Analyze the Flashy Flashers case

• What would the inventory record look like for each component part? Create a table for each item.
• What would the planned order releases be like for each component part? Fill in the table in p.496.
  • Note: Earliest an order release can be made is on week 1.
• According to your analysis, which items would experience stock-out situations in the near future? What are some possible root-causes why this may be happening? Explain.

Meme Plan Master Produs 200 7201 Hanna Operations Management. I allows you to evaluate the relationship between the inven- tory record data and the planned order releases. QUESTIONS 1. Suppose that the POQ for item B is changed from 3 weeks to 2 weeks. How does this change affect the order releases for items B, C. and D? 2. As the on-hand inventory for item C increases from 0 to 200, what happens to the order releases for items B. C. and D? 3. As the fixed order quantity (FOQ) for item D increases from 500 to 750, what happens to the order releases for items B. C, and D? 4. As the lead time for item C changes, what happens to the order releases for items B, C, and D? Inventory Lund Begrifennwand Pad Order W 36 20100720 ACTIVE MODEL Material Requirements Planning Using Data from Solved Problem 3 and Table 11.4 CASE Flashy Flashers, Inc. One planner suggested that the MRP outputs should be extended to provide priority and capacity reports, with pointers as to which items need their attention. The original plan was to get the order-launching capability implemented first. However, there is no formal system of priority planning, other than the initial due date assigned to each scheduled receipt when it is released, transforming it from a planned order release into a scheduled receipt. The due dates do not get updated later even when there are unexpected scrap losses, capacity shortages, short shipments, or last-minute changes in the MPS (responding to requests from favorite customers). Jobs are scheduled on the shop floor and by suppliers according to the EDD rule, based on their due dates. If due dates assigned to scheduled receipts were updated, it might help get open orders done when they are really needed. Furthermore, planned order releases in the action bucket are translated into scheduled receipts (using inventory transactions), after checking that its components are available. The current system does not consider possible capacity problems when releasing new orders Flashy Flashers is a medium-sized firm employing 900 persons and 125 managerial and administrative personnel. The firm produces a line of automo- tive electrical components. It supplies about 95 auto parts stores and Moon- bird Silverstreak car dealers in its region. Johnny Bennett, who serves as the president, founded the company by producing cable assemblies in his garage By working hard, delivering consistent product quality, and by providing good customer service, he expanded his business to produce a variety of electrical components. Bennett's commitment to customer service is so strong that his company motto, "Love Thy Customers as Thyself on a big cast-iron plaque under his giant oil portrait in the building's front lobby. The company's two most profitable products are the automotive front sidelamp and the headlamp. With the rising popularity of Eurosport sedans, such as the Moonbird Silverstreak, Flashy Flashers has enjoyed substantial demand for these two lamp items. Last year, Kathryn Marley, the vice president of operations and supoly chain management, approved the installation of a new MRP system. It is a first important step toward the eventual goal of a full-fledged ERP system. Marley worked closely with the task force that was created to bring MRP online. She frequently attended the training sessions for selected employees, emphasiz- ing how MRP should help Flashy Flashers secure a better competitive edge. A year later, the MRP system is working fairly well. However, Marley believes that there is always a better way and seeks to continually improve the company's processes. To get a better sense for potential improvements, she met with the production and inventory control manager, the shop supervisor, and the purchasing manager. Here are some of their observations. Production and Inventory Control Manager Inventory records and BOM files are accurate and well maintained. Inventory transactions are faithfully made when inventory is replenished or removed from the stockroom so that current on-hand balances are credible. There is an MRP explosion each week, which gives the company the new MRP. It provides stormation that helps identify when new orders need to be launched informa- dan can also be searched to help identify which scheduled receipts need to be expedited and which ones can be delayed by assigning them a later due date, thereby making room for more urgent jobs. Shop Supervisor His primary complaint is that the shop workloads are anything but level. One week, they hardly have any work, and the supervisor