Management of Mittel Rhein AG of Köln, Germany, would like to reduce the amount

Question

Management of Mittel Rhein AG of Köln, 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: 0.6 days 15.3 days Inspection time Wait time (from order to start of production) Process time Move time Queue time 3.4 days 0.9 days 3.6 days Required: 1. Compute the throughput time. (Round your answer to 1 decimal place.) Throughput time days Compute the manufacturing cycle efficiency (MCE) for the quarter. (Round your percentage answer to nearest whole percent.) 2. Manufacturing cycle efficiency

Explanation / Answer

Manufacturing Cycle Efficiency (MCE) = Value-Added time/Manufacturing Cycle Time

1) Throughput Time = process time + inspection time + move time+ Queue time = 3.4 + 0.6+ 0.9+ 3.6 = 8.5 days 2. Manufacturing cycle efficiency

Manufacturing Cycle Efficiency (MCE) = Value-Added time/Manufacturing Cycle Time

= (3.4+0.6)/8.5 =47% 3) Non value added activities = (0.9+3.6)/8.5 = 53% 4) Delivery Cycle time =Throughput time + wait time = 8.5 +15.3 = 23.8 days 5. New MCE Through put time = 8.5 -3.6= 4.9 days MCE = 4/4.9 = 82%

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