Calculate Lead Time

Orion Devices Inc. is considering a new just-in-time product cell. The present manufacturing approach produces a product in four separate steps. The production batch sizes are 58 units. The process time for each step is as follows: Process Step 1 7 minutes Process Step 2 5 minutes Process Step 3 4 minutes Process Step 4 9 minutes The time required to move each batch between steps is 10 minutes. In addition, the time to move raw materials to Process Step 1 is also 10 minutes, and the time to move completed units from Process Step 4 to finished goods inventory is 10 minutes. The new just-in-time layout will allow the company to reduce the batch sizes from 58 units to 3 units. The time required to move each batch between steps and the inventory locations will be reduced to 2 minutes. The processing time in each step will stay the same. Determine the value-added, non-value-added, total lead times, and the value-added ratio under the present and proposed production approaches. If required, round percentages to one decimal place.

Present Approach		Proposed Approach
Value-added time 25		min 25		min
Non-value-added time		min		min
Total lead time		min		min
Value-added ratio (as a percent)		%		%

PLEASE SHOW ALL WORK, WHERE NUMBERS COME FROM.

In this exercise for Present: Value-added processing time = Add together Process steps 1-4 Non-value-added time = Total within-batch wait time + Move time, where Total Within-Batch Wait Time = (Total Time to Perform Operations) x (Batch Size - 1). Add value-added processing time + non-value-added processing time to obtain total processing time. Calculate Value-Added Ratio = Value-Added Process Time Total Process Time In this exercise for Proposed: Value-added processing time = Add together Process steps 1-4 Non-value-added time = Total within-batch wait time + Move time, where Total Within-Batch Wait Time is obtained by multiplying the process time by the remaining units in the batch (waiting their turn) Add value-added processing time + non-value-added processing time to obtain total processing time. Calculate Value-Added Ratio = Value-Added Process Time Total Process Time