Free Essay

Custom Gear Case

In: Business and Management

Submitted By raihan88
Words 2012
Pages 9
1.0 Introduction

Custom Gear Inc, is a manufacturer of custom made metal gears weighing from ounces to over 50 pounds in Philadelphia. Custom Gear primarily sells the product to engineering research and development laboratories or very small manufacturers. The gears are made of different metals depending on the customer’s requirements. Over the past year, 40 different types of steel and brass alloys have been used as raw materials.

Business has been booming at Custom Gear which is shown through the company lost money for the first two years (2009 and 2010), but made small profits in 2011 and first quarter of 2012.Sales are rapidly increasing in 2009, 2010 and 2011. Through a recent market survey, it indicates that sales will be increase more in the next few years.

1.1 Organizational chart of the company

[pic]

1.2 Duties and responsibilities

The President of Custom Gear is Mr. Roger Rhodes, the founder of Custom Gear. His responsibilities are:

a) Contacts with some of the large customers

b) Arranges financing needed by company

c) Sits in weekly production meeting

d) Discussing on problems like scheduling, employee and also production.

The Engineer is responsible on:

a) Design company’s products

b) Procurement and maintenance of equipment

c) Oversee the supervisor/foreman

d) Attends weekly production meetings

e) Spend most time on factory floor

The Expediter:

a) Review work in progress in the shop

b) Select orders which are behind schedules and ensure they are treated on rush basis

c) Looking for past due raw materials and lost orders

The work force consists of 50 highly skilled or semiskilled employees which are managed through family type approach.

2.0 Problem Being Faced By Custom Gear

i. Accepting Larger Order

Custom Gear accepting larger orders is about 100 gears or more. Nevertheless, lower prices were accepted on these orders to help them to pay their overhead. Besides that, their sales department is not part of the business and there is no link between them and the manufacturing team.

ii. Bottleneck

It was expressed concern by their supervisor, Joe Irvine that bottleneck which appears in the production process. In one week, the bottleneck could happen maybe in one machine centre, and the next week in other machine centre. These problems make it difficult to deliver the orders out on time.

iii. Layout

Custom gear used job-shop standard layout. By applying the standard job-shop layout, they have make mistakes which increased the lead time, thus resulted in the need for an expeditor. Each work has a common set of machines or processes. The materials flow from one work centre to another depends on the operations needed for the particular order.

iv. Employees

Custom Gear also make mistake in hiring their workers. They are hiring too many employees for the company needs.

3.0 Action Taken to Solve the Problems

As discussed in earlier question, Custom Gear Inc. facing a few problems such as accepting large order, bottleneck in production process, layout design in machines and processes and employees problem. Thus, in order for Mr. Rhode to solve this problem and take further action, he must refer and evaluate a precise decision based on operations strategy.

First of all, Mr. Rhode needs to consider of accepting large orders from customer without putting the small orders at stake. Mr. Rhode needs to know the consequences with accepting large orders. Yes, Mr. Rhode can accept the large order but not at discounted price in order to help company to cover overhead cost. Plus, by accepting the large order, Mr. Rhode should increase the capability and capacity of producing small orders so that it won’t be any case of lateness and delayed.

Improving capability and capacity are should be focusing on employee skills such as highly skill employee and expert and adding new machines or rent a new building to support large order production. Prior to that, Mr. Rhode need to forecast the demand from the customer, if he still proceeds on accepting large order, this capability and capacity of production should be focused on. Furthermore, Mr. Rhode need to make sure the order entry system is efficient at all the time. This including a customer is able to request a change in design after the order has already been placed. It may be necessary to stop production on these orders and wait for the new materials or for new designed to be clarified. Plus, they do not have a process that charges back the disagreement on these orders; they need to input a system where if the customer wants to alter design they have to pay for it.

Plus, the employee should make sure the customer sign off on the tolerances before the order begins processing since the customer’s prints submitted with the order were not always contain the tolerances required during machining. In addition, Mr. Rhode should improvise the original layout and redesign the production flow consecutively to reduce time during production. Refer back to the case; the physical layout and materials flow are not supporting a production line effectively. This is because, the typical order shows the place to process the raw material are distributed or scattered. This will lead to high time utilization. By redesigning the layout and production flow production will be quicker and effective. Plus, the employee will have the high mobility in production floor and avoid jumbled flow of product through the shop or building.

