Widget Production: Executive Summary

Topics: Assembly line, Cost, Manufacturing Pages: 2 (592 words) Published: July 6, 2011
Widget Production Executive Summary
University of Phoenix
ISCOM/305
Kate Bethea
June 6, 2011

Widget Production for Taylor Inc.
Taylor Inc is looking to maximize the company’s productivity while minimizing worker’s compensation. As management starts to look at the options available to them, they need to evaluate their operation-management processes. The best option for breaking down the information and seeing what options are best a cost-benefit matrix is best follow. The cost-benefit matrix will show which alternative option will maximize productivity with lesser workers compensation claims. Cost-benefit Matrix

| |Current |Alternative 1 |Alternative 2 | |Number of Personnel |17 |6 |9 | |Labor Wage Per Shift |$5,848 |$2,064 |$3,096 | |Labor Wage Per Year |$2,105,280 |$743,040 |$1,114,560 | |Claims |4 |0.3 |1.9 | |Claim Cost Per Year |$436,000 |$32,700 |$207,100 | |Wage + Claims Cost |$2,541,280 |$775,740 |$1,321,660 | |Capital Expenditure |0 |$1,300,000 |$967,000 | |Savings in Wage + Claim Cost |0 |$1,765,540 |$1,219,620 | |Year 1 Cash Flow | |$465,540 |$252,620 | |Year 2-5 Cash Flow | |$1,765,540 |$1,219,620 | |Output |208 |392 |288 | |Weight Limit |42 |12 |23 |

The cost-benefit matrix...
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