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Stickley Furniture Page |
Case Study- Stickley Furniture
Case Study-Stickley Furniture
Operations Management Best Practices
type of production processing at stickley furniture
Production process of the stickley production proceeds by converting inputs into marketable outputs. The two main components involved during the process are transforming resources and transformed resources. The transforming resources are the agents that carry out the transformation process like building, machinery, computers and people. The transformed resources are the main inventory or raw material used during the transformation process to be converted into finished marketable goods. In successful production process series of processes are done into different levels and at each level value is added by the manufacturer to have optimum customer satisfaction and premium market presence. The value addition is not limited to just material and production but it is expanded to the distribution strategy, marketing strategy, packaging and convenience provided to the customer in product delivery or marketability. Thus value addition is fundamental to the production process as much as the production process itself.
It is exhibited from the case that the main production process applied by stickley furniture is Batch production. Batch production by nature is the production of specific group of components that undergoes production together and when one ends the other starts. Furniture manufacturing is a labor intensive industry, therefore the production is done managed in work groups or teams of labor specialized in the specific skill to perform the activity. Workers are skilled from high skill to low skill labors. Production is done in a large rectangular building with a 30-foot ceiling. The equipments used during the process are saws, sanders, tools and other small devices used in the transformation process. The different batches during the production of furniture at stickley can be categorized as follows:
Cutting: The production process begins with the sawing operations where logs received from the mill are cut through the automated computer controlled "optimizer" that adds efficiency in the production with the elimination of waste. Workers manually mark defects and knots before it is put for cutting. Computer controlled process set the ideal length for cutting and specific size for subsequent process. Production capacity of this batch is estimated to be 20,000 board feet cut each day.
Gluing: The batch of gluing is done by workers by putting different logs of similar size into the shape of chairs, tables, dressers etc.
Fine tuning: fine tuning is the interim phase between gluing and assembling. Pieces requiring drilling or mortising is done through CNC which is numerically controlled router that is programmed to make grooves and specialty cuts. There are many pieces that would require extra glue to be removed and surface to be cleaned and smoothened. Carving is also done here to the needed items. It is highly skilled task therefore specialized workers have been assigned this duty.
Assembling: After fine tuning the pieces are assembled either in the sub-assembly or directly in other components to get the complete set. For the purpose of identification and record tracking, each item is stamped with date of production and components like dresser drawer, cabinet doors and expansion leaves of tables are stamped to identify their location. The record keeping of each item is of special need when any item is brought for repair. With the tracking number the item can be identified in the record and can be repaired with the original piece.
Storing: When the furniture is assembled and labeled it is moved to the "white inventory" section and ultimately to the finishing department. In the finishing department workers give final touch by applying linseed oil and other polishing lubricants before it is finally shipped to customer or send to warehouse for storage for later delivery.
During the production process there are certain jobs done simultaneously as the sequence of the job is determined by the amount of ending inventory and processing time. Each production process is divided into different batches taking their respective time period. When this time period barrier is broken and different jobs are done simultaneously then it's given the name of "Flow Production process." Simultaneous, functions performed by many job converts the batch production to flow production but at smaller level.
Tracking the job status and location in production
During the production process all the items set in for assembling are stamped with date of production and component identification such as dresser drawer, cabinet doors etc. These stamped items are maintained in record to enable their proper identification and location during any repair and maintenance required. In the process of inventory control and management, there are many jobs or functions which are performed simultaneously. To avoid any confusion that can lead to over production, under production or faulty production each job is provided with the bar codes. These bar codes when applied to the job it helps in job identification and its operation. When the operation is completed the operator removes the bar code stickers and delivers the goods to the scheduling department. The scheduling department scanned the goods identification into the computer where item records are maintained. Thus it helps in production control to keep the track of progress on job and to know the location in the batch.
Production Planning and Scheduling
Production planning and scheduling is important tool for manufacturing and engineering in a way that the objective of scheduling is to minimize the production time and costs with the help of production facility, when to make, staff skills and quantity required and which equipment will be utilized. The production planning and scheduling will be focused on:
1. Increased production efficiency
2. Labor load leveling (balancing)
3. Inventory reduction
4. Real time information
5. Accurate delivery date quotes.
The production plan information required for the order received by stickley furniture of 40 mission oak dining room sets can be structured as follows.
Production Plan Input Operation Information
The production planning, controlling and reporting are the three main components of efficient production system. Production plan outlines the targets, time scales and methods of production. Targets of the production plan describes the quantities and types of products to be produced, time scales are the time frame or time line of the production process which is closely associated with the demand and supply of the market conditions. Production plans are established for weekly, monthly or even yearly basis depending on the nature of product and type of product lifecycle. Products with shorter product lifecycle have shorter production plans and vice versa. The information required for the production planning and scheduling is summarized below:
1. Forecast Demand information: It is the market information taken from the customer demand and market supply conditions. In case of furniture manufacturing such type of information is provided by the clients itself which specify the number of items to be produced. But the company specialist survey and research market to get the information on latest market conditions and requirements.
2. Production cost information: This type of information captures the cost of goods manufactured, cost of goods sold and operating and administrative expenses incurred during the production process. All these cost are measured using accounting tools and techniques to optimize the profit and minimize the cost incurred during production.
3. Inventory Costing information: Such type of information includes beginning inventory information, purchases required during production and ending inventory information.
4. Customer order information: It includes all the specifications required by the customer.
5. Supply chain management information: Complete listing of the manufacturing, distribution and purchasing sources information of the production process. Who will be the supplier of raw material, what inventory level will be maintained, what method of production will be applied, who and how the distribution handled and the value will added to the customer during the process.
6. Lot sizes: Proper specification of the 40 mission oak from the client
7. Lead time required: Specifying the production process time and the time required to be delivered to the customer.
Benefits of Production Policy
The benefits of the production policy applied by the stickley furniture are:
1. It is suitable for wide range of similar kind of goods that require similar machinery or equipment for the production process and similar kind of setting in the phase.
2. The production policy benefits on the economies of scale by producing range or products from similar category. It also reduces the need for flexible workforce hours and diverse skilled workforce.
3. Customer orders and complaints can be responded quickly by shifting the stored stocks of work-in-process inventory to final product or repair and maintenance of the product.
4. Company gets advantage in distributing the cost of bulk purchases and technological advancement in the huge amount of purchases thus reducing the variable and fixed cost per unit.
5. Information flow is management at each level this simplifies the costing procedure adopted by the company.
Problems with the policy
The problem with the current production process of the company is that:
1. It is labor intensive to great extant. However, the business of furniture production…[continue]
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The management at Stickley Furniture revealed that the demand for their products tends to increase during the first and third quarters, whereas it reveals descendant trends throughout the second and fourth quarters. Given these fluctuations then, the organizational leaders have striven to develop a level production plan that ensures steady output and steady labor force. The plan sees that "during the second and fourth quarters, excess output goes into
Other important information for each item is also available such as details of the suppliers, lead-time, and lot size policy. The inventory record also contains changes in order that may result from withdrawals, canceled orders, stock receipts, or similar events. 4. What benefits and what problems would you expect given the company's level production policy? The company's policy of level output works in such a way that prior to peak demand