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Creative Concept

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Bhavna Yadav
Bhavna Yadav

The document provides an overview of a case study for a furniture company. It discusses how the company began making custom wooden furniture and grew due to good quality and reputation. As demand increased for standard products, it started selling to retail outlets but faced issues with long delivery times and high inventory costs due to sharing manufacturing processes between custom and standard products. It provides answers to seven questions on long term decisions, how sales/marketing affects operations, the financial impact of increasing standard furniture production, and ways to avoid current issues related to production layout, forecasting, distribution and operations strategy.

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Creative Conceptwww.creativeconcept.comPrepared by:Arvind Sharma(8)Bhavna Yadav(11)Tarun Chandra(57)www.creativeconcept.com
Contents1Case Overview2Seven Questions based on Case Q&A 3Planting Site 4
Case : OverviewCompany began with custom-made wooden furniture
Good quality product resulted in good reputation
Company started selling to retail outlet
Need to produce more for satisfying growing demand of standard product
Single Manufacturing process for both standard & Custom furniture
Processing time & craftspeople shared for manufacturing Custom & standard furniture
Product line started scheduling regularly due to increased standard line demandCase Overview:Due to its High sale & profit priority is given to custom furniture
Increasing sales resulted in company’s growth
Matter of concern: money in inventory, longer promised delivery time and expensive warehouseQ1: Long term decision manager must take for effectively running his company?Decision to reduce cost & improve quality
Use mix of different layout for Custom & standard line product.Product layout for standard line product: Its usually used for large volume productProcess layout for Custom products :used when there is diversified products using common operations, varying volumes, varying rate of outputIncrease number of craftsman : Do this by improving forecast technique of demand
Management of resources: Manpower , raw material
Inventory management
More Emphasis on automating the production process

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Creative Concept

  • 1. Creative Conceptwww.creativeconcept.comPrepared by:Arvind Sharma(8)Bhavna Yadav(11)Tarun Chandra(57)www.creativeconcept.com
  • 2. Contents1Case Overview2Seven Questions based on Case Q&A 3Planting Site 4
  • 3. Case : OverviewCompany began with custom-made wooden furniture
  • 4. Good quality product resulted in good reputation
  • 5. Company started selling to retail outlet
  • 6. Need to produce more for satisfying growing demand of standard product
  • 7. Single Manufacturing process for both standard & Custom furniture
  • 8. Processing time & craftspeople shared for manufacturing Custom & standard furniture
  • 9. Product line started scheduling regularly due to increased standard line demandCase Overview:Due to its High sale & profit priority is given to custom furniture
  • 10. Increasing sales resulted in company’s growth
  • 11. Matter of concern: money in inventory, longer promised delivery time and expensive warehouseQ1: Long term decision manager must take for effectively running his company?Decision to reduce cost & improve quality
  • 12. Use mix of different layout for Custom & standard line product.Product layout for standard line product: Its usually used for large volume productProcess layout for Custom products :used when there is diversified products using common operations, varying volumes, varying rate of outputIncrease number of craftsman : Do this by improving forecast technique of demand
  • 13. Management of resources: Manpower , raw material
  • 15. More Emphasis on automating the production process
  • 16. Employ able generalists with a range of skills who will be needed eventually for promotionQ2: How did Sales & marketing affect operations when selling standard pieces to retail outlet ? There are four aspects of Sales & marketing affect on operationsTime : Delivery made after time will result in stock-out
  • 17. Quality : Customer expect product to be of high quality and reliability
  • 18. Cost : Customer demands lowest possible cost with maximum satisfaction
  • 19. Adaptability(flexible): It provides customer with more choicesQ3: Affect of producing more standard furniture on company’s financial structureWill require more inventory to satisfy increasing demand, otherwise may result in loss of market demand
  • 21. Sales & revenue has increased as demand for custom & standard furniture was rising
  • 22. Longer delivery time would have resulted in loss of customer.
  • 23. Gross Margin will narrow due to above reasonsQ4: How to avoid the current issues faced by manager?Marketing analysis and working out the marketing segmentation on the potential demand for the standard line products should have done
  • 24. Finance: Conduct a financial feasibility study on the decisions of investing or leasing that make sense of monetary value. This includes profitable study, technology, layout redesign, capacity expansion and inventory levelsQ4: Continue…Distribution- Should focus on outsource the non-core business activities if it is non-profitable. It is costly by not understanding the multi distribution network in standard line delivery (Multiple drop off points through retail channel sales)
  • 25. Operations: Check for right layout and work flow process in the company. Use hybrid model to handle the flexibility in the product nature, make both the production line being able to configure standard and customized so to reduce setup and changeover time and cope with the demands. Q5: Make to stock vs Make to Order ?Manufacturing strategy difference for make to stock and made to order is as underQ6: What is 60% of volume & 75% of $ value ?In this case 60% volume indicate 60% of total sales in terms of volume .(no of units).
  • 26. 75% of dollar value means -75% of total Revenue (in terms of dollars)
  • 27. Revenue ratio- Custom: Standard - 75:25 > 3:1
  • 28. Sales ratio- Custom: Standard - 60:40 >3:2
  • 29. Calculating $(Dollar) per unit ratioCustom: Standard(75/60) : (25/40) 1.25: 0.625 2:1 Q:7 What is Purpose of General purpose Machine, SPM, Flexible machine ?GPM : These machines can be used for general production operations for example lathe machines, cutting machines.
  • 30. SPM: These machines are made for specific operations job. Can not be used for any other production operation. These are customized as per the requirement of operations.
  • 31. Flexible machines are which can be changed as per the requirement of operation process.
  • 32. Automated machines- This machines are completely automatic and does not need any manual intervention in the process.Other types of MachinesCNC machines-These machines are called computed Numerically controlled machines. These machines are operated by programmed commands encoded on a storage medium (as opposed to manually controlled hand wheels or leavers. In modern CNC end to end component design is highly automated using CAD/CAM programs.
  • 33. Semi automated machines –these machines requires partial manual process to operate and partially automatic.
  • 34. Manual machines- operations of these machines are totally manual.www.creativeconcept.comThank You 
  • 35. Backup SlidesOnly the properlylaid out factory can ensure the smooth and rapidmovement of material, from the raw material stage tothe end product stage.
  • 36. PRODUCT LAYOUT Product layouts are found in flow shops (repetitive assembly and process or continuous flow industries). Flow shops produce high-volume, highly standardized products that require highly standardized, repetitive processes. In a product layout, resources are arranged sequentially, based on the routing of the products.Process layouts are found primarily in job shops, or firms that produce customized, low-volume products that may require different processing requirements and sequences of operations. Process layouts are facility configurations in which operations of a similar nature or function are grouped together.