Question

Meritor, a company that makes muffler assemblies for the automotive industry, is committed to the use of kanban to pull material through its manufacturing cells. Meritor has designed each cell to fabricate a specific family of muffler products. Fabricating a muffler assembly involves cutting and bending pieces of pipe that are welded to a muffler and a catalytic converter. The mufflers and catalytic converters are pulled into the cell based on current demand. The catalytic converters are made in a specialized cell.
Catalytic converters are made in batches of 10 units and are moved in special hand carts to the fabrication cells. The catalytic converter cell is designed so that different types of catalytic converters can be made with virtually no setup loss.
Meritor hires a team of consultants. The consultants suggest a partial robotic automation as well as the safety stock to be 12.5 percent. Meritor implements these suggestions. The result is an increase in efficiency in both the fabrication of muffler assembly and the making of catalytic converters. The muffler assembly fabrication cell averages 16 assemblies per hour and the lead time is two hours’ response time for a batch of 10 catalytic converters. How many kanban cards are needed? (Round up your answer to the next whole number.)

Answer 1

Answer: See explanation

Explanation:

The number of kanban cards that are needed can be calculated below:

Average demand, D = 16

Lead time, L = 2 hours

Safety stock, S = 12.5% = 0.125

Catalytic converters, C = 10

Using the formula, =DL(1+S) / C

= 16×2(1 + 0.125) / 10

= 32(1.125) / 10

= 36 / 10

= 3.6

= 4 approximately

Therefore, 4 kanban cards are needed.