Kohinoor Mills Operational Management Analysis

                                                                    

Author's : Mannan Saeed & Saleem Ahmad

Introduction

Kohinoor is a textile mill which was established in1958 at Rawalpindi. Initially two departments

were available to be worked on which were spinning and weaving but later on the firm expanded 

and added dyeing ,printing and stitching departments to its manufacturing process. Kohinoor is

well known mill for its best  clothes,fabrics ,bedsheets,hosiery ,  men’s and women’s wear like

formal shirts , T shirts etc .Kohinoor mills are situated in GujarKhan  and Lahore.  Kohinoor is

an export oriented company of Pakistan who mostly export most of its products Asia, Europe

,USA and Australia. Here in Pakistan they have a shop known as fair price shop near Peshawar

road Rawalpindi where they sell those products which are not suitable to be exported or else

known as faulty items ,overall considering the local market and the low prices for high quality

formal shirts etc they are favored by most of the customers. Kohinoor overall having its own

production unit and having a large market has got no brand recognition itself. Kohinoor  works

as a material provider to many companies  international such as Levis , GAP , Columbia Sports,

JC Penny ,Ann Taylor etc and in local its customers are Nishat  besides having its own mill they

prefer to contact Kohinoor to fulfill their order for their customers. The problem is Kohinoor

doesn’t want to get itself known as a brand rather as a manufacturing company for many of the

other companies , If Kohinoor makes its own brand then they fear of losing their sales and profit

as they would then be no longer taking the order for Nishat and others as it would then be busy in

creating their own brand .Secondly they don’t have any process , capacity and other financial

arrangements to start their own brand. According to our study they want to work  like the 

workers in Sialkot making footballs and at the end brand gets to be recognized is the Nike.

                                       Ten  Management Decisions

}  Goods and service design: what is required operations of each of other OM decisions

}  Quality:  determine the customer’s quality expectation

}  Process and capacity design: determine the process of production

}  Location strategy: judgements regarding nearness to customers and suppliers regarding cost factor

}  Layout strategy:  required integrating capacity needs, personal levels and inventory requirement

}  Human resource management: determine how to recruit, motivate and recruit personnel

}  Supply chain management: decide how to integrate supply chain into the firm strategy

}  Inventory management: considers inventory holding and ordering decisions

}  Scheduling:  determine and implement short term schedule that meet customers satisfaction.

}  Maintenance: requires decisions that consider facility capacity, production demand and maintain a stable process .

                                   10 Decisions implemented  in Kohinoor Mills

1.      Goods & Service Design

GujarKhan and Rawalpindi are the only two cities of Pakistan where the spinning cells of

Kohinoor are situated. According to Mr Naveed the Yarn Marketing Manager he said that

Kohinoor has conditioned itself to take long term orders like taking 3 months order in

advance . Their total production for yarn constitutes for 28,800,000 Lbs per annum .

There are five units of spindles with a total of 85,500 spindles which helps to spin thread

on a pin are situated at Rawalpindi, four units of a total of 65,500 spindles are situated at

GujarKhan which makes a total of nine units of 151,000 spindles .The Thickness of yarn

(dhaga) depends upon the  type of yarn which one is going to use to make the fabric .

There are three types of yarn :-

1.      Course Count which contains 6 singles to 40 singles of yarn

2.      Medium Count  which contains  40 singles to 60 singles of yarn

3.      Fine Count  which contains 60 singles to 100 singles of yarn

These three counts are the thickness of the yarn .Some of the cotton types  are Pak cotton , Indian 

cotton, American cotton, Egyptian cotton and Russian cotton .People say that what’s the

difference between the Pak cotton or Indian cotton because they are just different because of the

country otherwise geographically these two countries are the same .The answer to that question

would be that the Pak cotton differs because of its flexibility which is not found in Indian cotton .

Pak cotton is favorable in making  hosiery products like undergarments, sweaters etc .For

maintaining the quality there has been several house labs installed in the mill to ensure that there

is no compromise on the quality or the product that leaves the Kohinoor Mills textile Limited.

