Question

Ruiz Foods makes energy bars using a traditional manufacturing process. Raw materials are stored in inventory and then moved into production. Work in process inventory is moved across the company's three separate departments. The information below (in the Traditional column) is available for a recent order. If the company adopts lean manufacturing, management believes both move time and wait time can be reduced, as shown in the Lean column. Activity Traditional Lean Process time Inspection time Move time 20 hours 20 hours 3 hours 3 hours 5 hours 2 hours Wait time 2 hours 1 hour Required 1. Compute the total amount of non-value-added time under the traditional manufacturing process. 2. Compute cycle efficiency under the traditional manufacturing process. (Round your answer to 2 decimal places.) 3. Compute the total amount of non-value-added time under the proposed lean manufacturing process. 4. Compute cycle efficiency under the proposed lean manufacturing process. (Round your answer to 2 decimal places.) 5. Would the proposed lean approach improve cycle efficiency? Traditional approach non-value-added time 2. Traditional approach manufacturing cycle efficiency 3. Lean approach non-value-added time 4. Lean approach manufacturing cycle efficiency Would the proposed lean approach improve cycle efficiency? 1 hours hours 5.

Answer 1

Ans. 1	Particulars	Traditional
	Move time	5
	Wait time	2
	Inspection time	3
	Total non value added time	10	hours
	*Process time is a value added time.
Ans. 2	Cycle efficiency = Process time or value added time / (Non value added time + Process time) * 100
		20 / (10 + 20) * 100
		20 / 30 * 100
		66.67%
Ans. 3	Particulars	Lean
	Move time	2
	Wait time	1
	Inspection time	3
	Total non value added time	6	hours
Ans. 4	Cycle efficiency = Process time or value added time / (Non value added time + Process time) * 100
		20 / (6 + 20) * 100
		20 / 26 * 100
		76.92%
Ans. 5	Yes, the proposed lean approach would improve cycle efficiency since the cycle efficiency
	ratio of Lean approach is more than Traditional manufacturing process.