Riordan Manufacturing Production Plan Riordan Manufacturing Production Plan Riordan Manufacturing, Incorporated has become a leader within the industry of plastic molding. An eclectic array of state-of-the art design products (plastic beverage containers, custom plastic parts, and plastic fan parts), and attention to detail pertaining to quality control, are some of the main factors contributing to the company’s success (Riordan, 2008). Each specialized plastic is in a different location: plastic fan parts in Hangzhou, China; custom plastic parts in Pontiac, Michigan; and plastic containers in Albany, Georgia.
Difficulties in forecasting and managing the supply chain at Riordan’s China facilities have become a concern. The following will depict the issues with the current process and provide suggestions to improve the process management through lean principles. Riordan’s manufacturing plant in China has developed relationships with local businesses, customers and the Chinese government to supply labor, purchase materials, and communicate on regulations. The local company, from which Riordan purchases its electrical motors used in the fans, is on schedule only 93% of the time.
Plastic polymers are other components bought locally, and an essential portion of the fan. After all the components are together, the fans are assembled and individually packaged. Riordan currently uses make-to-stock for the fans; Riordan forecast for future demand by using average sales of the past three years (Riordan, 2006). The company also takes orders for custom fans under individual consumer contracts. The company’s plan to grow and become more efficient, requires a review of the capacity constraints (bottlenecks, or road-blocks) at its current manufacturing sites.
Strategic capacity planning allows an approach to determine the capacity level of capital-intensive resources (such as machinery, facilities, and labor force) that best supports the company’s competitive strategy (Chase et al. , 2006). The facility operating in China operates by its own process, different from that of the other plants ran by Riordan in the United States. The plant performs as a separate entity from the other locations. The data collected in the past about the production and capacity levels are not sufficient and eem to be inadequate for a proper analysis. The three-year forecasting model will not accurately portray or consider major economic matters, company adjustments, consumer changes, and by simply possessing the average with no determination of standard deviation, will give an inaccurate depiction of sales. A business’s operation is only as fast as its slowest process. In order for Riordan Manufacturing to be successful, it needs to seek out and remove bottlenecks. A bottleneck is a course in an operation in which the capacity is less than demand put upon that operation.
For Riordan, the capacity levels it important in the Hangzhou location. If capacity is insufficient Riordan may deter customers through slow service or allow other competition to enter the market (Chase et al. , 2006). If capacity is too much Riordan may have to reduce prices to inspire demand or shelf excess inventory to keep the business open (Chase et al. , 2006). Another bottleneck is that most of the raw materials and finished products are being sent from Hangzhou to Shanghai then to their final destinations.
Continuing to ship between Hangzhou and Shanghai could be too expensive for the company and start to reduce profits. Balancing the operation with the bottleneck is important because it will reduce work-in-process and long logjams before the bottleneck. These logjams can create problems of their own and tend to put workspace in disorder. By Riordan identifying these bottlenecks in the operation, they can improve the output of the entire process, which would make it definitely worth the effort.
Lean production is doing more with less time, money, space, inventory, and labor. It can benefit a company, like Riordan Manufacturing to eliminate waste, make procedures easier and increase production. Chase et al. (2006) state that “lean production is an integrated set of activities designed to achieve high-volume production using minimal inventories of raw materials, work-in-process, and finished goods” (p. 471). The essential components of lean production are surplus elimination, constant work-flow, and consumer appeal.
The minute these components are in the neighborhood of supply, quality and cost, this outlines the groundwork for a lean production organization. A Japanese plan of continuous progress named the Kaizen is responsible for the lean production idea. Riordan can adjust the lean production concept by employee empowerment and advancement, staying focused on making processes stronger, impact of consumer relations, rapid merchandise growth and production, and cooperation with suppliers are the imperative strategies of Riordan managing lean.
Features of a lean enterprise include a combined single piece continuous workflow and near incorporation of the entire value series from raw material to finished product. In addition, demand drives production rather than predictions. This means that manufacture designing is by consumer demand or appeal and not to become system loading or strict work flows on the company floor. This will help Riordan keep minimal inventories at each step of the production process. It is also important to know that having a working participation by employees involved in problem-solving is to improve quality and get rid of wastes.
A lean production company is a team based work company, with well trained workers empowered to make decisions and improve operations. Riordan Manufacturing is the leader in plastic molding. Riordan is innovative with its product line to include plastic beverage containers, plastic fan parts and custom plastic parts. Riordan quality control measures and product line are the main factors contributing to their success. Riordan is having difficulty in forecasting and managing their supply chain.
In an effort to assess future needs of the company, Team A reviewed Riordan’s supply chain, strategic capacity planning, constraints at its current manufacturing sites and the lean production concept. These concepts are essential for new process design at Riordan. References Chase, R. B. , Jacobs, F. R. , & Aquilano, N. J. (2006). Operations management for competitive advantage (11th ed. ). New York: McGraw Hill/Irwin. University of Phoenix. (2006). Riordan virtual organization. Retrieved from University of Phoenix, OPS571-Management website.