Question

On average, the manufacturing (processing) time spent per order is approximately 4 days. In addition, a typical order spends 4 days moving from process to process, 3 days in storage, and 2 days in inspection. For an average order, what is the manufacturing cycle efficiency (%), rounded to 1 decimal place (e.g., 32.463% = 32.5%)? (Hint: Refer to Exhibit 14.14 and accompanying discussion.)

Answer 1

Answer:

30.8 %

Explanation:

Manufacturing cycle efficiency refers to proportionate time that a product spends in value adding activities and process as compared to the entire time it is in the supply chain. The only value adding activity we can assume is when the actual manufacturing takes place thus the 4 days.

We can calculate total time by adding all the days the product was with the company such as

Total time spent in the supply chain = 4 + 4 + 3 + 2 = 13 days

so,

Manufacturing cycle efficiency = 4/13 = 0.3077 or 30.8 %

Hope that helps.