Printed Circuits Components For A Jit Factory

Printed Circuits Components for a JIT Factory

1. Major Facts

пÑ"? Acacia is a major producer of graphic plotters

пÑ"? Marketing forecast estimated annual volume to exceed 60,000 units

пÑ"? Management determined that the newest unit, 440A, is an excellent choice for JIT process

пÑ"? Supply Managers w/ technical backgrounds were assigned new product development

пÑ"? Suppliers were requested to use bar-coded labels for inventory and kitting purposes

пÑ"? Delivery for most JIT parts = 1 week (instead of usual monthly delivery)

пÑ"? Parts considered for outsourcing = 4 integrated circuits (IC’s), 7 diodes, 3 transistors

пÑ"? Monitor Inc selected as single-source for 14 PC components

пÑ"? During the production process, Monitor was not able to comply w/ JIT requirements

пÑ"? Monitor-supplied components were mislabeled, out of spec and often behind schedule

пÑ"? 5 diodes can not be resourced, Monitor is the sole manufacturer

пÑ"? 2 alternate suppliers have been identified; capable of supplying 4 IC’s and 3 transistors

пÑ"? Alternate suppliers equipped to have deliveries ready in approx. 1 month

пÑ"? Alternate suppliers’ costs are 10% higher than Monitor, Inc.

2. Major Problems

пÑ"? Monitor Inc has struggled to meet required specifications and has not delivered shipments on time. (MAJOR PROBLEM)

пÑ"? Management realized that Monitor’s focus was on high-volume production.

пÑ"? Monitor is the sole source for a majority of the diodes needed.

пÑ"? Why was Monitor selected as a single source for all 14 PC components, when they’ve never supplied parts to a JIT customer before?

пÑ"? What are the risks of using other sources for the transistors and IC’s?

пÑ"? Deliveries MUST be highly reliable to prevent stockouts and line shutdowns.

3. Possible Solutions

пÑ"? If Monitor is a small biz, Acacia could consider entering into a Mentor ProtÐ"©gÐ"© agreement and assists Monitor with process development and lean manufacturing.

пÑ"? Acacia could transition a portion of the orders for the IC’s and transistors to alternate suppliers that are capable of supplying the necessary quantities.

пÑ"? Acacia could conduct a Lean Event at Monitor to help the staff identify possible adjustments that could improve quality and on time delivery outputs.

4. Choice Rationale

To improve the supply process and maintain a