Plus, Mr. Rhode should relate the physical layout and material flow with effective operation scheduling to avoid delays and production effectiveness. According toVollman, “The priority planning and the shop floor control and the scheduling elements ultimately determine the performance of the production system.” this technique of operations scheduling forms a very important part and acts as the backbone for the performance of the manufacturing or the service organizations. With the help of the operations scheduling, there are two very important factors or the aspects of the resources within an organization that can be pertained are as follows: allocating the resources within an organization and setting up the timetable. In today’s competitive world, the orders that are placed either from the side of the customer or from the side of the assembly benches are to be completed on or before the contracted or the promised date. For fulfilling this, operations scheduling plays a very critical role and completely ensures that these dates are met. Mr. Rhode must have a proper schedule system in order for employee to manage the resources and process the order accordingly and avoid any unwanted circumstances in production line.

In small or big organization, employees are playing a huge role in determining a success of a company. Thus, Mr. Rhode also has to focus on the employee’s relations and not only operations side. Training and staff development is very important to make sure staffs are competence and give staff an opportunity to improve skills. The competence staff will benefits the company and let the employee remain knowledgeable. Moreover, Mr. Rhode should realize the employees in custom gear are not unionized and this can bring harm to the company. Employee relationship programmes need to be implemented so that employee stay motivated.

Lastly, if Mr. Rhode still had to consider accepting a large order from customer, he can choose the other option which is do outsourcing the order. Outsourcing the productions happened because of a few factors. For example, insufficient capacity, high cost involved producing in house and avoiding risk as well as quality maintenance. Plus, this method can avoid bottleneck problem. If a machine has a backlog of work then people don't just sit and watch it build up. They can sub-contract for instance. But, this option requires firm decision whether company wants to outsource all or partial of order and strong analytical skill from the company and may be harmful to the company.

4.0 The Relationship between the Cases with the Operations Strategy and Process Design Concepts

Custom Gear seems to not have a set of specific strategies in managing its business. The company might have a vision and mission but no strategies on how to translate those two. This could be seen when the company reacts rather spontaneously with issues and problems related to the operations. Whenever a problem arises, top management decided something without consulting whether the decision will be in line with the company’s strategies as it has none.

It is to be noted that organizational strategies is important because it guides the organization by providing direction for, and alignment of, the goals and strategies of the functional units. When an organization like Custom Gear operates without any formulated strategies, the approach will be like an old saying ‘we’ll cross the bridge when we reach the bridge. This means the company will think and decide whenever the needs are there. If business as usual, the operations will be just like any other day.

Being without clear strategies, Custom Gear will not be able to achieve the stated vision and mission. This is due to the main reason of not knowing the company’s core competencies; the special attributes possessed by Custom Gear that give it a competitive edge with the competitors in the industry. The company will also not able to define what kind of strengths, weaknesses, opportunities and threats it will face.

With no clear strategies, it will affect the operations as a whole; for example process layout. The company’s process layout is a job shop type. This is due to low volume of high variety custom gears made according to orders. However, with recent decision to accept larger quantities per customized gear has landed the company into a problem. The designed layout is to cater small production of gears for each order and not more than 100 gears. Without special work flow to differentiate small orders and large orders, it will make the process flow run not as planned. To overcome this problem, the company decided to assign an employee in identifying orders that are behind schedule. The company could not afford to abandon orders of high volume as the orders keep the company running at full capacity. The management sees an opportunity in making profit with these large orders but not knowing whether this will have affect on business’ daily operations. This might not be the case if a clear strategy is formulated in the first place.

5.0 Conclusion

Undeniably, every business based company in the market has the target to utilize the sources in order to maximize their profit and achieve their goal. Based on the case study, Custom Gear Incorporation is one of the companies which manufacture custom-made gears for its clients. Within the company, certain process control characteristics exist to provide operational support to the company. The management of the company should be implementing an efficient operational strategy in order to avoid any unwanted circumstances in production line. Through to the production process it would take any bad implication if the strategy is not clear determined.

