Printed Circuits Components for a Jit Factory
Printed Circuits Components for a Jit Factory
Printed Circuits Components for a JIT Factory
Major Facts
Acacia is a major producer of graphic plotters
Marketing forecast estimated annual volume to exceed 60,000 units
Management determined that the newest unit, 440A, is an excellent choice for JIT process
Supply Managers w/ technical backgrounds were assigned new product development
Suppliers were requested to use bar-coded labels for inventory and kitting purposes
Delivery for most JIT parts = 1 week (instead of usual monthly delivery)
Parts considered for outsourcing = 4 integrated circuits (IC?s), 7 diodes, 3 transistors
Monitor Inc selected as single-source for 14 PC components
During the production process, Monitor was not able to comply w/ JIT requirements
Monitor-supplied components were mislabeled, out of spec and often behind schedule
5 diodes can not be resourced, Monitor is the sole manufacturer
2 alternate suppliers have been identified; capable of supplying 4 IC??™s and 3 transistors
Alternate suppliers equipped to have deliveries ready in approx. 1 month
Alternate suppliers??™ costs are 10% higher than Monitor, Inc.
Major Problems
Monitor Inc has struggled to meet required specifications and has not delivered shipments on time. (MAJOR PROBLEM)
Management realized that Monitor?s focus was on high-volume production.
Monitor is the sole source for a majority of the diodes needed.
Why was Monitor selected as a single source for all 14 PC components, when they?ve never supplied parts to a JIT customer before?
What are the risks of using other sources for the transistors and IC?s?
Deliveries MUST be highly reliable to prevent stockouts and line shutdowns.
Possible Solutions
If Monitor is a small biz, Acacia could consider entering into a Mentor Prot?©g?© agreement and assists Monitor with process development and lean manufacturing.
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.
Acacia could conduct a Lean Event at Monitor to help the staff identify possible adjustments that could improve quality and on time delivery outputs.
Choice Rationale
To improve the supply process and maintain a positive relationship with Monitor Inc, a team of supply