Pro-Forma Statement 1: Business Analysis
A. Documents
A. Analysis
B1.
To make my pro-forma statements I had to plan for future goals, I intended to make up the money I used in the first three quarters by quarter 4. I tried to backwards plan by adjusting the numbers to hopefully meet the criteria. Each quarter my cash flow increased by about 300,000. I did not increase my effectiveness with pro-forma statements or budgets to ensure adequacy of funds.
The production capacity in my first 2 quarters was low but only because it was upcoming product and needed to be tested on the market. By launching it and seeing what the demand was I altered my next quarter numbers and redirected my target product based on the numbers produced by my previous quarters. I also made a risk …show more content…
by creating a third product, in hopes to have a bigger market of buyers, in creating the third product I was trying to get the company to appeal to every type of buyer instead of the two we had to choose from. After the numbers came out, I realized it would have been more beneficial to stick to my two products and focus on my target markets.
Creating an extra product was more expensive and took away from my original products. I opened up another distribution area in third quarter which helped sales with an increase but my production demand I believe was a bit low.
B2.
The Just in Time (JIT) method, would have been an extremely efficient way to start up my business and overall operational efficiency, because it would require the smallest amount of inventory and cost, which would have helped maintain budgets at a minimum. Since JIT is a system that operates on a “parts and supplies delivered just as needed in the quantity needed” (Wesley, 2010). JIT would have eliminated my spending also by looking out and keeping up with Ohno’s seven wastes into this new upcoming business I could have been much more successful. By avoiding overproduction I could avoid holding on to inventory that is just taking up space and money. Queues, idle storage or inventory banks; which also just take up space. Transporting only when needed and where needed. Inventory control would again eliminate unnecessary use of space and money. Motion, over processing and …show more content…
defective product, by eliminating un-needed moves of equipment and personnel, no over production of technology, and holding on to anything defective is again a waste of space and money. All of these strategies are crucial to a successful business especially one starting out with a limited amount of money, which in turn would create more operational efficiency.
During my simulation I always ended up with zero inventory I was not producing enough product, for the high demand, being able to implement JIT would help eliminate that problem not having to worry about back stock but rather what they want and need at the time its needed.
B2b.
Lean operations, a much more complex method because it’s more of an external implementation, because it focuses on the customer and their wants and needs. The customer does have the ultimate say, but it takes product testing before you can determine exactly what the customer wants and likes as well as dislikes. By being able to cater to the customer we’d ensure more success because they are getting exactly what they ask for. In turn gaining a loyal customer base. The best way to implement a lean operation is by joining the JIT method, helping the workers create good quality products the first time and minimizing the amount of inventory that needs to travel long distances. By implementing these activities we can increase the operational efficiency and create a more effective business.
B3.
The applicability of work cells versus a traditional straight line method is simple, by arranging machinery, equipment, and personnel in a specific order, to focus on the production of a single product of group of related products (Wesley, 2010) you create a better manufactured product and a timely manner. Either the focused work center or the focused factory would serve as more efficient than the traditional straight line. In essence it’s the original assembly line, but keeping things in a specific order so that each part is individualized and perfected before heading off to its next stop. This allows maximization of inventory only as needed and eliminates defective products.
Work cells eliminate work the waste of space, reduces direct labor, and heightens employee participation and awareness, and reduced investment in machinery and equipment.
B4.
My inventory management wasn’t very efficient ended up with no left over stock which created a problem when the demand increased and my production did not. By the end of my 4th quarter I lost sales by not being able to deliver 1062 computers, which lost me a lot of customers, I failed to project high demands as a beginning company. My inability to cater to the exact needs of the customer effected my likeliness to succeed, if I could re-do it I would implement the JIT method and the safety stock, so that we could create exactly what the customer asks for and send it off in a timely manner, creating less waste of funds and maximizing the customers’ needs. Safety stock would have also been an effective way of managing my inventory, by having that buffer I could have avoided losing so many sales due to lack of resources in this case inventory. By being able to implement the JIT method I would be able to run a more efficient company that provides the right amount of production at any given
time.
