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 75 parts. A part requires 2 minutes in milling and 9 minutes in finishing. The move time between the two operations for a complete batch is 10 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 6 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) | % | % |
Solution: | |||||
Traditional Philosophy | Lean Manufacturing Philosophy | ||||
Value-added time | 11 | Min | 11 | Min | |
Non-value-added time | 824 | Min | 55 | Min | |
Total lead time | 835 | Min | 66 | Min | |
Value-added ratio (as a percent) | 1.3 | % | 16.7 | % | |
Working Notes: | |||||
Traditional Philosophy | |||||
Value-added time = 2 min of Milling time + 9 min of finishing time | |||||
Value-added time = 11 min | |||||
Non-Value Added time = Value Added time X (Batch size - 1) + Move time | |||||
Non-Value Added time = 11 min X (75 - 1) + 10 min | |||||
Non-Value Added time = 814 min + 10 min | |||||
Non-Value Added time = 824 min | |||||
Lead time = Value Added time + Non-Value Added time | |||||
Lead time = 11 min + 824 min | |||||
Lead time = 835 min | |||||
Value-Added Ratio = Value Added time / Lead time | |||||
Value-Added Ratio = 11 min / 835 min | |||||
Value-Added Ratio = 0.0131736 | |||||
Value-Added Ratio = 1.3 % | |||||
Lean Manufacturing Philosophy | |||||
Value-added time = 2 min of Milling time + 9 min of finishing time | |||||
Value-added time = 11 min | |||||
Non-Value Added time = Value Added time X (Batch size - 1) + Move time | |||||
Non-Value Added time = 11 min X (6 - 1) + 0 min | |||||
Non-Value Added time = 55 min + 0 min | |||||
Non-Value Added time = 55 min | |||||
Lead time = Value Added time + Non-Value Added time | |||||
Lead time = 11 min + 55 min | |||||
Lead time = 66 min | |||||
Value-Added Ratio = Value Added time / Lead time | |||||
Value-Added Ratio = 11 min / 66 min | |||||
Value-Added Ratio = 0.1666666 | |||||
Value-Added Ratio = 16.7 % | |||||
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