Gizmoz Study Case

Quality Parts Company supplies gizmos for a computer manufacturer located a few
miles away. The company produces two different models of gizmos in production
runs ranging from 100 to 300 units.
The production flow of models X and Y is shown in Exhibit 9.11. Model Z

requires milling as its first step, but otherwise follows the same flow pattern as X
and Y. Skids can hold up to 20 gizmos at a time. Approximate times per unit by
operation number and equipment setup times are shown in Exhibit 9.12.
Demand for gizmos from the computer company ranges between 125 and 175 per
month, equally divided among X, Y, and Z. Subassembly builds up inventory early
in the month to make certain that a buffer stock is always available. Raw materials
and purchased parts for subassemblies each constitute 40 percent of the
manufacturing cost of a gizmo. Both categories of parts are multiple-sourced from
about 80 vendors and are delivered at random times. (Gizmos have 40 different
part numbers).
Scrap rates are about 10 percent at each operation, inventory turns twice yearly,
employees are paid on a day rate, employee turnover is 25 percent per year, and net
profit from operations is steady at 5 percent per year. Maintenance is performed as
needed.
The manager of Quality Parts Company has been contemplating installing an

automated ordering system to help control inventories and to “keep the skids
filled.” (She feels that two days of work in front of a workstation motivates the
worker to produce at top speed.) She is also planning to add three inspectors to
clean up the quality problem. Further, she is thinking about setting up a rework line
to speed repairs. Although she is pleased with the high utilization of most of her
equipment and labor, she is concerned about the idle time of the milling machine.
Finally, she has asked the industrial engineering department to look into high-rise
shelving to store parts coming off machine 4.
Questions
1. Which of the changes being considered by the manager of Quality Parts
Company are counter to the lean philosophy?
2. Make recommendations for lean improvements in such areas as scheduling,
layout, kanban, task groupings, and inventory. Use quantitative data as much as
possible; state necessary assumptions.
3. Sketch the operation of a pull system for running Quality Parts Company’s
current system.
4. Outline a plan for introducing lean at Quality Parts Company.
1. The manager is considering installing an automated ordering system to

control inventories. This would not fit into the lean philosophy as it would
have the skids filled with workers making products 2 days in the front. Lean
philosophy calls for not producing a product until it is needed.
2. The plan that implements 3 inspectors are not necessary. Because each
worker carries out a specific task, they may be personally responsible for the
quality of the product they produce. This means that when the product of the
previous stage meets the requirements, worker of the next stage will perform
their duties. If, products are defective, they will removed from the chain and
press the system-wide button to adjust the plan. According to the JIT
strategy, one of the elements of reducing waste is Quality at Source. Quality
at source means doing it right the first time and when something goes
wrong, stop the process or assemble line immediately, so there can not
waiting for processing, no workers or equipment to wait for input to operate.
Besides, task groupings could be correlated by moving skids of the same of
similiar function to the same area to improve production capacity and time
reduction. Furthermore, Lathe has the highest set up time (30) as well as the
second highest operations time (50). The company should add additional
machine in the process to increase the total production of the company
3. A U-shaped layout would be most beneficial as it reduces lead times. Flow
of parts and materials through the different departments will be smoother
and efficient.Physical workflows in the plant could also be improved. By
swapping the placement of machines 1 and 3, a cleaner workflow could be
established. Also by adding a door between the assembly line and paint shop
near the offices, the gizmos had to travel between skids 7 and 8 could be
reduced by approximately 75%, thus increasing efficiency.Another problem
was the excess product produced by machine four. The manager had
contemplated of purchasing high-rise shelving for the surplus, but with a
five-minute set-up at machine 4, a kanban system could be set up between
machine 4 and the assembly department step 9, eliminating the need for
high-rise shelving for storage of parts coming from machine 4. This system
could act as a signal for machine 4 operations signaling them when they
reached an upper production limit and to cease production. It could also
signal the operator when they need to restart production to replenish needed
supply.
4.
- Present and analyze condition of the current system that the company is
using and its weak
- Introduce about what lean production is and its advantages in a production
process, such as such as improving productivity and product quality,
shortening production cycle times, reducing the cost of tangible and
intangible inventories, improving equipment efficiency, etc.
- Explain what company will get if using this lean production system,
including improvement that happens at the result before and after lean
production system implementation. Besides, we should present lean
production system's weakness, including times needed to change system that
causing production off and at the same time explain that although that, total
production will fulfilled in time and the next time and this will be an
advantage for company

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Quality Parts Company supplies gizmos for a computer manufacturer located a few

The production flow of models X and Y is shown in Exhibit 9.11. Model Z

The manager of Quality Parts Company has been contemplating installing an

1. The manager is considering installing an automated ordering system to

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