Jay: So$,$ it seems if we continue to outsource, we have to live with the increased prices! Now, let

us address the second issue, which is of quality of products. What do you think is happening?

Linda: We do not seem to have any quality issues with products that we import from Mexico,

India and Thailand. Bulk of problems seem to be from products coming from China. We keep

buying from Chinese suppliers due to cost advantage.

Jay: That is true, but we are falling behind in our market due to low quality product. We have to

have suppliers that will provide quality products.

Kathy: I agree. What is the third issue Jay?

Jay: The third major issue is about uncertain and unpredictable deliveries. Often, we are unable

to honor our delivery commitments to our customers. Why is that happening?

Linda: This is happening with most of our supplies in Thailand. I have talked to our suppliers

about the issue. They seem to blame the shipping companies for delays.

Jay: After listening to all of you, it seems we must seriously think about stop outsourcing and

start home production. We will be in a better position to monitor quality and production

deliveries. If we do it right with an efficient production process, we may be able to produce at a

competitive cost. John, you are our production manager. What do you think? Should we

consider producing in$-$house? Do we have the production capability?

John: Jay, yes, we can produce in$-$house. However, that would require setting assembly lines for

our products. My suggestion is that we do so in phases, product by product. Based on our

experience with one assembly line, we can decide if we should pursue with other product lines.

Linda: I agree with John. Let us think of which product line we should start with?

Kathy: My suggestion is that we start with ceiling fan production as summer is coming up soon

and we expect a surge in demand.

Jay: Sure, I also think so$.$ Does everyone agree that we start with an assembly plant to produce

ceiling fans? If this plan works, we can move to other product lines.

All nodded their heads in agreement.

Jay: John, please develop an assembly line that will meet our projected demand with the lowest

production cost. We will have anther meeting after two weeks to review the plan.

John Wovel, the production manger, called a meeting of his engineers to develop a production

plan. The first step of production plan was to develop a WBS $($Work Breakdown Structure$)$ of fan

production and then divide production to smallest possible work elements $($activities$,$ their

duration $($production times$),$ and precedence relationship. The engineering team came up with

several plans, and eventually the one shown in Figure $1$ was accepted by the management

team.

The assemble plan will run two shifts per day. Each shift will operate for $8$ hours.

The expected demand rate is $40$ fans per day.

Figure $1$

Work element

A

B

C

D

E

F

G

H

J

K

L

M

N

P

Q

R

Based on the information given in the case, answer the following questions. Show all work that you

need to arrive at your answers.

a$)$ Develop the activity precedence diagram.

b$)$ Determine the minimum cycle time, the maximum cycle time.

c$)$ What will be the production rate per day if minimum cycle time is used? maximum cycle time is

used?

d$)$ In order to meet the projected demand what should be the cycle time?

Based on the information given in the case, answer the following questions. Show all work that you

need to arrive at your answers.

a$)$ Develop the activity precedence diagram.

b$)$ Determine the minimum cycle time, the maximum cycle time.

c$)$ What will be the production rate per day if minimum cycle time is used? maximum cycle time is

used?

d$)$ In order to meet the projected demand what should be the cycle time?

e$)$ What is the theoretical number of minimum workstations?

f$)$ Assign work elements according to the most following tasks rule.

g$)$ Assign work elements according to the greatest positional weight rule.

h$)$ Calculate the percentage idle time and assembly line efficiency for each of the above two rules.

i$)$ Which assembly line do you recommend? Why?