LETTER OF TRANSMITTAL

To
Dr. Golam Mohammad,
Faculty; Production Management,
School Of Business,
North South University,
Banani, Dhaka.

August 10, 2002

Sir,

We would like to thank you for giving us the opportunity to have real world
exposure in Production Management. We are delighted at this moment for
completing the paper with so many limitations.

We have been assigned this paper as a partial requirement of Mgt-314. As

students of this course we are grateful that we have got this opportunity, which
helped us to apply the theories of Production Management.

We have tried to put our best rigor preparing this paper. It would be our pleasure
to be of any assistance, in case of any further clarification regarding this paper.

Yours sincerely,
Hasan Amin Answary I.D-982-014-030
Md. Rizwanul Islam I.D- 011-077-030
Tanbhir Ahmad Tahlil I.D- 011-243-530
Md. Muktadir Alam Chowdhury
General Pharma

ORIGIN OF THE TERM PAPER:

Our distinguished faculty Dr. Golam Mohammad informed us that we would have

to submit a business proposal on a company in Bangladesh context

requirement for Mgt-314 (Production Management). We decided to do the

report on General Pharma, one of the emerging Pharmaceuticals company

in Bangladesh. We are really grateful to our honorable faculty for assigning

us with such a project because this project has given us a chance to obtain

real life exposure in the field of Production Management. I am submitting

this report on August10, 2002.

PURPOSE OF THE REPORT:

The main purpose of the report is to apply the knowledge that has been acquired

in this course, in understanding how we manage a new business organization,

What are the things that I should think about, How can I evaluate whether this

particular project is working efficiently or not, what are the things that satisfy

different customers of different culture and relate all over the corporate strategy.

OBJECTIVE OF THE REPORT:

The main objective of this report to bridge the gap between textbook

knowledge and real life practices and evaluate this concept in context of

2
General Pharma

our General Pharma. Its object is to get clear picture of business of

Pharmaceuticals industry.

SCOPE:
The scope of the report was that, I got the opportunity to apply what we have

learned in the classroom in the outside world and make a judgment of the

combination of the real life and bookish example. It also taught us to prepare an

effective idea and attitude that helps a lot to find out the truth very easily.

LIMITATIONS:
Certain data that we required were not provided by the present company, neither

in the website nor in magazines or other available sources that I have looked for.

METHODOLOGY:
The methodology of the report includes the collection of data through primary

source and secondary source, but the main source was Primary data.

INDUSTRY BRIEFING

An Overview

The pharmaceutical industry is one of the dynamic industries in Bangladesh and

it plays a vital role in our economy. Pre liberation there was not many

pharmaceutical companies existed in this part of the country. Most of the

3
General Pharma

industrial sector was developed in the West and therefore, East was neglected

for industrial growth. After liberation we had no alternative but put more emphasis

on developing new industry. But due to lack of capital and infrastructure facilities

our growth was very slow. Only a few pharmaceutical companies were continued

their operation after liberation. During early and mid-eighties several companies

launched their operation with joint venture or with technical collaboration with the

well-known companies of Europe. Such as Bayer, Ciba-Gaigy, Brystol Mayer,

Glaxo, U.K., Hoechst, BASF, SK&F.

In comparison with other industries, we found the growth of this industry is

tremendous and is ever increasing. Its productions and operations have more

than doubled in the last ten years. Since it is a very sensitive and risky industry,

the companies must follow the drug, health and hygiene policy. All of them must

have to be registered by "Drug Administration Registration". Moreover, these

companies cannot produce and operate what ever they prefer. There are some

stringent rules and regulations, which must follow and abide by at all time. There

are about twelve companies are publicly traded. Among them three or four of the

firms are doing exceptionally well to meet or exceed the international quality

standards at all time. Recently, the International Standard Organization (ISO)

with ISO 9001 has awarded the Beximco Pharmaceuticals Ltd (BPL), Square

Pharmaceuticals, and Advanced Chemical Industrries(ACI). These three are the

major players in the industry and currently they hold about 80% market share.

Other nine publicly traded companies hold about 15% and rest of the other

private and multinational companies hold 5% market share.

4
General Pharma

Bangladesh has recently started to export medicine. This has influenced our

economy growth. At present 10% of total production is exported to Asia, Africa &

Europe.

