Right now, long wait times are being reported despite the fact that the crew has the capacity to load and unload twenty trucks a day when they are only dealing with fifteen. The fact that they could handle sixteen trucks a day with one fewer person illustrates at least on part of the inefficiency right away -- if the team has one more person than they need and they are still not capable of reducing wait times, than trucks' times are not being efficiently coordinated.
If, as can be assumed, there is generally more loading occurring in the early part of the day, then perhaps an extra crew person could be hired for the first four hours of the day, with only three remaining for the last four hours. This would have no effect on the overall cost of employment for the loading crew. With the capacity to load twenty-four trucks in an eight-hour workday, a five-person crew should get through one truck every twenty minutes. Staggering the arrival of the trucks to fit this pace in the first four hours should be a sufficient and effective measure in improving efficiency. Decreasing randomization should always be the first step in increasing efficiency, almost by definition.
If the randomization of truck arrivals is unavoidable, the crew should simply be cut to three people. This crew still has the capacity to handle the average number of trucks that show up in a day, so wait times should not be hugely effected. If this is the case, however, Nam should seriously reconsider the centralization of his kitchen. Without a little more order imposed, such centralization will only continue to eat into his profits. His stores either need to be able to operate on their own, or as part of a cohesive and well-planned system.
5. Cheng American Masters Furniture Company
The contract...
Based on the figures provided, there is no discernible reason why the company should have to pass on this contract, nor why they should feel a need to subcontract all or part of the job. The delivery of three-thousand tables in thirty days requires the output of one hundred tables a day. This is only two tables per day per worker at the current operating capacity of seventy percent, when the average time it takes one worker to completely assemble a table is forty minutes. This means that there is ample room for error and correction in the manufacturing process, which is ideal given the new nature of the furniture being produced, the materials and machinery being used in its production, and the increased size of the order, which is new territory for the Cheng furniture company.
Because the contract has already been offered, and because the company is well-established and without any cash flow problems, this would be the ideal time for an expansion if possible. The contract from Burger King offers the possibility of this expansion, and to turn it down or subcontract it would be a huge mistake. Instead, the company should begin production immediately and begin identifying problems and fine-tuning their operation. Given he skilled nature of their employees, new training and innovation should not take a significant amount of time. Also, the company could be brought back to full operating capacity in order to meet this challenge. With these efforts, it should be possible not only for the Cheng American Masters Furniture Company to meet the required production of three-thousand tables by April 15, but they should even be able to produce the entire order of five thousand units.