Had I been able to implement the JIT in my simulation, I would have been able to provide to the increase in demands, by providing fast turn back. Safety stock would be a back plan for times when all we need is the basics or simple product, to get us by on orders. Having more than one approach is always a good thing. Being able to implement the safety stock strategy would have allowed me to again provide the customers with a fast turn back and would have prevented my lack of inventory. Through-out the simulation I had an increase in demand, I believe these two modifications would help increase production levels on a quicker level, by providing exactly what is asked, and or having it ready to go.
B5.
All aspects could ultimately be improved to make a more beneficial program, it would constantly have to change with the changes and demands of today’s market however so there is no 100% fix to the simulation. Incorporating JIT, statistical process control, and six sigma could help create a more efficient simulation for now. The implementation of the continuous improvement program could have been very beneficial in the simulation to allow the company to modify the products aftermarket testing to see how well they did and catered to the needs of the customer. By allowing this we could have seen just how implementing this helps the company continue to grow. Maintaining a desired quality level in my company and for my product, by paying more attention to every stage rather than focusing on my end goal which was to establish the company, would have proved more efficient.
JIT would help the simulation by allowing us to choose the type of production, it clearly makes a drastic change, and especially when dealing in foreign countries, the demand is different and being able to cater to them by having this available can prove very successful. Statistical process control (SPC) would also be a good aspect to the simulation because it would allow the user to make on spot adjustments to their product or company as they see results the only way to successfully make a company is learning from your mistakes, being able to adjust fire in the simulation would be a very beneficial tool. The SPC technique would have been beneficial because it allows processes to be subject to a certain degree of variability, which in turn will quicken the appropriate action to eliminate assignable causes, in my case, lack of inventory. Six sigma would also be ideal because it would allow for less error in the company by being able to implement this we, the user could help eliminate, misplaced or improperly shipped items.
Works Cited
Wesley, P. A. (2010). JIT and Lean Operations. In P. A. Wesley, Operation Management .
A. Analysis
B1.
To make my pro-forma statements I had to plan for future goals, I intended to make up the money I used in the first three quarters by quarter 4. I tried to backwards plan by adjusting the numbers to hopefully meet the criteria. Each quarter my cash flow increased by about 300,000. I did not increase my effectiveness with pro-forma statements or budgets to ensure adequacy of funds.
The production capacity in my first 2 quarters was low but only because it was upcoming product and needed to be tested on the market. By launching it and seeing what the demand was I altered my next quarter numbers and redirected my target product based on the numbers produced by my previous quarters. I also made a risk …show more content…
by creating a third product, in hopes to have a bigger market of buyers, in creating the third product I was trying to get the company to appeal to every type of buyer instead of the two we had to choose from. After the numbers came out, I realized it would have been more beneficial to stick to my two products and focus on my target markets.
Creating an extra product was more expensive and took away from my original products. I opened up another distribution area in third quarter which helped sales with an increase but my production demand I believe was a bit low.
B2.
The Just in Time (JIT) method, would have been an extremely efficient way to start up my business and overall operational efficiency, because it would require the smallest amount of inventory and cost, which would have helped maintain budgets at a minimum. Since JIT is a system that operates on a “parts and supplies delivered just as needed in the quantity needed” (Wesley, 2010). JIT would have eliminated my spending also by looking out and keeping up with Ohno’s seven wastes into this new upcoming business I could have been much more successful. By avoiding overproduction I could avoid holding on to inventory that is just taking up space and money. Queues, idle storage or inventory banks; which also just take up space. Transporting only when needed and where needed. Inventory control would again eliminate unnecessary use of space and money. Motion, over processing and …show more content…
defective product, by eliminating un-needed moves of equipment and personnel, no over production of technology, and holding on to anything defective is again a waste of space and money. All of these strategies are crucial to a successful business especially one starting out with a limited amount of money, which in turn would create more operational efficiency.
