CASE STUDIES

Jackson Manufacturing Company

Kathleen McFadden, vice president of operations at Jackson

Manufacturing Company, has just received a request for quote

$($RFQ$)$ from DeKalb Electric Supply for $400$ units per week of a

motor armature. The components are standard and either easy to

work into the existing production schedule or readily available

from established suppliers on a JIT basis. But there is some dif$-$

ference in assembly. Ms$.$ McFadden has identified eight tasks that

Jackson must perform to assemble the armature. Seven of these

tasks are very similar to ones performed by Jackson in the past;

therefore, the average time and resulting labor standard of those

tasks is known.

The worker had a $115\%$ performance rating. The task can

be performed in a sitting position at a well$-$designed ergonomic

work$-$station in an air$-$conditioned facility. Although the arma$-$

ture itself weighs $10\mathrm{.}5$ pounds, there is a carrier that holds it so

that the operator need only rotate the armature. But the detail

work remains high; therefore, the fatigue allowance should be $8\%.$

The company has an established personal allowance of $6\%.$ Delay

should be very low. Previous studies of delay in this department

average $2\%.$ This standard is to use the same figure.

The workday is $7\mathrm{.}5$ hours, but operators are paid for $8$ hours

at an average of $$12\mathrm{.}50$ per hour.

The eighth task, an overload test, requires performing a task that

is very different from any performed previously, however. Kathleen

has asked you to conduct a time study on the task to determine the

standard time. Then an estimate can be made of the cost to assemble

the armature. This information, combined with other cost data, will

allow the firm to put together the information needed for the RFQ$.$

To determine a standard time for the task, an employee from

an existing assembly station was trained in the new assembly pro$-$

cess. Once proficient, the employee was then asked to perform the

task $17$ times so a standard could be determined. The actual times

observed $($in minutes$)$ were as follows:

Discussion Questions

In your report to Ms$.$ McFadden, you realize you will want to

address several factors:

How big should the sample be for a statistically accurate stand$-$

ard $($at$,$ say, the $99\mathrm{.}73\%$ confidence level and accuracy of $+-5\%)?$

Is the sample size adequate?

How many units should be produced at this workstation per day?

What is the cost per unit for this task in direct labor cost?

Source: Professor Hank Maddux, Sam Houston State University