Computer Residuals Computer Residuals De-manufacturing De-manufacturing Method and Its Economic Method and Its Economic Value Value Project Site: PSE&G Project Site: PSE&G Resource Recovery Center Resource Recovery Center Paulsboro, N.J. Paulsboro, N.J. Group Members: Group Members: Sheila Navarro Sheila Navarro Hazel Savellano Hazel Savellano Rebecca Sutton Rebecca Sutton
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Computer Residuals De-manufacturing Method and Its Economic Value Project Site: PSE&G Resource Recovery Center Paulsboro, N.J. Group Members: Sheila Navarro.
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Method and Its Economic ValueMethod and Its Economic Value
Project Site: PSE&GProject Site: PSE&G
Resource Recovery CenterResource Recovery Center
Paulsboro, N.J.Paulsboro, N.J.
Group Members:Group Members:Sheila NavarroSheila NavarroHazel SavellanoHazel SavellanoRebecca SuttonRebecca Sutton
Dilbert Dilbert by Scott Adamsby Scott Adams
OutlineOutline
Problem StatementProblem Statement Current SolutionCurrent Solution Scope of ProjectScope of Project Operational AnalysisOperational Analysis Economic AnalysisEconomic Analysis RecommendationsRecommendations ConclusionConclusion
Problem StatementProblem Statement
Approximately 2000 computers per yearApproximately 2000 computers per year 50% refurbished and donated50% refurbished and donated 40% remanufactured and resold40% remanufactured and resold 10% residual10% residual
Problem:
What to do with the residuals?
Current SolutionCurrent Solution
Contracted to outside sourceContracted to outside source• Take Monitors and CPUTake Monitors and CPU• Storage requiredStorage required• Optimal truckload capacity Optimal truckload capacity • ““Out of sight, out of mind.”Out of sight, out of mind.”
Scope of ProjectScope of Project
Alternative SolutionAlternative Solution Establish a method of de-manufacturingEstablish a method of de-manufacturing
• consider CPU onlyconsider CPU only• environmental issues with monitorsenvironmental issues with monitors
Economic evaluation against current Economic evaluation against current solutionsolution target costingtarget costing break-even analysisbreak-even analysis comparing alternativescomparing alternatives
Operational AssumptionsOperational Assumptions
IBM family of CPUIBM family of CPU Optimal working Optimal working
environmentenvironment Tools allow for Tools allow for
easiest disassemblyeasiest disassembly
Establishing the Work StandardEstablishing the Work Standard
Predetermined motion time systemPredetermined motion time system Determines amount of time requiredDetermines amount of time required
MOST (Maynard Operation Sequence MOST (Maynard Operation Sequence Technique)Technique)
General MoveGeneral Move (for movement of object through air) (for movement of object through air) Controlled MoveControlled Move (for the movement of object in (for the movement of object in
contact with surface or other object)contact with surface or other object) Tool UseTool Use (for use of hand tools) (for use of hand tools)
MOST WORK MEASUREMENT TECHNIQUEACTIVITY SEQUENCE MODEL SUB - ACTIVITIESGeneral A B G A B P A A - action distanceMove B - body motion
G - gain controlP - placement
Controlled A B G M X I A M - move controlledMove X - process time
I - alignmentTool Use A B G A B P A B P A F - fasten
De-manufacturing rate for one unit:De-manufacturing rate for one unit:8.16 units per hour = 7.35 minutes per unit8.16 units per hour = 7.35 minutes per unit
Economic AssumptionsEconomic Assumptions
Costs are analyzed Costs are analyzed as present economy as present economy studiesstudies
Analysis designed to Analysis designed to break-evenbreak-even
No MARRNo MARR
Economic DataEconomic Data
Outside service costs:Outside service costs:
Labor = $10 per unitLabor = $10 per unit
Transportation = $1.70 per unitTransportation = $1.70 per unit
Total = $11.70 per unitTotal = $11.70 per unit**
* * prices based on full capacity truck loadprices based on full capacity truck load
Unit Elements Factor Estimates RowDE-MANUFACTURING COST ELEMENTS Units Cost/Unit Factor ofRow Total
A: Factory Labor 24.51 13.48* 330.39$ B: Quality Costs - Training 10% A 33.04$ C: TOTAL LABOR 363.43$ D: Factory Overhead - Set up Costs 521% C 1,893.47$ E: Outside Manufacture - Transportation Cost 22% C 79.95$ F: TOTAL DIRECT CHARGE 2,336.85$ G: Facitily Rental -H: TOTAL DE-MANUFACTURING COST 2,336.85$ I: Quantity - Lot Size 200J: De-manufacturing Cost/Unit 11.68$
Outside Cost/Unit - Target Cost 11.70$
* U.S. Department of Labor, Bureau of Labor Statistics - March 1998* U.S. Department of Labor, Bureau of Labor Statistics - March 1998
Cost & Time EvaluationCost & Time Evaluation
Equipment cost per worker = $286.03Equipment cost per worker = $286.03 Set-up cost of $1,893.47 = 6 workersSet-up cost of $1,893.47 = 6 workers Disassembly rate for 200 units = 24.5 Disassembly rate for 200 units = 24.5
hourshours
RecommendationsRecommendations
Demanufacturing task as part of unused Demanufacturing task as part of unused computer handling operationcomputer handling operation
Schedule 2 workers per week for Schedule 2 workers per week for demanufacturingdemanufacturing
Set-up 2 workstationsSet-up 2 workstations 1 workstation for CPU disassembly1 workstation for CPU disassembly 1 workstation for sub-disassembly1 workstation for sub-disassembly Set-up cost = $572.06 Set-up cost = $572.06
Final ThoughtFinal Thought
Implementing an efficient de-Implementing an efficient de-manufacturing operation will result manufacturing operation will result in a 70% cost reduction. in a 70% cost reduction.