Question
In: Accounting
DataSpan, Inc., automated its plant at the start of the current year and installed a flexible...
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 | % | 82 | % | 78 | % |
| Total sales (units) | 3030 | 2900 | 2752 | 2649 | ||||
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 | 0.9 | 0.7 | 0.9 | 0.9 | |||||
| Process time per unit | 2.9 | 2.8 | 2.7 | 2.6 | |||||
| Wait time per order before start of production | 19.0 | 20.8 | 23.0 | 24.8 | |||||
| Queue time per unit | 4.4 | 5.1 | 5.9 | 6.8 | |||||
| Inspection time per unit | 0.7 | 0.9 | 0.9 | 0.7 | |||||
Required:
1-a. Compute the throughput time for each month.
1-b. Compute the delivery cycle time for each month.
1-c. Compute the manufacturing cycle efficiency (MCE) for each month.
2. Evaluate the company’s performance over the last four months.
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.
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.
Solutions
Expert Solution
| Ans. | Throughput Time | Delivery Cycle | Manufacturing Cycle | ||||
| Months | Time | Efficiency | |||||
| 1 | 8.9 | days | 27.9 | days | 29.21% | ||
| 2 | 9.5 | days | 30.3 | days | 29.47% | ||
| 3 | 10.4 | days | 33.4 | days | 25.96% | ||
| 4 | 11 | days | 35.8 | days | 23.64% | ||
| *Calculations for 1 a, b, c are shown below: | |||||||
| Ans. 1 a | Throughput time = Move time + Process time + Queue time + Inspection time | ||||||
| Months | |||||||
| Particulars | 1 | 2 | 3 | 4 | |||
| Move time per unit | 0.9 | 0.7 | 0.9 | 0.9 | |||
| Process time per unit | 2.9 | 2.8 | 2.7 | 2.6 | |||
| Inspection time per unit | 0.7 | 0.9 | 0.9 | 0.7 | |||
| Queue time | 4.4 | 5.1 | 5.9 | 6.8 | |||
| Total (Throughput Time) | 8.9 days | 9.5 days | 10.4 days | 11 days | |||
| Ans. 1 b | Manufacturing cycle efficiency = Process time or value added time / Throughput time * 100 | ||||||
| Months | |||||||
| 1 | 2.9 / 8.9 * 100 | 29.21% | |||||
| 2 | 2.8 / 9.5 * 100 | 29.47% | |||||
| 3 | 2.7 / 10.4 * 100 | 25.96% | |||||
| 4 | 2.6 / 11 * 100 | 23.64% | |||||
| Ans. 1 c | Delivery cycle time = Throughput time + Wait time per order before start of production | ||||||
| Months | |||||||
| 1 | 8.9 + 19 | 27.9 | days | ||||
| 2 | 9.5 + 20.8 | 30.3 | days | ||||
| 3 | 10.4 + 23 | 33.4 | days | ||||
| 4 | 11 + 24.8 | 35.8 | days | ||||
| Ans. 2 | The Throughput time measure displays | Favorable | trends | ||||
| Delivery cycle time - days measure displays | Favorable | trends | |||||
| Manufacturing cycle efficiency - days measure displays | Unfavorable | trends | |||||
| *Throughput time and delivery cylce time are increasing every month, so these are favorable trends and | |||||||
| Manufacturing cycle efficiency is an unfavorable trend as it is decreasing every month. | |||||||
| Ans. 3 | Month 5 | Month 6 | |||||
| Throughput time | 4.2 days | 3.5 days | |||||
| Manufacturing cycle efficiency (MCE) | 61.90% | 74.29% | |||||
| *Calculations: |
 ekkarill92 answered 2 years agoRelated SolutionsDataSpan, Inc., automated its plant at the start of the current year and installed a flexible...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)
?...
DataSpan, Inc., automated its plant at the start of the current year and installed a flexible...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)
?...
DataSpan, Inc., automated its plant at the start of the current year and installed a flexible...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)
?...
DataSpan, Inc., automated its plant at the start of the current year and installed a flexible...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)
?...
DataSpan, Inc., automated its plant at the start of the current year and installed a flexible...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) ?...
DataSpan, Inc., automated its plant at the start of the current year and installed a flexible...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)
?...
DataSpan, Inc., automated its plant at the start of the current year and installed a flexible...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)
?...
DataSpan, Inc., automated its plant at the start of the current year and installed a flexible...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)
?...
DataSpan, Inc., automated its plant at the start of the current year and installed a flexible...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)
?...
DataSpan, Inc., automated its plant at the start of the current year and installed a flexible...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)
?...
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