LaCrosse, Inc., sales manager Josh Brown has been receiving calls from customers
ID: 335392 • Letter: L
Question
LaCrosse, Inc., sales manager Josh Brown has been receiving calls from customers complaining about the length of time it takes to receive an order. To help him understand the issue, he gathered the following information from DanGold Enterprises’ most recent order.
1
Calculate the delivery cycle time, the manufacturing cycle time, the value-added time, and the manufacturing cycle efficiency percentage.
Days Required Process customer order 0.1 Wait for direct materials to arrive 4.0 Fabrication of parts 3.0 Move order to assembly department 0.5 Wait for machine time 6.0 Assembly of parts 3.0 Move order to finishing department 0.4 Wait for machine time 3.0 Finishing of units 6.0 Move to packing department 0.6 Packing 1.6 Move to shipping department 0.2 Load delivery truck 0.5 Drive to customer 1.0 Unload delivery truck 0.5 Return to plant1
Explanation / Answer
Delivery cycle time starts when a customer places an order. Manufacturing cycle time starts when a customer order has been processed and accepted for production. The manufacturing cycle time both extend upto the shipping of the products. The delivery cycle time extends upto the final delivery of products.
Manufacturing Cycle Time = (Time taken from Waiting for direct materials to Loading delivery truck) = 28.8 days
Delivery Cycle Time = (Time taken from Order Processing to Unloading delivery truck) = 30.4 days
Value Added Time = Total time taken for processing = Fabrication + Assembly + Finishing + Packing = 13.6 days
Non-Value Added Time = Wait Time + Move Time = Delivery Cycle Time - Value Added Time = 16.8 days
Manufacturing cycle efficiency percentage = Value Added Time / Manufacturing cycle time = 47.22%
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