Market Value of the Industry: 14 billion Taka

Total Employment Provided: 8 %

Industry leader

Beximco Pharmaceuticals Ltd (BPL) is the largest manufacturer of quality live

savings drug and medicine in the industry. It has captured already 45 % of the

total market. Since its inception in 1979 with 39 employees and today it has 2700

employees throughout the country. As pharmaceutical companies are growing

rapidly they are creating jobs. Thus, companies increase its products and

productivity through research and development, which will create more demand

and eventually more employment opportunity. Now BPL’s products are sold in

more than 16 countries across 3 continents (Asia, Africa and Europe). They have

spent $1,000,000 for obtaining antibiotic production technology. After reviewing

the financial report of several companies we found that most of the companies

overall performance level have been satisfactory and they have steady growth.

SOURCE: Bangladesh Aushad Shilpa Shamiti,

Medical Review Journal

5
General Pharma

COMPANY BRIEFING

General Pharmaceuticals Ltd. (GPL) is one of the new comers in the

pharmaceutical industry, having launched effective operation from the year 1987

reached its marketing operation in 1991. Since, the company size is moderate

and it is in growing stage they are currently under construction for expansion of

their production facilities and layout. In their production facilities some are

manual and some are semi-automatic. By our physical visit we found out some of

the obvious reasons for losing effective production time and not attaining

production to its optimal capacity. By careful quantitative analysis and

rearranging the sub-processing units the company can increase its productivity

by 20-30% without investing substantial amount of capital. Also, we have found

that some of the equipments and machineries are out dated and human factors

are much neglected. They do not have highly specialized job training.

From the 80’s multinational companies (MNC) like Glaxo, Fisons, Ciba-Geigy etc.

dominating the total pharmaceutical market. Some present giants like Beximco,

Square, Acme, Opsonin were yet to develop with modern marketing concepts.

With the blessings of the drug policy 1982 the Drug Administration Authority

restricted the import of low-tech products to enhance the development of local

companies. That was the turning point for the company to flourish. With a very

small initial investment and a small marketing network it started and after 13

years it has achieved the 17th position with 50 products among the

pharmaceutical companies of Bangladesh. Now General Pharmaceuticals Ltd.

6
 General Pharma

has a team of young energetic and enthusiastic professionals having experience

in all the functional area of management.

MANAGING
In 1995 General Pharmaceuticals Ltd. started marketing three most essential

Director India in Bangladesh like anti cancer,

imported drugs of Torrent Pharmaceuticals,

anti hypertensive drug. General Pharmaceuticals successfully established the

sophisticated imported items from Torrent Pharmaceuticals by which General

Marketin Administ Accounts & Commercial Factory
Pharmaceuticals has created a market image in the pharmaceuticals market of
g Dept. ration Finance & Purchase
Bangladesh.
Sales Product

ion
Organization
MIS Dept.
Quality

Product
General Control
Pharmaceuticals Ltd. is a private limited company headed by Managing

Mgt. Dr.
Director, Dept.
Momenul Haique (Physician). The organ gram here will show
Distributio
alSource departments at a glance.
n Dept. Source: General Pharmaceuticals, Headquarters

Any more information on these departments is available in appendices of this

report. Company Organogram

Source: General pharmaceuticals
Vision 0f General Pharma:
Asst. Production manager

7
General Pharma

Vision of General Pharma:

General pharma plays a leading role in improving the quality of life and well being

of people of Bangladesh through responsible application of knowledge and skills.

Mission of General Pharma:

General pharma will devote its resources to provide products and services of

high and consistent quality which ensure value for money to its customers.

To create an image for quality of its products and services, productivity of its

operations and innovative abilities of its employees.

To ensure superior return on investment through healthy and sustainable growth

of the company.

To contribute to the personal development and well being of the employees.

To encourage and support qualitative improvement of the services of its

distributors and suppliers.

To participate in selected government/non-government projects and in

community services for the attainment of social goals.

HUMAN RESOURCE:

General Pharma's most vital resource is its people. Its dedicated teams of

professionals from various disciplines are integrated in a conducive environment

8
General Pharma

to best achieve the company's objectives. People at General have one common

trait, they strongly believe in the company's philosophy of serving the nation and

Contributing to society as a whole. The General Pharma team continuously

strives to alleviate human sufferings by developing new and improved drugs.