Other than that, because economies of scale are usually not a part of a job shop's competitive edge, they compete on factors other than price. They compete on volume of the gear purchase, speed of product delivery, and customization. Besides that, the job shop is organized by process, where assembly lines or continuous flow operations are organized in a product layout. In the latter layout, equipment or work processes are arranged according to the exact steps in which the product is made and the path for each part resembles a straight line. Thus the company should have to improvise to the new layout and redesigning their production flow due to produce the gear to avoid bottleneck in the production process. In other hand, this will lead the productivity increase. This we can conclude that the management of organization should have to implement the right operational strategy to accomplish mission and goal by the company.

REFERENCES

Case study on Custom Gear Inc. (2012).

Putra Business School, Dr. Azmawani Abdul Rahman. 2013. Operations Management.

Singapore: Mcgraw Hill.

Similar Documents

Premium Essay

Aapple Vs Samsung Clock Case Study

...Batool Hendal Raghad Al-yaqout Nawaf Bouarki CPEG 220 Term Paper Aapple vs Samsung Watch After the great revelation in electronic devices, Samsung and Apple companies produced smart watches. For Apple they have e now three different watches. It has apple watch, apple watch sport features and apple watch features. For Samsung, they have Samsung gear S2, Samsung gear S2 classic. This paper aims to provide a thorough study about the organization, architecture, operating systems, programing, and a market survey of existing computer technologies available in Kuwait between a watch from each company. For The Apple Watch, it comes in a square-but-round design. It has two sizes - 38mm or 42mm. it may diverse in case and strap, depends on what range you opt for - regular, Sport, Edition or the...

Words: 2484 - Pages: 10

Premium Essay

Salesforce Objects

...service (SaaS). Force.com Salesforce.com's platform as a service (PaaS) product is known as Force.com. The Force.com platform allows external developers to create add-on applications that integrate into the main salesforce.com application and are hosted on salesforce.com's infrastructure.These applications are built using Apex (a Java-like programming language) and Visualforce (an XML-like syntax for building user interfaces in HTML). Apex programming includes classes and triggers, in which Objects play an important role . Lets have a look what an Object really mean in general terminology and in Salesforce terminology Object The real-world objects, which we can look around have state and behaviour. For example, a Bike has state(wheels, gear, handle) and behaviour(accelerating,...

Words: 980 - Pages: 4

Free Essay

Hehe

...1.0 Introduction Eastern gear Inc. is a manufacturer of custom made gears ranging in weight from a few ounces to over 50 pounds. The gears are made of different metals depending on the customer’s requirements. Eastern gear sells its products primarily to engineering research and development laboratories or very small manufacturers. The president of Eastern Gear decided to accept a few larger orders for 100 gears or more. Although lower prices were accepted on these orders, they helped pay the overhead. It was found that the large orders caused many of the small orders to wait for a long time before being processed. As a result some deliveries of small orders were late. Roger Rhodes had faced many problems and the major problem is not having an efficient production line. The current production process is inefficient and disorganized. After consideration of several alternatives, we have found some major problems that occur in Eastern Gear Inc. The problem that have been analyse is the problem in term of raw materials, production flows, factory layout, poor quality control checks, unproductive way to rush orders and others The problems come from the process design that is inefficient. They also are lacking an organized quality control program. This has resulted in the doubling of production times and a six percent return rate on orders. As the president, he needs to take a responsible by doing actions to solve all the problems that occurred. The actions that should be properly......

Words: 5387 - Pages: 22

Free Essay

Local Lawsuit

...than 90 countries. The company has approximately 1150 team members employed at more than 400 facilities and offices in the United States and around the world (Tyson Foods.com). In a local lawsuit I will summarize the actions that lead to the lawsuit. Discuss what management could have done to prevent the events that lead to the lawsuit and the ethical consideration reflected in the law applicable to this case. Determine which source of law would be most relevant in this case and how management could have leverage knowledge of the sources to prevent similar instance in the future. Finally recommend what management might be able to do to pursue alternate resolutions outside of court. Summarize the actions that lead to the lawsuit. Owning a business almost guarantee that you will be in civic court at some point. You may be forced to file a business lawsuit against a customer who refuse to pay an invoice, or against another company that may be using your logo or product name without permission. A business lawsuit must comply with specific procedures to have your side of the case heard. Many business owners hire lawyers to help protect their interest and navigate the legal process (msbusiness.com). Meat packing and food processing workers wear specialized protective...