2.      Managing Quality

All divisions of the Kohinoor Textile Mills are ISO 9001-2000 certified. Customers are

also involved in the  process by asking them for their feedback via various online surveys

conducted by the Mills authority and sometimes university students are also  provided

with the tasks to evaluate the mill performance from the customer viewpoint .Kohinoor

mill has yearly audit conducted by an international company  UK based known as  LRQA

(LLOYD’S Register Quality Assurance ).Other than that  the Mill has their own local

body which conducts its survey in the mill twice or thrice an year. Kohinoor Mills

measure its quality by four stages :

1.Blow Room Testing  : In this test the raw cotton which comes from mostly Okara,

Multan and other parts of the Pakistan is blown into bits by bits to remove any debrie or

dust particles.

2.Drying Section : The cotton is then dried in order to remove any humidity or wetness so

that to produce the desired quality yarn.

3.Carding Department :  Reblowing the  cotton to make sure the unwanted particles or                                                                                                                                                                                                            removed  for sure.

4.Simplex : Making the fine thread for the clothes.

3.      Process and Capacity

}  Four main production processes

•      Spinning : It is the process for making yarn from textile fibers  on spinning machines like

ring spinning machines  ,air jet spinning machines etc .Kohinoor Mills use air jet

spinning machines. Types of yarn which are processed are cotton yarn and blended yarn.

•      Weaving: The weaving process consists of five basic operations, shedding, picking,

beating-up, left off and take upShedding: Separating the warp yarns into two layers by

lifting and lowering the shafts, to form a tunnel known as the ‘shed’. : Passing the weft

yarn (pick) across the warp threads through the shed. Beating-up: Pushing the newly

inserted weft yarn back into the fell using the reed. Let off:    The warp yarns are

unwound from the warp beam during the above three processes.

Take up: The woven fabric is wound on the cloth beam during the above three processes..

( Lycra, Nylon, Polyester filament/fibre, Tencel, Linen, Bamboo, Modal, Viscose, Wool,

Polypropylene, Acrylic, Soyabean and Silk etc)

•      Dyeing and printing : it’s a type of process in which the fabric is colored.In dyeing 

initially one color is produced but in printing process various types of colors are

produced.Dyeing is done on grey fabric whereas printing can be done  on grey and

colored fabric.In dyeing color is applied on the both side of the fabric where as in

printing only one side of fabric is colored.(Anti-Bacterial, Easy Care, Scotch Guard,

Water Repellent and Fire retardant finishes)

•      Stitching:It is the sewing of the fabrics and furs etc with the help of a needle and a thread.

•      (Bed linen, Down proof fabric, Curtains, Decorative fabrics, Shower curtains)

4.      Location  Strategy

The four processing units  are established at Lahore and Rawalpindi.Spinning ,

processing  and made ups are done Rawalpindi mill where as weaving is only done at

Lahore. Rawalpindi location is strategic its because the mill is situated near the border of

Rawalpindi and Islamabad so its easy for the mill to be easily contacted by its customers

by both of the twin cities and so as it is easy for the Kohinoor mills to contact some of its

suppliers because of the industrial area being situated in Islamabad especially the I-9

sector of Islamabad .It also helps the Mill to access the airports for export purposes where

as the Rawalpindi has a wide range of area which is why  the three processing units of the

Kohinoor mills are situated at Rawalpindi , there is also a motorway near by which helps

the two cities mills to be inter connected like Lahore and Rawalpindi.

5.      Layout Strategy

          

 It constitutes as the efficient  inventory system which is why they have an efficient use of

software known as Oracle which is widely used  in the mills. The efficient monitoring of the

inventory makes sure that the customer gets its order delivered on time and they are able to get

their raw materials on time to do so. Not only that the mill makes sure that they only take those

orders for which they have the capacity to do so like if  Nishat says that they need to have want

to use Kohinoor Mills dyeing and printing section for the coloration of its fabrics of 500,000

units in a month then the mill owner should  need to check  that their fabric coloring machine is

coloring properly and they do have the storage room to store the raw materials provided by the

Nishat.

