DataSpan, Inc., automated its plant at the start of the current year and install
ID: 2744692 • Letter: D
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. Month 1 2 3 4 Throughput time (days) ? ? ? ? Delivery cycle time (days) ? ? ? ? Manufacturing cycle efficiency (MCE) ? ? ? ? Percentage of on-time deliveries 91% 86% 83% 79% Total sales (units) 3,210 3,072 2,915 2,806 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: Average per Month (in days) 1 2 3 4 Move time per unit 0.4 0.3 0.4 0.4 Process time per unit 2.1 2.0 1.9 1.8 Wait time per order before start of production 16.0 17.5 19.0 20.5 Queue time per unit 4.3 5.0 5.8 6.7 Inspection time per unit 0.6 0.7 0.7 0.6 Required: 1-a. Compute the throughput time for each month. (Round your answers to 1 decimal place.) 1-b. Compute the manufacturing cycle efficiency (MCE) for each month. (Round your answers to 1 decimal place (i.e., 0.123 should be entered as 12.3).) 1-c. Compute the delivery cycle time for each month. (Round your answers to 1 decimal place.) 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. (Round your Throughput Time to 1 decimal place. Round your MCE percentage answer to 1 decimal place (i.e., 0.123 should be entered as 12.3).) 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. (Round your Throughput Time to 1 decimal place. Round your MCE percentage answer to 1 decimal place (i.e., 0.123 should be entered as 12.3).)
Explanation / Answer
Delivery Cycle Time: The amount of time from when an order is received from a customer to when the completed order is shipped is called delivery cycle time. This time is a key concern to many customers, who would like the delivery cycle time to be as short as possible. Cutting the delivery cycle time may give a company a key competitive advantage - and may be necessary for survival.
Delivery Cycle Time = Wait time + Throughput time
Throughput time: The amount of time required to turn raw materials into completed product is called throughput time, or Manufacturing cycle time.
Throughput time = Process time + Inspection time + move time + Queue time
Manufacturing cycle efficiency (MCE): It calculates the percentage of the time spent in manufacturing products that are devoted to value added activities. Value added activities refer to activities that cannot be eliminated without affecting the quality of the product.
MCE = Value added time (or Process time)/ Manufacturing cycle time
where: Manufacturing cycle time = Process time + Inspection time + Move time + Queue time
Month Percentage of on-time deliveries Total sales (units) Move time per unit (a) Process time per unit (b) Wait time per order before start of production © Queue time per unit (d) Inspection time per unit (e ) Throughput time (f) = Process time + Inspection time + move time + Queue time Delivery Cycle Time = Wait time (c ) + Throughput time (f) Manufacturing cycle time (g)= Throughput Time MCE (b)/( g) 1 91% 3,210 0.4 2.1 16 4.3 0.6 7.4 23.4 7.4 28% 2 86% 3072 0.3 2 17.5 5 0.7 8 25.5 8 25% 3 83% 2915 0.4 1.9 19 5.8 0.7 8.8 27.8 8.8 22% 4 79% 2806 0.4 1.8 20.5 6.7 0.6 9.5 30 9.5 19% 5 0.4 1.8 20.5 0 0.6 2.8 23.3 2.8 64% 6 0.4 1.8 20.5 0 0 2.2 22.7 2.2 82%Related Questions
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