Reference no: EM131233808

How do each of the projects below improve supply chain?

Project 1

Outsource the machining and assembly of parts to regional machine shops. Continue in-house assembly lines for final assembly.

This will potentially reduce the labor force by one third (about 100 people) and will potentially result in the sale or disposition of approximately $3 million work of machinery. It is possible that the company contracted for outsourcing will purchase the machines, but there may be a book loss on the sale. there may be enough room freed up in the plant to move all of the remaining operations into one location. Outsourcing the manufacturing of these parts will require enhanced communication with supplies and customers. Inventory management is especially concerned about controlling the quality of the outsourced parts.

Project 2

Develop focus factories or work cells to streamline the production process.

This will require the breakdown of the plant into product line specific "mini" plants. Inventory will be reorganized to support the product line. The reorganization will require physical labor to move inventory and system updates to improve accuracy in terms of quantity and location of inventory.

Employees will be assigned to a specific product line and will need training to understand the focus factory or work cell concept. The factory manager anticipates that employees will have greater ownership of the manufacturing process because they will be more involved in the process from start to finish. He anticipates that errors will be reduced and that employees ill know when inventory is low and needs to be replaced.

Sales and Marketing cautioned that it will be essential that a reorganization of plant production must not impede the delivery of current customer orders. Further delays could cause customers to permanently move their orders to the competition.

The layout for this type of process has not been determined

Project 3

Upgrade technology with a new fully-integrated ERP system that improves communication with suppliers, within the production facility, and with customers.

By improving communication along the supply chain, Fenlo will be a better position to improve efficiecny along the entire supply chain. This will improve Fenlo's profitability if the rewards from the ERP System outweigh the risks (or cost).

This project will include a major system upgrade in order to line internal and external partners to the internet (data flows both way on the supply chain) All internal and external partners must understand the potential benefits of e-supply chain implementation and be will to put forth the regired effort. With a project of this magnitude, buy-in will be required from all parties. The type of upgrade includes expenses for hardware and software, consulting and change management. The company must also have the right people in place with the right skills to operate and maintain the system. Training is a major concern as most jobs will require computer literacy.