Reference no: EM132320438

Introduction to Supply Chain and Operations Management Assignment -

Oil Change at the Dealership -

I was home one day last week so I called and made an appointment to get an oil change. At first, they were suggesting come in next week but finally said, "Come at 2:30 and we'll fit you in." This was good to hear. This dealership does all of our new car servicing. In total, they probably do 10 oil changes a day. I know their oil change costs $40.

I arrived at 2:25 and parked the car. I stopped to admire the new models so ended up right on time. I went in and waited in line at the service counter. (3 minute wait) Only one service advisor was available. When my turn came, he called up my name on the computer and put in the request for the work to be done. Then he printed off the form, and explained it to me. It is a new car so I pointed out I am entitled to the first 3 oil changes being free. He had to change the bill as he hadn't caught it the first time. I signed it and went to sit in the waiting room. (total of 7 minutes). About 3 minutes after I sat down, I saw the advisor put the keys and workorder in the mechanic's tray.

At 3:00 my car was pulled into the shop. They wrote down the mileage, did the work, reset the automatic reminder for me, signed off on the paperwork and then went and parked my car outside. On his way back in (3:25), the mechanic dropped the paperwork and my key at the window for the service advisor to total the bill and present it to me.

At 3:35 the service advisor had completed the bill and he called me from the waiting room. I asked a couple of questions. I couldn't read his handwriting and thought he had totalled the bill incorrectly. He retotaled it and improved the handwriting. I presented my credit card for payment. He processed it and by 3:50 I was back in my car ready to go home.

Assignment - Pull out a piece of paper that can be handed in.

a) Using a process map, lay out the steps from the time I arrived until the time I started my car to leave the dealership. Include times for each step. Don't forget a start and end process step. What is the total cycle time? You will have about 5 minutes to complete the first part (a) of the assignment.

b) The Dealer has approached you and asked for your operational help.

• Where are the delays that could be eliminated?
• How could you do that? What changes would have to be made?
• What would be the new cycle time with your recommendations implemented? Can you approximate the time savings? If shop time is billed at $90 per hour, what would be your savings on a single oil change?
• How could mistakes (like the "free" oil change missed or couldn't read the handwriting) or loops be avoided?

c) As the consultant, a proud graduate of the BAM program, what are the main reasons for mapping the process?

d) If the dealership could do 10 oil changes in 8 hours, what is their productivity per labour hour?

e) The standard in the oil change industry is one oil change every 30 minutes or ____ in an 8 hour day. What is the efficiency of the Dealership? Comments?

f) Value Added steps .... Using your best estimates, what is the ratio of value added / total cycle time? Why is it be important to examine this?

g) What are some potential problems as the dealership decreases their total cycle time?

h) What are some other Key Business Process Measures that could be used in assessing the oil change procedures at this dealership?