DataSpan, Inc., automated its plant at the start of the current year and install

Question

DataSpan, Inc., automated its plant at the start of the current year and installed a flexible manufacturing system. The company is also evaluating its suppliers and moving toward Lean Production. Many adjustment problems have been encountered, including problems relating to performance measurement. After much study, the company has decided to use the performance measures below, and it has gathered data relating to these measures for the first four months of operations.

Management has asked for your help in computing throughput time, delivery cycle time, and MCE. The following average times have been logged over the last four months:

Required:

1-a. Compute the throughput time for each month.

1-b. Compute the delivery cycle time for each month.

1-c. Compute the manufacturing cycle efficiency (MCE) for each month.

2. Evaluate the company’s performance over the last four months.

3-a. Refer to the move time, process time, and so forth, given for month 4. Assume that in month 5 the move time, process time, and so forth, are the same as in month 4, except that through the use of Lean Production the company is able to completely eliminate the queue time during production. Compute the new throughput time and MCE.

3-b. Refer to the move time, process time, and so forth, given for month 4. Assume in month 6 that the move time, process time, and so forth, are again the same as in month 4, except that the company is able to completely eliminate both the queue time during production and the inspection time. Compute the new throughput time and MCE.

Month 1 2 3 4 Throughput time (days) ? ? ? ? Delivery cycle time (days) ? ? ? ? Manufacturing cycle efficiency (MCE) ? ? ? ? Percentage of on-time deliveries 78 % 74 % 71 % 68 % Total sales (units) 3780 3618 3433 3304

Explanation / Answer

Part 1 (a) - Calculation of Throughput time for each Month

Part 1 (b) - Delivery cycle time for each month

Part 1 (c) - Calculation of Manufacturing cycle Efficiency (MCE) for each month

Part 2 - Performance of company decreased over the last 4 months. Company gave the best performance in 1st Month with Total efficiency of 27.71% which has been decreased to 19.42% over the 4 months period.

Part 3 (a) - Calculation of New Throughput time and Manufacturing cycle efficiency for 5th Month

Throughput Time

Manufacturing Efficiency Cycle

Manufacturing cycle efficiency

(Process time / Throughput time)

Part 3 (b) - Calculation of throughput time and Manufacturing cycle efficiency for 6th Month

Throughput Time

Manufacturing cycle efficiency

Manufacturing cycle efficiency

(Process time/Thoughput time)

Comment - As and when Non value added items like Move time, Queue time, Inspection time are passes away, The efficiency of company increases over the time.

As seen in the question, MCE in 4th month was only 19.42% which increased to 76.92% in 6th Month. Target of efficiency is always 100% which will be possible when

Process time = Throughput time

Particulars 1 2 3 4 Move Time per unit 0.7 0.5 0.6 0.6 Process time per unit (Value added time) 2.3 2.2 2.1 2.0 Queue time per unit 4.9 5.6 6.4 7.3 Inspection time per unit 0.4 0.5 0.5 0.4 Throughput Time in days 8.3 8.8 9.6 10.3

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