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Manufacturing and production organizations consider quite some factors before starting their operations. The demand patterns based on the quality of the products is a determining factor of most of the activities. As such, the managers must have highly skilled analysts to assist in the determining the various sections that will determine the success of the factories. This article is the analysis of Littlefield factory according to the simulation.
In the simulation, whether simulating the demand based on the predictable pattern or random, it is clear that the orders may follow a specific trend based on tastes. As such, to align the capacity of the factory with the demand, the factory needs to add two bunches of the machines at the start of the third month. This is in anticipation of an increase in demand as a result of early buyers. At the beginning of the fourth month, there is need to increase efficiency and rate of production, and thus the factory has to sell the older products and buy newer and faster machines. After the month 6, the factory has to start selling its bunches of tools as the demand continues to decrease.
Assuming that for the first 50 days, due to low demands, the factory adopted the default contract, since there is an increase in the order in month 3, there is a need for more focus on the production rate and thus may choose the lead time contract, in preparation for an increase in the demand. However, after month 3, the factory changes strategy to rush contract so that it can meet the needs of the clients who need products within the day or even half a day. Since demand is high, a failure in meeting the demands of one customer may not affect the factory so much. However, after month 6, the factory needs to adopt lead time contracts and eventually default contract.
Lot sizing depends on the rate of production. Lot sizing will follow the contract chosen. For instance, in the default contract, the lot sizes will be low, at around 5 lots, and then increase to 3 lots in month 3. Two lots is used in the beginning of a sharp increase in demand and finally introducing 1 lot to meet the demand during the high season. However, the trend has to be reversed in the middle of month 6, except that when the demand is too low in the later months, the factory will need to have 10 lots per order.
Inventory management is crucial for the factory to thrive in the business, and to save the costs of both purchases, storage, and usage of the raw materials. During the low demand periods, the factory will have to have small deposits of the raw materials within its stores. In the middle of month 3, when the demand is seen to be picking up, the management should stock more raw materials to make them available and also to save on the cost resulting from the fixed amount per order, so that ample storage is created within the premise.
In summary, this simulation is efficient in the factory setting. It has equipped me with the realistic industrial scenario, where demand affects the production of the company, and at the same time, influence purchases. Also, I have learned the importance of the understanding the working of various departments in ensuring that the object of the plant is met. These departments include sales, purchases, human resource and engineering, among other departments.
Anon., 2018. Littlefield Technologies. s.l.:s.n.
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