Flash Memories Inc. is considering a new just-in-time product cell. The present manufacturing approach produces in four separate steps. The production batch sizes are 60 units. The process time for is step is as follows.
Process step 1 5 Min
Process step 2 3 Min
Process step 3 11 Min
Process step 4 6 Min
The time required to move each batch between steeps is 15 minutes. In addition, the time to move raw materials to Preocess Step 1 is also 15 minutes, and the time to move completed units from Process Step 4 to finished goods inventory is 15 minuts.
The new just-in-time layout will allow the company to reduce the batch sizes from 60 to 5. The time required to move each batch between steps and the inventory locations will be reduced to 3 minutes. The time required to move each batch between steps will stay the same.
Determine the value-added, nonvalue-added, total lead times and the value added ratio under the present and proposed production approaches. Round whole percentages to two decimal places.