Running Head: PROCESS DESIGN FOR RIORDAN MANUFACTURING Process Design for Riordan Manufacturing STUDENT NAME University of Phoenix Online INSTRUCTOR NAME OPS/571 DATE Process Design for Riordan Manufacturing The Riordan Manufacturing plant in Hangzhou, China operates its manufacturing unit to prepare the electric fan to provide the worldwide supply based on the production forecast sales extrapolated using the theory of moving averages for last three years. This paper includes an analysis of the material requirement planning, existing process design, application of supply-chain concepts including any available global opportunities.
Additionally, this paper will include a production forecast and as well as an implementation plan for lean production and a just-in-time system to optimize the profit at Riordan and improve customer satisfaction with timely delivery of orders with appropriate inventory management system. Material Requirement Planning The material requirement planning of Riordan manufacturing is designed to supply the required material for creating the parts of electric fan in order to produce the components at each phase of assembly line production.
The receiving department collects the raw material, which is processed in the molding department to make it suitable for generating parts of the fan after being polished and trimmed in the trimming department. These parts are further processed in the assembly department to make larger components such as fan blades or fan housings. The packaging departments puts each parts of the fan in right package with adequate labeling so that it can be delivered to distribution center through shipping department (University of Phoenix, 2004).
There are waste by-products from above mentioned departments, which increase the cost of the finished product in the form of the electric fan. The leftover materials are used for creating customized products but it is not sufficient to minimize the inventory loss. Another drawback in the present system is the gap between the actual orders of fans and production forecasted sales based on the yearly demand of the electric fans. The gap between supply and demand challenges the management of the China Production plant to keep the adequate material for uninterrupted production of fans to achieve the proper fulfillment of orders.
New Process Design Appendix A is a flow chart for the existing system at Riordan’s China plant shows that the current production process is dependent on the local supplier for stock of motors and plastic polymers in order to manufacture the electric fans. This process is able to achieve only 93% of delivery on time. The addition of an extra supplier to the manufacturer can help in getting the right stock of motors as it will increase the competitiveness between suppliers and firms which assists in getting the stock of motors.
There is another option of keeping the extra stock of motors but it will affect the cost of inventory management. Since plastic polymer is available worldwide, it can be purchased locally to reduce the margin of cost of inventory. In addition to the before mentioned material requirements plan, supply chain process and technology involving lean production along with a just-in-time system can improve the operation process significantly with an improved business strategy to meet the order requirements of customers on time.
Supply Chain Supply chain processes play a crucial role in the entire lifecycle of production development, sales department and customer relationship management. It handles the bill of materials and routings to produce the electric fans in timely manner and in scheduling the delivery of the products to the customer without any slippage. The optimal processes of supply chain can provide Riordan Manufacturing a certain advantage over the competitors in the market of fans (Chase, Jacobs and Aquilano, 2006).
Outsourcing of inventory management can reduce the burden of receiving the stock of motors and plastic polymers as well as logistics involved in each component of supply-chain key activities (Roach-Partridge, 2008). Global product sourcing can help in lowering the cost of purchasing the required material from other countries where it is available on low price. Mass customization can also be considered to meet the demand of periodic orders in compliance with constraints of supply chain.
The supply chain process can concentrate on inventory management process in the system to fulfill the order requested (Chase, Jacobs and Aquilano, 2006,). Riordan focuses on management of inventory from raw material to produce fans. It is necessary to track the quality and need of inventory for optimizing the performance of supply-chain process. These measurements are necessary for assessing the exact requirement of material based on revised production forecast sales with key inputs from the conceptual application of supply chain management (Chase, Jacobs and Aquilano, 2006).
Production Forecast The plant’s production forecast is based on the theory of moving averages. The manufacturing unit in China takes care of electric motors and plastic polymers required for production of fans. The demands for next year’s production are calculated on the basis of average sales for the last three years, which is projected for the coming year (University of Phoenix, 2004). This plant also takes care of customized version of electric fans for individual customers on a small scale.
The estimation of cost for planning, scheduling, production and delivery is based on order requirement of yearly production but it should be forecasted early to meet the demands in effective manner for local as well as U. S. customers (University of Phoenix, 2004). Implementation Plan Lean production, using the concepts of just-in-time, is the most appropriate concept to optimize the material requirement planning, inventory management, production and scheduling of the products in the market at the best location in the right amount at the right time to increase the revenue of the company (Shields, 1999).
Project planning and preparation is the first step for starting the basic outline for implementation of lean production in the China Plant. Further steps in the requirement of gathering and analysis will define the needs and improvement of the existing process to create the design for implementation of the project. Appendix B shows a Gantt chart outlining these steps. Total quality management concepts can be applied in the last phase of implementation to control the quality issues with introduction of defect prevention, quality standards, budget control, etc. Conclusion
The correct identification of bottelnecks and proposed solution for the optimizing the operations with streamlining all the process from receiving raw materials to shipping the deilvery assists in minzimizing inventory and revenue loss and maximizing the customer satisfaction and profit from China plant. The proposed solution incorporates all the factors of the existing system to implement new process for achieving the objectives of the firm. Appendix C includes a cover letter to Riordan Manufacturing detailing the coordination of aggregate operations planning and TQM for the Riordan electric fans.
