. Standard order
iv. Reorder point
3) Price
4) Delivery Date
19 July 2012 KLE College of Pharmacy, Nipani. 12
13. Value Analysis
• Definition:- It is a systematic study of every
element for it’s cost in a part, material or service to
make certain that it performs it’s function at the
lowest possible cost.
• Benefits of value analysis:-
i. Decrease in existing cost of the product or service.
ii. Unnecessary expenditure is identified and
eliminated.
iii. Product value improves for new materials and
processes.
iv. More profits.
19 July 2012 KLE College of Pharmacy, Nipani. 13
14. Value ratio
Mathematical representation of the value can be
done as Function
Value = Total cost
Reasons for unnecessary costs:-
i. Lack of information
ii. Lack of ideas
iii. Changed circumstances
iv. Wrong beliefs, habits and attitudes
19 July 2012 KLE College of Pharmacy, Nipani. 14
15. Value Analysis Technique
In this technique (n) number of questions are
applied, like:-
o what must I do?
o What else does the item do?
o What does it cost?
o What else will the job do?
o What will be alternative costs?
19 July 2012 KLE College of Pharmacy, Nipani. 15
16. Purchasing
Centralized :- the purchasing Decentralized:- different
procedure of materials for department purchase their
different department is done requirement seperately.
together from one This is basically seen in
purchasing department. large organizations.
This is seen in small
organizations. Advantages
Flexible purchasing system
Advantages Procurement is faster
Efficient system
Bargaining capabilities
increased
Good raw material obtained
at lower price
19 July 2012 KLE College of Pharmacy, Nipani. 16
17. Vendor development
The supplier or the person who sells the
required materials or services for the
production is known as a vendor.
The purchase of raw materials/service from a
specific vendor is known as the vendor
development.
There are four stages of vendor development:-
19 July 2012 KLE College of Pharmacy, Nipani. 17
18. Four stages of vendor development
Stage Name Development
Survey stage Identifying the potential
1st sources of suppliers.
Seeking information.
Provisional vendors list.
Enquiry stage Analysis of information in
2nd standard enquiry format.
Accreditation, FDA
approval, ISO certification.
Personal visits.
Negotiations and Quality control
3rd selection stage specifications, clarification,
credit, quantity discounts.
Experience and Performance appraisal,
4th evaluation stage Quality, delivery time.
19 July 2012 KLE College of Pharmacy, Nipani. 18
19. 1) Survey stage
The following sources are considered for information
• Trade directories :- e.g.
Yellowpages.eindiabusiness.com
• Trade journals:- e.g. Pharmatimes
• Telephone directories
• Supplier’s catalogue
• Salesmen
Other ways are like interchanging of information
with other companies, tracing of public tenders and
advertisements in the press.
19 July 2012 KLE College of Pharmacy, Nipani. 19
20. 2) Enquiry stage
After getting the information of the suppliers,
detailed analysis of the supplier is being
carried out. A comparison is being made
between the different suppliers on basis of the
following points:-
a. Technological competition,
b. service competition,
c. price competition,
d. delivery time.
19 July 2012 KLE College of Pharmacy, Nipani. 20
21. 2) Enquiry stage
The following aspects can be verified by the first
hand visit:-
Internal facilities of the vendor
Financial adequacy, stability and reputation of
the vendor
Location of vendor’s factory
After sales service
Industrial relations
19 July 2012 KLE College of Pharmacy, Nipani. 21
22. 3) Negotiation and selection stage
• The vendors who clear the enquiry stage are
selected and negotiations are being carried out
with them.
• The various aspects such as credit, quantity
discount, quality specifications are being
discussed.
19 July 2012 KLE College of Pharmacy, Nipani. 22
23. 4) Experience and evaluation stage
• The buyer evaluates and appraises the
performance of the vendor.
• The objective is to improve the performance
of the vendors.
Few ways of evaluating a vendor are:-
o Categorial method
o Weighted point method
o Cost ratio method
19 July 2012 KLE College of Pharmacy, Nipani. 23
24. Categorial method
The buyer sets up some category on which the evaluation of the vendor is done. Specimen
of supplier’s evaluation form is given below.
