1. Map out the order entry and production planning processes. How long do these processes take? How much of this time is “value-added”? What is the percent valueadded time? What accounts for the remainder of the time? Zephtrex fabric is a specialized product made by Ellison Textiles and used exclusively by CMX Corporation. The current demand level is just one-third of Ellison’s manufacturing capacity, but the business is expected to grow substantially over the next year.

Order-Entry Process CMX sends an order to Ellison Textiles 15 business days before CMX needs the Zephtrex fabric. However, CMX would like to shrink this to 10 days. As one CMX manager noted, “Fifteen days doesn’t give us the flexibility we need to respond to changes in the marketplace. Sure, we could hold extra inventory here, but I’m not sure this is necessary, especially given the capacity situation at Ellison.”

CMX sends the order to the Ellison sales rep, Ed Stevens, via e-mail. Ed supports multiple plants and generally checks his e-mail twice a day. However, if he is on the road and does not have access to the Internet, it may take 24 hours to receive and acknowledge the order. (CMX has been very good in the past about following up on orders that weren’t confirmed within a day.) Ed passes these orders to the production planner, Rosemary Wilkins, at the next production planning and status meeting, which occurs every Tuesday and Friday morning at 7:00 A.M. via a conference call.