Economics and Lead Time
CASE ANALYSIS
FOLDRITE FURNITURE CO.:
PLANNING TO MEET A SURGE IN DEMAND
Submitted to: Submitted by:
Dr. P. K. Dash Abhinav Anand Operations Management PGDM-BHU010
Case facts about FoldeRite Furniture:- * Established in 1987 * Throughout 1990s company grew organically. * 1999-2006 annual growth rate 3.5%. (More than market growth rate) but one competitor grew by 6% annually. * In 2006 company’s performance was very bad due to following concluded reasons- * Loss of productivity and yields caused by high labor turnover. * Cost of raw materials was increasing * Increasing proportion of unskilled labor. * Continuous acquisition of small firms which distracted management from their main issues. * This thing also generated liquidity shortage * These things resulted in reduced margins as well as increased lead time from 4 to 6-8 weeks.
Major policies that company adopted after change in management:- * New CEO marshal Epstein from a major consumer goods company was appointed. * Manufacturing VP Jose Ramose was hired. * Together they decided 4 major goals:- * Continued innovation in both products and processes, * Customer responsiveness: producing high quality products that fulfilled market needs, and providing quick service, * Lean manufacturing, and * Retention of a well-trained, stable, and productive workforce, with reduced turnover. * Reduced no of products to provide high quality products.
Consequences:-
* All these helped in reduction of lead time. * They had a $60M revenues and profitable despite recession
Ques-(01) what are the Manufacturing Options available with Mr. Martin Kelsey?
Ans. The objective of the aggregate plan was to demonstrate cost-effective ways to meet the demand while maintaining productivity, quality, reliability and providing
FOLDRITE FURNITURE CO.:
PLANNING TO MEET A SURGE IN DEMAND
Submitted to: Submitted by:
Dr. P. K. Dash Abhinav Anand Operations Management PGDM-BHU010
Case facts about FoldeRite Furniture:- * Established in 1987 * Throughout 1990s company grew organically. * 1999-2006 annual growth rate 3.5%. (More than market growth rate) but one competitor grew by 6% annually. * In 2006 company’s performance was very bad due to following concluded reasons- * Loss of productivity and yields caused by high labor turnover. * Cost of raw materials was increasing * Increasing proportion of unskilled labor. * Continuous acquisition of small firms which distracted management from their main issues. * This thing also generated liquidity shortage * These things resulted in reduced margins as well as increased lead time from 4 to 6-8 weeks.
Major policies that company adopted after change in management:- * New CEO marshal Epstein from a major consumer goods company was appointed. * Manufacturing VP Jose Ramose was hired. * Together they decided 4 major goals:- * Continued innovation in both products and processes, * Customer responsiveness: producing high quality products that fulfilled market needs, and providing quick service, * Lean manufacturing, and * Retention of a well-trained, stable, and productive workforce, with reduced turnover. * Reduced no of products to provide high quality products.
Consequences:-
* All these helped in reduction of lead time. * They had a $60M revenues and profitable despite recession
Ques-(01) what are the Manufacturing Options available with Mr. Martin Kelsey?
Ans. The objective of the aggregate plan was to demonstrate cost-effective ways to meet the demand while maintaining productivity, quality, reliability and providing