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 periods, excess output is placed in the inventory to be used in case it is needed. This excess output is then used when the demand for supply exceeds the production capacity during the periods of peak production. To be more specific: Demand is highest in the first and third quarters. During the second and fourth quarters, therefore, excess output goes into inventory, and this excess output is then used during the first and their quarters.
This seems a sensible way of doing things so that there is always a source of supplies ready and handy when needed. The problem may be, however that the resources that are most needed are unavailable or that too many supplies for one specific aspect of the furniture are available and there is a paucity in some other area.
For this reason, generating of the material, and generating sufficient material should be planned before onset of the project and in accordance with demands of the project requirements. In fact, MRP II (manufacturing resources planning) would have been helpful here, where approximate outlay of resources through all seasons is determined ahead of time, as well as financing for resources in both amount and timeliness. The approximate amount of resources available as needed would be planned out at the outset of the project as well as knowledge of all the resources needed in varying degrees throughout the process. In short, in order for them to do their best, Stickley must have all their resources -- each and every components as well as subcomponents precisely when needed in both slack period and in peak demand periods. Putting aside excess goods prior to the peak demand period is wise, but these excess goods may not consider projects that will come up in the near future nor may they contain each and every part that may be needed; there may be too few of some, and too many of another component. Working out ahead of time, detailed capacity requirements so that the exact characteristics of the project will be met according to the specific capacity requirements also helps with short-range capacity requirements when for instance, certain chairs of the dining room set will have to be completed in short notice and one needs sufficient material in the inventory to complete certain elements. Lack of the materiel may necessitate revisions in scheduling which would be unfortunate since it would be intrusive to the schedule. It is important that stability in scheduling and in producing the articles at timely periods be achieved throughout. And for this reason, it is crucial that the necessary resources be available in the inventory as and when needed so that capacity is there to satisfy requirements.
Can you suggest any changes that might be beneficial to the company? What are they?
The company is considering a Total Quality management approach and this may indeed be helpful for it.
Since the late 1980s, firms have launched TQM programs in an effort to retain or maintain customer interest in face of the growing competitiveness around the globe. TQM attempts to continuously improve the quality of products and processes and investigates the factors that can achieve this. What TQM essentially states is that total product quality and satisfaction can and is achieved by everyone involved in the process. This includes management, workforce, suppliers, and even customers (Cua, McKone, & Schroeder, 2001). TQM bases its theory primarily on Fishbein and Azjen's (1975) assertion that attitudes and beliefs (including affect, evaluation, and social norms) drive intention, thereby, judgment, and act. Not only does the client have to experience pleasurable evaluation (feelings, beliefs) with the product or process, but the product or process has to be a fit (supplying usefulness) to the client or prospective client too. The company since to focus on quality and produce its work coherently and responsibly. However, there is room for improvement and TQM may help it.
To still greater effect, an ERP system may be helpful. ERP provides an integrated standardized record keeping system so that information sharing is permitted amongst all areas of the organization in order that the system can be managed more effectively. This may be particularly helpful for Stickley Furniture since their furniture system sounds a busy and complex place where various functions such as purchasing, distribution, production, sales, human resources, financing and accounting must all work together to achieve the objectives of the factory. Information sharing is a must so that all factions of the organizing knows what is occurring and that all flows speedily without mishap. This is also important given the complexities of detail that must flow between all workers and be known at all times such as the resources in the 'white' and finished goods inventory - particularly crucial in order to respond to customer orders precisely and in a timely manner and in order to smooth production.
An ERP system can also be useful in helping workers better check for quality -- specially since each worker is responsible for his or her workmanship, and can better put them in touch with distributors and therefore more readily and easily cheek material. It will help them outfit the inventory faster, order material more rapidly when depleted or when almost depleted and help them maintain contact with their various customers.
At the moment, the store keeps careful records of each piece of furniture so that details will be helpful when and if repair is needed. An ERP system can keep all of this in one place and add supplementary details as well as links to distributors and other applicable important information.
Furthermore, an ERP system can be helpful in facilitating closer connection and synchronicity between the various quality control people who handle inspections and work with operators to correct any deficiencies aside from those who work on difficult and challenging projects. The system can establish and better communication between them as well as solidifying contact with customers and allowing the articles to be completed faster and shipped in less time to their destination.
Risk categories of transitioning to ERP are several and include the following: hiring an unprofessional vendor who is unfamiliar with the type of organization and software implemented; installing wrong, or not needed, software, or failing to install software that the company needed. These are risks that would get the company into expense and time-consumption (Chass, Aquilamo, & Jacobs, 2001).
Other risks include poor management and little involvement from the leaders of the company (Yusuf, et al., 2004). It is important that there is a structure to the ETP system as well as that there is a plan set in place according to which the experts will follow. Lack of this plan, and lack of monitoring progress according to this plan, may likely cause the process to fail. L & GJ Stickley Furniture seems to have something already in place. But with 1350 employees and five retail showrooms in New York with two in Connecticut and in North Carolina and with its furniture sold nationally by 120 dealers, an ERP system would be particularly helpful for them as long as all the risks are worked through and strategies taken for risk management.
It also strikes me that the system of supply chain mapping (SCM) may be useful here. Supply chain mapping is a system of processes, systems, organizations, peoples, and technologies that are involved in moving a product from supplier to the customer in as organized and facile a manner as possible.
Its 3 principles are: process modeling; performance measurements; and best practices.
SCM involves five distinct management processes:
1. Planning a process that best meets the demands of sourcing, delivery, and production
2. Procuring the goods and services to meet these stated requirements
3. Creating and completing product from start to finish so that it meets client's stated requirements
4. Polishing article to required status of end product so that it meets required satisfaction and criteria. This includes services such as distribution management, order management, and transportation management.
5. Reviewing articles that may have been returned for specific reasons (Cooper, 2001).
This model is useful to Stickley in that it focuses on customer interactions, as well as all details of the product transaction, and intricacies of market procedures from aggregate demand to fulfillment of the order.
As a general picture, SCM maps the entire strategic chain in order to help the firm with communication, decision making and with moving the product from firm to client. The model eases distribution of key information as well as clarifying the…