BPL places very high priority on developing its human resources. The company

makes considerable investments in attracting, training and developing talented

and dynamic professionals. Over the years, the company has been successful in

providing an environment that nurtures individual growth and development and

allows people to achieve personal fulfillment.

Over hundreds of young, energetic and highly motivated individuals from different

cultures and diverse disciplines such as Pharmacy, Chemistry, Biochemistry,

Microbiology, Medicine, Engineering, Business Administration, Accounting etc.

make up the General Pharma’s team.

BPL's sales force of over 50 highly professional representatives ensures the

timely promotion and smooth delivery of its products to every part of the country.

What makes people at General Pharma unique is not just the strength of their

professional competence, but also their reliance of character and spirit of

enterprise.

STRENGTH:

The company stands out for its strong product differentiation, progressive

management, and aggressive exploration of opportunities, such as penetration of

international markets, introduction of newer drugs and high tech dosage forms.

9
General Pharma

A good relationship with the medical community and an innovative marketing

approach distinguish the Company brand. The company has identified the key

areas that will support future growth - strong ties with the medical community, a

comprehensive management information system, and a team of highly motivated

and skilled employees

Product Quality Policy:

Medicine is directly related to human life and therefore, its manufacturers have

immense social responsibility of providing safe and effective medication. From its

Very inception, General Pharmaceuticals has always emphasized the need for

uncompromising quality.

General Pharma strictly follows WHO guidelines at every stage of manufacturing

and procures its raw materials from the very best sources. But what makes

General a success story is its people. General's team of highly skilled and

motivated professionals work around the clock to guarantee the safety and

efficacy of its products.

10
General Pharma

General takes great pride in its people. At General they believe that it is their

people that set them apart.

Marketing of General Pharma:

For any corporation marketing these days has become an essential part of

business. The very term “Marketing” can be defined as a good job of

understanding consumer needs and wants, develop products that provides

superior value and price, distribute and promote them effectively.

General pharma as large corporation has a great collection of product line in its

various divisions that obviously need a very firm marketing strategy. Now, the

term “marketing strategy” theoretically means that steps that are to be taken to

position a product to the consumers. General pharma definitely has some

different marketing strategies. In fact we have come to know that General

Pharma has different marketing strategies for its different products while we

interviewed the Marketing Manager. As its marketing strategies vary with respect

to its products, the other tools of marketing also vary. That means, segment and

segmentation, distribution and promotional activities etc of vary according to its

products.

Now let us have a brief view about what are meant by term’s segmentation,

distribution and promotion. The term “segmentation” means dividing the market

into distinct group of buyers with different needs, characteristics or behavior that

might require separate products or marketing mixes. The term “distribution”

means the process involves in marking a product or service available for use or

11
General Pharma

consumption by the consumer or business user. The term “promotional activities”

means the specific mix of personal selling, sales promotion and public relation a

company uses to pursue its marketing objectives.

General pharma also takes special attention on the total quality management of

its products all divisions by constantly improving the its all the products. The

corporation has also set up its marketing mixes of all the products very effectively

and efficiently.

STRENGTH:

The company stands out for its strong product differentiation, progressive

management, and aggressive exploration of opportunities, such as penetration of

international markets, introduction of newer drugs and high tech dosage forms.

A good relationship with the medical community and an innovative marketing

approach distinguish the Company brand. The company has identified the key

areas that will support future growth - strong ties with the medical community, a

comprehensive management information system, and a team of highly motivated

and skilled employees

Marketing strategies of Pharmaceutical Division:

12
General Pharma

Segment:- From an overview, we have noticed that the segment for the major

products of pharmaceutical division is almost all the districts and sub-districts of

the country.

Segmentation:- Segmentation of pharmaceutical division for most the products

are general people of the country. That means the segmentation of this division

in all class of people of Bangladesh.

Distribution:- The pharmaceuticals division has recently expanded and

strengthened its cold chain network covering all the 14 distribution points through

the country.

Promotional Activities:- The promotional activities of the division actually is

influencing the local physicists to recommend its medicines. It also makes deal

with the local dispensaries to make a great sale. It also has some advertising

policies.