Words: 1098 - Pages: 5

Free Essay

Unit 6

...What is the wave of future surfboard? This is a question that has been asked by surfboarding aficionados since the 1960’s. According to the Firewire Surfboards case study, many surfers prefer their “gear” old school or custom-shaped to order. At the San Diego based, Firewire Surfboards, developer and CEO, Mark Price, has challenged those very ideals with the creation of his far lighter, stronger, and more flexible foam to make their boards. The issue lies with having the surfing community accepts the fact that change must happen to launch the sport to the next level. Firewire Surfboards was launched in 2005 by Mark Price to create a surfboard that according to him, “Will create wave-riding magic”. Mark Price, a former surfing pro, understands that there is competition that can hinder the success of his business. The biggest hurdle for Firewire is the past. Many surfers prefer to have their equipment custom-shaped to order. To try to tap into this market, Firewire is introducing its first custom board line and so that their product can reach the “hard-core” surfers. Firewire Boards is prepared to sell the new line for a bit more than $600.00. On the other hand, Channel Islands (competitor), sell’s their off-the-rack boards for $ 650.00. In the end, many of the local shops are trying to buy boards from Firewire and put their mane on the product. Firewire is also looking to tap into the developing of boards for beginners that can help them compete with companies like......

Words: 635 - Pages: 3

Free Essay

“Export Procedure of Manufacturing Industry Study on Employee Opinion on Export Practice of D.L.W”

...SUMMER TRAINING PROJECT Survey report on “Export procedure of manufacturing industry study on employee opinion on export practice of D.L.W” SUBMITTED BY: Ram agrawal ACKNOWLEDGEMENT This Project Report is a combined effort of many people who have contributed in their own ways in making this report effective and purposeful. In my report, I would like to take the opportunity of thanking all those who have been instrumental in preparing this report. Firstly I would like to thank God for bestowing upon me his kind blessing althroughout. I am extremely grateful to our Director- Pro, SHEKHAR GHOSH for providing us this opportunity to prove our skills in this summer training project. I also extended my heartiest gratitude to my mentor for this project work, Pro, HEMLATA BHAT who provided me every bit of relevant information and guidance in making this project a success. It was a great experience working under her supervision. I specially wish to thank Mr. Ashraf hussion (J.E) and K.K.shrivastava, D.L.W.Varanasi (Diesel Locomotive Workshop, Varanasi) for his valuable suggestions & continuous support. Ram agrawal DECLARATION I hereby declare that the project report entitled, ‘Survey report on “Export procedure of......

Words: 7407 - Pages: 30

Premium Essay

Rei Business Model Analysis

...Microsoft Office System Customer Solution Case study REI Improves Its Product Development Processes by Integrating Process and Project Management Tasks “REI is combining the best of what Visio and Apprentice Process Modeler do for process modeling; what Project and PM Solutions do for project management; what SharePoint does for collaboration and document management; and what Outlook does for communication and collaboration. It’s all tied together with the Microsoft .NET Framework.” Kevin Myette Director of Business Operations REI (Gear and Apparel) Successful manufacturers of retail products, like Recreational Equipment, Inc. (REI), need to consistently develop high-quality products and decrease the time it takes to deliver them to market. To do that, they must efficiently manage product development processes, projects, and information. The REI Gear and Apparel division is taking an integrated process and project management approach to designing, managing, and tracking its product development processes and projects while collaborating and managing the workflow online. REI is combining Microsoft .NET technology, the Microsoft Office Enterprise Project Management (EPM) Solution, and software based on Microsoft Office Visio 2003 to create an integrated business solution it can use to model as-is business processes, experiment with what-if scenarios, and then convert the optimized processes into detailed project plans. Project managers can further develop these plans,......

