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BUS644: Operations Management: Space Age Furniture Company

Case study on operations management strategies in the furniture industry.

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    Furniture 1 Space Age Furniture Company Robert Baca BUS644 : Operations Management Prof. Jamal Batta February 24th 2014 Based on the case study of Space Age Furniture Company, analyze the impact of Material Requirements Planning (MRP) on inventory management, production scheduling, and overtime costs. Discuss the potential improvements that could be made to the MRP system, particularly focusing on subassembly lot sizes, and evaluate the trade - offs between overtime costs and inventory costs. Additionally, compare and contrast different types of production processes (Job Shop, Batch, Repetitive, and Continuous Flow) and recommend the most suitable production process for Space Age Furniture Company. Include an analysis of how management can track job status and location during production and suggest any changes that could further enhance operational efficiency. Word Count Requirement: 1,500 - 2,000 words.

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    Furniture 2 Space Age Furniture Company Introduction Space Age Furniture Company manufactures tables and cabinets to hold microwave ovens and portable televisions. These products are made in various sizes and with various features, but all follow basically the same production and assembly operations. Two of these products – the Saturn microwave and th e Gemini TV stand have a part (n o. 3079) that requires machining on a special lathe used only for making that part. Space Age began using an MRP system that has helped reduce inventories greatly and improve on - time deliveries. Space Age had estimated that it cost $1.25 per week to store each Gemini and $1.50 per week to store each Saturn that wasn’t shipped immediately. The master schedule for producing these two items for the next six weeks is show below: Master Schedule Week 1 2 3 4 5 6 Gemini 600 400 700 500 400 600 Saturn 300 400 400 600 300 300 Part 3079 is used in two different subassemblies: no. 435, which is used in the Gemini TV stand, and no. 257, which is used in the Saturn microwave stand. One of part 3079 is used in each subassembly, and one of each subassembly is used in each of the final products. Part 3079 may be produced in any quantity since the lathe that makes it is not used for anything else. Space Age has decided that these subassemblies should be made in minimum quantities of 1,000 at a time (Vonderembse & White, 2013).

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    Furniture 3 This paper will develop an MRP for Space Age Furniture Company using the information in the case including the production of sub - assemblies in lot sizes of 1,000. The lot size of 1,000 for sub - assemblies has produced a lumpy demand for part 3079. The paper will also suggest ways for improvements over sub - assemblies in lot sizes of 1,000 while also analyzing the trade off between overtime costs and inventory costs. A new MRP that improves the MRP will also be reviewed along with a compare and contrast of the types of production processing and determining which the primary mode of operation is and why. Finally the paper will discuss the ways that management can keep track of job status and location during production and also recommending any changes that might be beneficial to the company and/or add value for the customer. MRP for Space Age Furniture Company According to the case information provided for Space Age Furniture Company, there are two different subassemblies in the company. The first one is no. 435, which is used in Gemini TV while no. 257 is used in the Saturn microwave stand. In each of the two subassemblies no. 3079 is used. Each of the subassemblies is also used in each of the final products. Based on this information it is important to understand that the subassemblies play an important part in the production process. Including them in the development of the MRP is the first step. The three most important data requirements of MRP are the master production schedule, bill of materials, and inventory records. The Master Schedule File is the master schedule and drives the system and generates material requirements. This will be at the level of the subassemblies. The Bill of Materials serves two purposes; first it will list all the components of a product and the quantities needed to make the product. Second, it shows the relationship amongst those components, which indicates product structure , meaning that part 3079 is uses 257 and 435. The third thing is

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