management essay

Step 1: Response to Quote Request:

Requests for quotation (RFQs) are collected from the fax machine by the part-time sales administrator, The RFQ data is logged into a tracking database (CRM software) to make a permanent record of the RFQ. The administrator often piles up RFQs until she can get around to them, and of course if the RFQ comes in after she goes home it sits until the next day. Once the RFQ is “logged in” it is sent to one of two technical sales specialists depending on the geographic location of the requestor. If the RFQ was sent via Email directly to the technical sales specialist (TSS) it is sent to the administrator for logging and then comes back to the TSS. This often happens because a long-time customer has an established relationship with the TSS.

The TSS first compares the customer’s design existing designs to determine whether the new item can be “copied” from the existing item. The customer’s documentation is reviewed to make sure CCC knows exactly what to build.

If the RFQ is determined to be a repeat order, the bill of materials, manufacturing router, and customer spec used in the last order are reviewed by the TSS for current accuracy.

If the job is brand new or significantly different from the last time CCC made the product, engineering gets involved. As a result of this engineering, a basic manufacturing routing is made for every quote so that “resources needed” and “manufacturing leadtime” can be part of the quote package. This takes 0.5 to 2 days on average. The package is then handed back to the technical sales specialist, who reviews the data and compares materials needed with materials available.

If the raw materials needed are not available, purchasing is consulted to determine leadtime and current price. Once this data is received (hopefully the same day) the TSS can continue processing the RFQ. She also validates that engineering followed the customer’s instructions and/or specifications. Unfortunately, about 40 percent of the time a mistake is found that results in sending the package back to engineering for correction. This can add 15 minutes or an entire day or more to the quote response process. Once any errors are corrected, the TSS creates a formal quote document and sends it to the potential customer.

Step 2: Response to Customer Purchase Order:

When the customer sends in a purchase order, it is received by fax or Email. Verbal orders are not allowed. The order is processed by the sales administrator, who often sets them aside because she’s working on something else. She consolidates all relevant data onto an Excel document and also initiates the Design Review and Verification Form (DRVF.) The purpose of the Excel document is to give the planning department a single document for entering demand data into the ERP system. The DRVF is used by the technical sales specialist as a checklist to make sure all important data has been reviewed, verified and where necessary communicated to engineering, planning and accounting. (Note: the DRVF has been identified by an ISO auditor as part of due diligence to the customer, so it cannot be eliminated.)

Step 3: Sales Order Entry:

Sales orders are entered into the ERP system by the planning department. This drives demand for the item. If the documentation received from sales is correct and complete, data entry usually happens within four hours of package receipt. Unfortunately, about 25 percent of sales order packages have something wrong with them and must be returned for correction. As part of order entry, the availability of component materials is checked again, since something could have used up the inventory sales was counting on when they did the quote. If material must be ordered, its leadtime is analyzed versus the job operations. If the material is needed early in the job, the ship date will be delayed. If the material will have time to arrive before it’s needed, the job will not be delayed.

After the order is entered it is checked for accuracy by another member of the planning department. Corrections, if any, are made immediately and take less than 15 minutes. After this check, the customer’s order is acknowledged by sending a PDF copy of the sales order to the customer via Email.

Step 4: Work Order Entry and Release to Stockroom:

The work order (also called a job or a shop order) is entered by the planning department to indicate to the ERP system that supply is being planned to meet the demand caused by the customer order. The job also drives specific component requirements (by quantity and date) because each job has a kit list used by the inventory control clerk to pull the correct quantity of parts at the correct time.

MRP is run several times a day to capture new demand (from sales orders) new supply (from jobs or purchase orders) and inventory transactions (receipts, issues, returns, etc.) This program calculates what components are available for use in manufacturing and what must be purchased if there is not enough component inventory, It also determines when the components must arrive in order to meet the work order due date,

The “shop order package” is made up of three documents:

1. The job order, which lists all the operations (steps) needed to make the finished product and the materials needed at each step

2. The kit list, which lists all the components and the quantity of each needed. It also lists the location of the component in the stockroom. This document is used by the inventory control clerk to kit the order (step 5.)

3. The material checklist, which the operator is to review and sign indicating he received the components he needed to begin work.

The job order package is checked for accuracy by another member of the planning department before step 5.

Corrections, if any, are made immediately and take less than 15 minutes.

