Littlefield Technologies Part 1

“When the simulation began, we felt confident in our team’s vision, goals, and strategic plan. After the first rollover, we quickly became aware that the success of a company relies heavily on the dynamics of the market. The strategic decisions of competitors weigh heavily on the overall direction of a company. Our original plan quickly became obsolete in the tumultuous bike industry, and we were forced to re-evaluate our competitive positioning. To this end, we learned

The company started off producing 20,000 units of mountain bikes. We did not change the production quantity. Last year our forecast sales were 24,000 when we only sold 19,866; therefore we thought it would be best to leave production at 20,000 bikes. Having excess inventory, we concluded that 20,000 units should be enough considering our quality has not changed and our advertising will not increase the sales dramatically. Although we had the choice to produce as much as 30,000 units, we felt as though we did not have sufficient money to increase production. We were interested in allocating the money towards marketing as opposed to production. We realized that without awareness, no matter how many units we make, sales would be inefficient.

: We changed lot size for 3 times. On Day 58, we changed to 2 lots/job in order to take Contract number 2 to make earn more money. On Day 64, we changed to 3 lots/job and hope the lead time would decrease. This was a big mistake we made. After this change, we noticed the queue for station #3 is very high, station #3 became bottleneck and our

We adjusted focus to our niche market, sold off capacity in the low end and traditional markets, and proceeded to decrease our production going into the next round. While selling capacity was the correct financial decision to combat our emergency loan, we were then left with stock outs in all of our product lines. As a result, we continued to struggle with overproduction and avoiding stock outs, but made improvements resulting in less drastic inventory swings in the later

Steve was concerned about the potential loss of customers and suggested that Prairie Winds purchase a second pasta production machine for $40 million. The company had excess space in the existing facility that could be used for the new machinery. However, this space currently was leased to another company on a year-to-year basis and was generating annual rent of

Based on this, we then decided to look at the utilization and queue figures on, leading up to, and after day 31 at each station, so we could attempt to identify any potential bottlenecks. The first thing that jumped out at us

After a few months of detailed scrutiny of the numbers, we were able to make pricing decisions more quickly by using the breakeven change in volume to set the new price. Based on our broad

1. Do you feel that the Bearington plant has the right equipment and technology to do the job? Why?

Markowicz felt that he had a primary responsibility to the company to ensure that the production process runs smoothly at his plant, and after the first half of 2010, it reported profitable operations and net cash inflows from investing activities was positive for the first time in three years and had already reached $250,000 in just the first half of the year. This meant an increased level of production and increased pressure on machines; therefore naturally the breakdown of machines was increasing. In addition, Milton’s regular supplier had hiked about the prices on the motors that he needed by 25%, while Markowitz had been able to find from a supplier overseas for 25% off temporarily to build customer base.

The industry witnessed several industry level stock outs, because of low production capacities. Ideally most should have been made of the situation. We should have seen the opportunities and worked to achieve way beyond our set goals.

Safety Stock: I have concluded to keep our customers happy and to end losing 10% of our demand to our competitors we must maintain a 95% cycle-service

Andres was forced to import product from French division as he ran out of capacity several times due to new machines performing inadequately. This added an overhead expense of approximately 2147 (Additional maintenance costs + Transfer costs)

These two bottlenecks constrained the whole process. Alex and his colleagues were happy to identify two "Hebie"s, NCX-10 and Heat Treatment Department, which bottlenecked a flow sufficient to meet demand and make money. So the only thing to do was to find more capacity. To increase the capacity of the plant was to increase the capacity of only the bottlenecks. To increase the capacity of bottlenecks did not mean to install new machine, but to find the hidden capacity. With the help of Jonah, Alex found the NCX-10 had 1-hour idle time, as the union contract stipulated that there must be a half-hour break after every four hours work. The hours lost in the breaks of NCX-10 were enormously expensive because the throughput for the entire plant had been lowered by the bottleneck. The problem of the second "Hebie", heat treat, was that they didn 't make the bottleneck work on the parts contributed to throughput and many products were unable to be shipped without the parts in pile for treatment. What was more, they only did most inspections prior to final assembly but never inspected the parts before bottleneck. It easily let defects go through bottleneck and lost time in the bottleneck could not be recovered. The cost of one hour lost in these two bottlenecks is the cost of an hour lost in the system, which is computed as the total expense of the system divided by

In the late 1980’s to the mid 1990’s the plant struggled to meet budgetary goals and was faced with potential closure. These struggles stemmed from the plants inability to increase efficiency and reduce cost. Reducing labor

• Increased production capacity- the Nairobi plant was operating with only one shift yet it has a three shift potential and forecast production at 2,300 units- approximately 60% of the capacity of