In: Accounting
Calculate Lead Time
Flint Fabricators Inc. machines metal parts for the automotive industry. Under the traditional manufacturing approach, the parts are machined through two processes: milling and finishing. Parts are produced in batch sizes of 80 parts. A part requires 4 minutes in milling and 8 minutes in finishing. The move time between the two operations for a complete batch is 9 minutes.
Under the lean philosophy, the part is produced in a cell that includes both the milling and finishing operations. The operating time is unchanged; however, the batch size is reduced to 4 parts and the move time is eliminated.
Determine the value-added, non-value-added, and total lead times, and the value-added ratio under the traditional and lean manufacturing methods. If required, round percentages to one decimal place.
Traditional Philosophy | Lean Manufacturing Philosophy | |||
Value-added time | min | min | ||
Non-value-added time | min | min | ||
Total lead time | min | min | ||
Value-added ratio (as a percent) | % | % |
Traditional Philosophy:
1. Value Added Time: Milling Time + Finishing Time
Value Added Time: 4 Min + 8 Min
Value Added Time: 12 Minutes
2. Non Value Added Time: Move Time + Value Added Time * (Batch Size - 1)
Non Value Added Time: 9 + 12 * (80 - 1)
Non Value Added Time: 957 Minutes
3. Total Lead Time = Non Value Added + Valued Added time = 957 + 12 = 969 Minutes
4. Value added ratio = Value Added / Total Lead time = 12 / 969
Value added ratio = 1.3%
Lean Manufacturing Philosophy:
1. Value Added Time: Milling Time + Finishing Time
Value Added Time: 4 Min + 8 Min
Value Added Time: 12 Minutes
2. Non Value Added Time: Move Time + Value Added Time * (Batch Size - 1)
Non Value Added Time: 0 + 12 * (4 - 1)
Non Value Added Time: 36 Minutes
3. Total Lead Time = Non Value Added + Valued Added time = 36 + 12 = 48 Minutes
4. Value added ratio = Value Added / Total Lead time = 12 / 48
Value added ratio = 25.0%