Question

Management of Mittel Rhein AG of Köln, Germany, would like to reduce the amount of time between when a customer places an order and when the order is shipped. For the first quarter of operations during the current year the following data were reported: Inspection time 0.7 days Wait time (from order to start of production) 16.6 days Process time 2.7 days Move time 1.3 days Queue time 4.5 daysRequired:1. Compute the throughput time. (Round your answer to 1 decimal place.)2. Compute the manufacturing cycle efficiency (MCE) for the quarter. (Round your answer to the nearest whole percentage (i.e., 0.12 should be entered as 12).)3. What percentage of the throughput time was spent in non–value-added activities? (Round your answer to the nearest whole percentage (i.e., 0.12 should be entered as 12).)4. Compute the delivery cycle time. (Round your intermediate calculations and final answer to 1 decimal place.)5. If by using Lean Production all queue time during production is eliminated, what will be the new MCE? (Do not round intermediate calculations. Round your answer to the nearest whole percentage (i.e., 0.12 should be entered as 12).)

Answer 1

Step-by-step explanation:

1. Throughput time = 2.7 + 0.7 + 1.3 + 4.5 (process + inspection + move + queue) = 9.2 days

2. Manufacturing cycle efficiency (MCE) = Value added time / throughput time

= 2.7 / 9.2 = 29%

3. Non–value-added throughput percentage = 100% - 29% = 71%

4. Delivery cycle time = wait time + throughput time

= 16.6 + 9.2

=25.8 days

5. New manufacturing efficiency = Value added time / Throughput time

= 2.7 / (2.7 + 0.7 + 1.3)

= 2.7 / 4.7 = 57.4%

Answer 2

1. Throughput Time = 9.2 days

2. Manufacturing Cycle Efficiency = 29%

3. 71% throughput time was spent in non value added activities.

4. Delivery Cycle Time = 25.8 days

5. New MCE = 57%

Step-by-step explanation:

Given

Inspection time 0.7 days

Wait time 16.6 days

Process time 2.7 days

Move time 1.3 days

Queue time 4.5 days

1. The throughput time is calculated by adding all time except the wait time.

I.e.

Throughput time = Inspection time + Process time + Move time + Queue time

Throughput Time = 0.7 days + 2.7 days + 1.3 days + 4.5 days

Throughput Time = 9.2 days

2. Calculating the manufacturing cycle efficiency.

Manufacturing Cycle Efficiency is calculated by dividing value added time by throughput time.

Where the value added time = the process time = 2.7 days

And throughput time = 9.2 days (calculated in (a) above)

Manufacturing Cycle Efficiency = 2.7 days ÷ 9.2 days

Manufacturing Cycle Efficiency = 0.2934782609

Manufacturing Cycle Efficiency = 29.34782609%

Manufacturing Cycle Efficiency = 29%

3. Calculating the percentage of the throughput time was spent in non–value-added activities.

This is calculated by subtracting MCE calculated above from 100%

% throughput time = 100% - 29%

% throughput time = 71%

So, if 29% throughput time was spent in value added activities, 71% throughput time was spent in non value added activities.

4. Calculating the delivery cycle time.

This is calculated by adding the wait time to throughput time.

i.e.

Delivery Cycle Time = Wait Time + Throughput Time

Where Wait Time = 16.6 days and Throughput Time = 9.2 days

Delivery Cycle Time = 16.6 days + 9.2 days

Delivery Cycle Time = 25.8 days

5. Calculating new MCE.

Here, we'll used the same formula used in (2) above

i.e

Manufacturing Cycle Efficiency is calculated by dividing value added time by throughput time.

Where the value added time = the process time = 2.7 days

But throughput time will be calculated as

Throughput time = Inspection time + Process time + Move time (because of the elimination of all queue time)

Throughput Time = 0.7 days + 2.7 days + 1.3 days

Throughput Time = 4.7 days

So, New MCE = 2.7 days ÷ 4.7 days

New MCE = 0.5744680851

New MCE = 57.44680861%

New MCE = 57%