3. Provide two potential issues surrounding the implementation/use of TOC principles in Insearch. Your answers must be specific to the case.

Qu Cll'l Insearch Productions Pty Ltd produces two types of bike frames(Fran1e I and Frame '1'}. Frame It passes through four processes: Cutting, Welding, Polishing, and Painting. Frame '1'\" use: three of the same processes: Cutting, Welding, and Painting. Each of the four processes employs ten workers who work eight hours each day. Frame I sells for $45 per unit, and Frame Y sells for $55 per unit. Raw materials are the only unit-level variable expense. The materials cost for Frame I is $25 per unit, and the materials cost for Frame Y is $25 per unit. Insearch's accounting system has provided the following additional information about its operations and products: FrameY USE-1 \"unit 10 minutes -_ 30 -Z__ NA -_ 15 Market demand for K: 255 n - r da Market demand for Y: 155 n r da Note: Any production interruptions can be corrected within 2 days. Insearch's general manager, Kent Fyne, has just implemented a bonus system where workers can receive a small bonus if they exceed their production targets. However, Kent is unsure what to do with his newly appointed engineer, Kip Loeking. Kip has been keen to nd ways to improve the functioning of the Cutting machines and the Polishing machines. However, by doing so Kip has caused some unexpected problems with these machines, which in tum has meant that some workers have to conduct extra set up and maintenance activities. Kent is also troubled by the fluctu ating prices of some direct materials. In the last few months, the per unit direct material cost of Frame It varies between $15 and $25, whereas the per unit direct material cost of Frame '1' can be anywhere between $25 and $35. Added to this concern is that one of Insearch's competitors, Outreach, has recentiy dropped its prices and in doing so has made a big dent on the demand of Insearch's products. Required: 1 Apply the 5 steps in the TOG approach to Insearch Productions. Specifically, discuss: a. What is Insearch's major binding constraint? Support your answer with calculations. b. Suggest three w_ays that Insearch exploit its binding constraint. Explain your answer, and support your answer with calculations where appropriate. c. What does \"subordinate all other activities" mean? Why is it an important step in managing Insearch's resources? :1. What does \"elevating the constraint\" mean? Provide one example of how Insearch may be able to elevate its binding constraint. e. What is the fifth TDD step? Assuming that the binding constraint you have identied in {a} has been elevated, what is the next binding constraint lnseardt needs to focus on? 2 Suppose that Kip the engineer has proposed a process design change that will increase the polishing time for Frame I from 15 to 23 minutes per un'rt and decrease the welding time from 15 minutes to 15 minutes per unit (for Frame K}. 111e cost of process redesign would be $15,555. How long would it take to \"break even" if the process redesign were to go ahead? Should the proposal be accepted? What step in the TDC process does this proposal represent