PRESENT THREATS & PERFORMANCE:

Pharmaceutical business turnover of the company was almost at par with the

level of the previous year, so was the national market according to the IMS data.

The result was achieved in spite of several new pharmaceutical manufacturing

companies entering the market as well as permission given to an Indian

company to market their imported finished dosage forms, in violation of the

stated policy of the government not to allow import of finished products in cases

where local production capacity is sufficient.

13
General Pharma

General Pharma introduced several new dosage forms developed in their

laboratories, including eye preparations. They have also obtained approval from

drug administration for marketing some researched products from their

principals. They have further expanded and strengthened their cold chain

network, covering all the 14 distribution points through the country, in order to

improve the distribution of insulin and other temperature sensitive products.

All the plants for expansion and modernization of the Pharma production and

distribution facilities under the right issue have been implemented. Their

productivity will have significant improvement in the coming months as they

realized the benefits of the investments made.

Factory Report:

The General Pharmaceuticals Ltd. has a large factory premises at Mouchak,

Kaliakoir, Gazipur. The total area of the factory premises is 66 decimal. The

factory has a production capacity of 50 million taka (10,20,408 USD) per month

in terms of value. The Factory is divided into two departments:

a. Production Department

b. Quality Control Department

a. Production Department: One assistant production manager

heads Production Department. He is a pharmacy masters. There

are three units in production department:

14
General Pharma

i. Liquid Section

ii. Tablet and Capsule Section,

iii. Blister, strip and Packing Section.

There are four production officers, two QC officers. All of them are

pharmacy masters'. There are eight production supervisors, fifteen

machine operators, eight process men, and forty-five general

workers in production department.

The production data of 2000 is given here in the next page:

Category Capacity per annum Production

Tablet Compression 120.00 million tablets 88.0 million tab.

Tablet coating 75.54 million tablets 45.0 million tab.
Capsulation 140.10 million capsules 80.0 million cap.
Powder filling 2.50 million Kg 1.80 million Kg
Tube crimping 0.46 million tubes 0.20 million Lts.
Liquid filling 1.00 million liters .75 million Lts.
TABLE: Category wise Capacity

Source: General Pharmaceuticals

Factory

The factory production capacity is over utilized by running the machines in two or

three shifts and over time.

In the factory we find three types of labors. The number and types are shown in

the following table-

TYPES OF LABOUR NUMBER OF LABOUR SALARY

Permanent 40 2000 Taka per month
Casual 30 60 per day

15
General Pharma

Daily 20 48 per day

TABLE: Category of Labour

Source: General Pharmaceuticals

b. Quality Control Department: The quality control department of

General Pharmaceuticals is in the factory premises at Gazipur. The

assistant quality control manager takes care of the entire quality

control operation. There are three quality control officers, one

microbiologists, two quality control supervisor, two laboratory

assistants are working in quality control department.

The quality control department mainly looks after quality control in the

manufacturing unit to keep the reputation and image of the company high.

Product Line

The following pharmaceutical products make its line up of finished formulations--

1. In the anti-hypertensive class our product

i) Calchek(Amlodipine)

2. In the vitamin/Iron preparation class the products :-

i) Genaplex(Vitamin B complex) Capsule

ii) Genaplex (Vitamin B complex)Tablet

iii) Genaplex (Vitamin B complex)Syrup

iv) Irofol (Iron Preparation)Capsule

v) Irofol (Iron Preparation)suspension

vi) Metabol drop

16
General Pharma

3. In the Bronchodilators / Anti-asthmatics class the product is: Salbut

(Salbutamol) syrup.

4. In the anti-mycotic class the product is : Genafield Ointment

5. In the antibiotic class the products are -

i) Geflox (Ciprofloxacin)250/500 mgTablet

ii) Velogen (Cephradin)250/500mgCapsule/Dry Syrup

iii) Doxigen(Doxicycline) 100 mgCapsule

iv) Genamox (Amoxycillin)250 and 500 mgCap./ Dry Syrup

v) Gentrim (Co-Trimoxazole)Tab. / Suspension

vi) Genamox (Amoxycillin)Peadiatric Drop

vii) Velogen (Cephradin)Peadiatric Drop

viii) Nufex(Cephalexin)500 mg capsule/Dry Syrup

6. In the anti protozoal / Metronidazole class the product is Metrion

suspension / Tablet

7. In the anti histamine class the product is Hitagen Tablet/Syrup

8. In the ulcer-healing class the products are :

i) Gepin (Ranitidide) tab and Syrup(100 and 250 ml)

ii) Genacid (Antacid) tab

9. In the analgesics class the products are Genamol (paracetamol)Tablet /

Syrup.