Grading
Factors Always Usually Seldom Never
9 8 7 6 5 4 3 2 1 0
Supplies are as per
quantity selected
Deliveries are on
time
Rigorous follow up
is not necessary
Willing to
accommodate when
production schedules
are suddenly
changed
19 July 2012 KLE College of Pharmacy, Nipani. 24
25. Weighted point method
Here the rating points are divided between quality,
delivery and price.
For eg quality – 50 points
delivery- 30 points
price – 20 points so total is 100 points.
The rating can be obtained by following equation.
19 July 2012 KLE College of Pharmacy, Nipani. 25
26. Weighted point method
Quantity rating = (no. of lots accepted/ no. lots
received) ×rating points
Delivery rating = (no of lots delivered on time/ no
of lots delivered) × rating points
Price rating =(least offer received/ supplier’s
offer)
× rating points
19 July 2012 KLE College of Pharmacy, Nipani. 26
27. Buying techniques
Purchasing of material , machinery and services
is done by purchasing department.
For buying the material company has to pay up a
price, the value that a seller sets on his goods in
the market is called as the price of that good.
Price is one of the greatest variables in the
purchasing of material.
19 July 2012 KLE College of Pharmacy, Nipani. 27
28. How is the purchasing done????
• Quotations :- It is a kind of an inquiry done to
know whether the vendor can supply the desired
material and at what price.
• They are not the purchase order. They just contain
all the details including freight, taxes and many
other costs.
• The highly used quotation techniques are
• Spot quotations
• Floating a limited enquire
19 July 2012 KLE College of Pharmacy, Nipani. 28
29. How is the purchasing done????
• Spot quotations:- this is basically used for the small
items not related to the technical purpose.
The prospective buyer goes to the market and gets the
quotations from the different suppliers.
• Floating a limited enquire:- this method is used when the
value of the purchase is small. In this technique the
reliable vendors are called upon and asked to provide the
quotations.
19 July 2012 KLE College of Pharmacy, Nipani. 29
30. How is the purchasing done????
• Tenders:-
It is a written letter or a published document
that is aimed at finding the price for procuring certain
materials.
Tenders are invited from recognized firms. A few
types of tenders are:
# single tender
# Open tender
# Closed tender or limited tender
19 July 2012 KLE College of Pharmacy, Nipani. 30
31. How is the purchasing done????
• Single tender:- It is invited from one reliable
supplier. This kind of tender is floated only when
the itms are required urgently.
• Open tender:- Also known as ‘ press tender’. This
is used when the value of item to be purchased is
very high. It is used to locate more suppliers.
In this tender procured, a small amount of the
deposit money is taken from the supplier so that
they do not withdraw from the submitted rates.
19 July 2012 KLE College of Pharmacy, Nipani. 31
32. How is the purchasing done????
• Closed tender or limited tender (Negotiations):-
It is done to arrive at the mutual understanding
between the supplier/vendor and the buyer.
19 July 2012 KLE College of Pharmacy, Nipani. 32
33. How is the purchasing done????
What’s the need for negotiation?
@ prices are related to large volumes or to a large value.
@ terms and conditions are required for large volumes.
@ contract is desired for a longer period.
@ variations in quantity to be purchase are possible.
@ when supplies or services can be obtained from only
one source.
@ when no acceptable quotations are received from the
other vendors.
19 July 2012 KLE College of Pharmacy, Nipani. 33
34. How is the purchasing done????
Process of negotiations:- It is a kind of win-win situation.
Both the parties try to benefit to the maxima through the
negotiation.
It is not a kind of bargaining but a mutual understanding
between the two parties.
19 July 2012 KLE College of Pharmacy, Nipani. 34
35. How is the purchasing done????
• Discounts:- They are cash concessions offered by the vendor to
the buyer, in order to enhance the volume of the business
opportunities.
Reasons for offering discounts?????
