Study of production and cost information systems: At helicopter division Hindustan aeronautics Ltd: Bangalore. Indian Institute of Management Banglore.

Abstract

The Helicopter division of Hindustan Aeronautics Limited is engaged in the manufacture and overhaul of Cheetah and Chetak helicopters. It has now taken up the production of the newly developed Advanced Light Helicopter (A.L.H.). Aircraft manufacturing industry is characterised by high cost of materials and long lead times for procurement, fabrication and assembly. Helicopter division processes more than 8000 types of such components in its fabrication and assembly shops. The division is in the process of switching over from cost plus pricing system to fixed price system. In view of the diminishing defence orders, the division is venturing the highly competitive export market. Cost control and shorter delivery lead times are the key result areas. Hence, it is essential to have effective Production and Cost information system for monitoring and control. The existing Production and Cost information systems donot provide timely and accurate information for monitoring and control specifically in the context of fixed pricing system. Hence the project has been undertaken to study and analyse the material and information flow through the system and make recommendations to overcome the deficiencies in the system. The material flow through the system has been studied under three heads : Material procurement system, Component fabrication system and Overhaul & Assembly system. Data have been collected to identify deficiencies in each of the systems. The personnel operating the system and using the information generated have been interviewed to identify the problems in the existing system and the information requirements of the users. In the Material procurement system, the material planning, purchase, receipt and store transaction activities function as standalone subsystems. Hence there is delay in material pricing and difficulty in purchase monitoring.