=+16-40 K Non-financial measures of quality, manufacturing cycle efficiency (CMA, adapted)

OBJECTIVES 1, 2, 3 Torrance Ltd evaluates the performance of its production managers based on a variety of factors, including cost, quality and cycle time. The following are non-financial measures for quality and time for 2014 and 2015 for its only product:

Non-financial quality measures 2014 2015 Number of returned goods 385 462 Number of defective units reworked 1 122 834 Annual hours spent on quality training per employee 32 36 Number of units delivered on time 12 438 14 990 Annual total 2014 2015 Units of finished goods shipped 14 240 16 834 Average total hours worked per employee 2 000 2 000 The following information relates to the average amount of time (in days) needed to complete an order:

Time to complete an order 2014 2015 Wait time From order being placed to start of production 8 6 From start of production to completion 6 7 Inspection time 2 1 Process time 4 4 Move time 2 2 Chapter 16: Balanced scorecard: quality, time and the theory of constraints 653 M16_HORN3377_02_LT_C16.indd 653 2/09/13 3:59 PM Required 1 Calculate the manufacturing cycle efficiency for an order for 2014 and 2015.