Donner Company Case Solution Essay

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1. The process flow diagram of the production system at Donner.
Preparation Stage

Imagine Transfer


2. What size orders would you schedule on the CNC drill? On the CNC router?
Time taken to process the orders depends on the selected drilling method either
a) Manual drilling or CNC OR b) Using CNC Drill
Assumption 1: Manual Drilling is not done on all the available Manual Drill Presses in parallel.
Calculating time taken for Manual drilling and CNC Drilling:
= Setup Time + Run Time (Per Hole) * No. of Holes drilled on each circuit board * No. of boards
Time taken for Manual drilling =15 + 0.08*500*x where x= number of circuit boards
Time taken for CNC drilling = 240 + 0.004*500*x where x= number of
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of Boards (n) Parallel Process allowed Manual Drill 6 < n ≤ 56 No Parallel Processing CNC Drill n > 56 CNC Drill
What Size orders can be scheduled on CNC Router?
Using the steps used in previous part, calculating the time taken by each method
Time taken for Punch Press =50 + x Time taken for CNC Router = 150+ 0.5x
To figure out whether CNC Router to be used,
50 + x ≥ 150+ 0.5x Hence x ≥ 200. [x= number of circuit boards]
Conclusion for CNC Router: n < 200 Use Punch Press
Total no. of Boards (n) n > 200 For Use CNC Router
3. Would you recommend adding another CNC drill? Perform a net-present value calculation to help make the decision. Price of the CNC machine is $80,000. The additional assumption we need to add to assumption already given is that:
Arthur Dief will run all the small orders (8 circuit boards or less) and other boards will be done on a CNC machine despite of the shop floor policy which states that only orders for more than 100 boards be drilled on a CNC machine.
The company is currently using a CNC machine for orders for equal or greater than 140 boards due to capacity of a CNC machine; however, they would be able to process all orders with CNC machines if they add one more machine.
In this case, if we calculate the current cost in drilling process:
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