Professional Documents
Culture Documents
Process of coping with the changes that might affect the plan
Intervention in operation to bring it back on track
Thompson Telescopes Ltd is a division of US based Murrays Parent Group, a large conglomerate
Thompson sells a range of standard telescopes (200 std. types) for amateur astronomers and club
To reduce cost
To enhance the capabilities to meet the customers orders Thompson was buying only 50% of the parts from their US company by 2000 Thompson holds 18% Market of EMEA
DESCRIPTION Successfully established the company in the marketplace. He prepares & approve annual budget and submit monthly report. Target ROCE to 15% Sales take full ownership of processing customer orders from pricing, quoting delivery dates through manufacturing to delivery. Reg Fox major concern about the late delivery complaints & salespeople wasting time to collect data from manufacturing Responsible for Budgets & Period Financial reports. Peter operates standard costing system with direct labor performance reporting. Responsible for maintenance of designs for standard make to order products. Responsible for product support, production engineering, & buying. Her major concern was that the sales team tends to drop lots of orders with short delivery dates which creates pressure in the manufacturing system
DESCRIPTION Product Thompson has 200 types of standard telescopes that are produced in 8 different sizes & 2 different finishes. Sales (70% - Std. Designs; 30% - Made to Order). There are 2500 active components listed in the system out of which 500 are raw materials, 1250 are made in house, & 750 are bought from US
Stock records are stored in file for every components used in Std. Type of telescope. Stock records are maintained by a stock controller (300entries/day). System automatically reorder the stock if it drops below a certain level but this this reordering is based on last 3 months usage which is out of date.
Finished Stock It is similar to Component Stock Control as in this we store records of Control finished telescopes that are there in the warehouse. When the stock falls below the limit, clerk raises the factory order. Warehouse processes customer orders in FIFO. Stores Procedure Stock check of stores is held twice each year. Volunteers from shop floor & Offices checks the physical figures & stock records. If there is a huge difference then stock controller is expected to provide the reason.
GROUP ACTIVITY
Choose any product and describe how will you manage the planning & control aspects For assistance you can use the planning and control model.
Time Horizon
Days/Weeks/Years
Uses partially disaggregated demand forecasts Determines resources and contingencies Objectives set in both financial and operations terms
Uses totally disaggregated forecasts or actual demand Makes interventions to resources to correct deviations from plans Ad hoc consideration of operations objectives.
Hours/days
MANUFACTURING PROCESS
It helps to set up the machine for the next part urgently required
24 H
3 - 12 WEEKS
OUTPUT
TRANSFORMED RESOURCES
Telescope
ORDER WINNERS
Quality Customization Option available to customers
ORDER QUALIFIERS
Price Level of Customer Service
Delivery Time Competition Initial Cost of Raw Material is subsequently high Orders Management Unreliable Sales Forecast Part Numbering System Shipping parts requires 4 months advance notification Inventory Management
P = Throughput
Time
D = Demand Time/
Customer Waiting
Time
CASE QUESTIONS
What Problems are being created for Manufacturing By: Sales Engineering Current procedures for stock control
SALES Sales Team tends to provide lots of orders with short delivery dates to the manufacturing team. This make it complex to manage the production system ENGINEERING The engineering team provides layout of the Standard telescope for manufacturing. But in make to order telescopes, the engineers have to prepare a new layout for manufacturing process. So, the manufacturing unit has to adjust the machines according to the new layout. CURRENT PROCEDURES FOR STOCK CONTROL Managing inventory was a major concern in this company. As the data fed by the stock controller in the system is only 40% accurate as compared to the stock quantities. Thus it creates problematic situation for the manufacturing team to efficiently continue the production
Thompsons Customers are complaining that deliveries are unreliable and that promises are often broken, but stocks are high and stock turns are sluggish. How should Thompson plan to overcome these problems?
Thompson must:
Assure sales team must not be given authority to provide the order delivery dates. As delivery dates must be provided by using a proper sequence that can be FIFO, Priority based, Manufacturing Lead Time etc. Manufacturing Manager opinion must be given preference before adjusting the delivery dates. This will avoid unexpected promises made by the salesperson to the customer.
The firm is bearing around 20% cost of holding inventories. Also the inventories are not managed in an appropriate way. For this, Thompson can deploy the warehouse inventories in the batches and must focus on unique identification numbers to be allocated to the batch so that stocks records can be easily made. Also inventory system must be updated daily to enhance the manufacturing lead time.
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