Words: 5331 - Pages: 22

Premium Essay

Running Room Case Study

...Running Room Case Study 10/21/14 T/TH 9:30 AM Present Strategy The Running Room company has been a successful and profitable business since its inception, catering to both avid runners and more casual joggers by selling high end running shoes. Its owner, Raina Cisco, used her background as a nationally ranked runner to establish credibility as a running shoe authority, especially for higher end products. In order to maintain this image of quality, Cisco chose to primarily sell Nike shoes. The Nike brand is associated with performance in the minds of her customers, and she was able to make a $5-$7 premium per pair of Nike shoes. Despite this success, after about 10 years of steady growth, profits began to decline due primarily to large department chains entering the running shoe market, the loss of loyal, aging customers, and difficulty in balancing the needs of these loyal customers with those of the younger generation of serious runners. The Running Room’s current strategy to achieve new growth involves diversifying the product offerings to appeal to not only serious runners, but also more casual consumers. Cisco stocked stores with more fashionable sportswear items for her more cursory customers while attempting to appeal to the running community by offering custom-fit, high performance shoes. This strategy captures a large target market; however, it is ultimately unsuccessful as a growth model because it does not fully satisfy either consumer group. The serious......

Words: 1286 - Pages: 6

Premium Essay

Internship at Marsa Maroc

...Azarkan Hind In partial fulfillment of INT 4300 – Internship School of Business Administration Optimization of the Trucks Transit in Marsa Maroc Terminal Dr. Youssef Boulaksil Fall Term 2013 Executive Summary The container terminal is a flat modal form that binds the ship to truck, train or to another vessel in the case of transshipment. This connection is done via interfaces: truck / area inter exchange, train / buffer zone, ship / dock. Thus, the major container flows are channeled to or from this system are the result or the source of a multitude of internal flow system (sorting, inspection, shifting, connection, full containers, empty containers). These flows are treated with different tools and different locations around the terminal. That means, the container terminal is to optimize the processing of massive volumes of containers in order to achieve economies of scale (749,000 TEUs'' 20-foot equivalent'' per year), improving the use of resources and more special equipments that are expensive.  In fact, responsible for handling division have the prospect of having a solution to balancing and optimization of the supply chain through the design of equipment used (tractors) to import and export in delivery to the end customer.  My final project study is in the heart of this approach. It has as an objective, the study of solutions that meet the diverse needs. To do this, I had some operational research to minimize the process of delivery of......

Words: 11589 - Pages: 47

Premium Essay

Hello

...Course Name : Operations Management Course Code : GSM 5113 Credit : 3 (3+0) Semester/Trimester : Second Trimester 2012/2013 Pre-Requisite : None Course Objectives : The course has several objectives: • Introducing the functional area of operations and demonstrating how operations interface with an organization’s other functional areas. • Highlighting the various issues and problems that traditionally arise in the management of operations within both manufacturing and service organizations. • Building a familiarity with the terminology, modeling, and methodology often employed in the operations function. • Presenting recent technological advances that directly affect operations management. Synopsis : Operations management goes by many names: Production, Production Management, or simply Operations. For our purposes we will define it as the production and delivery of goods and services. It encompasses designing the product and its accompanying production process, acquiring and organizing the necessary resources, and planning and executing production. With such a broad scope, the operations function plays an integral role in the ability of an organization to achieve its goals. A well-trained manager must be familiar and conversant with the many issues and concepts that arise within this functional area. In this course we will study the......

Words: 546 - Pages: 3

Free Essay

Eastern Gear

...1. Introduction This report aims to identify and analyze the underlying problems with Eastern Gear, Inc. Currently, there are too many shortcomings in its system, rendering it inefficient right from the beginning. In the first part of this report, the problems face by Eastern Gear, Inc. are identified and elaborated. Subsequently, possible solutions to these problems are analyzed and dissected, identifying their respective advantages and disadvantages. At the end of the report, relevant suggestions and recommendation are presented, together with its feasibility. 2. Problems faced by Eastern Gear, Inc. 2.1. Make to order (MTO) The business strategy used by Eastern Gear, Inc. is Make-to-order. In a nutshell, this meant that products are built according to customer-dictated blueprints. The beginning construction of a product only after the design is confirmed represents longer downtime between order and readiness of ordered goods as compared to an organization which operate in a more conventional manner of selling template, mass produced products which are readily available at point of purchase. Adding on to the fact that customers usually do not pay in full during initial placement of order, this may cause cash flow retardation. Furthermore, customers with heavy considerations with regards to the time factor may be put off by the waiting time. 2.2. Order process As mentioned above, some customers see time as a key deciding factor when making a purchase. Orders are not finalized...