10. In the Anthelmintic group the product is Alzed(Albendazole) Tablet.

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General Pharma

11. Antidiabetic:Gored(Gliclazide)Tablet

12. Opioid Analgesic:Trumen(Tramadol) Capsule

Anti Stroke:Cereton(Vinpocetine)

Source: General Pharmaceuticals

THE PRODUCTIOIN PROCESS:

The General Pharmaceutical Limited is making different medicine. Most of them

follow the same process- major difference is in the ingredient and the time

requirement in each process. In our term paper we have only considered one

medicine that is paracytamol - in this company it is called " Genimol".

After receiving the raw materials from the suppliers, they first store them and

then a sample is sent to the " Quality Control" department. If they meet the

requirement of standard then the materials get an approval from that department.

Each of the approved material containers gets a sticker on it. It is written "QO

Release" on the sticker. After that the materials are ready for used in the process

of the medicine.

The product we are dealing with have 11 sub-processing units in its production

line. They are described below-

1. WEIGHING:

This is the starting process of production. Here, they weight ingredients; those

are needed for the tablet " Genimol”. The materials those are needed for the

tablet already mention this pharmacist.

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General Pharma

The following table is showing the ingredients needed according to weight-

Sl. No. INGREDEINTS WEIGHT

1 Paracytamol 500 mg
2 Maiz starch 10 mg
3 Povidon K- 30 10 mg
4 Talcom Powder 4 mg
5 Magnessium 4 mg

Stearet
6 Aluminium Foil 35 mg
7 PVC Film 175 mg
TABLE: Ingredients of each tablet

Source: General Pharmaceuticals

2. SIEVING:

The ingredients are sieved separately so that if any other particles are there - it

can be removed easily.

3. DRY MIXING:

In this stage all the materials are given in the " Dry Mixture " machine. Except

telcom powder and magnesium stearate, all other ingredients are mixed there.

4. WET MIXING:

The output of dry mixing is then mix with water. Thus the paste is made here.

5. DRYING:

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General Pharma

The paste, made in above process contains much more water. The excess water

is evaporated through drying machine. In this room there is no air condition. After

drying the paste, it is turned into a molded form.

6. SCREENING:

Then the molded form is transformed into granular form under this process. The

granular is very small in size.

7. LUBRICATION:

In this stage talcum powder and magnesium stearate are mixed with the

granules. It will help to get uniformity in all the tablets. The finishing of the tablets

will be also very smooth.

8. COMPRESSION:

Here the granules get the tablet forms. The machine is set according to the size

they want to get.

9. DEDUSTING:

After compression, there is lot of dust on the body of tablets and these are totally

cleaned in this process. Moreover the rejected tablets are also marked here.

10. BLISTERING:

The tablets then come under strips. Two types of blistering we have found here.

One is making " ALU-ALU" blister - it means on both side of the tablet there

comes the thin aluminum cover. The second machine is making "ALU-PVC"

blister- it is the way that make the tablet transparent from one side with the PVC

material and the thin aluminum comes in the other side.

11. PACKING:

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General Pharma

After the blistering is completed - the next come the packing. It is totally manual

there and done by the three different labor groups who are again independent

from one another. Again since the packing is same for both type of blistering, it

does not matter which type of medicine is going to which packing group.

At last the product goes for inventory. The production management ends here.

They fulfill the order slip, provided by the marketing department. Thus they meet

production schedule. In our paper we have considered up to this stage. So

whatever the change we have proposed it concentrates only and only this range.

There is a major contribution of" Quality Control" (QC) department throughout the

production process. Starting from pre-storage till packing they can check quality

at any stage to assure the best one.

Here we find that if the raw materials are rejected only then those go back to the

suppliers. On the other hand, from any other stage, the rejected items will be

considered just as scrap. The production process is stopped immediately.

