Process_Design_for_the_Manufacturing_of_Riordan_Electric_Fans

Process Design for the Manufacturing of Riordan electric fans Gordon Bocock Operations Management OPS/GM 571 May 25, 2011 Mr. Michael Taousakis Introduction This paper includes an analysis of the material requirement planning, existing process design, application of supply-chain concepts including any available global opportunities. Additionally, the following will be included production forecast and as well as an implementation plan for lean production. The profit at Riordan and improve customer satisfaction with timely delivery of orders with appropriate inventory management system. The MRP for the manufacturing of the Riordan fans Riordan Manufacturing receives a yearly estimate of orders with customer-defined specifications. When implemented, the new Material Requirement Planning (MRP) Systems will determine how much and when to manufacture the specific electric fans required satisfying or exceeding the customers’ expectations. The system calculates the time needed to receive the materials used to produce the fans, the time needed to manufacture them, the required date the fans are needed, and will ensure that this deadline will be met without problems or delays. Analysis of factors and Risks at Hangzhou, China Facility Receiving Process: The process of getting inventory into the system is delayed by the end of the day creating a risk of inventory being misplaced, stolen, misused or, entered incorrectly. There needs to be a separation of duties; the supervisor cannot verify the receipt after the receiving clerk has counted physically and entered the data into the company system. Inventory Management establishes control standards with procedures to ensure that assets are protected and properly used. All employees are responsible for maintaining compliance of control activities. Order Fulfillment, the current ordering system lacks an authorization and reconciliation process. The company risks cost of replacing products that were said to be delivered and the inability to fulfill orders on time due to the shortage of materials. A new process design for the production of the Riordan electric fans Currently Riordan produces the electric fans at the plant located in China. This allows for the company to utilize the cheaper resources and labor that is associated with this area. Currently the process that is utilized is that the plastic used in the production of the fans are bought locally, along with the completed fan engines that will power the electric fans. The plant in China then injects the plastics into molding machines that create the various plastic parts that will be used in the completed project. Once the products are completed the plant will then ship these electric fans to anywhere in the World through use of FedEx. This process design for the production of the electric fans is sound and seems not to have any negative effects associated with this process. The only changes that could possibly be made to increase efficiency are the method used in determining what amount of products needs to be ordered. Currently the method is extrapolation based on the previous three years of sales, due to the issue with on time deliveries this method is understandable, but perhaps isn’t the most cost efficient. If the company was able to develop a more reliable supply chain than currently exist this would allow for more “real time” ordering to be done and thus the company could experience a higher degree of dynamic production capacity than currently exist (Riordan, 2006). Supply Chain for Riordan electric fans The Management that Riordan has that lax a diazole attitude regarding the regulation of the supply chain. Riordan needs to audit receiving, inventory management, and order fulfillment processes to ensure measures are in place to limit risk. The supply chain process for Riordan is critical for its success. This process essentially entails the transformation of materials into semi-finished and finished products, the flow of material from suppliers, and the distribution of products to customers (Chase, Jacobs, & Aquilano, 2006). Today’s marketplace, companies like Riordan are competitive and seeking new and innovative ways to transform their supply chain and make it into a competitive or strategic advantage. Companies are continuously seeking supply chain services which will enhance its overall efficiency, which in turn, will drive in more revenue while gaining a competitive advantage (Chase, Jacobs, & Aquilano, 2006). One methodology which may be beneficial for Riordan to utilize is outsourcing on a global scale. Outsourcing can potentially save Riordan a great deal of money. It would help Riordan center on additional business activities and not have to focus on the outsourced jobs since it is being provided by external experts; this, in turn, would eliminate several facets of the supply-chain. Outsourcing would be a great way to distribute our work globally, in which we would take advantage of regional markets while reducing operational costs. The company could additionally integrate an inventory management system which would be able to work off-site. Also, Riordan should consider integrating a process of procurement which would help in this capacity. It would focus on both quality and quantity, and make sure that processes are being implemented at the proper time, location, and from the right source (Chase, Jacobs, & Aquilano, 2006). Constraints on supply would be highlighted so that additional sources of spending can be located, and at the same time, erroneous spending will become minimized. This supply chain process will help ensure that orders may be able to be filled. It will be necessary, however, to continually track the inventory as far as requirements and quality are concerned. Production Forecast for Riordan electric fans The production forecast for Riordan is based on the fact that the unit in China is accountable for both the electric motors and plastic polymers, which are essential components of the electric fans. A projection of production demands has been determined according to the average amount of sales during the past three years. Additionally, scheduling, planning costs, production, and delivery is based on annual production requirements and not being effectively forecasted (Chase, Jacobs, & Aquilano, 2006). Riordan must make sure to analyze the appropriate economic markets to determine how the economy’s flow will affect the company. The company should additionally integrate a lean production process so that the product is launched in the proper market, at an adequate price, and that adequate quantities are available so that waste is reduced and both expected and unexpected changes may be properly addressed in a timely manner (Riordan, 2006). Implementation Plan for Riordan electric fans Production-planning is executed out in order for resources and activities to be in line over time so as to reach the objectives with a minimal amount of resource consumption (Chase, Jacobs, & Aquilano, 2006). Adequate planning needs to be implemented in order for the plan’s progress to be evaluated at regular intervals. It would help to form an appropriate team for the project, which will involve management’s input. This will also entail establishing appropriate job duties. Another activity will involve choosing which methodologies, implementation tools, and Material Requirement Planning software should ultimately be utilized. Actually implementing the production plan will be the third activity (Chase, Jacobs, & Aquilano, 2006). This will include the identification of the bottlenecks within our forecasting process and production plan in order to meet all of our clients’ needs in the most advantageous way. Quality and production methods will be improved and defects identified and overall costs reduced. The fourth activity will involve maintaining the production environment through quality control and quality assurance and making any required modifications (Chase, Jacobs, & Aquilano, 2006). Cover Letter for Operations planning and TQM for Riordan electric fans May 25, 2011 Gordon Bocock CEO, Global Operations DFTQ, Inc. San Jose, California, 92136 Dear Mr. Taousakis: After considerable review of the current process at DFTQ, Inc., my team and I identified areas where operations planning and TQM can be improved. With changing technologies and advanced operational processes available, it would be enhance our ability to satisfy our customers and increase our customer base by offering a better quality product. This proposal will track all the bottlenecks in the company and implement new and efficient ways of tracking inventory and maintaining a lean production strategy. This will also entail better forecast methods that will save the company money and reduce waste in the plant. If you have any questions or concerns please don’t hesitate to call me 1-800-246-1089 Sincerely, Gordon Bocock References Chase, R.B., Jacobs, F.R., & Aquilano, N.J. (2006) Operations Management for Competitive Advantage, 11e. Retrieved from: https://ecampus.phoenix.edu Riordan Manufacturing Virtual Organization (2006) Retrieved from: https://ecampus.phoenix.edu