Jones Manufacturing Company Aicha Thiam, Daniel Pugh, Nathan Palmer, Jamie Munger, and Douglas Ashburn MBA 513.

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Presentation transcript:

Jones Manufacturing Company Aicha Thiam, Daniel Pugh, Nathan Palmer, Jamie Munger, and Douglas Ashburn MBA 513

Current Process Map

Table 1: Hours to complete 20,000 unit orderLot size = 2000 Moving TimeWorking TimeTotalTarget Lead Time 272 hrs (16hrs * 17process) 283 hrs 20mns (16 hrs 40mns * 17 process) 555 hrs 20mns Cycle Time (balanced line) 16hrs 40mns 150 hrs (16 hrs 40mns * 9 lots) Complete Order705 hrs 20mns200 hours

Solution A Table 2: Hours to complete 20,000 unit order Problem: Lead Time Solution A: Reduce lot size to 200 Moving TimeWorking TimeTotalTarget Lead Time 272 hours (16hrs * 17process) 28 hrs 20mns (1hr 40mns * 17 process) 300 hrs 20mns Cycle Time (balanced line) 1hr 40mns 165 hours (1hr 40mns * 99 lots) Complete Order465hrs 20mns200 hours Reduce lot size…. Changes the cycle time but not enough The problem is with the “informational downtime” involved with moving the parts: work orders, scheduling, etc… Introduce a “load- and go-” system

Table 3: Hours to complete 20,000 unit order Problem: Lead Time and Moving Time Solution B: Reduce lot size to 200 & Switch- and go- system Moving TimeWorking TimeTotalTarget Lead Time 5 hrs 40mns (20mns * 17process) 28 hrs 20mns (1hr 40mns * 17 process) 34 hrs Cycle Time (balanced line) 1hr 40mns 165 hrs (1hr 40mns * 99 lots) Complete Order199 hrs200 hours *Additional cost to change Moving Procedure: $40/hr * 4 Drivers * 167 hours/month = $26,720 Solution B Same chaotic movement of the forklifts around the factory Solution: –Create an “assembly-line” setup in the unused space

New Process Map

Table 4: Cost/Savings of Revised Factory Layout from Forklifts to Conveyors Capital InvestmentSavings/ monthPayback Period Move 48 Machines$144,000 Install Gravity Conveyor$19,040 Eliminate Forklifts and Drivers$26,720 Totals:$163,040$26,7206 months Assume: 33.33% increase of factory capacity Pros: –Increase capacity does not require more forkelifts/drivers given initial cost is recovered (6 months) Cons: –Could not be configured in a timely manner to process the order –Increase in demand would require a reconfiguration of factory layout Final decision is strategic!