Introduction to Supply Chain Management
Production & Inventory
Inventory is plays a very important part in today’s business world. Companies must maintain some type of inventory to cover the uncertainties of supply and demand. Inventory must be closely monitored to ensure there are just the right amount and not an excess. Inventory that has expiration dates must especially be monitored closely to avoid spoilage. Inventory control is a very big issue and companies use many different ways to monitor this. One way to do this is to put your factory floor on-line to assist in your inventory control.
The factory floor is probably one of the most important areas in a manufacturing facility. There are many things that happen on the factory floor and any problem in this process could potentially spell disaster. Most manufacturing facilities strive successfully implement lean manufacturing on their factory floor. Lean manufacturing is the practice of expending resources for one purpose, the end customer. Anything else in this process that is not for the end customer is considered waste and thus eliminated. Toyota has implemented an online system called the Manufacturing Execution System to assist there lean manufacturing process on the factory floor. According to; (Marketing Decision Support Systems, Inc, 2009)
By making the factory floor activity visible through the use of the Manufacturing Execution System (MES), and measuring the flow times of parts on a continuous basis, the factory has a benchmark from which to identify areas that need improvement and the system to demonstrate those improvements.
So as we can see, the Manufacturing Execution System is benefiting the inventory process activities at Toyota by making ...
... middle of paper ...
...made about the war zone being the same as the factory floor reiterates the importance that information technology plays in inventory control and how it can benefit whoever chooses to use it.
Works Cited
Brousell.d. (2005, Oct) The Factory Floor: Ripe for RFID. Managing Automation. Retrieved 7 Apr 2011, From.
http://www.managingautomation.com/maonline/magazine/read/view/The_FactoryFloor_Ripe_for_RFID_5439490
Crittenden,s. (2005, May-June) Information Technology for Marine Corp Ammunition. PB 700-05-03, Volume 37, Issue 3. Retrieved 6 Apr 2011, From.
http://www.almc.army.mil/alog/issues/MayJun05/ammo.html
MDSS-Machine performance. (2009), Lean Manufacturing through Factory Floor Innovation. Retrieved 4 Apr 2011, From.
http://articles.smashits.com/articles/technology-and-science/154247/lean-manufacturing-through-factory-floor-innovation.html
In today’s operational management arena, there are certain expectations from a managerial aspect that must be met in order to be successful. A comprehensive look at the Space Age Furniture Company will show exactly what the Materials Requirement Planning (MRP) calculations are for this company at present time and then take the information given in order to properly suggest ways to improve the sub-assemblies. In addition, there will be an analysis on the trade-offs between the overtime and inventory costs. A calculation will be made on the new MRP that will improve the base MRP. This paper will also compare and contrast the types of production processing to include the job shop, batch, repetitive, or continuous, and determine which the primary mode of operation should be and exactly why. A detailed description on how management can keep track of the job status and location during production will also be addressed. Finally, there will be a recommendation on they type of changes that need to occur that will be beneficial to the company and at the same time add value to the customer. This paper will conclude with summary of the major points.
Once they develop and implement this inventory control system, inventory records are going to be upheld truthfully and that they will get the accurate standing of the inventory up-to-date. In order to maintain the steady continuous supply for production need... ... middle of paper ... ... ory holding costs, ordering costs, and shortage costs, and have a classification system for inventory items. In conclusion, while reading the case study, I saw much disorganization throughout the company’s entire system.
Lean is not a new concept and surfaced as a result of Toyota’s Production System. Manufacturing has been using lean principles since the 1980’s (Sarkar, 2008). Lean today goes beyond manufacturing into health, education,
In addition, on day 105, the reorder quantity was 13,200. This approach was effective as it increased the number of inventory kits available for production. In total, the company used $2,059,000 to increase its inventory levels. The increased inventory levels and the readjustments of reorder points enabled the factory to increase the number of jobs accepted each day as well as to reduce the number of jobs waiting for kits. In addition, there was a high number of kits queued at station one from day 80 which was accompanied by increased utilization of station one. Besides, we were able to reduce the lead time for all the orders and this enabled the company to increase its revenues.
