...Parker Earth Moving Company Team B Week 3 Parker Earth Moving Company is learning how to optimize its operational performance. The company is looking to make these changes through process improvement and outsourcing. The initial steps PEMC will begin to make are to implement a new ordering system that uses a continuous inventory system with reorder points and reorder quantities established in the programs software, thereby creating an automatic order processing. Secondly, PEMC is looking into forwarding some of their support work to two different contractors and this paper will evaluate the two contractors and make a recommendation for the company. Finally, the PEMC management team must also make preparations for the potential of a natural disaster, which will involve adjusting the reorder points and the reorder quantities. Parker Earth Moving Company (PEMC) is working on a continuous inventory a system which has a reorder point. The determinant of when to order in a continuous inventory system is the reorder point, the inventory level at which a new order is placed (Russell & Taylor III, 2009). The formula for the reorder point is the rate of demand per period times lead time. PEMC can produce 10,000 units per month during a five day work week, which comes out to actually 20 days a month given four weeks in a month. This means the company can produce 500 units in a day. The reorder point can be determined using the following formula: Reorder point = (demand per period)*...
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...Running Head: PARKER EARTH MOVING COMPANY RECOMMENDATION Parker Earth Moving Company Recommendation Amanda Duarte ISCOM 305 August 18, 2011 R. Sell Parker Earth Moving Company (PEMC) is in the business of providing high-quality small earthmoving equipment for home and small business consumers. In an effort to grow its business, PEMC has developed a new navigational device called the Ultramover. The Ultramover was designed for personal and small business use and is intended to sell for $129.95 per unit. The Marketing and Sales Department has forecasted the first quarter sales to be 30,000 units. However, it was recently discovered that forecasted estimate was incorrect. Through thorough analysis it has been determined that the actual demand target for the Ultramover is expected to be 30,000 units per month, and 90,000 units per quarter. As a result of this new information, PEMC has hired this consulting firm to provide solutions that will enable PEMC to meet its production needs. The purpose of this paper is to provide those recommendations for improved productivity (University of Phoenix, 2011). Determining the Needs of the Customer In order for us to determine the needs of PEMC we must first have a clear vision of the company’s analysis data for the Ultramover. Through this review of the data, we have determined that PEMS currently only has the capability to produce ten thousand units of the Ultramover each month by operating two production shifts...
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...Parker Earth Moving Consulting Executive Summary Customer Requirements Parker Earth Moving Company (PEMC) is a producer of high-quality earth moving equipment used in homes and in small-business landscaping industries. PEMC must manufacture 30,000 units per month or 90,000 units for the quarter (University of Phoenix, 2011). Producing such numbers requires PEMC to use Subcontractor A or Subcontractor B and make them work 6 instead of 5 days of the week and add a third shift to their work day. In addition to making these numbers work in the amount of work days, PEMC needs to keep in mind all costs to keep minimal losses. PEMC has hired ABCS2 Consultants to provide solutions to help enable PEMC to meet its production needs and recommendations to improve productivity (University of Phoenix, 2011). How ABCS2 Determined the Requirements ABCS2 has determined that there are three specific requirements PEMC must address. The first requirement is the limited space that PEMC has available for production and storage of its inventory. The second requirement is the amount of staff needed to meet production needs and customer satisfaction. Supply chain management consists of managing the flow of information through the supply chain and making it more responsive to customer’s needs. The final requirement is the period of time to train the employees for production of the Ultramover. Proper utilization of Subcontractor A and Subcontractor B manufacturing companies could allow PEMC to produce...
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...Parker Earth Moving Company Consulting: Session Three John Flynn, Lakeidra Haygood, Dwann Herron, Rosy Manivong, and LaTasha Snowden ISCOM/305 June 13, 2011 Kairo Hannon Memorandum TO: Parker Earth Moving Company FROM: Team B Consulting DATE: June 13, 2011 SUBJECT: Business Process Improvements Parker Earth Moving Company’s (PMEC) foreign competition has caused the company to reduce market share. The percentage has declined from 47% to 29% and PEMC has suffered losses of 3%, 7%, and 11% in the last three years. Team B analyzes the current operations and activities of PEMC to determine the best way to achieve profitability. Business Process Recommendations Recovering losses and achieving increased profitability requires PEMC to implement several operations management principles. Beginning with redefining the organization’s vision and mission statement; internal stakeholders such as management and employees should acknowledge and work toward the organization’s objectives together. Managers can work collaboratively on creating a work breakdown structure, further clarifying primary tasks, and creating strategies for each business unit. A balanced scorecard can highlight each department’s key performance indicators, goals, and results. Implementing a work environment based on the Kaizen model for continual improvement encourages employees and managers to work on solutions rather than conflicts. Employees can help establish where and when production interruptions...
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...Executive Summary Widget Production ISCOM / 305 University of Phoenix Taylor Inc is manufacturing the Widget X that requires a special assembly line. At this point re-evaluation of labor productivity is needed due to the difference between the regular Widgets and the Widget X. With careful consideration of this project, operations-management must compare the current labor productivity to two alternative methods that would help them with the increase. A cost-benefit matrix will be provided to show comparison of current labor productivity, alternative one and alternative two labor productivity as well as, the effects the alternatives would have, and what the benefits of networking strategies to streamline operational procedures would be. Taylor Inc Cost Benefit Matrix | |Current |Alternative 1 |Alternative 2 | |Wasted Motion |27% |1% |7% | | Physical Lifting |42 |12 |23 | |People Required |17 |6 |9 | |Productivity |208 |392 |288...
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...Executive Summary Widget Production ISCOM/305 Systems Operations Management August 22, 2011 Mario Vaccari Executive Summary Widget Production Taylor Inc. is looking into improving the physical layout of the company in an effort to maximize productivity and reduced worker’s compensation claims. To do this management will need to analyze the current operations management process of the company and come up with two alternatives, which will help determine the best choice to maximize labor productivity for Taylor Inc. The cost-benefit matrix below will show which alternative management technique will maximize productivity with less worker’s compensation claims. Cost Benefit Matrix Current Alternative One Alternative Two Number of employees 17 6 9 Payroll costs per 8 hour day $5,848.00 $2,064.00 $3,096.00 Payroll costs per week $29,240.00 $10,320.00 $15,480.00 Payroll savings per week 0 $18,920.00 $13,760.00 Payroll costs per year (52 weeks) $1,520,480.00 $536,640.00 $804,960.00 Claims per year 4 0.3 1.9 Claims costs per year $436,000.00 $32,700.00 $207,100.00 Claims costs savings 0 $403,300.00 $228,900.00 Wages and claims per year $1,956,480.00 $569,340.00 $1,012,060.00 Wage and claims savings per year $0.00 $1,387,140.00 $944,420.00 Physical lifting in pounds 42 12 23 Capital expenditures $0.00 $1,300,000.00 $967,000.00 Cost difference in capital expenditures $1,300,000.00 0 $333,000.00 Outputs of finished widgets 208 392 288 Life in equipment 0 7 5 Wasted...
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