References Chase, Richard B. , Jacobs, F. R. , & Aquilano, Nichlas J. (2006). Operations management for competitive advantage (11th ed. ). New York: McGraw-Hill. Roach-Partridge, A. (2008). 3PL Elements: Outsourcing = A Formula for Change. Inboundlogistics. Retrieved from http://www. inboundlogistics. com/articles/features/0708_feature01. shtml Shields, T. (1999). Tutorials – lean production / lean manufacturing. Defense Acquisition University. Retrieved from http://www. dau. mil/educdept/mm_dept_resources/navbar/lean/01rdg-lean. sp University of Phoenix. (2004). Riordan Manufacturing Virtual Organization. Retrieved from University of Phoenix, OPS571 website. Appendix A Flow Chart for New Process Design Appendix B Gantt chart for Implementation of Lean Production |WBS | |Tasks |Owner |Plan Start |Plan Finish |Days |Hrs. | |1 |Lean Production Project | | | | |1886 | |1. |Project planning & prep | |3-Oct-10 |1-Jan-11 | | | |1. 1. 1 | |Supervison & coord |A |3-Oct-10 |1-Jan-11 |65 |208 | |1. 1. 2 | |Develop plan |A |4-Oct-10 |28-Oct-20 |19 |46 | |1. 1. 3 | |Develop budget |B |24-Oct-10 |3-Nov-10 |9 |14 | |1. . 4 | |Schedule kickoff mtg. |C |17-Oct-10 |17-Oct-10 |1 |2 | |1. 1. 5 | |Conduct kickoff mtg. |D |7-Nov-10 |7-Nov-10 |1 |64 | |1. 1. 6 | |Monthly Meetings |A | | |6 |192 | |1. 1. 7 | |Quarterly Mtgs. |A | | |2 |64 | |1. |Requirements Management | | | | | | |1. 2. 1 |Conduct requirements analysis | |24-Oct-10 |13-Oct-10 | | | | | |Develop interview forms |A |24-Oct-10 |28-Oct-10 |5 |80 | | | |Conduct interviews |A |28-Oct-10 |25-Oct-10 |21 |672 | | | |Write prelim. equirements |B |14-Nov-10 |2-Nov-10 |15 |120 | | | |Conduct walk-thru |A |6-Dec-10 |7-Dec-10 |2 |128 | | | |Update requirements doc. |C |8-Dec-10 |13-Dec-10 |4 |64 | |1. 2. 2 |Establish requirements baseline | |15-Dec-10 |3-Dec-10 | | | | | |Publish draft req. doc. A |15-Dec-10 |15-Dec-10 |1 |8 | | | |Conduct req. review mtg. |A |19-Dec-10 |20-Dec-10 |2 |128 | | | |Incorporate comments |D |26-Dec-10 |30-Dec-10 |5 |80 | | | |Send document for signatures |A |3-Jan-11 |4-Jan-11 |2 |16 | | | |Establish formal baseline |A |4-Jan-11 |4-Jan-11 |1 |1 | |1. 2. |Establish System Design and Training | | |5-Jan-11 |25-Feb-11 | | | | | |Design for MRP |E |5-Jan-11 |25-Feb-11 |48 |384 | | | |Design for Supply Chain |F |5-Jan-11 |25-Feb-11 |48 |384 | | | |Process | | | | | | | | |Design for Production |G |5-Jan-11 |25-Feb-11 |48 |384 | | | |Forecast | | | | | | | | | | | | | | | |1. 2. |Implementation Plan | | | | | | | | | |MRP Implementation |2 |26-Feb-11 |14-Apr-11 |34 |272 | | | | |developer | | | | | | | |SCP Implementation |4 developer|26-Feb-11 |14-Apr-11 |34 |272 | | | |Forecast Production |2 |26-Feb-11 |14-Apr-11 |34 |272 | | | |Implementation |developer | | | | | |1. 2. |TQM | | | | | | | | | |Defect prevention |K |10-Apr-11 |— | | | | | |Quality Control |L |10-Apr-11 |– | | | | | | | | | | | | | | | | | | | | | Appendix C Cover Letter to Riordan Manufacturing May 24, 2010 Riordan Manufacturing One Riordan Plaza San Jose, CA 95112 Dear Sir, We are pleased to put forward the proposal for lean production and TQM for enhancing the productivity of Riordan Manufacturing.
The process improvement plan of the manufacturing plant in China requires careful attention to MRP, supply chain and production forecast sales to maximize the revenue of operating unit as well as increasing the customer base with installation of lean production and introduction of total quality management concepts. This will be helpful in preparing the counter strategy to meet the random orders in periodic phases, which is currently based on the yearly demand of the electric fans from the customer. The Gantt chart for project plan of lean production explains the effective layout of implementation of a new design process in the China plant. The application of TQM is necessary to measure the efficiency of the new process and whether it is cost-effective in comparison to previous process with application of six sigma.
We can provide statistical measures to optimize the process in due course. Overall, the assimilation of proposal for aggregate operational planning provides a positive analysis of the new solution. Please let me know your feedback on the proposal. If there are any changes required or suggestions for altering the structure, please e-mail me [email protected] COM or call me at 123-456-7890. Sincerely, Lucy Brennan ———————– Order for plastic polymer from local supplier N END Produce the Riordan Electric Fan Is plastic polymer available? Use the motors for manufacturing Order the no of motors required for meeting the supply Is supply of Motors enough? Manufacturing of Electric Fans at Riordan START Y Y N