LowTech Gizmos Co. makes low-tech gizmos using a relatively simple process (see flow chart below) with the following parameters. Their factory works from 9am to 5pm with a 30 minute lunch from 12:00 to 12:30.

Step 1: Kitting

Step 2: Assembly

Step 3: Testing

Step 4: Assembly (again if required)

Kitting is performed by a team of 6 persons with each person taking 30 seconds to put together the required components in a kit and prep for assembly.

Assembly is performed by a team of 9 people, with each person taking 55 seconds to assemble the components into the end product.

Testing is performed for a batch of 20 units of the end-product. The testing machine takes a minute to setup and a further 3 seconds for each unit in the batch.

Assume there are no errors in the process.

The profit per low-tech gizmo completing the process is $7/unit.

Assume also that there is sufficient demand to match the capacity of the process.

The company is proposing to introduce a new Shiny Gizmo that can serve 30% of its market, at an additional profit of $1/unit. However, it does not plan to add any further resources, even as the Shiny Gizmo takes 10 more seconds at Kitting, 8 more seconds at Assembly, and an additional second of variable time at Testing.

1. Calculate the processing rate (capacity) for the factory stations with this new product mix of Shiny and traditional Gizmos in units/day. Please make sure to show your product mix calculations for each step.

Kitting: _____________________________ units/day

Assembly: __________________________________ units/day

Testing: ___________________________ units/day

Therefore, Daily Profits with new product mix: $ _______________________ /day

2. What is the average cycle time factory assuming this new product mix?

Average Cycle Time: ___________________________seconds

Kitting Assembly Testing Kitting Assembly Testing