During my simulation I always ended up with zero inventory I was not producing enough product, for the high demand, being able to implement JIT would help eliminate that problem not having to worry about back stock but rather what they want and need at the time its needed.
B2b.
Lean operations, a much more complex method because it’s more of an external implementation, because it focuses on the customer and their wants and needs. The customer does have the ultimate say, but it takes product testing before you can determine exactly what the customer wants and likes as well as dislikes. By being able to cater to the customer we’d ensure more success because they are getting exactly what they ask for. In turn gaining a loyal customer base. The best way to implement a lean operation is by joining the JIT method, helping the workers create good quality products the first time and minimizing the amount of inventory that needs to travel long distances. By implementing these activities we can increase the operational efficiency and create a more effective business.
B3.
The applicability of work cells versus a traditional straight line method is simple, by arranging machinery, equipment, and personnel in a specific order, to focus on the production of a single product of group of related products (Wesley, 2010) you create a better manufactured product and a timely manner. Either the focused work center or the focused factory would serve as more efficient than the traditional straight line. In essence it’s the original assembly line, but keeping things in a specific order so that each part is individualized and perfected before heading off to its next stop. This allows maximization of inventory only as needed and eliminates defective products.
Work cells eliminate work the waste of space, reduces direct labor, and heightens employee participation and awareness, and reduced investment in machinery and equipment.
B4.
My inventory management wasn’t very efficient ended up with no left over stock which created a problem when the demand increased and my production did not. By the end of my 4th quarter I lost sales by not being able to deliver 1062 computers, which lost me a lot of customers, I failed to project high demands as a beginning company. My inability to cater to the exact needs of the customer effected my likeliness to succeed, if I could re-do it I would implement the JIT method and the safety stock, so that we could create exactly what the customer asks for and send it off in a timely manner, creating less waste of funds and maximizing the customers’ needs. Safety stock would have also been an effective way of managing my inventory, by having that buffer I could have avoided losing so many sales due to lack of resources in this case inventory. By being able to implement the JIT method I would be able to run a more efficient company that provides the right amount of production at any given
time.
Had I been able to implement the JIT in my simulation, I would have been able to provide to the increase in demands, by providing fast turn back. Safety stock would be a back plan for times when all we need is the basics or simple product, to get us by on orders. Having more than one approach is always a good thing. Being able to implement the safety stock strategy would have allowed me to again provide the customers with a fast turn back and would have prevented my lack of inventory. Through-out the simulation I had an increase in demand, I believe these two modifications would help increase production levels on a quicker level, by providing exactly what is asked, and or having it ready to go.
B5.
All aspects could ultimately be improved to make a more beneficial program, it would constantly have to change with the changes and demands of today’s market however so there is no 100% fix to the simulation. Incorporating JIT, statistical process control, and six sigma could help create a more efficient simulation for now. The implementation of the continuous improvement program could have been very beneficial in the simulation to allow the company to modify the products aftermarket testing to see how well they did and catered to the needs of the customer. By allowing this we could have seen just how implementing this helps the company continue to grow. Maintaining a desired quality level in my company and for my product, by paying more attention to every stage rather than focusing on my end goal which was to establish the company, would have proved more efficient.
JIT would help the simulation by allowing us to choose the type of production, it clearly makes a drastic change, and especially when dealing in foreign countries, the demand is different and being able to cater to them by having this available can prove very successful. Statistical process control (SPC) would also be a good aspect to the simulation because it would allow the user to make on spot adjustments to their product or company as they see results the only way to successfully make a company is learning from your mistakes, being able to adjust fire in the simulation would be a very beneficial tool. The SPC technique would have been beneficial because it allows processes to be subject to a certain degree of variability, which in turn will quicken the appropriate action to eliminate assignable causes, in my case, lack of inventory. Six sigma would also be ideal because it would allow for less error in the company by being able to implement this we, the user could help eliminate, misplaced or improperly shipped items.
Works Cited
Wesley, P. A. (2010). JIT and Lean Operations. In P. A. Wesley, Operation Management .