Lean manufacturing refers to systematic identification and elimination of waste through CI processes in pursuit of perfection (Khan et al. 2013; Yang & Yang 2013). Lean production is now used worldwide in manufacturing plants to eliminate waste from all ar...
During this project, I am going to mention the details of TOYOTA production process system which was developed more than 40 years ago by Taiichi Ohno, the president of Toyota Motor company at that time. The production system that Toyota company uses now and before is relevant to the concept of the process costing system which is currently used in all department of the company.
According to Toyota, they have undertaken a manufacturing revolution that has fundamentally changed established practices; all the way back to the product development and design. They have done this by integrating four areas: design, production engineering, procurement, and component supply. They have achieved higher quality at lower costs by creating standardized, multipurpose components. Also the reduction in cost has heightened the value and fortifies the competitiveness of product. To do this, Toyota has required intensive coordination with its suppliers. Another factor of their Integrated Low Cost is that Toyota steadily feeds cost improvements back into the product to raise their value along with the fact that four Toyota’s seven corporate auditors are outside corporate auditors.
Toyota is a pioneer of the LEAN manufacturing principle. Lean, as a process, is a way to add value to customers while minimizing waste (LEI, 2011). It can also be thought of in terms of flow, which is how Toyota likes to think of it. It is simply a process of decision making where the problems tend to be thought of in terms of flow, reducing starts and stops or unnecessary motion increases flow, reducing waste.
Inventory management is a method through which a business handles tangible resources and materials to ensure availability of resources for use. It is a collection of interdisciplinary processes including a full circle of the demand forecasting, supply chain management, inventory control and reverse logistics. Inventory management is the optimization of inventories of manufactured goods, work in progress, and raw materials. According to Doucette (2001) inventory management can be challenging at times; however, the need for effective inventory management is largely seen more as a necessity than a mere trend when customer satisfaction and service have become a prime reason for a business to stand apart from its competition. For example, Wal-Mart’s inventory management is one of the biggest contributors to the success of the company; effective and efficient inventory management is of critical importance.
The business is related to a manufacturing concern; therefore, the importance of enhancing manufacturing operations seems to increase. Manufacturing operations management is commonly known as MOM (Daft, Kendrick & Vershinina, 2010). Management of operations is basically a process which reviews the manufacturing or production process with an intention to maximize the production efficiency. Manufacturing operations management is thoroughly divided into many different arenas like production management, supply chain management, analysis of performance, quality and compliance and many others. Manufacturing operations management revolves around all the underlying production processes (Hills & Jones, 2009).
Production Functions A production function in general, without specifying what kind, is related to the output of a production process which starts with the factors of production. Production functions are an integral part of explaining marginal products as well as allocative efficiency. There are different classifications for production functions, and what constitutes them, determined by the type of production. This article of the WIKI aims to focus on the Substitional production function, explaining what it is and means, as well as the limitations, of doing the same.
Totty, M. (2009, June 2). Business Solutions New Ways to Use RFID. The Wall Street Journal. Retrieved November 14, 2011, from http://online.wsj.com/article/SB10001424052970203771904574175882366028604.html
• While making a methodology is challenging, executing it is considerably more troublesome. Numerous organizations comprehend Toyota Production System now, yet at the same time think that it is troublesome to execute and implement.
Toyota has implemented many different systems such as performance monitoring software, the Just in time (JIT) inventory system, electronic quality control system, communication system and information system thought out their value chain which enable to make correct decision during the manufacturing process. They have identified that having large inventories of spares cost them extensive capital and they have implemented the Just in time (JIT) inventory system which advices the suppliers the exact spares that the product line required and provides a time frame. Toyota adopted continuous learning and embraces change allowing their staff to research and innovation (Toyota
In 1950s, Toyota has developed lean thinking. The Toyota Production System aspires to minimize waste and increase efficiency while at the same time enhances its product quality. From this initiative, Toyota managed to widen its competitive edge by employed fewer employees in the car production with a small number of flaw products.