PRODUCTION MANAGEMENT II – CASE 6 ASSIGNMENT

CASE 6: KURA DIESEL MOTOR WORKS

Kura Diesel Motor Works had been a pioneer in the manufacture of this type of internal combustion engine.  The plant is located on tidewater in the Federal Capital City of
Abuja, because the company originally built engines for the marine field, chiefly fishing boats and pleasure craft.  Subsequently, its activities were extended to the stationary type of engines, used primarily for the production of power in small communities, in manufacturing plants or on firms. 

During the earlier years of the Company’s operation, its engines were largely special-order jobs.  Even at the present time, about 60 percent of the output is made to order.  There has been in, recent years, however, a trend toward standardization of component parts and reduction in the variety of engines produced.  The engineering department has followed the principle of simplification and standardization in the case of minor parts, such as stubs, bolts and springs, giving a degree of inter-changeability of these components among the various sizes and types of engines.  Sizes of marine engines have been standardized to some extent, although customer requirements still necessitate some designs.  In the small engines for agricultural use, there has been a genuine effort to concentrate sales on a standard line of engines of three sizes, 20HP, 40HP and 60HP.

 

The company has always been advanced in the engineering development and design.  The production phase, on the other hand, has not been progressive.  The heritage of job-shop operation persists and despite the definite trend toward standardization, manufacture continues largely on a “made-to-order” basis.  The increasing popularity of diesel engines has brought many new producing companies into the field, with a consequent tightening of the competitive situation.

High manufacturing costs and poor service have been reflected in the loss of orders.  Customers’ complaints, together with pressure from the sales department, promoted management to call in a consulting engineer to make a survey of the manufacturing department and recommend what action should be taken.   The report of the engineer showed the following:

1.     Manufacturing methods, while still largely of the job-shop character, are in main good and no wholesales change should be made.  As production is still 60 percent special, a complete shift to line manufacture or departmentalization by product is not feasible.

2.     Machinery and Equipment are for the most part general purpose, in line with manufacturing requirements. Some machine tools are approaching obsolescence and for certain operations, high production single purpose machines would be advisable.  Extensive replacement of machine tools is not a pressing need, but an increased use of jigs and fixtures should be undertaken immediately.  There are many bottlenecks existing in the plant, but contrary to your belief, as well as that of your Foreman and other shop executives, there is no serious lack of productive equipment.  The trouble lies in the improper utilization of the machine time available.

3.     Production control is the major element of operating weakness and improvement is imperative.  The lack of proper control over production is evidenced by the following;

a.     High-in-process inventory, as indicated by piles of partially completed parts over the entire manufacturing floors areas.

b.     Absence of any record concerning the whereabouts of orders in the process from their initiation to delivery at assembly.

c.      Inordinate number of rush orders, particularly in assembly but also in parts manufacture.

d.     Too many parts choosers who force orders through the shops by pressure methods.

e.      Excessive setup costs resulting from the piece-meal methods.

f.       Failure of all necessary components parts to reach the assembly at approximately the same time.

g.     Lack of definite sequence of manufacturing operations for a given part.

The state of affairs found by the Consultant was, he realized, due to two main causes.

1.     The strong influence of the original job-shop character of manufacture and the very slow evolution to large scale operation.

2.     The fact that the top management of the Company was essentially sales minded.

His recommendations, therefore, had to be made with the idea of presenting a simple, straight forward programme to produce adequate control over production and to enable this control to be instituted gradually and logically.

Questions:

a.     Outline the essential features of a production control system for the company, giving sufficient detail to make clear how the system will function.

b.     Enumerate the benefits which the Company will derive when your production control system is in operation.

c.      What is the foreman’s place in the scheme of things, when a fully developed production control system is in operation and when a Production Control Department has been established?