First we consider on the current layout of the company- that is given in the next

page. There we find that the current layout is a totally massed up. The production

started from the right hand side and in the third stage it shifted to the left. No line

arrangement is there at all. The product needs to move from the same place

more than one time, thus increasing processing time unnecessary. Two of the

sub-processing units are in the 1st floor that takes more time. They are the

Dedusting and Blistering. One blistering machine is in ground floor, too. The

layout is also showing that there is a lot of free space - unutilized, in the ground

floor.

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General Pharma

Description OF THE PRESENT LAYOUT:

(Please see Present Layout and Present Logical Diagram in the Appendix)

There are two exit and entry, to and from 1st floor. These exit and entry are on

both end of the factory facility. As we enter through the main entrance there is

screening, drying, wet mixing and dry mixing compartments on the left hand of

the corridor. Again, the weighing, sieving and storage room are on the right hand

side. At the far end of the corridor there is lubrication and compression chamber

on the left and solid packing room on the right.

Taking the left passage we can see the on staging process of syrup. Since we

are not concerned with syrup process we won't be talking about that in our report.

Taking the first passage on the right we see another connecting passage. At the

left end of the connecting passage there is printing chamber and a strip machine

chamber. On the right of the connecting corridor there are some unused space

and again an unused dryer.

You have to take the stairs to go to the 1st floor. This stair is situated at right

side ..of the factory facility. The first thing you see is a passage leading to the

administrative block and in front there is quality control department. Taking the

passage you will see the blistering room on the right and de-dusting chamber on

the left. Not to forget the final storage in under the stairs in the ground floor. From

here the final product are distributed throughout the country.

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General Pharma

As it is evident form the layout picture, that there are quite some unused space in

the factory facility.

REASONS FOR THE PRESENT LAYOUT:

According to the managing director, while starting the company, they didn't

expect such a big demand in the market. So they invested a small. As a result,

the factory layout is small enough. On the other hand the equipment, they bought

at that time was also lower capacity. Now they have found the high demand. But

the problem is that already they have invested a big amount in acquiring their

fixed asset. If they try to buy new machine with higher capacity and build up the

factory construction again, then it will ask for a huge amount of money. That is

why they can't just change all these over a night and meet the higher demand.

Problem Identification:

System design is how an organization plans to produce its goods or it’s services.

The following diagram expresses the process selection and system design:

Forecasting
Capacity Planning

Product and
Process/ Facilities and Equipment
Service
Selection
Design
n Layout
Technological

Change Work Design

Source: Production/ Operations Management

William J. Stevenson

23
General Pharma

This company did mistake on the very first in their system design that is

"forecasting". They thought the demand would be very low. That's why they

started the production with small capacity. They were very wrong. This wrong

forecasting gave birth to wrong layout. In this way their capacity went down. They

are aware of the technology and slandered product design. The poor forecasting

results in inadequate process selection. Finally they came up with un-optimized

layout and unmanaged capacity.

So far from the present layout we have found that there is lot of bottleneck at

different places. Most of them are occurring because of the extra material

handling time and our approach is to reduce total processing time that will

ultimately eliminate bottleneck problem by arranging product layout, with

dedicated sub-processing units, in the production.

Now let's observe what is needed to change the layout in this company.

If we apply product layout then the outlook we will get is given in the next page.

The new outlay will reduce the material handling time a lot - we believe. In this

layout, the entire 11 sub-processing unit will be in the ground floor. The quality

control section will also be here. So it can save more time.

DESCRIPTION OF THE PROPOSED LAYOUT:

We have found here that medicine is a product where process dictates the

sequence in which the steps must be performed. The equipment necessary in

different sub-processing units is arranged in order in which they are needed.

Starting from the weighing (the first step in production) till the packing, each of

24
General Pharma

the sub-process is so dedicated that not a single can be done until the previous

one is fully completed.

Here in our proposed factory layout there is only a single main entrance in

ground floor. On the left hand side of this entrance there are six workstations,

which are sequentially arranged in order to accomplish the sub processing tasks.

The first workstation is "Weighing” where the raw material is received from the

suppliers. Then the raw materials are sent to the second workstation (Sieving).

