Introduction:

Mobile Mania is a mobile phone manufacturing organization. The organization prides itself on low cost quality phones. They produce 4 different types of phones. The organization has been operating smoothly, but is looking for ways to optimize the line and improve quality. The target price for the phone is $100 and the demand is100 units daily. They operate 2 shifts, 5 days a week for 8 hours a day (including breaks).The value added time is 35 seconds. The lead time is 1.5 days.

For each assembly line, there are 2 designated runners to get the parts needed. Each line contains 10 stations with 10 employees plus the runners and a supervisor. Each phone is tested for quality before leaving the assembly line.

Problem:

One problem encountered by the organization includes unequal demand which means that inventory is not stable and piles up at certain stations and the process may not be efficient. The company wants to know the right amount of inventory and how to optimize the process. Calculate the EOQ, ROP with and without safety stock, working time available, cycle time, takt time, lead time and process efficiency.Create the planned and actual production and calculate the Actual % of planned & monthly output for each line. Compare the lines. What do you recommend to improve inventory and cycle time?

Another problem is the labor cost are too high and the lines may not be efficient. The planned production is an 8 hour shift, but the company has been running a 10 hour shift. The organization wants to know if it is feasible to have 2 runners or can the process be more efficient without them? Calculate the production, cost and labor for each line. What can be done to reduce the labor? What can be done to make the process more efficient?

Station	Operation #	Planned Production time in seconds	Planned # of workers	Actual # of Workers
1	1	15	3	3
2	2	30	3	4
3	3	35	3	4
4	4	15	3	3
5	5	15	3	3
6	6	20	3	3
7	7	30	3	4
8	8	32	3	4
9	9	15	3	3
10	10	35	3	4

Overhead cost is 13; Planned overhead is 10; Profit is 20; selling price is 100. Actual unit gross profit is 11, direct labor is 500 and units produced =2000.

Discussion

Analysis of the Problem

Questions to answer:

What do you recommend to improve inventory?

What do you recommend to make the process more efficient?

What can be done to reduce the labor?

What can be done to make the lines more efficient?

For each question: Discuss the current situation and the options for a solution (2) for each question. Describe how your options will help answer the questions.

Phone Set up or Demand Holding Lead Safety EOG ROP with Stock order cost ime or Carrying Cost 1.5 1.5 T100 T200 T300 T400 25.5 25.5 25.5 25.5 18.4391 20.6155 27.6586 13.0384 30 37.5 67.5 20 25 42.5 87.5 20 20 Phone Set up or Demand Holding Lead Safety EOG ROP with Stock order cost ime or Carrying Cost 1.5 1.5 T100 T200 T300 T400 25.5 25.5 25.5 25.5 18.4391 20.6155 27.6586 13.0384 30 37.5 67.5 20 25 42.5 87.5 20 20