3.1 Case Exercises For Class

Case Exercise 1:
The Goode and Cooke Company produces several models of frying pans. There is little difference in
the production time required for the various models; the plant is designed to produce 160 frying
pans per eight-hour shift, and there are two shifts per working day. However, the plant does not
operate for the full eight hours: the employees take two 12-minute breaks in each shift, one in the
first four hours and one in the second four hours; two hours per week are devoted to cleaning the
factory and performing maintenance on the machines; one four-hour period every four weeks is
devoted to the meeting of the quality circle. The plant usually produces about 3,500 frying pans per
four-week period. You may ignore holidays in solving this problem. Answer the following questions
by adjusting the data to a four-week time period.
a) What is the design capacity in frying pans?

b) What is the effective capacity in frying pans? As a percent?
c) What is the actual output?
d) What is the efficiency?
e) What is the utilization?
f) Re-work the problem using a time period of one eight-hour shift.
Case Exercise 2:
TSMC manufactures semiconductor chips for companies such as Nvidia and Qualcomm. A simplified
process for chip manufacturing at TSMC consists of three steps. Step one is Depositing, Step two is
Patterning and step three is Etching. Table shown below gives the required processing time and
setup time. Assume the unit of production is a wafer. The plant operates for 8 hours a day. The
demand is 800 units of wafers per day. Also assume that a setup can only begin once the batch has
arrived at the machine. All units of a batch need to be processed before any of the units of a batch
need to be processed before any of the units of the batch can be moved to the next machine.
Process Step Depositing Patterning Etching

Setup Time 15 minutes 30 minutes No Setup
Unit Processing Time 0.25 min/wafer 0.15 min/wafer 0.30 min/wafer
What is the process capacity in wafers per hour with a batch size of 500 wafers? Identify the
bottleneck in the process limiting the process capacity. What is the desired throughput rate to meet
the daily demand?
Productivity Gains at Whirlpool
Workers and management at Whirlpool Appliance’s Benton Harbor plant in Michigan

have set an example of how to achieve productivity gains, which has benefited not
only the company and its stockholders, but Whirlpool customers and the workers
themselves.
Things weren’t always rosy at the plant. Productivity and quality weren’t good.
Neither were labor-management relations. Workers hid defective parts so
management wouldn’t find them, and when machines broke down, workers would
simply sit down until sooner or later someone came to fix it. All that changed in the
late 1980s. Faced with the possibility that the plant would be shut down,
management and labor worked together to find a way to keep the plant open. The
way was to increase productivity-producing more without using more resources.
Interestingly, the improvement in productivity didn’t come by spending money on
fancy machines. Rather, it was accomplished by placing more emphasis on quality.
That was a shift from the old way, which emphasized volume, often at the expense
of quality. To motivate workers, the company agreed to gain sharing, a plan that
rewarded workers by increasing their pay for productivity increases.
The company overhauled the manufacturing process, and taught its workers how to
improve quality. As quality improved, productivity went up because more of the
output was good, and costs went down because of fewer defective parts that had to
be scrapped or reworked. Costs of inventory also decreased, because fewer spare
parts were needed to replace defective output, both at the factory and for warranty
repairs. And workers have been able to see the connection between their efforts to
improve quality and productivity, and their pay.
Not only was Whirlpool able to use the productivity gains to increase workers’ pay, it
was also able to hold the lid on price increases and to funnel some of the savings
into research, which added to cost savings and quality improvement.
Questions:
1. What were the two key things that Whirlpool management did to achieve
productivity gains?
2. How are productivity and quality related?
3. Who has benefited from the productivity gains? How can a company afford to pay
its workers for productivity gains?
Source:
Based on “A Whirlpool Factory Raises Productivity- And Pay of Workers” by Rick
Wartzman, from The Wall Street Journal, 1992

3.1 Case Exercises For Class

Uploaded by

Copyright:

Available Formats

3.1 Case Exercises For Class

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

3.1 Case Exercises For Class

Uploaded by

Copyright:

Available Formats

Case Exercise 1:

a) What is the design capacity in frying pans?

Process Step Depositing Patterning Etching

Workers and management at Whirlpool Appliance’s Benton Harbor plant in Michigan

You might also like