! When there is a bulk purchase.
! When the bills are cleared immediately.
! And also to maintain the good rapo with
the buyer
Types of discounts:-
1) Volume contracts.
2) Deals
3) Discounts
4) Consignment terms
19 July 2012 KLE College of Pharmacy, Nipani. 35
36. How is the purchasing done????
# Volume contracts:- This kind of discount is offered
proportionate to the volume of material ordered.
# Cash discount:- Cash discount is given on the basis of
the time of the payment done by the purchaser. The
normal credit period is 90 days.
# Cumulative discount:- It is a method of offering the
discount on the basis of actual purchases and appropriate
to the quantity range in a year.
19 July 2012 KLE College of Pharmacy, Nipani. 36
37. Purchasing cycle and procedure
• The purchasing department of the company is
responsible for the purchase of all the raw materials as
well as the requirements.
The following steps are followed in the purchasing cycle.
1) Recognition of need and receipt of requisition: The
requisition includes the following information:-
- Name
- Quality and quantity specifications
- Date by which material is required
- Place at which material is to be delivered
19 July 2012 KLE College of Pharmacy, Nipani. 37
38. Purchasing cycle and procedure
2) Selection of potential sources of supply
3) Making request for quotation
4) Receipt and analysis of quotations
- material specifications and quality
- price of the material
- taxes
- terms of payemeny
- place of delivery
- delivery period
- gurantee period
- validity of tender
19 July 2012 KLE College of Pharmacy, Nipani. 38
39. Purchasing cycle and procedure
5) Selection of right source of supply
6) Issuing the purchase order
7) Follow-up of the order
8) Receipt of materials,reports and analysis
9) Checking and approving of vendor’s invoice for
payment
10) Closing of completed order
11) Maintenance of record and file
Purchasing cycle flow chart has been given in the
following slide.
19 July 2012 KLE College of Pharmacy, Nipani. 39
40. Spell out of specifications &
Need recognition requirements
Official requisitions
Check specifications,
Specifications Purchase
prices/supplies
file records
Inquiry tender Select suppliers Supplier’s
record
Quotations & analysis prices and terms, negotiations, finalisation
Purchase order for supply
Suppliers’ acceptance
Follow-up
19 July 2012 KLE College of Pharmacy, Nipani. 40
41. • Contd ….
Delivery of materials
Checking of invoice Materials & reports,
with purchase order analysis
Payment made
19 July 2012 KLE College of Pharmacy, Nipani. 41
42. Example of Materials and People Flow
19 July 2012 KLE College of Pharmacy, Nipani. 42
43. Location of Stores :
Store should be located adjacent to the manufacturing area.
It depends up on nature and value of items to be stored and
frequency with which items are received and issued
Objectives :
Minimum wastage of space
Maximum ease of operation
Minimum handling cost
Minimum other operational cost
19 July 2012 KLE College of Pharmacy, Nipani. 43
44. Facilities of Store
Inspection center
Quarantine room
Washing room
Centralized weighing department
Adequate space
19 July 2012 KLE College of Pharmacy, Nipani. 44
45. Functions of stores
General function :
Maintenance of Stock (materials and tools)
Maintenance of hygiene, sanitation, and
pest control
Maintenance of material handling
equipment
19 July 2012 KLE College of Pharmacy, Nipani. 45
46. Functions of stores
Specific functions :
Receiving & recording of raw materials
Quarantine storage – Sampling & approval by QC
Positioning & Storage
Issuing & recording of materials
Receiving & Dispatching of finished goods
Distribution
Optional functions :
Dispensing, Maintenance of weights & measures
19 July 2012 KLE College of Pharmacy, Nipani. 46
47. Material handling system
Right Definition :
Material handling uses the right
method to provide the right amount of the right
material at the right place, at the right time, in
the right sequence, in the right position, in the
right condition, and at the right cost.
19 July 2012 KLE College of Pharmacy, Nipani. 47
48. Material handling system
Involves handling, storing, and controlling material
• The raw materials, in-process materials and
finished goods are moved from one place to
another in the plant.
