The High Altitude Ski Company manufactures skis in the finishing and assembly pr

Question

The High Altitude Ski Company manufactures skis in the finishing and assembly process. Skis are manufactured in 40-ski batch sizes. The finishing time is 5 minutes per ski. The assembly time is 9 minutes per ski. It takes 12 minutes to move a batch of skis from finishing to assembly.

a. Compute the value-added, non-value-added, and total lead time of this process.

b. Compute the value-added ratio. Round to one decimal place.
%

Explanation / Answer

a) Value-added lead time = 14 min (5 min + 9min)

non-value-added lead time:

Total with in batch wait time = (5 min + 9min) *(40-1)

= 546 min

Move time = 12 mins

Total lead time = 546 + 12 = 558mins

b) Value-added ratio = Value added lead time/ Total lead time

= 14/558

= 0.025 = 2.5%

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