Operation and Chain Supply

Topics: Supply chain management, Lean manufacturing, Toyota Production System Pages: 8 (2082 words) Published: April 28, 2014
Operations and Supply Chain Case Studies

Operations and Supply Chain Case Studies

In today’s environment of global shopping where the demand for products is as wide as the number of firms offering them, orders can be placed in advance or at a moment’s notice from across the globe. The question of the manufacturer or reseller is how to best manage production across the supply chain. This paper will have two parts to it; part one will review the case study of the Realco Breadmaster. It will provide analysis on the current supply chain management and will make recommendations for a more strategic approach. Part two will focus on a case study for Toyota. This case will focus on quality and the Lean philosophy.

First, it is important to provide some foundation support of what operations and supply chain management entail. Every firm or organization must make a product or provide a service to someone that is needed or valued. Operations are the collection of people, technology, and systems that are in a firm whose primary responsibility is to provide the company’s products or services (Bozarth & Handfield, 2008). “Supply chain is the network of manufacturers and service providers that convert and move good from the raw materials state through to the end user” (Bozarth & Handfield, 2008, p.4). Planning and controlling operations and supply chains are critical to the strategic plan of an organization, and so is the coordination and communication with other functional areas of the firm’s supply chain partners. Aggregate or sales and operations planning takes it a step further to include the process that facilitates an organizations plan and coordinate operations and supply chain decisions over a specific period of time.

Inventory is the stock of items used to support production, supporting activities and customer service. It is the “bread and butter” that keeps manufacturing firms in business, and is a critical resource in the supply chain. Inventory can be manually managed so that different business conditions can have less of a negative impact on the operations, and give support to the efficient running of supply chains. There are also many tools that companies use to manage production, such as the master scheduling, the material requirements planning (MRP), job sequencing, and distribution requirements planning (DRP). Now with all that said, let us now begin the review and analyze the first case study about the Realco Breadmaster Company.

Realco, owned by Mr. Johnny Chang, introduced a new breadmaker two years ago. The new machine had many advanced features, which made it very successful, but still Mr. Chang wondered if the firm was could meet the orders that had been placed, and if the production could keep up with the demand. Mr. Chang set out to better understand the production schedule of the machine, and found that the production team was completing 40,000 breakmakers every other week. This 40,000 was based on the assumption that the demand for the machines was approximately 20,000 per week. Mr. Chang learned that the production levels had not been changed for over one year. Next, he visited the marketing manager, Jack Jones, and learned that the current orders were as follows:

Week Promised Shipments

1 23,500

2 23,000

3 21,500

4 15,050

5 13,600

6 11,500

7 5,400

8 1,800

Mr. Chang found that when customers call in to place orders, the marketing manager’s practice was to advise the customer that orders will be filled and shipped in three weeks. This allowed a one week cushion since 40,000 units could be produced in two weeks, and there was a current ending inventory of 7,000 units.

Mr. Chang decided that he would like to see a master scheduling be created for the breadmaker. “A master scheduling is a detailed planning process that tracks production output and matches this output to actual customer orders” (Bozarth & Handfield, 2008, p.478). He was...
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