Question

Williams Optical Inc. is considering a new lean product cell. The present manufacturing approach produces a product in four separate steps. The production batch sizes are 57 units. The process time for each step is as follows:

Process Step 1	9	minutes
Process Step 2	8	minutes
Process Step 3	5	minutes
Process Step 4	4	minutes

The time required to move each batch between steps is 15 minutes. In addition, the time to move raw materials to Process Step 1 is also 15 minutes, and the time to move completed units from Process Step 4 to finished goods inventory is 15 minutes.

The new lean layout will allow the company to reduce the batch sizes from 57 units to 3 units. The time required to move each batch between steps and the inventory locations will be reduced to 3 minutes. The processing time in each step will stay the same.

Determine the value-added, non-value-added, and total lead times, and the value-added ratio under the present and proposed production approaches. If required, round percentages to one decimal place.

	Present Approach		Proposed Approach
Value-added time		min		min
Non-value-added time		min		min
Total lead time		min		min
Value-added ratio (as a percent)		%		%

Answer 1

Solution :-

	Present Approach	Proposed Approach
Value-added time	= 9 + 8 + 5 + 4 = 26 minutes	= 9 + 8 + 5 + 4 = 26 minutes
Non-value-added time	= [ 26 * ( 57 - 1 ) ] + [ 15 * 15 ] = [ 26 * 56 ] + 225 = 1,456 + 225 = 1,681 minutes	= [ 26 * (3 - 1 ) ] + [ 15 +15 ] = [ 26 * 2 ] + 30 = 52 + 30 = 82 minutes
Total lead time	= 1,681 + 26 = 1,707 minutes	= 26 + 82 = 108 minutes
Value-added ratio (as a percent)	= 26 / 1,707 = 0.01523 = 1.5%	= 26 / 108 = 0.240 = 24.1%