Performance and cost analysis: seminar. Marcus Komponenter AB. Benjamin Rubin Anders Holmberg Arvid Claeson. Marcus Komponenter. Producing unthreaded fixing elements
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Marcus Komponenter AB
Benjamin Rubin Anders Holmberg Arvid Claeson
Two different value chains; for specially ordered products and own produced articles, respectively:
Design (CAD together with customer)Supply (receiving raw material, in this case steel wires)Production (the core)Distribution
All in all, Marcus has demanding customers, that wants large volumes of products fast. This puts pressure on the production and distribution apparatus, which for a sustainable competition must fulfil the wants effectively. That is, with fast throughput time and with as low inventory levels as possible.
Different products demand different production steps, but the picture below visualises the factory and thus some of the identified different cost centres;
Färdigvarulager=finished goods storage, Pack=packaging, Slip=grinding, Råvarulager=raw material storage, Klipp=cutting and rolling machine, Svarvar=lathes
Production and distribution of diverse products (both specially ordered and common products)
Cost centers for production
Production centers for each individual product are the cost centers (lathe, cutting and rolling machine, grinding machine and soforth)
Storage costs (including both storage and bufferts) –>minimize by just in time
Production of large volumes and batches makes it diffcult to allocate overhead costs for single products. Therefore, we suggest to use an activity based cost management system in order to focus on managing activities and thus being able to control and to minimisie cost in each step of the production cycle.
ABCM – Activities consume costs, the basis!
Can lead to an effecient overlook of value adding and non-value adding activities
Green=value adding. Red=not value-adding. White dots=exchange time White stripes=hardening
For Marcus Komponenter it is of great importance to deliver products fast and with great ”correctness”, since the products are relatively difficult to technically differentiate. Thus, it is necessary to adapt to a JIT-concept.
JIT- a ”pull” system
Right amount of products is to be produced at the right time. The demand creates the pulling mechanism throughout the production.
Lower storage levels and smaller batch sizes makes JIT possible as it visualises problems within the production where, consecutively, continuos improvements in the production can take place.
Minimizes storage due to that the customer wants/gets the product directly. Also reduces waste since what is being produced is actually needed.
Shorter throughput time
This, since only what needs to be produced is produced, thus avoiding queues in the production.
Shorter throughput time and faster reaction to customer´s wants gives a competitive advantage
Total quality management (TQM) should permeate the work.
- Minimise mistakes, maximising quality