• Adds value through time and place utility
• Impacts space requirement, profits, quality, safety,
and productivity
• On an average, 20% of production cost is spent on
material handling system
19 July 2012 KLE College of Pharmacy, Nipani. 48
49. Twenty Principles of Material Handling
1. Planning principle. Plan all material handling
and storage activities to obtain maximum overall
operating efficiency.
2. System principle. Integrate as many handling
activities as is practical into a coordinated system
of operations, covering vendor, receiving, storage,
production, inspection, packaging, warehousing,
transportation. etc.
19 July 2012 KLE College of Pharmacy, Nipani. 49
50. Twenty Principles of Material Handling
3. Material flow principle. Provide an operation
sequence and equipment layout optimizing
material flow.
4. Simplification principle. Simplify handling by
reducing, eliminating, or combining unnecessary
movement and/or equipment.
5. Gravity principle. Utilize gravity to move material
wherever practical.
19 July 2012 KLE College of Pharmacy, Nipani. 50
51. Twenty Principles of Material Handling
6. Space utilization principle. Make optimum
utilization of space .
7. Unit size principle. Increase the quantity, size,
or weight of unit loads or flow rate.
8. Mechanization principle. Mechanize handling
operations.
19 July 2012 KLE College of Pharmacy, Nipani. 51
52. Twenty Principles of Material Handling
9. Automation principle. Provide automation to
include production, handling, and storage
functions.
10. Equipment selection principle. In selecting
handling equipment, consider all aspects of the
material being handled.
19 July 2012 KLE College of Pharmacy, Nipani. 52
53. Twenty Principles of Material Handling
11. Standardization principle. Standardize handling
methods as well as types and sizes of handling
equipment.
12. Adaptability principle. Use methods and
equipment that can best perform a variety of
tasks and applications where special purpose
equipment is not justified.
19 July 2012 KLE College of Pharmacy, Nipani. 53
54. Twenty Principles of Material Handling
13. Dead weight principle. Reduce ratio of dead
weight of mobile handling equipment to load
carried.
14. Utilization principle. Plan for optimum utilization
of handling equipment and manpower.
15. Maintenance principle. Plan for preventive
maintenance and scheduled repairs of all
handling equipment.
19 July 2012 KLE College of Pharmacy, Nipani. 54
55. Twenty Principles of Material Handling
16. Obsolescence principle. Replace obsolete
handling methods and equipment when more
efficient methods or equipment will improve
operations.
17. Control principle. Use material handling
activities to improve control of production
inventory and order handling.
19 July 2012 KLE College of Pharmacy, Nipani. 55
56. Twenty Principles of Material Handling
18. Capacity principle. Use handling equipment to
help achieve desired production capacity.
19. Performance principle. Determine
effectiveness of handling performance in terms
of expense per unit handled.
20. Safety principle. Provide suitable methods and
equipment for safe handling.
19 July 2012 KLE College of Pharmacy, Nipani. 56
57. Handling of materials must be performed
Safely
Efficiently
At low cost
In a timely manner
Accurately (the right materials in the right
quantities to the right locations)
And without damage to the materials
19 July 2012 KLE College of Pharmacy, Nipani. 57
58. Risks associated with improper handling
• Increase in cost of raw material and finished
products
• Delay in production schedule and long
production cycle
• Waste of machine time and personnel time
• Increase in in-process inventories
• Damage or loss of material and employee safety
liabilities
• Employee frustration and reduced morale
• Customers dissatisfaction
19 July 2012 KLE College of Pharmacy, Nipani. 58
59. Selecting Material Handling System
Systematic Approach
1. Define the problem
19 July 2012 KLE College of Pharmacy, Nipani. 59
60. Selecting Material Handling System
2. Analyze the problem
Observe activities
Obtain layouts, flow patterns, schedules, etc.
Obtain information on existing material handling
equipment
Analyze situation by Twenty Principles of Material
Handling, and/or forms
Can activities be combined, simplified,
eliminated???