The sales order package is then filed in the “open orders” cabinet.

Step 5: Material Kitting and Staging on the Production Floor:

Materials for the job are gathered by the inventory control clerk. The items needed for the first operation are issued from stock and the other components are held in controlled stores until they are requested by production operators. Each container is labeled with the part number, lot number, job number, customer name, date and quantity issued. The materials are then transported to the staging area in the extrusion department. From that area, operators take material when they are ready to run a job.

Currently the inventory control clerk pulls an order as soon as he can and stages the material on the floor. Sometimes the department is not ready to run that order when the material is staged. Reasons for this include:

1. The production manager has not scheduled the job yet

2. The job is scheduled but the machine needed is tied up on another job

3. The job is scheduled but the machine needed is down for maintenance

4. The job is scheduled but the specific operator needed to run the machine is not available

Step 6: Manufacturing:

The production manager schedules jobs based on due date, machine availability, and operator availability. He knows that for most jobs the biggest element of manufacturing leadtime is queue (time spent waiting for the resources at the next operation.) A typical simple job order would have the following steps:

Op Description Requires (input) Results in (output)

10 Kitting/Staging Material available in inventory Material staged in central rack

20 Extrusion Material, tooling and instructions Wire on 10,000 foot spools

30 Re-spool for stripe Wire on 10,000 foot spools Wire on 2,500 foot spools

40 Stripe Plain wire on 2,500 foot spools Striped wire on 2,500 foot spools

50 Re-spool for ship Striped wire on 2,500 foot spools Striped wire on 500 foot spools

60 Inspection Material and work order “Passed QA” and test reports

70 Pack and ship Material, shipping documents Shipment to customer

Part of the output at steps 20-50 is that each spool of wire is labeled with the job number and footage. At the re-spool operation, the finished part number is added to the label so it can be quickly identified when it moves to Inspection. The production work centers run two shifts, but the re-spool work center is day shift only.

Most of the machine operators can perform in-process inspection, but some jobs require in-process inspection by QA due to complexity or special circumstances. The QA department is staffed from 6:00am to 6:00pm. All finished items must go to QA for final inspection because test reports and material certification documents are required by CCC’s customers. (Note: this requirement cannot be changed so don’t bother to suggest its elimination.)

Step 7: Final inspection and test report generation:

When a job has been spooled to meet the requirements of the customer it is ready for final inspection. This process takes between 0.5 and 3 hours, with a few jobs requiring more time due to their complexity or the complexity of the test reports required. The queue time for final inspection averages 0.5 days. If the job does not pass inspection, it is placed in quarantine until the production, engineering and operations managers can meet to decide what to do. If the job passes inspection, the paperwork is sent to the planning department, where the job is reported closed in the ERP system. At that point the buyer/planner looks up the order ship date.

Step 8: Packing and shipment:

If the job is due to ship three or more days from completion date, the job paperwork is filed with the sales order package. If the job is due to ship in the next 24-48 hours, the sales order package is pulled, matched with the job paperwork and placed in a “waiting shipment” basket. Each morning the buyer-planner reviews a report that tells her what is due to ship today (or past due.) When a job’s ship day arrives, or if the job is due to ship immediately, shipment transactions are done in the ERP system and the paperwork is sent out to the shipping department.

About 20 percent of sales orders cannot be shipped smoothly because the shipment method was not specified at the time of customer order, the original shipment method is inappropriate (due to the weight of the finished product) or it’s a credit card order and the card gets rejected when accounting tries to charge it. Each of these issues requires contacting the customer, which can add anywhere from two hours to two days to the leadtime because the customer doesn’t get back to CCC.

Your task:

Prepare a written report for the owner. What overall recommendations do you have? What problem(s) would you solve, in what order, and specifically how would you solve them? By the way, the last consultant (whom she fired) tried to “fix” everything by using an on-line ordering process. The product is too complex. Don’t even go there!

Minimum length is one page single-spaced, two pages double-spaced. Maximum length is two pages single-spaced, four pages double-spaced. Required font: Arial 10. Minimum margins: 0.5 inch. Maximum margins: 1.0 inch. Charts, diagrams and/or graphs may be used but must appear as exhibits referred to in your report and be attached to the back of the report. Exhibits do not count toward minimum or maximum number of pages.

Rev C 11/08/2015 page 1