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    Melody Fabrications implemented new performance measures as part of a continuous improvement campaign involving JIT production and purchasing. Management wants to know throughput time, manufacturing cycle efficiency, and delivery cycle time. For each month, the document computes these measures: throughput time ranges from 2.9 to 5.4 days, manufacturing cycle efficiency ranges from 9.4% to 13.8%, and delivery cycle time ranges from 7.6 to 15 days.

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    Melody Fabrications implemented new performance measures as part of a continuous improvement campaign involving JIT production and purchasing. Management wants to know throughput time, manufacturing cycle efficiency, and delivery cycle time. For each month, the document computes these measures: throughput time ranges from 2.9 to 5.4 days, manufacturing cycle efficiency ranges from 9.4% to 13.8%, and delivery cycle time ranges from 7.6 to 15 days.

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    779 views3 pages

    Chapter 7-The Balanced Scorecard: A Tool To Implement Strategy

    Uploaded by

    itsmenatoy
    Melody Fabrications implemented new performance measures as part of a continuous improvement campaign involving JIT production and purchasing. Management wants to know throughput time, manufacturing cycle efficiency, and delivery cycle time. For each month, the document computes these measures: throughput time ranges from 2.9 to 5.4 days, manufacturing cycle efficiency ranges from 9.4% to 13.8%, and delivery cycle time ranges from 7.6 to 15 days.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    of 3

    CHAPTER 7-THE BALANCED SCORECARD: A TOOL TO

    IMPLEMENT STRATEGY

    Problem (Measures of Internal Business Process Performance)

    Melody Fabrications, Ltd., of Dasmariñas, Cavite, has recently begun a continuous improvement
    campaign in conjunction with a move toward JIT production and purchasing. Manage has
    developed new performance measures as part of this campaign. The following operating data
    have been gathered over the last four months:

    Month

    1 2 3 4

    Throughput time, or velocity ? ? ? ?

    Manufacturing cycle efficiency ? ? ? ?

    Delivery cycle time ? ? ? ?

    Percentage of on-time deliveries 72% 73% 78% 85%

    Total sales (units) 10,540 10,570 10,550 10,490

    Management would like to know the company's throughput time manufacturing cycle efficiency,
    and delivery cycle time. The data to compute these measures have been gathered and appear
    below:

    Month

    1 2 3 4

    Move time per unit, in days…………………0.5 0.5 0.4 0.5

    Process time per unit in days………………..0.6 0.5 0.5 0.4

    This study source was downloaded by 100000795173129 from CourseHero.com on 05-12-2022 06:36:23 GMT -05:00

    https://www.coursehero.com/file/92522669/Chap-7-Prob-1docx/
    Wait time per order before start of

    production, in days………………………….9.6 8.7 5.3 4.7

    Queue time per unit in days………………...3.6 3.6 2.6 1.7

    Inspection time per unit, in days……………0.7 0.7 0.4 0.3

    As part of its continuous improvement program, the company is planning to move toward a JIT
    purchasing and production system.

    Required:

    1. For each month, compute the following operating performance measures:

    a. The throughput time, or velocity of production.

    b. The manufacturing cycle efficiency (MCE)

    c. The delivery time.

    Answer:

    Throughput time| Manufacturing Cycle Efficiency (MCE)| Delivery Cycle Time


    Month 1 5.4 11.1% 15
    Month 2 5.3 9.4% 14
    Month 3 3.9 12.8% 9.2
    Month 4 2.9 13.8% 7.6

    Solutions:
    Month 1
    Throughput time= 0.5+0.6+3.6+0.7 = 5.4
    MSE= 0.6/5.4= 11.1%
    Delivery Cycle Time= 5.4+9.6 = 15
    Month 2
    Throughput time= 0.5+0.5+3.6+0.7=5.3
    MSE=0.5/5.3= 9.4%
    Delivery Cycle Time= 5.3+8.7= 14
    Month 3
    Throughput time= 0.4+0.5+2.6+0.4= 3.9
    MSE= 0.5/3.9= 12.8%
    Delivery Cycle Time= 3.9+5.3= 9.2
    Month 4

    This study source was downloaded by 100000795173129 from CourseHero.com on 05-12-2022 06:36:23 GMT -05:00

    https://www.coursehero.com/file/92522669/Chap-7-Prob-1docx/
    Throughput time= 0.5+0.4+1.7+0.3= 2.9
    MSE= 0.4/2.9= 13.8%
    Delivery Cycle Time= 2.9+4.7= 7.6

    This study source was downloaded by 100000795173129 from CourseHero.com on 05-12-2022 06:36:23 GMT -05:00

    https://www.coursehero.com/file/92522669/Chap-7-Prob-1docx/
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