Prism Canada Inc. Case Study
Prism Canada Inc. Case Study
Problem Statement:
Will outsourcing the company’s inefficient sheet metal operation be a proper strategic move to save the company money and satisfy current and potential customers with respects to quality and delivery lead time?
Size up: Item | So What? | Machine break-downs | Since break-downs occur at the initial step, the rest of the process gets delayed causing longer customer lead time and extra shifts are required which increases labour expense. | Age of the machines | Considering the turret press was old and broke down often, this causes a delay in customer lead time and unnecessary costs because parts are expensive and hard to find. | Under performing sheet metal operation | Because the sheet metal operation is underperforming, it is causing the company to lose money by not being able to supply customer orders and perform efficiently. | Production efficiency at 40% | Should approach 100% in order to meet customer lead time of less than 6 weeks | Frequently adding second shift | Since the process is taking more than double the time to complete, a second shift must be added to ensure that lead times are met. This is costing the company a significant amount of money. | Aging workforce | Considering the age of the company’s workforce, it is becoming less productive, adding to the reason of running an extra shift and delaying customer lead time. | Unionized work force | Workers will only perform duties within their own job classification and are discouraged to perform at a level above and beyond the company’s expectations. Due to seniority rights, the company cannot allocate labour efficiently. | Elimination of sheet metal operation | Deciding to eliminate the whole sheet metal operation could potentially cause the company to lose a significant amount of business when perhaps the issue could be resolved by purchasing a new turret press and implementing proper training procedures for employees in regards
Problem Statement:
Will outsourcing the company’s inefficient sheet metal operation be a proper strategic move to save the company money and satisfy current and potential customers with respects to quality and delivery lead time?
Size up: Item | So What? | Machine break-downs | Since break-downs occur at the initial step, the rest of the process gets delayed causing longer customer lead time and extra shifts are required which increases labour expense. | Age of the machines | Considering the turret press was old and broke down often, this causes a delay in customer lead time and unnecessary costs because parts are expensive and hard to find. | Under performing sheet metal operation | Because the sheet metal operation is underperforming, it is causing the company to lose money by not being able to supply customer orders and perform efficiently. | Production efficiency at 40% | Should approach 100% in order to meet customer lead time of less than 6 weeks | Frequently adding second shift | Since the process is taking more than double the time to complete, a second shift must be added to ensure that lead times are met. This is costing the company a significant amount of money. | Aging workforce | Considering the age of the company’s workforce, it is becoming less productive, adding to the reason of running an extra shift and delaying customer lead time. | Unionized work force | Workers will only perform duties within their own job classification and are discouraged to perform at a level above and beyond the company’s expectations. Due to seniority rights, the company cannot allocate labour efficiently. | Elimination of sheet metal operation | Deciding to eliminate the whole sheet metal operation could potentially cause the company to lose a significant amount of business when perhaps the issue could be resolved by purchasing a new turret press and implementing proper training procedures for employees in regards