Define the term processing cycle efficiency pce given the

Question

Process Cycle Efficiency (PCE) and JIT The manufacturing company for which you currently serve as plant controller is contemplating moving from a conventional manufacturing layout to a just-in-time (JIT) system. The overall strategy is to improve manufacturing operations, thereby enabling the company to compete more effectively in an increasingly competitive environment. As a member of the decision-making team, you have been asked to provide input regarding the decision at hand.

Required: Prepare a memo for management in which you address the following issues:

1. Comment on the relative costs and benefits of adopting a JIT manufacturing strategy.

2. For which type of companies, from a competitive standpoint, would the adoption of JIT be most useful? Why?

3. Define the term processing cycle efficiency (PCE). Given the estimated data below, calculate the PCE for your plant under the existing manufacturing layout and after the proposed implementation of JIT:

Activity	Current System	After JIT Implementation
Storage	3 hours	1 hour
Inspection	40 minutes	8 minutes
Moving	75 minutes	20 minutes
Processing	2 hours	75 minutes

4. Distinguish between value-added time and non-value-added time within the present decision context.

Answer 1

The manufacturing company for which you presently serve up as plant controller is contemplating moving from the conventional manufacturing layout to the JIT system. The overall policy is to enhance the manufacturing operations, thus enabling the company to compete more efficiently in an increasingly competitive atmosphere. As the member of decision-making team, you have been inquired to give input concerning the decision at hand. Required: Create a memo for the management in which you address the given issues: 1) Review on the relative costs and advantages of adopting the JIT manufacturing policy. 2) For which kind of companies, from a competitive point of view, would the adoption of JIT be most helpful? Explain why? 3) Define the word processing cycle efficiency. Provided the estimated data below, compute the PCE for your plant in the existing manufacturing layout and after the proposed implementation of the JIT.