Production_Plan_for_Riordan_Manufacturing

Production plan for Riordan manufacturing Team C illustrates a production plan for Riordan Manufacturing, focusing on the supply chain, lean production, and capacity planning for electric fans in Hangzhou, China. Duris (1997) suggests, “Even if you have the most fully functioning package the system still needs to be very intentional, deliberate, well thought-out, risk-adverse, measurable, safe, controlled, gradual, and guaranteed to work” (p. 93). Focusing on these manufacturing characteristics allows a company to react to almost all problems that may occur in the production plan. Team C shows the development of this plan that contributes to the success of this international project. Logistics of the supply chain According to the Council of Supply Chain Management Professionals, “Logistics management is that part of supply chain management that plans, implements, and controls the efficient, effective forward and reverses flow, and storage of goods, services and related information between the point of origin and the point of consumption in order to meet customers' requirements” ("Cscmp supply chain," 2011) Riordan Manufacturing's China plant is a subunit of Riordan Manufacturing that forecasts the sales of electric fans, and distributes them around the world. The electric motors are purchased from a local Chinese company and are used to complete the assembly units. The main branch of Riordan maintains adequate supplies of electric motors in stock, but storing this item at the China plant would need some improvement. The main branch buyer also purchases the plastic polymers locally. One supply issue is with periodic orders for electric fans, which are received randomly throughout the year. Such unplanned orders make it hard for the China plant to know how much material in the short term period will be necessary to support production, because the orders are accounted for randomly and for different quantities. To ensure that the China plant will be able to meet any delivery schedule its customers request, the “China plant maintains a safety stock of polymer material, but does not stock electric motors other than a small quantity of the more popular types for warranty repairs, but depends on the electric motor supplier to maintain motors in their stockroom” (Apollo Group, 2012, Supply Chain portal, para.8). “The China Plant, following good supply chain management practices, periodically provides the electric motor company with a list of the motors it forecasts it will need throughout the year to help the company plan which motors and how many it should carry in its stock” (Apollo Group, 2012, Supply Chain portal, para. 8). While looking at the current logistics of the supply chain from the main office to the China plant and back everything appears efficient, except the retaining of the stock of electric motors needs to be larger at the China branch. Instead of the electric motor supplier maintaining the motors in their stockroom, the China branch should be keeping more motors in stock. Another issue that does arise is the use of FedEx and ship deliveries. In this scenario the main office should use only one service to provide the product, so the estimation time of the product arrival remains consistent and the cost association with this type of delivery projects accurately. Regular reliance upon a singular shipping source will stabilize the cost of shipping items. Lean Production Fan production at the Hangzhou, China facility will adhere to the Riordan Manufacturing game plan that notes a goal for “lean manufacturing processes to attain a 10% reduction operating expenses” ("Riordan Manufacturing - Employee Site," 2012, Operations-Project Process-Scorecard). “Lean production is an integrated set of activities designed to achieve high-volume production using minimal inventories of raw materials, work-in-process, and finished goods” (Chase, Jacobs, & Aquilano, 2006, p. 271). The processing steps for the electric fans are straightforward and shown in figure 1: The process illustrated in figure 1 is a “pull” system that relies on demand before work is complete. One example of this demand is how suppliers only deliver HDPE pellets when the molding departments need them. Another instance is how the molder only molds when the trimmer needs a product. This occurs all the way to shippers, which only ship with an entry of an order. This pull system allows Riordan to minimize inventory and will help us meet our 10% reduction in operating expenses. Waste Identification The reduction of waste is another important aspect of our lean production system. Identifying the possible wastes at each process step shall be closely monitored for improvement over time. The system captures seven types of waste to include: “waste from overproduction, waste of waiting time, transportation waste, inventory waste, processing waste, waste of motion, and waste from product defects” ("Jit just-in-time manufacturing," 1999). Through the use of a “pull” system, and continual improvement of the production process, the lean production system will reduce waste, and Riordan’s fan production will meet the needs of the consumer and still meet Riordan Manufacturing’s 10% operating cost reduction goals. Capacity Planning “Capacity planning is the ability to hold, receive, store, or accommodate” (Chase, 2006, p. 264). When looking at capacity planning, management needs to determine the most effective way to produce the fans, which includes the number of employees required, as well as the number of outputs or fans in production. The processing steps that should be taken into consideration are molding, trimming, assembly, and packaging. Concerning molding and trimming, Riordan needs to ensure that they have the correct number of machines to produce enough fans to meet demand, for assembly, and packaging. Riordan also needs to ensure that they have the proper number of employees necessary to complete the process. The capacity plan will vary for different times of the year, for example, the demand will be higher in the spring and summer months so there is a chance that fewer employees will be essential in the winter months when demand is lower. Adequate capacity will ensure service levels are met and reduce the chance of competitors entering the market, which will assist in keeping prices stable and make sure that the workforce is used to the correct extent. Conclusion By focusing, monitoring, appraising, and making relevant changes to the supply chain, lean production, and capacity planning, Riordan Manufacturing’s electric fans can be produced with greater efficiency, less waste, while producing more profit. Holding proper levels of shelf-stock and using a singular shipping source for scheduling will stabilize the supply chain. Implementing a lean program to schedule and plan production will increase productivity, reduce waste, and increase profitability. Applying an appropriate capacity plan, weighing demand and production capabilities, this will reduce money wasted on storing products by decreasing the amount of time between the production and sale of fans. Focusing on these key areas, and executing the suggested changes in production, will increase the bottom line of Riordan Manufacturing’s electric fan business unit.   References Apollo Group, Incorporated. (2012). Virtual Organizations Portal. Riordan Manufacturin Employee Site. Retrieved February 6, 2012 from: https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Riordan/index.asp. Chase, R. B., Jacobs, F. R., & Aquilano, N. J. (2006) Operations management for competitive advantage (11th ed). New York: McGraw Hill/Irwin. Cscmp supply chain management definitions. (2011). Retrieved from http://cscmp.org/aboutcscmp/definitions.asp Duris, R. (1997). Baby steps are best. Automatic I.D. News, 13 (12), 93. University of Cambridge. (2012). Jit just-in-time manufacturing. (1999). Retrieved from http://www.ifm.eng.cam.ac.uk/dstools/process/jit.html