19 July 2012 KLE College of Pharmacy, Nipani. 60
61. Selecting Material Handling System
3. Identify possible solutions
Organize meeting with:
material handlers
machine operators
supervisors
support engineers
4. Evaluate alternatives
Meet again to rate alternatives
19 July 2012 KLE College of Pharmacy, Nipani. 61
62. Material Handling Equipment
Five categories:
1. Industrial trucks
2. Automated guided vehicles
3. Monorails and other rail guided vehicles
4. Conveyors
5. Cranes and hoists
19 July 2012 KLE College of Pharmacy, Nipani. 62
63. Industrial Trucks
Two basic categories:
1. Non-powered
– Human workers push or pull loads
1. Powered
– Self-propelled, guided or driven by human
– Common example: forklift truck
19 July 2012 KLE College of Pharmacy, Nipani. 63
64. Nonpowered Industrial Trucks
(Hand Trucks)
(a) Two-wheel hand truck, (b) four-wheel dolly,
(c) hand-operated low-lift pallet truck
19 July 2012 KLE College of Pharmacy, Nipani. 64
65. Powered Trucks
Capacities from 450 kg up to 4500 kg
Power sources include on-board batteries and internal combustion motors
19 July 2012 KLE College of Pharmacy, Nipani. 65
66. Powered Trucks
•Designed to pull
one or more trailing
carts in factories and
warehouses, as well
as for airport
baggage handling
•Powered by on-
board batteries or IC
engines
19 July 2012 KLE College of Pharmacy, Nipani. 66
67. Automated Guided Vehicles
An Automated Guided Vehicle
System (AGVS) is a material
handling system that uses
independently operated, self-
propelled vehicles guided
along defined pathways in the
facility floor
• Types of AGV:
– Driverless trains
– Pallet trucks
– Unit load AGVs
19 July 2012 KLE College of Pharmacy, Nipani. 67
68. Driverless Automated Guided Train
• First type of AGVS to
be introduced around
1954
• Common application
is moving heavy
loads over long
distances in
warehouses and
factories without
intermediate stops
along the route
19 July 2012 KLE College of Pharmacy, Nipani. 68
69. AGV Pallet Truck
• Used to move palletized
loads along
predetermined routes
• Vehicle is backed into
loaded pallet by worker;
pallet is then elevated
from floor
• Worker drives pallet truck
to AGV guide path and
programs destination
19 July 2012 KLE College of Pharmacy, Nipani. 69
70. Unit Load Carrier
• Used to move unit
loads from station to
station
• Often equipped for
automatic
loading/unloading of
pallets and pans using
roller conveyors,
moving belts, or
mechanized lift
platforms
19 July 2012 KLE College of Pharmacy, Nipani. 70
71. AGVs Applications
1. Driverless train operations - movement of large
quantities of material over long distances
2. Storage and distribution - movement of pallet loads
between shipping/receiving docks and storage racks
3. Assembly line operations - movement of car bodies
and major subassemblies (motors) through the
assembly stations
4. Flexible manufacturing systems - movement of
work parts between machine tools
5. Miscellaneous
19 July 2012 KLE College of Pharmacy, Nipani. 71
72. Rail-Guided Vehicles
• Self-propelled vehicles that ride on a fixed-rail
system
• Vehicles operate independently and are
driven by electric motors that pick up power
from an electrified rail
• Fixed rail system
– Overhead monorail - suspended overhead
from the ceiling
– On-floor - parallel fixed rails, tracks
generally protrude up from the floor
19 July 2012 KLE College of Pharmacy, Nipani. 72
74. Conveyor Systems
• Large family of material transport equipment
designed to move materials over fixed paths,
usually in large quantities or volumes
1. Non‑powered :
Materials moved by human workers or by gravity
2. Powered :
Power mechanism for transporting materials is
contained in the fixed path, using chains, belts,
rollers or other mechanical devices
19 July 2012 KLE College of Pharmacy, Nipani. 74
75. Conveyor Types
• Roller
• Skate‑wheel
• Belt
• In‑floor towline
• Overhead trolley conveyor
19 July 2012 KLE College of Pharmacy, Nipani. 75
76. Roller Skate‑wheel Belt
Overhead trolley conveyor
In‑floor towline
19 July 2012 KLE College of Pharmacy, Nipani. 76
77. Cranes and Hoists
Handling devices for lifting, lowering and transporting
materials, often as heavy loads
• Cranes
– Used for horizontal movement of materials
• Hoists
– Used for vertical lifting of materials
• Cranes usually include hoists so that the crane-
and-hoist combination provides
– Horizontal transport
– Vertical lifting and lowering
19 July 2012 KLE College of Pharmacy, Nipani. 77
78. Hoist
Load
19 July 2012 KLE College of Pharmacy, Nipani. 78
79. Bridge Crane Gantry Crane Jib Crane
19 July 2012 KLE College of Pharmacy, Nipani. 79
80. Salvaging and Disposal of
Scrap and Surplus
The words ‘Scrap’ and ‘Surplus’
symbolize waste and to that extent these
account for the loss of profits.
