Management of Mittel Rhein AG of K-ln. Germany, would like to reduce the amount

Question

Management of Mittel Rhein AG of K-ln. Germany, would like to reduce the amount of time between when a customer places an order and when the order is shipped. For the first quarter of operations during the current year the following data were reported: Requirement 1: Compute the throughput time. (Round your answer to 1 decimal place.) Requirement 2: Compute the manufacturing cycle efficiency (MCE) for the quarter. (Round your answer to 2 decimal places.) Requirement 3: What percentage of the throughput time was spent in non-value-added activities? (Round your answer to the nearest whole number. Omit the "%" sign in your response.) Requirement 4: Compute the delivery cycle time.(Round your answer to 1 decimal place.) Requirement 5: If by using Lean Production all queue time during production is eliminated, what will be the new MCE? (Round your answer to 3 decimal places.)

Explanation / Answer

Hi, Please find the calculations below Part A: Throughput time = Process time + Inspection time + Move time + Queue time = 2.8 + .3 + .9 + 4.2 = 8.2 Part B: MCE = Value-added time (Process time)/ Throughput time = 2.8 days/ 8.2 days = 0.34 Part C: Percentage of time spent on non-value-added activities = 100% - MCE% = 100% - 34% = 66% Part D: Delivery cycle time = Wait time + Throughput time = 16.8 days + 8.2 days = 25 days Part E: Throughput time would change to: 4 days MCE will become: 4/8.2 = .49 Thanks, Aman

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