A manufacturing company has been plagued by the chronic failure to ship orders t

Question

A manufacturing company has been plagued by the chronic failure to ship orders to customers by the promised date. To solve this problem, the production manager has been given the responsibility of increasing the percentage of orders shipped on time. When a customer calls in an order, the production manager and the customer agree to a delivery date. If the order is not completed by that date, it is counted as a late shipment. Describe actions that managers might take to show improvement in the performance measure but which do not actually lead to improvement in the organization's overall performance.

Explanation / Answer

Possible actions that could decrease performance:

> The production manager establishes delivery dates with a lot of ‘cushion’ and that are easy to make.

> Customers could become disappointed in slower delivery times and find alternative vendors.

Recommendations:

> Establish standard delivery times by product type, and measure performance to those standards.

> Move the responsibility for establishing exceptions to the standard delivery times to the Planning or Scheduling Department.

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