Scrap is commonly used for waste of all
kinds.
19 July 2012 KLE College of Pharmacy, Nipani. 80
81. These occur for the following reasons:
Mistakes in procurement
Wrong planning decisions
Wasteful processes in production
Inevitable waste during the adjustment of
the equipment
Overall absence of efficiency
19 July 2012 KLE College of Pharmacy, Nipani. 81
82. Disposal of scrap, surplus, recyclable, obsolete
materials is one of the most important area of
materials management, but often overlooked or
considered minor.
Popular due to increased public awareness of
environment, government legislation, better
recognition of opportunities it offers in return.
e.g. paper files and forms are recyclable item
that can be sold to recycle company.
19 July 2012 KLE College of Pharmacy, Nipani. 82
83. The following measure are adopted and
monitored for handling scrap:
1. Controlling of surplus and scrap
2. salvaging or converting the waste for
advantageous use.
3. Disposal of the surplus and scrap to the
best advantage.
19 July 2012 KLE College of Pharmacy, Nipani. 83
84. The production department primarily controls the first
function by proper design, while purchase
department handles the second and third functions.
Waste materials in pharmaceutical industry:
• Empty drums, packing materials, card boards,
aluminium caps, bottles etc. these are non-
recoverable rejects.
• Spoiled materials during production. In a few
instances, these may be recoverable.
• Worn-out parts of equipments (examples are
punches and dies), old equipment (due to expiry of
life) and obsolete equipment (due to technology
change).
19 July 2012 KLE College of Pharmacy, Nipani. 84
85. Salvage :
It is defined as the processing of materials
(items) for advantageous use or disposal of
company property, which is no longer
economically useful in its present position.
Salvage operation :
Waste materials are properly collected and
stored at one place continuously, so that these
can form a separate batch in production.
Recoverable materials are stored in a scientific
way as other items stored.
19 July 2012 KLE College of Pharmacy, Nipani. 85
86. Materials are stored in terms of quality or size or
specifications.
Waste is invested for suitability to recover or avoid them.
Salvaging operation are possible under the following
conditions:
Evidences from laboratory tests and assays that the drug
products meet all applicable standards of identity, strength,
quality and purity.
Evidence from inspection of premises that the drug
products and their associated packing were not subjected to
improper storage condition, as a result of the disaster or
accident.
19 July 2012 KLE College of Pharmacy, Nipani. 86
87. Disposal
Disposal of scrap, waste and surplus
materials can be effected by several way :
Surplus material should be returned to the
original supplier. Alternatively a customer who
needs them should be explored.
As a social obligation, some material are
defected or broken before selling them as scrap.
19 July 2012 KLE College of Pharmacy, Nipani. 87
88. Disposal
Materials may be sold by inviting quotations
from potential buyers or through various
contracts such as fixed price contract, varying
price contract, specific bids and negotiations.
