The Swift Company Exercise:
Service level target: delivery within 2 hours.
A: Existing Supply Chain.
1. Main Plant:
Molding 20 duros/hr x 8 hrs
Footpads 38 duros /hr x 8 hrs
Add trim 28 duros/hr x 8 hrs
Stack & Lord 36 duros /hr x 8 hrs
Inventory: About one hour of work-in-process inventory is kept in between each process. Transit time to next step finishing plant takes 90 minutes. 2. Finishing Plant:
Unloading 42 duros / hr x 8 hrs
Glue backing 22 duros /hr x 8 hrs
Backing to table 30 duros / hr x 8 hrs
Box & Label 26 duros / hr x 8 hrs
Inventory: about one hour work in process inventory kept in between each process. Transit time to next step i.e. finished goods warehouse is about 90 minutes.
3. Finished goods warehouse:
Naturally unloading / loading activity tales place.
Finished goods inventory of 1600 duros.
(A) Supply Chain Operations spread at three locations are completely inefficient and carry wasteful activities costing time, money and manpower. It is recommended to centralize manufacturing, finishing plant and finished goods warehouse at one location to eliminate non-value adding/unnecessary /repetitive steps like: * Stack & Load
* Stack & Load
* Unloading at finished goods warehouse
* Transportation cost to finishing plant
* Transportation cost to finished goods warehouse
Once all these steps/processes are centralized at one point elimination of all these steps will automatically reduce work-in-process inventory held at every stage.
(B) All of the processes after molding have to be balanced to match capacity of molding because it is dependent upon molding capacity that how much product is fed into processes downstream so there is no need to hold/keep capacity downstream more than molding capacity so it...
Please join StudyMode to read the full document