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Chapter 3: Q14-7PE (page 373)
Means only producing what is needed when needed and no more.
JIT manufacturing is a production approach in which things are generated to satisfy needs rather than more than ahead of necessity.
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Question:Compared to manufacturing systems, what is it about the environment of service operations that makes them much harder to control?
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One of your Taiwanese suppliers has bid on a new line of molded plastic parts that are currently being assembled at your plant. The supplier has bid \(0.10 per part, given a forecast you provided of 200,000 parts in year 1; 300,000 in year 2; and 500,000 in year 3. Shipping and handling of parts from the supplier鈥檚 factory are estimated at \)0.01 per unit. Additional inventory handling charges should amount to \(0.005 per unit. Finally, administrative costs are estimated at \)20 per month. Although your plant can continue producing the part, the plant would need to invest in another molding machine, which would cost \(10,000. Direct materials can be purchased for \)0.05 per unit. Direct labor is estimated at \(0.03 per unit plus a 50 percent surcharge for benefits; indirect labor is estimated at \)0.011 per unit plus 50 percent benefits. Up-front engineering and design costs will amount to $30,000. Finally, management has insisted that overhead be allocated if the parts are made in-house at a rate of 100 percent of direct labor cost. The firm uses a cost of capital of 15 percent per year. What should you do, continue to produce in-house, or accept the bid from your Taiwanese supplier?
Many bottled water manufacturers have recently worked with their suppliers to switch over to bottles using much less plastic than before, reducing the amount of plastic that needs to be transported, recycled, and/or disposed of. What sourcing practice is this an example of?
Question: Students arrive at the Administrative Services Office at an average of one every 15 minutes, and their requests take on average 10 minutes to be processed. The service counter is staffed by only one clerk, Judy Gumshoes, who works eight hours per day. Assume Poisson arrivals and exponential service times.
c. How long is the (waiting) line on average?
What term refers to the optimization of value-adding activities and elimination of non-value-adding activities that are part of a value stream?
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