• It is worth considering that scrap like any other
material represents money and to that extent it
has a value.
19 July 2012 KLE College of Pharmacy, Nipani. 88
89. Unit lode, Pelletization and
Containerization
Unit load is a set of items (raw material, semi
finished parts, finished product) to be move
together, like:
A set of cartons on a pallet
A set of products in a container
In a unit load, parts are
In something (In a carton)
On something (On a pallet)
Grouped by something (wrapped, strapped)
19 July 2012 KLE College of Pharmacy, Nipani. 89
90. Reasons for using unit loads in material
handling
Multiple items
handled
simultaneously
Required number
of trips is reduced
Loading/unloading
times are reduced
Product damage is
decreased (a) Wooden pallet, (b) pallet box, (c) tote box
19 July 2012 KLE College of Pharmacy, Nipani. 90
91. Pallets :
Style and Size based on:
Shipping and receiving restrictions
Size and weight of items on the pallet
Space restrictions
Equipment used to move the pallet
Cost, supply, and maintenance
Aisle widths, door sizes, stacking heights
19 July 2012 KLE College of Pharmacy, Nipani. 91
92. Types of Pallets :
Materials used : • Plastic
• Softwood • Steel
• Hardwood • Aluminium
• Paper
19 July 2012 KLE College of Pharmacy, Nipani. 92
93. Containerization :
Different types of containers are used according to
the type of material.
e.g
Boxes, cartons, cases, sacks, bales, pallets,
drums, barrels, crates, cable drums, machinery,
and processed timber
• Tank containers for bulk liquids and dangerous
goods.
19 July 2012 KLE College of Pharmacy, Nipani. 93
94. TRAINING AND DEVLOPMENT
• Training and development may be defined as an
attempt to improve current or future performance
of employees through learning, usually by
changing the employees attitude or increasing
his/her skills and knowledge.
19 July 2012 KLE College of Pharmacy, Nipani. 94
95. TRAINING AND DEVLOPMENT
• Training and development program - Steps :
I. Explain the trainee what is the job, how is the
job done and why is it done (relevance).
II. Show how the job should be done
(demonstration).
III. Allow the trainee to do the job (practice).
IV. Follow up by explaining what was done
correctly and what was done incorrectly.
Correction always should be made as
privately as possible (feedback).
19 July 2012 KLE College of Pharmacy, Nipani. 95
96. TRAINING AND DEVLOPMENT
• Training and development program –
Methods :
I. On-the job training
II. Off-the job training
19 July 2012 KLE College of Pharmacy, Nipani. 96
97. TRAINING AND DEVLOPMENT
I. On-the job training :
Majority of industrial training are on-the job
training, because it is related to the
productivity.
On-the job training refers to methods that are
applied at the workplace, while the employee
is actually working.
19 July 2012 KLE College of Pharmacy, Nipani. 97
98. TRAINING AND DEVLOPMENT
II. Off-the job training :
This method is commonly used for the
training of employees.
Off-the job training refers to methods that are
applied away from workplace.
19 July 2012 KLE College of Pharmacy, Nipani. 98
99. JOB ANALYSIS
• Job analysis is defined as a process of collecting
and studying information relating to the
operations and responsibilities of a specific job.
19 July 2012 KLE College of Pharmacy, Nipani. 99
100. JOB ANALYSIS
• Process of job analysis :
Defining uses of job analysis
Information collecting
Information processing
Job description Job specification
19 July 2012 KLE College of Pharmacy, Nipani. 100
101. JOB ANALYSIS
• Uses of job analysis :
• Personnel planning
• Training and development
• Work scheduling
• Performance appraisal
• Job evaluation
19 July 2012 KLE College of Pharmacy, Nipani. 101
102. JOB ANALYSIS
• Job Description :
is defined as a combination of statement
containing the work to be performed and the
essential working conditions of a particular job.
• Job specification :
may be defined as a statement of human
qualities and other desirable characteristics
required for discharging the assigned job.
