Donner Case

Question 1:

What is the normal process flow of the production system at Donner? Draw a process flow diagram.

Question 2:

What orders would you schedule on the CNC drill? On CNC router?

Operation Setup Time (min) Run Time/board

Manual Drill 15 0.08*500 = 40

CNC Drill 240 0.004*500 = 2

Punch Press 50 1

CNC Router 150 0.5

a) CNC Drill vs Manual Drill

Let x be order size than -

15 + 40x = 240 + 2x; x = 5.92;

From this equation we get x approximately equal to 6. So Donner Company should use the CNC Drill for orders of more than or equal to 6 boards. The Manual Drill process should be used for all orders of less than 6 boards. This is because production time for CNC is less than manual for order size of more than 6 units.

b) Punch Press vs CNC Router

As for above, let x be order size than -

50 + x = 150 + 0.5x; x = 200;

So if order size is more than 200, Donor Company should go for CNC Drill. If order size is less than 200, Punch press would be preferred. At exactly 200 boards per order, any of them could be used.

Question 3:

What is the capacity of the Dry Film Photo resist area? (Assume the order size is eight.) How does the capacity change with the order size?

Assumptions -

* Working hours available is 8 hours/day

* Setup for the next step begins when the previous step's run is finished

For Order Size of 8 unit -

Total Production time for a panel(8 board) - 47.4 mins.

So, daily capacity in orders is - (8*60)/47.4 = 10.126 ≈ 10 order/day.

Order size in boards Order size in panels Process Time Daily Capacity in orders Daily capacity in Boards

8 1 47.4 10 80

80 10 69 7 560

200 25 105 4.6 920

400 50 165 2.9 1160

800 100 285 1.7 1360

So, as we see that as the order size increases, Daily order capacity decreases but Daily capacity of boards increases. This happens due to the fact that set up time has negative impact on overall production.

Question 4:

What is the standard labor time for an order of 1 board? 8 boards? 200 boards?

Order Size Technology Set up time (min) Runtime (min) Total time per order (min) Time per board (min)

1 Manual Drill

Punch Press 339 57.55 396.55 396.55

8 CNC Drill

Punch Press 564 51.05 615.05 76.89

200 CNC Drill

CNC Press 664 1176.25 1840.25 9.20

Question 5:

What are some of the issues faced by the Plummer?

In spite of huge increase in sales in large quarter, the profit and loss summary of the company shows that net profit before taxes decreased considerably from $14,800 in August of 1987 to $3,100 in September of the same year. Also net sales and gross profit margin decreased in this period. All this can be attributed to huge inefficiencies that exist in the manufacturing processes of Donner.

Major issues are -

* Poor Quality - Items returned by customers increased from 1% to 3%. One tenth of the boards returned to the Donner Company were damaged or out of tolerance while the rest were returned due to the company not completing one or two different required operations.

* Process Flow - One of Donner's major problems lies in their process flow. There are many bottlenecks and employee downtime which arise from poor process flow setup and unforeseen problems.

* Low Productivity - For example Plater spent 15% of her time walking between her desk and the plating tank. Also, plating and etching processes were located far form the machining operation.

* Late