Case
Teaching Notes
Supplementary Resources
Abstract
Cummins Generator Technologies India Limited (CGTIL) was in the process of setting up a world-class factory at Ranjangaon based on “lean” production principles. The project team, however, went a step ahead and married “green” with “lean”. While lean is about taking the system inefficiencies out, the green is about harmony with nature. The case is about CGTIL’s journey of deriving synergies between seemingly conflicting objectives of lean and green.
This case was prepared for inclusion in SAGE Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.
2023 Sage Publications, Inc. All Rights Reserved
Resources
Exhibit 1: CGTIL History
Cummins Generator Technologies India Limited (formerly Newage Electrical India Ltd) is the recognised market leader in brushless A. C. Generators (Alternators). Established in 1991, the Company has consistently set new standards of quality and business excellence.
The market perceives ’sTAMFORD™ Alternators'(brand name of the products manufactured by CGT) as a premium quality product. The Company has won several prestigious awards including the Rajiv Gandhi National Quality Award and Golden Peacock National Quality Award.
CGT India experienced unprecedented growth in the business – selling 13,000 alternators in the 2003 to selling 50,000 alternators in the year 2007 from their plant at Ahmednagar. The company has recently set up one more plant in Ranjangaon.
Major Highlights
June 1989 – CGT signs MOU for JV with Crompton Greaves (CGL)
April 1993 – Commercial production started.
May 1996 – Accredited with ISO 9000.
July 2002 – Crompton Greaves Ltd sells shares to Cummins Group.
April 2003 – India Product IP 23 Compliant (First Unit globally)
Year 2003 – Sales Volume 13,000 Alternators value US$20 million
Jan 2004 – Formal inauguration of facilities after expansion
Feb 2004 – Started Exports to Associate Entities (Group companies).
Year 2004 – Sales volume 19,000 alternators – value US$30 million
May 2005 – Capacity in place for manufacturing 40,000 alternators annually
Year 2005 – Sales volume 30,000 & value US$40 million
Year 2006 – Sales volume 43,000 & value US$58 million
Jan 2008 – CGT Ranjangaon Plant Inaugurated
Source: Company Data
Source: Company Data
Exhibit 2: Cummins Inc. Mission
The principle that is central to Cummins mission as a company is to ensure that their actions around the world reflect a commitment to the environment.
That commitment takes on several forms, including:
- Using technological capabilities to produce the safest and cleanest-running products on the market.
- Minimizing the environmental impact of their manufacturing and service facilities through comprehensive conservation and waste reduction efforts.
- Demanding that everything they do leads to a cleaner, healthier and safer environment.
- Ensuring that Cummins employees everywhere have clean and safe facilities at work.
- Demonstrating a commitment to sustainable growth by providing leadership on important environmental issues such as climate change.
- Demonstrating a dedication to transparency in sharing their environmental and safety-related activities with key stakeholder groups.
Source: www.cummins.com
Exhibit 3: Green Site – CO2 Emission Offset
| Criteria | Assumptions | CO2 Emission in Ton per annum | No. of Trees to offset this emission |
| Number of people working within CGT Ranjangaon Plant | Maximum 750 people working at any time | 375 | 1,420 |
| Transportation | 6 buses average 140 kms per day per bus | 123 | 465 |
| Other impact due to CGT | |||
| Air Travel | Average 12,000 miles per month | 70 | 264 |
| Liquid fuel use for manufacturing | 2,000 gallons per month | 267 | 1,013 |
| Total number of trees to be planted to offset the environmental impact | 3,162 | ||
Source: Company Records
Exhibit 4: CGT Ranjangaon Green Factory Pictures
Façade
Canteen Roof
Duct and vents on the shop floor
Landscaping and wind tower
Exhibit 5: Plant Construction Site pictures
Cross section of terrain
Site terrain after levelling and construction
Exhibit 6: Alternatives considered for the ventilation and cooling for the factory shop area
| Parameter | Air conditioned shop using electricity | Evaporative cooling using electricity | Ventilated louver – Wind tower |
| Possible air changes | 22 | 22 | 10 |
| Capital cost | $600,000 | $450,000 | $180,000–300,000 |
| Operating cost per annum | $300,000 | $200,000 | Nil |
| Additional connected load | 615 KW | 280 KW | Nil |
| Shop-floor temperature | 30° Celsius | 35° Celsius | 3–5° Celsius less than ambience |
| Dust Control | Class 100,000 | Class 100000 | Class 100,000 < |
| Relative humidity | 70% | 80%, No control in monsoon | No control, it is ambient humidity |
| Make up water quantity if required | Nil | 100 litre/hr | Nil |
| Risks | Rising electricity costs | Rising electricity costs | Continuous wind availability, increasingly hot during summer |
Source: Company Records.
Exhibit 7: Key Features of CGTIL’s Green Factory, Ranjangaon
Energy and Atmosphere
- Wind tower provides natural ventilation, reducing ambient temperatures for the shop, and reduced heat load for office air conditioning
- Energy efficient T5 fluorescent lighting for the shop and CFLs for the office.
- Efficient use of natural daylight
- Automated building management system to control pump operation, and localized occupancy sensors and dimmers to adjust lighting
Materials and Resources
- Use of high efficiency glass for windows and skylights
- Recycled content – use of fly ash in bricks for building construction
- Low VOC-content paints, coatings, adhesives, and sealants
- CFC-free air conditioning
- Vermiculture – use of worms to decompose canteen food waste and leaves
Water Efficiency
- High efficiency fixtures and toilets in restrooms and locker facilities
- Rain water runoff is collected, filtered and allowed to percolate, recharging ground water levels
- Treated ‘gray water’ from canteen and sinks used for landscape irrigation
Sustainable Site
- Buildings suitably designed for the hilly terrain, minimizing the need for excavation and filling
- Landscaping designed to reduce irrigation need by 50%, and to control storm water runoff
- Tree plantations offset carbon emissions from plant operations; the site has over 3,000 plants
- Outdoor lighting designed to minimize night-time light.
Exhibit 8: Green Initiatives at CGT Nagar Plant
- Replacing the street HPMV lamps with metal halide lamps, thus saving on energy consumption.
- Refurbishment of Diesel Generator Set to improve overall efficiency and improve fuel & oil economy, thermal efficiency. (State grid power connection was yet not available, hence the dependence of diesel generation.)
- Arrested air leakages in the plant and revised preventive maintenance schedules, so that effectiveness of air cooling system was ensured.
- Conservation of water improved through using the efficient tap. The Sewage Treatment Plant and Effluent Treatment Plant were upgraded.
- Wood scrap is reduced by 65% by the following steps:
- Introducing fabricated steel bottom pallets for laminations at Supplier end.
- Reducing wooden pallets rejection due to weather cracks by introducing FIFO system.
- Energy conservation measures included:
- Switching off lights/fans during lunch times.
- HC Stator core pack cell – changes were made in hydraulic pump electrical circuit to save electricity during idle time.
- Improved roofing had the following benefits: Shop Floor Temperature Reduced by 15%, improved working environment, and improved Mean Time Between Failure (MTBF) of equipment.
Source: Company Records
Exhibit 9: IGBC Green Factories Rating System
This case was prepared for inclusion in SAGE Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.
2023 Sage Publications, Inc. All Rights Reserved