19 July 2012 KLE College of Pharmacy, Nipani. 102
103. JOB ANALYSIS
Job Analysis
Job description Job specifications
Job title Education
Job place Experience
Job summary Training
Machines, tools and equipment Judgment
Materials and forms used Initiative
Working condition Responsibilities
Hazards
19 July 2012 KLE College of Pharmacy, Nipani.
Physical effort 103
104. JOB DESIGN
• Job design involves conscious efforts to
organize tasks, duties and responsibilities into a
unit to achieve objectives.
• Job design involves three steps.
– Specifications of individual tasks.
– Specification of the methods of performing each
tasks.
– Conversion of tasks into specific jobs to be assigned
to individuals.
19 July 2012 KLE College of Pharmacy, Nipani. 104
105. JOB DESIGN
• Mechanisms of job design :
Understanding the nature of job is important,
because it determines the skill requirement in
performing a job.
Skill variation, responsibility and growth
Low High
Enlargement and enrichment
19 July 2012 KLE College of Pharmacy, Nipani. 105
106. Job enlargement
It involves performing of a variety of jobs or
operations at the same time. It is mainly
intended to enlarge the job horizontally.
It avoids monotony, as a result of high degree
of specialization, but the basic nature of job
remains same. Therefore, it has limited role in
motivating employees. There is a need for up-
gradation of authority and responsibility.
19 July 2012 KLE College of Pharmacy, Nipani. 106
107. Job enrichment
It acts as an additional motivating factors to
other models described earlier in job design.
This factor attracted more attention, both in
academic circles as well as in practice.
Therefore, it requires a detailed study.
19 July 2012 KLE College of Pharmacy, Nipani. 107
108. Job enrichment
Job enrichment is concerned with designing of
job in terms of the following :
• Work content provides greater variety.
• Levels of knowledge and skills are higher.
• More autonomy and responsibility in terms of
planning, directing and controlling is given to
workers for their own performance.
• Work experience becomes meaningful.
19 July 2012 KLE College of Pharmacy, Nipani. 108
109. BLUE AND WHITE-COLLAR JOBS
• A position that involves mainly physical labor.
With the decline in manufacturing and an
increase in harmonization agreements, the term
blue collar is now rarely used.
• Blue collar refers to the blue overalls traditionally
worn in factories in contrast to the white shirt
and tie supposedly worn by an office worker,
known as a white-collar worker.
19 July 2012 KLE College of Pharmacy, Nipani. 109
110. LABOR WELFARE
• Labor Welfare means working out things for the
well-being of the labors. Knowing there wants
and enabling them to fullfill there wants.
• Labor welfare is the voluntary efforts of employer
to establish within the existing industrial system,
working and sometimes living and cultural
conditions of the employee beyond what is
required by law.
19 July 2012 KLE College of Pharmacy, Nipani. 110
111. Advantages of material management
• It eliminates unproductive handling of the
materials like back-tracking, rehandling
etc.
• It reduces idle machine capacity and thus
ensures better turnover on investment.
• It reduces considerably the idle time of the
workers.
19 July 2012 KLE College of Pharmacy, Nipani. 111
112. Advantages of material management
• The quality of the materials is also maintained
through minimum human touches, elimination of
breakages, etc.
• Every inch of the factory space is properly
utilized.
• The issue of materials is also facilitated.
• It helps in maintaining effective production
planning and control.
19 July 2012 KLE College of Pharmacy, Nipani. 112
113. Advantages of material management
• Reduced operating costs and timely
production.
• Greater job satisfaction on the part of both
the workers and the employer.
19 July 2012 KLE College of Pharmacy, Nipani. 113
114. References
• CVS Subrahmanyam; Pharmaceutical
Product and Management, Published by-
Vallabh Prakashan, Page no :- 260 – 282
• S.C. Saksena; Business Administration
Management, Published by- Sahitya
Bhawan, Page no :- 262 – 263, chapter
20.
19 July 2012 KLE College of Pharmacy, Nipani. 114
115. 19 July 2012 KLE College of Pharmacy, Nipani. 115