OM-Custom Mold Inc_final

7/31/2019 OM-Custom Mold Inc_final

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Custom Molds, Inc(Operations Management, page 139)

Presented by Group 2:

Sureash Muthu GM04500Emran Ismail GM04694Hwa Tee Hai GM04680Soon Hor Fam GM04510

Lee Chia Fuh GM04647


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Synopsis

Founded in 1987 in Tucson, Arizona byfather and son Tom & Mason Miller.

Manufacture custom made moulds for:

Plastic parts

Plastic connectors for the Electronic industry

They began by focusing on mould thenexpanded into production of plastic parts.


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Issues

Changing strategies in customersbusiness also changes the order needs.

Total time from order placement to receiptby customer is longer than promised.

Increasing number of defective products

Bottlenecks in productionCant predict where, why, when.


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Purpose

The purpose of this case is to focus on issuesrelating to process design and to discuss how

decisions involving process structure,customer involvement, vertical integration,resource flexibility and capital intensity

interacts with different competitive priorities.


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Purpose ( con t d )

In answering the questions, we will look into how to competeeffectively in each of Custom Molds markets & how to best configureits processes.

Issues that we will consider:

There are 2 different processors taking place in the same facility

The different processors serve different customers. Mouldfabrication requires flexibility and quality where partsmanufacturing competes on delivery and low cost.

Although the number of orders has remained relatively stable, thevolume per order for parts has increased significantly over the last3 years. This increased has caused a bottleneck in the shop.

The change in sales mix has created excess capacity and in mouldfabrication and the owner has relegated one of the mastermachinist to the role of the expediter.


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Question (1)What are the major issues facingTom and Mason Miller?


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Solution (1) Declining orders of multiple molds and

plastic parts.

Delivery problems:

Promised 3 weeks but actual 4-5 weeks.

Affects clients production schedule.


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Solution (1) ..contd Poor quality of products

Defective parts.

Inefficient production processes.

Poor manpower planning/expertise.

Piece-meal problem-solving.


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Question (2)a) Identify the individual processes

on a flow diagram.

b) What are the competitivepriorities for these processes and

the changing nature of theindustry?


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Solution (2a)

ORDERRECEIVED

DESIGNREVIEW

ORDERMATERIAL &

TOOLING

M & T RECEIVEDFABRICATIONSCHEDULED

MOLDFABRICATION

CLEAN & POLISHPACKING &SHPPING

TESTING &INSPECTION

FAILS

PASS

Molds Processes Flow Diagram


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Parts Processes Flow DiagramORDER

RECEIVED

PART &MATERIALREVIWED

R. MATERIAL &PRODUTIONSCHEDULED

R. MATERIALSRECEIVED

MATERIALS DRYMIXED &BLENDED

MATERIAL WETMIXED INTO

SLURRY

SLURRYTRANSFERRED

TO HOLDINGTANK

MOLD SECURED FROMINVENTORY ORFABRICATION

PARTSMOLDED CUT AND TRIMOPRERATION PACKING &SHPPING

ADDITONALASSEMBLY

INSPECTION(ASSEMBLY

NEEDED) NO

YES

Solution (2a) ..contd


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Companies compete in the marketplace by virtue ofone or more of the following competitive priorities:

Qualityto produce in accordance with the

specification without error. Speeddo things quickly in response to customers

demand.

Costto produce at low cost.

Flexibilityto change the volume of production, thetime taken to produce, mix of different product or servicesproduced and ability to innovate and introduce newproducts and services.

Solution (2b)


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Mold Fabrication Process: Job process, limited no of molds manufactured per order.

Competitive Priorities:

Quality Should be of top quality

Should be consistent

Lead-time

Delivery should be on-time

High development speed

Flexibility

Customization of the mold

Solution (2b) ..contd


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As this industry is moving toward an increasedneed for speed in development and timelydelivery at consistently top quality, hence thecompany should focus these competitive

priories on the core process of supplierrelationship to reduce lead times for deliveryof material and tooling.



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Parts Manufacturing Process: Batch process, higher volume & cost sensitive market.

Competitive Priorities:

Cost Low cost operations

Lead-time

On-time delivery Quality

Should be consistent



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As the customers in this industry dependent ontimely consistent deliveries at low cost, thecompany should adjust to the dynamicenvironment and focus on these competitive

priorities and the core processes of supplierrelationship & customer relationship to avoidbeing out-competed.



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The nature of the industry has changed. From traditional mold fabrication.

speed in development and timely delivery atconsistently top quality.

To part manufacturing.

dependent on timely consistent deliveries at lowcost.

The company should focus these competitivepriories on the core process of supplierrelationship to reduce lead times for deliveryof material and tooling.



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Question (3)a) What alternative might the Millers

pursue?

b) What key factors should theyconsider as they evaluate these

alternatives?


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Alternatives with 3 aspect of focus Short term

To resolve day to day operational issue

Minor incremental operation process changes toimmediately improve delivery performance.

Medium term

To decide for an in depth change on overall

operation methodology and process. Long term

Realignment of strategic operational decisionswith organizational objectives.

Solution (3a)


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Short term

Implement flexibility of pool resource utilization

E.g. any master machinist from 1 of the 13 pool resources tohandle mold fabrication to reduce potential delay scheduling.

To evaluate reduce of delay (improvement in core processes)

Material ordering (3 to 4 weeks). Scheduling of fabricate mold to produce part (1 to 3 weeks).

Medium term

Reorganize the plant layout, streamlining the process with quality

management culture, e.g. TQM process. Enhancement in supplier relationship through supply chain

management enhance time based competitive priorities.

Better utilize resources.

Holding raw material inventory based on forecasting, e.g JIT.

Solution (3b)


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Long term 4 options Refocus the company on custom mold fabrication.

Refocus on growing parts manufacturing market.

Reorganize the different requirement for 2 separate processes.

Establish 2 entirely separate lines.

Key factors to consider

Cost of implementation vs benefits to organization.

Competence in the organization and the capacity to execute the

change. Market trend development customize mold vs manufacturing

market an evaluation of Organizational core businessstrategy.



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Many operations at manufacturing facilitiesinvolve customer contact.

Quality Control, design engineering, marketing,sales and other organizations represent thecustomer at various stages of any process.

Customer contact can be very high, especially

between production and engineering andproduction and quality control.

Summary


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Changing customer demand has changebusiness.

To address this, Custom Molds needs to makedecisions involving process structure, customerinvolvement, vertical integration, resourceflexibility and capital intensity interacts with

different competitive priorities.

Summary ..contd


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Thank You

OM-Custom Mold Inc_final

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