Words: 2855 - Pages: 12

Free Essay

750 Powerpoint Chart

...specific diagram. A screenshot of all the diagrams are included to help you locate just what you need easily and quickly. Browsing through this set of creative diagrams can also inspire new ideas! CONTENTS (793 SLIDES + 156 ICONS = 949 ITEMS) Folder: Cause Effect diagram (38) ........................................................................................................................... 2 Folder: Circle diagram (21)...................................................................................................................................... 4 Folder: Consulting diagrams (83) ............................................................................................................................ 6 Folder: Extreme custom animation (15) ................................................................................................................ 10 Folder: PowerPoint 3D (51)................................................................................................................................... 11 Folder: PowerPoint charts (51) ............................................................................................................................. 14 Folder: PowerPoint concepts (84) ......................................................................................................................... 16 Folder: PowerPoint Graph (44)......

Words: 5723 - Pages: 23

Premium Essay

Groups Teams and Conflict

...Groups, Teams, and Conflict MGT/311 January 19, 2015 CardiCare Valves Project Riordan Manufacturing is a Fortune 1000 company specializing in the design and manufacturing of custom plastics. Current customers include companies from the health care and food and beverage industries. The purpose of the following project presentation and plan is to accommodate the production of the newly designed CardiCare Valve heart valves. The company is currently planning to gear up for production under their current model, borrowing resources from varied divisions while expecting to hire an undetermined number of new employees. As one of the newly hired superintendents hired to assemble and lead new teams to begin this new production for Cardicare Valves, the research into the issue has been undertaken and the potential strategies have been identified to implementing a successful ramp-up and shift in production. Strategies The available strategies to build successful teams include the following: clearly defining the goals of the team and the skills required, selection of team members, ensuring valuable communication, promoting a productive workgroup, resolving conflicts, and managing motivation (Robbins & Judge, 2013). There are, of course, several challenges that could be barriers or obstacles to success. For instance, there might be personal or professional differences between team members and/or managers, chosen communicators may fail to properly communicate the goals......

Words: 1073 - Pages: 5

Premium Essay

A Car or a Truck, Which Would You Choose?

...Final Essay Solomon Sanders COM/170 10/15/2013 David Bennett A car or a truck, which will you choose? Most people love their automobiles. One can use a car or truck for a long list of different things. A hand full are, transport, haul, entertain, race, and service use. Uses go well beyond just this hand full. Automobiles get consumers from point A to Point B. Automobiles also can be for recreational use or for business use. Automobiles are used in sports like NASCAR and Formula 1 racing. Autos can be an investment or a nightmare. Autos make their passengers lives easier by transporting them quickly and safely provided the drive abides by local law and regulations. Cars and trucks have both similarities and differences, and that which is best depends on what an owners needs are. Hands down the most popular vehicles on the road today are cars and trucks. Passenger capacity is one important area where there are similarities and differences between cars and trucks. Both cars and trucks need an operator to move about the streets. The average car holds four adults or two adults and three children comfortably. The average truck, depending on the type of truck, holds two to eight passengers. Single cab pickup trucks are on the low side, carrying two, and the high side is a large sports utility vehicles holding eight passengers. Cars and......

Words: 1437 - Pages: 6

Premium Essay

Alan Mulally, Ceo, Ford Motor Company

...Abstract Ford Motor Company is an American multinational corporation and one of the world’s largest automakers based on worldwide vehicle sales. On June 16, 1903, Henry Ford founded and incorporated the business which continues to operate and is controlled largest by the Ford family for over 100 years. This paper will discuss one of Ford’s CEO’s, Alan Mulally, who is currently the company’s president and chief executive officer. This paper explores the role of leadership and how it impacts the organizational performance at Ford Motor Company. This paper discusses Alan Mulally’s leadership style and how goal setting helped Ford improve its performance. In addition, an assessment of Mulally’s leadership will analyzed on each element in communication openness including message transmission, trust, agendas, and goals. In summary, an evaluation of the effectiveness of Mulally’s leadership style will be discussed along with a recommendation on whether he should continue with his style, or pursue a different style. (Hellriegel, D., & Slocum, J W, Jr. 2011) The Role of Leadership and its Impact on Organizational Performance Leadership is an important function in any business and should establish a clear vision while communicating the vision to others. Leadership can have a significant impact on an organization’s performance. The role of leadership is the act of motivating people toward reaching a common goal. There are three types of leadership which commonly exists......

Words: 1164 - Pages: 5