overproduces (more than called for by the scheduled receipts) just to keep everyone busy. The next week polto can be just the opposite so many new orders with short fuses that almost everyone needed to work overtime or else the scheduled receipt quantities are reduced to cover immediate needs. It is feast or famine, unless they make ter things work on the shop floor! They do make inventory transactions to report deviations from plan for the scheduled receipts, but these "overrides' make the scheduled receipt information in the MRP records more uncertain for the planners. A particular concem is to make sure that the bottleneck workstations are kept busy. Purchasing Buyers are putting out too many fires, leaving little time for creative buying. In such cases, their time is spent following up on orders that are required in the very near future or that are even late. Sometimes, the MRP plan shows planned order releases for purchased items that that are needed almost immediately, 496 PART 2 MANAGING CUSTOMER DEMAND TABLE 11.27 PLANNED ORDER RELEASE FORM FILL IN THE PLANNED ORDER RELEASES FOR ALL COMPONENTS. Week 1 2 3 4 5 6 Item Description and Part Number Side lens (SL111) Side lens rubber gasket (SL113P) Side frame subassembly (SL112A) Side frame (SL121F) Side bulb subassembly (SL122A) Flasher bulb subassembly (SL1234) Side cable grommet and receptacle (SL131F) Flasher cable grommet and receptacle (SL133F) Side bulb (SL132P) Flasher bulb (SL134P) Head frame subassembly (HL211A) Head lens (HL.212P) Headlamp module (HL222P) Head frame (HL223) Back rubber gasket (C310P) Screws (C206P) RESOURCE PLANNING CHAPTER 11 495 Part Number SL 111P Safety Stock (Units) Lot-Sizing Rule FOQ = 350 S1112A Su 1130 SL121F SL122A SL123A Lead Time (Weeks) Scheduled Receipt 2 On-Hand (Units) (Units and Due Dates) 0 15 3 D 1.4L 20 BO (week 2) 1 20 F00 = 100 20 2 0 L4L 0 80 (week 2) 2 0 L4L 0 80 week 2) 2 0 FOO = 200 0 2 0 POQIP = 2 weeks) 0 110 (week 1) 1 25 FOQ = 100 35 100 (week 1) 2 0 FOQ = 250 1 0 FOO = 400 100 Source: This case was originally prepared by Professor Soumen Ghosh, Georgia Institute of Technology, for the purpose of classroom discussion only. Copyright Soumen Ghost. Used with permission. SL131F SL 132P SL133F SL 134P HL200E SL100E SL113P C206P (4) HL211A (1) HL212P (0) C206P 12) SL112A (1) SL111P (1) SL123A HL223F C310P C310P (1) SL121F (1) C206P 2) HL222P 0 SL122A (1) SL134P SL131F (1) SL132P (0) SL133F (1) Note: Usage quantities are shown parentheses A FIGURE 11.49 BOMs for Headlamps and Sidelamps due date. MPS Start Date 494 PART 2 MANAGING CUSTOMER DEMAND not allowing for the planned lead time. In checking the MRP records, the Your Assignment Put yourself in Marley's place and prepare a report on your findings. Sos.ch planned lead times are realistic and what the suppliers expect. Last week you are required to do a manual MRP explosion for the sidelarosa things were fine for an item, and this week a rush order needs to be placed lamps for the next 6 weeks (beginning with the current week). Aseta What is the problem? all the required information about the sidelamps and headlamps (shown in in Table 11.27. It should show the planned order releases for a wens te Marley tried to assimilate all this information. She decided to collect it is now the start of week 1. Fill in the planned order releases for Tables 11.23 through 11.26 and in Figure 11.49) to gain further insight into next 6 weeks. Include it in your report, Supplement your report with worksheets on the manual MAP exten possible problems and identity areas for improvement and list the actions that planners should consider this week to destes orders, 2) expedite scheduled receipts, and (3) delay a scheduled rece TABLE 11.23 PART NUMBERS AND DESCRIPTIONS Finally, Identify the good and bad points of MRP implementation at Part Number Description Flashers. Conclude by making suggestions on ways to improves 0206P Screws planning process C310P Back rubber gasket TABLE 11.24 MASTER PRODUCTION SCHEDULE HL 2005 Headlamp HL211A Head frame subassembly Item Description and Part Number Quantity HL212P 120 Head lens Headlamp (HL200E) HL222P Headlamp module 90 HL 223 Head frame 75 SL 100E Sidelamp Sidelamp (SL100E) 100 SL171P Side lens 80 SL112A Side frame subassembly 110 Week 6 SL113P rubber gasket SL121F Side frame SL122A Side bulb subassembly TABLE 11.25 REPLACEMENT PART DEMAND Flasher bulb subassembly Item Description and Part Number SL131F Quantity Side cable grommet and receptacle Date Side lens (SL111P) SL132P 40 Side bulb Week 3 SL133F 35 Flasher cable grommet and receptacle Week 6 SL 134P Flasher bulb Week 4 Week 5 Week 6 Week 3 Week 5 SL123A TABLE 11.26 SELECTED DATA FROM INVENTORY RECORDS Part Number Lead Time (Weeks) Safety Stock (Units) C206P Scheduled Receipt (Units and Due Dates) 1 On-Hand (Units) 30 Lot-Sizing Rule FOQ = 2,500 FOQ = 180 1 C310P HL211A HL212P 270 20 3 40 0 180 (week 1 L4L 2 0 HL 222P 15 3 HL 223F 10 15 FOQ = 350 POQIP = 4 weeks) POQIP = 4 weeks) 1 0 10 285 week 1) 0 120 (week 1)