Case is about family business (father and son : Tom and Mason Miller), which began producing molds and later added production of plastic parts to main business. Although production is traditionally being focused on quality and design of both molds and plastic parts (mass production/ customization accordingly), total number of order is remained the same, but client’s desires have been shifted.
1). Custom Molds Inc. has faced the following major issues:
Although the number of parts orders remained virtually constant, the volume per order for parts has increased significantly during last 3 years. These, has created bottlenecks and has led to late deliveries of parts.
Two different processes (fabricating molds/producing plastic parts) take place in a single facility.
Above-mentioned processes serve different customer needs. Fabricating molds requires more skill-oriented stuff, more flexible and qualitative process. Competitive advantage for finished molds (fabricating molds process) is based on delivery and low cost, and moreover this process has much more higher margin that for producing plastic parts.
Sales mix changing has created excess capacity in mold fabrication.
Changing electronics manufactures (Custom Molds`s major clients) strategies has influenced order needs in unexpected way.
Difficult to predict “when?” and “where?”.
2). The competitive priorities for each of the individual processes are the quality, cost effectiveness and customer responsiveness. The changing nature of the industry was in the tendency of manufacturers to develop strategic partnerships with suppliers. Hence, more and more demand for responsiveness was laid upon suppliers to sustain the competition. In the Custom Molds’ case, as order for multiple molds began declining, the responsiveness of the individual processes began suffering due to the capacity constrains (bottlenecks) at different stages of operations. This naturally entailed the lost sales to customers.
(All the individual processes that are carried out at Custom Molds are shown on the flow diagram in exhibit t# 1).
3). Our team suggestions are:
Mold fabrication- to focus on small capacity/ specialized machines, and include more workers in supervising process.
Producing of plastic parts- to focus on little number, but large capacity machines with insufficient input (workers).
Testing and inspection – to move this area in the centre of facility (to make movement of goods more efficient and to make easier communications between inspecting/testing workers and managers).
Office- a) to make order placement more truthful (matching ability of order fulfillment with time promised); b) to identify customers` needs more precisely; c) compare changes and it’s influence on company’s finance (taking into consideration return on income); d) due to the market demand company should make strategic decision and conclude if it is better to concentrate on molds or plastic parts (this is the most appropriate alternative).
Courtney from Study Moose
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