Then the ingredients are sent to the third workstation (Dry Mixing), then “ Wet

Mixing”, “Drying” and then the sixth workstation that is “Screening”. All these

workstations are inter-connected by the wooden doors. We have kept more two

doors one in “Wet mixing” and another in “Screening” for comfortable

communication with other workstations as well as emergency exit. After

screening the ingredients come to the “Lubrication”, then “Compression”, and

then it comes to the “Blistering Room” and from there it goes to the “Packing”

finally. The quality control department and the printing machine are at one end of

our proposed design against the main entrance. We have kept the “Quality

Control Department” a bit far from most of the workstations in order to keep all

the workstations close to each other and thus tried to reduce material handling

time as least as possible. Since in our term paper we have only considered one

medicine (Paracytamol), which is called “Genimol” in the company so that we are

not interested to describe the manufacturing process of other products such

syrup and two cap capsules in our proposed design.

25
General Pharma

No doubt the new layout will make the production process much more convenient

and time requirement will also go down. Since they will be able to save time, they

can easily complete another batch of production. Thus they will reach at higher

capacity. That time they also need less labor and thus reduce the cost, too.

By applying the product layout the company can reach at the situation when they

don't have any idle time - it refers to the time that is included in the total

processing time but actually nothing is done in that time. In case of

pharmaceutical plant the idle time is the material handling time - it is consuming

more time than it actually requires.

The number of workstations i.e. the sub-processing units is assigned to perform

certain task along with maintaining the sequence within a standard cycle time.

Since they are arranged in a row they will need the lowest amount of material

handling time.

The cycle time is the lead-time - the total time required to transfer the input to

output. It is determined by the maximum time required at any sub-processing

unit. At present the cycle time for the given company is much more than it really

needs because of the time loss in material handling.

Whereas the summation of those sub-processing units are showing the actual

production time. They have considered only the time they need to complete the

process, not the time that the inputs need to come to that sub-processing unit.

All of these can be proved mathematically. We will also go for that. But

before that let's see how much they need to invest to arrange the product

layout.

26
General Pharma

How much to invest?

As we need 5 new doors and also to construct 6 new 10ft by 10 ft brick walls.

The breakdown of all these are given in following:

Cost of new door = Tk. 7,000 = 7000*5 =Tk. 35,000

Cost of making a wall (transportation, labor etc.) = Tk.6,000 = 6000*6 = 36,000

Other costs = Tk. 4,000

So TOTAL COST = 75,000

CONCLUSION

In the company, there was bottleneck in almost every sub-processing unit. That’s

why they need much time for material handling. Applying product layout can

reduce this time. Since it is a pharmaceutical company, the production must have

to follow the sequence of sub-processing units. The layout will be perfectly all

right in this case. But if they can reduce the time in material handling, they can

get more time for production process. As they will get more time for production

they can produce more. In this way the capacity will increase.

The capacity will be highest when there will be no material handling time at all.

But in practice it is simply impossible. In each step they must need some time to

transfer material from one unit to another. So obviously they need to spend some

time for material handling. Whatever amount of idle time we can reduce, we will

must get a positive effect on both of required processing time and capacity.

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Therefore from our analysis it is proved that if we can reduce our idle time, we

can on one hand increase the processing time and on the other hand it will

increase capacity.

RECOMMENDATION

We strongly suggest applying proposed product layout to increase the capacity

and decrease the required processing time. To change the layout they need to

invest, it may increase the per tablet cost. But the output also increases side by

side. Thus the cost will be spread over and a very little effect on the cost will be

there.

WORK CITED

Books

Production / Operations Management

Author: William J. Stevenson

Operations Management

Author: James B. Dilworth

Plant Layout and Design

Author: James M. Moore

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Websites

www.cl.uh.edu/bpa/hadm/HADM_5731/ppt_presentations/15facmgt/tsld016.htm

www.mfg-excellence.com/botmgmtart12.htm

www.mfg-excellence.com/execsem1.htm

www.amegroup.com/mfgr/npfl.html

www.mel.nist.gov/msidstaff/szykman/research/layout.htm

APPENDIX

• Team Profile

• Resume

• Quality control Release Voucher

• Measurement of Factory Premises

• Ingredients of GENAMOL 500mg

• Price List

• Handbills

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• Web Materials

• Member’s Directory 2000

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