6.      Human Resource  Management

According to  Kohinoor their most valuable resource is their people  .Not only this there

is no discrimination of anything including gender ,cast or color as it was seen in our visit

to the mill women were seen working side by side in the stitching department. Not only

this they take a great care of their employees such as the Kohinoor employees have been

provided with a free housing society so that they don’t have to worry about renting any

house or building a new one. Not only that but during the tough energy crisis in Pakistan

where electricity shortage is been experienced ,Kohinoor has their own power plant

which helps to perform their own processes efficiently without experiencing any  

electricity shortages .People living in the housing societies have been provided with

special benefits of free electricity  for up to a limit like they only are to pay RS 210 a

month .For gas it is also absolutely free but now they are thinking of installing meters and

start to charge their valuable resource a little bit .In Lahore Kohinoor Mills each day all

of its employees are fed with free lunch  which helps them to motivate where as they are

provided with to holidays a week whereas in Rawalpindi only one day a week  holiday is

given. There is a school near by the society which provides education to the employees

children at a low price. For medical there is a clinic in the mill which provides free

medical check ups to the employees not only that all of the employees are entitled to be

treated under medical insurance at civil servant hospital for any of the harmful diseases

such as cancer etc. Early on there were parties held every month for the employees to

release their work tension not only that there is a cricket ground too build in the society

where various teams of the Kohinoor mills used to compete against each other but now it

has ended due to the changing of the management.  There are fire place grounds , state of

the art safety equipment's such as sirens, water sprinklers , water cylinders etc. to tackle

any unhappy situation.

7.      Supply Chain Management

       Kohinoor as already mention mostly takes long term orders after calculating and analyzing it

it fulfills the order and make sure the mill runs at its full capacity and deliver the promise quality.

Required raw material are analyzed for cost and quality through the testing phases like if the raw

material ordered by the Kohinoor is not fit to the quality or has some faults then the Kohinoor

management immediately contacts that supplier and inform him about this query and then the

further action is taken. Types of yarn are Pak cotton with least thick yarn known as course count

which is used to make flexible clothes like sweaters  ,under garments etc . Medium count which

is a mixture of Pak, USA, Russian ,Egyptian cotton  then there is a fine cotton which includes

USA , Russian , Indian  and Egyptian cotton . Then there is super fine cotton which includes

American and  Egyptian cotton which helps in making export quality formal shirts.

8.      Inventory Management

           Kohinoor inventory mostly depends upon looking at the demands and taking long term

orders. The total production of Yarn is 28,800,000 LBS per annum. Due to the usage of the

software known as Oracle  the inventory  managed perfectly with the proper procedures  to take

note on the total capacity of the mill and the capacity free enough to use  .How much time would

it take to complete the order ant to start an another one.

9.      Scheduling

First with the efficient  employees training and usage of heavy equipment like air jet

looms and also with the usage of the software Oracle Kohinoor has make sure to deliver

its product on time maintaining the quality as promised to the customers which is why

many international companies and local companies who besides having their own mills

and production units prefer to Kohinoor Mills to make their orders. For only this reason

the employees of the Rawalpindi Kohinoor Mills are entitled to serve their Saturday at

the Mill  sometimes to meet the require demand and to tackle the seasonal  demand

winter cloth collection , Christmas collection etc.

10.  Maintenance

To ensure high quality sophisticated house labs have been installed to make sure to check

the materials especially the arrived raw material or the material send from the supplier or

the customer through which the final product or cloth has to be made. Each year an audit

is done by an international company known as LRQA (Lloyd's Register Quality

Assurance ) not only this some local audits are also done within years to eliminate any in

efficiency , corruption or any other gap which is lowering the company performance or

moral.