Based on the information presented in the scenario/case study discuss Albatross Anchor’s competitiveness in relation to (please address all items in the below list and provide support for your conclusions):
a) Cost of Production: The current cost of production for the two different anchors are $8 per anchor for the bell/mushroom type, and $11 per anchor for the snag hook anchors.
b) Economies of Scale in material purchasing: Due to the limited areas of warehousing the material, economies of scale is not realized. The limitation of total area and the inefficiencies that are currently in place are preventing Alabatross Anchor from appreciating the profits available to ...view middle of the document...
2. Speed of manufacturing process from order to finished product.
The speed of the manufacturing process from order to finish product is very challenging since each anchor requires its own specific equipment. The current process is to completely change over the manufacturing line for each type of anchor. This process makes it more time consuming and creates more work for employees not to mention the potential for equipment and product breakage. In addition, these extra costs are not helping to produce additional products but slowing the production process. Lean manufacturing processes are necessary to implement when possible. “The term ‘lean manufacturing’ represents half the human effort in the company, half the manufacturing space, half the investment in tools, and half the engineering hours to develop a new product in half the time” (Rockford Consulting, 2013).
3. Flexibility in filling order(s)
Due to the limited space and poor design of the operation, Albatross Anchors is not flexible in being able to fill all of the orders that they receive. They are hobbled by inefficiencies and location of necessary products and equipment. The process flows of filling the orders are being compromised with the current layout. “The flow patterns arrange the process steps in a natural flow order, link process steps to minimize cycle time and travel distance, eliminate cross-over points, and stimulate a continuous flow process” (Resource Engineering, 2013).
As stated earlier, the company is “antiquated” and “technology-deprived” and so is the equipment that is currently being used to produce the anchors that Albatross Anchors manufactures. It is necessary to update the equipment and additional technologies that will help to streamline production and improve the quality and quantity of these products while still providing a safe environment for employees that meet the industry standards. The guidelines for these standards are governed by the American National Standards Institute (ANSI). “The Institute's mission is to enhance both the global competitiveness of U.S. business and the U.S. quality of life by promoting and facilitating voluntary consensus standards and conformity assessment systems, and safeguarding their integrity” (ANSI, 2013)
5. Capacity and facilities
In addition to the equipment within the facility, the facilities themselves need to be overhauled and updated to reflect the direction that the company wishes to go and not to look back at where it has been. The facilities need to be retooled to improve productivity and efficiencies and adjust the capacities of the different areas within the building to maximize the square footage. This reorganization will improve the work flow and the attitudes of the Albatross employees
6. Service to customers
Albatross Anchors sells only at the wholesale level to distributors who purchase the product in bulk and then redistribute it in smaller batches to the retail outlets,...