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Medical Systems Corporation manufactures diagnostic testing equipment used in hospitals. The company practises JIT production management and has a state-of-the-art manufacturing system. The following non-financial
Medical Systems Corporation manufactures diagnostic testing equipment used in hospitals. The company practises JIT production management and has a state-of-the-art manufacturing system. The following non-financial data were collected every two weeks in the Elizabeth plant during the first quarter of the current year: Fortnightly measurement period Cycle time (days) Number of defective finished products Customer complaints Unresolved complaints Products returned Warranty claims In-process products rejected Average number of units produced per day per employee Percentage of on-time deliveries Percentage of orders filled Inventory value/sales revenue Machine downtime (minutes) Bottleneck machine downtime* minutes) Overtime (minutes) per employee Average setup time (minutes) 1 1.7 4 4 7 1 2 4 3 3 6 6 451 948 100% 28 88 28 22 132 2 1.4 4 8 1 4 3 3 6 6 446 95% % 100% 28 88 22 0 132 3 1.4 3 7 u 0 3 3 3 3 8 8 453 95% 100% 28 132 17 0 127 4 1.3 4 65 6 0 3 > 0 10 457 978 98% 1.5% 88 0 11 123 5 1.3 3 8 8 0 2 2 2 2 11 457 100% 100% 2% 77 66 22 119 6 1.2 3 9 9 > 0 1 1 0 8 8 462 100% 100% 0 83 11 11 111 * The concept of bottlenecks is explained in Chapter 16. Required: 1. For each non-financial performance measure, indicate which of the following areas of manufacturing performance is involved: . production processing product quality customer satisfaction in-process quality control productivity delivery performance raw material and scrap inventory machine maintenance. Area of Manufacturing Performance (Some measures may relate to more than one area.) Categories of measures: Cycle time (days) Number of defective finished products Customer complaints Unresolved complaints Products returned Warranty claims In-process products rejected Average number of units produced per day, per employee Percentage of on-time deliveries Percentage of orders filled Inventory value/sales revenue Machine downtime (minutes) Bottleneck machine downtime (minutes) Overtime (minutes) per employee Average setup time (minutes) 2. Write a memo to management commenting on the performance data collected for the Elizabeth plant. Be sure to note any trends or other important results you see in the data. Evaluate the Elizabeth plant in each of the areas listed in requirement 1
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