An international hardware and electronics company manufactures and sells a wide range of products under its own brand, but also acts as an original equipment manufacturer (OEM) for other electronics companies. In its OEM business, the company has outsourced all testing, packaging and shipping processes for its motherboards to an external assembler.
The process at the external assembler is composed of three main steps. At first, each unit undergoes a series of tests before being ready for packaging which takes on average 40 seconds per unit. Afterwards, a shipping carton is prepared and the motherboard will be packaged in an antistatic bag and placed in the carton which takes on average 30 seconds per unit.
Lastly, cables, manuals and drivers are added and the carton is made ready for shipping which on average takes 20 seconds per unit. The manager of the external assembler has decided to assign three workers to step 1, two workers to step 2 and one worker to step 3. All workers work concurrently and independently of each other.
i. To outline the process, describe its process flowchart including activities, buffers and the ties between them.
ii What is the effective capacity of each of the resource pools, the effective capacity of the process and which resource pool forms the bottleneck?
A consulting company has suggested to the external assembler to revise its allocation of workers across the different process activities in order to become more efficient. The consultants claim that by cross-training workers and assigning some of them to more than one process activity, the effective capacity of the process will increase by as much as 30%.
iii. Explain why the consultants believe that the efficiency of the process can be improved by reallocating the workers’ time and how the new allocation should look like?
iv. To cope with an increasing demand of the OEM, by which means can the assembler identify potential throughput improvements and how might these look like?