Smit Corporation is considering implementation of a JIT inventory system. The company’s industrial engineer recently conducted a study to determine the average number of days spent in each activity of the production process. The following table summarizes her findings:
Production Activity | Number of Days |
Cutting materials | 13 |
Rework | 5 |
Warranty repairs | 7 |
Quality training | 14 |
Painting finished goods. | 15 |
Bending materials | 10- |
Purchasing raw materials. | 3 |
Assembling finished products | 19 |
Instructions
a. Identify Smit’s value-added production activities.
b. Identify Smit’s non-value-added production activities.
c. Calculate Smit’s total cycle time.
d. Determine Smit’s manufacturing efficiency ratio.
e. Which of the above activities might be reduced or eliminated if Smit implemented a JIT system?
f. List some of the positive and negative consequences of eliminating some of the non-value- added activities.
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