Due to growth, they have some trouble. To avoid this, they have decided to hire someone who knows production planning systems to help them. After interviewing, they chose you to fill this position. They give you following information and wants to develop following production planning problems.
Part 1:
Ben Floyd really enjoyed wood shop in high school, so he used an inheritance to buy some basic woodworking tools. He started out doing odds jobs, and then one day he made a porch swing for his house. Several people saw it and asked him to make one for them word of mouth brought him many customers. In June of 2008 he married Bobbie Ruth, marketing graduate. Bobbie Ruth saw a chance to expand the swing business to similar products and eventually have hardware, building supply and furniture stores. Thus BF Swing was born. Due to his love of his work and Bobbie Ruth’s marketing ability, the business prospered. Today, they make stools, rockers as well as swings. The company now employees about 35 people five days a week.
Due to growth, they have some trouble. To avoid this, they have decided to hire someone who knows production planning systems to help them. After interviewing, they chose you to fill this position. They give you following information and wants to develop following production planning problems.
The following table gives the standard processing time (in minutes) for each operation of the tree products. In addition, it contains the expected time available in each department per week.
Processing Time (minutes) Available (Hours) Department Stool Rocker Swing Drill 7 10 11 70 Lathe 15 0 0 35 Crosscut saw 3 16 10 105 Rip Saw 1 3 4 40 Mortise 0 10 8 70 Tenon 3 22 11 105 Router/Shaper 0 5 3 35 Plane 0 13 7 70 Sand 5 25 35 145 Assemble 12 30 45 200 Finish 5 15 22 80 Total 50 mins 157 mins 200 mins
The
Week
Forecast Demand
Week
Forecast Demand Stool Rocker Swing Stool Rocker Swing 20 88 281 25 26 106 320 177 21 99 341 25 27 105 312 173 22 121 302 22 28 86 341 65 23 113 303 21 29 99 350 295 24 97 324 28 30 104 364 264 25 86 311 198 31 113 310 204
Ben Floyd and Bobbie Ruth wants you to develop two possible aggregate planning plans.
• The first plan uses a constant workforce without backorder. • The second plan uses zero inventory plan. • According to the plans, which plan do you recommend them?
To develop the two plans and calculate their associated costs, you need to know that the BF Swing time wage is $15 per hour, hiring costs are $500 per employee, and firing cost are $700 per employee. A stool costs $250 to make, a swing costs $380 and a rocker costs $150. The inventory cost carrying rate is 20 percent per year.
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