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ISQA 459/559 DR. MELLIE PULLMAN FoldRite Furniture Approaches.

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Presentation on theme: "ISQA 459/559 DR. MELLIE PULLMAN FoldRite Furniture Approaches."— Presentation transcript:

1 ISQA 459/559 DR. MELLIE PULLMAN FoldRite Furniture Approaches

2 Planning Steps Calculate the existing available skilled and unskilled workers  Case states that company has sufficient workers to make the annual forecast over 200 production days (2010)-level  So calculate average need for each product at each skill level Determine the Labor actually needed to fill demand (March-August) Determine the total cost of fulfilling demand for each option by figuring cost of:  Overtime  Use of subcontractors  Hiring and Training workers  Cost of Design Change  Cost of Carrying Inventory

3 Based on Forecast 2010 data Data From Template Sufficient Capacity to produce Annual Forecast with 200 production days in 2010 Workers work 10 hour days Capacity to produce:  524,280 Cloudchairs  306,916 AlStrong  253,570 Green Comfort Staffing = labor time * Daily Capacity/ (daily hours/worker *yield) Example: Cloud Chair w/ Skilled (2 min/item)(hr/60min)*(2621.4 ch/day)/ (10 hours/day/worker)*.95 = 9.2 workers Required Labor Daily Current Capacity Current Staffing Level Mins/item =yearly/ 200 days Skille dUnskilled SkilledUnskilled CloudChair292,621.4 9.2? AlStrong12.8281,534.6 34.5? GreenComfort13311,267.9 28.9? Calculate Available Workers Total Skilled Workers = 73 Total Unskilled Workers=?

4 Calculate hours for each Category Calculate hours for each Category Data From Template Staffing = labor time * Daily Demand/ (yield) Example: Cloud Chair w/ Skilled (2min/item)(hr/60min)*(2500 ch/day)/.95 = 87.72 worker hours/day Or (per month @ 18 days) = 87.72 worker hours/day *18 =1578.9 hours Required Labor per product March Forecast Labor hours needed Mins/item Daily (18 days) Monthly Skilled Un skilled SkilledUnskilled CloudChair292500 1578.9? AlStrong12.8281500 6063.2? GreenComfort13311260 5172.6? Determine Labor Hours Needed (March)

5 Determine Labor Hours Needed (March-August) MarchAprilMayJuneJulyAugust CloudChair 45,00073,80065,25079,20086,40067,150 AlStrong 27,00029,70028,50036,00032,40029,750 GreenComfort 22,68025,20022,50027,90025,20021,250 Production days 18 1518 17 Required skilled hours 12,81515,00613,821 Available skilled hours 13,140 10,950 Excess (shortfall) 325(1,866)(2,871) Needed Skilled workers (2)1019 Required unskilled hours 32,70339,94736,539 Available unskilled hours 33,480 27,900 Excess (shortfall) 777(6,467)(8,639) Needed unskilled workers (4)3658

6 Tackling the shortages & surpluses Average all the required people per month for 6 months gives: 13 additional skilled & 40 unskilled Or don’t hire until April and Use excess worker capacity to build inventory in March then average the remaining demand over 5 months.

7 Consider other options (at least 2) Overtime. What is the additional labor cost? Subcontract. Frees up skilled labor hours and some unskilled hours, still need to hire some. Hiring  Early hiring in March with carrying extra inventory  Hiring in April with carrying extra inventory  Hiring and Training in March Change in Design  Hire all workers March 1 and use overtime for some  Hire all needed workers in April  Hire unskilled workers to train in March and start extra production in April

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