Essay sunwind case study

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Sunwind A.B. – A Case Study

On November 14, 2000 Olav Larsson, Managing Director of Sunwind, eased back in his seat as his A380 climbed away from Tokyo’s Narita Airport to begin the 17 hour flight to Gothenburg, Sweden. He was returning from a 10-day trip to Japan where he had visited factories of Nissan and Mazda as well as a number of their parts suppliers. This visit had reinforced his conviction that Sunwind should initiate a proposal to Volvo, its major customer, that Just-In-Time delivery of floor lids1 be made directly onto its 700 series automobile assembly lines at Torslanda, near Gothenburg, Kalmer, a port city on Sweden’s east cost, and at Ghent in Belgium.

Lars, a graduate engineer, had previous managerial
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Average weekly requirements in 2001 were expected to approach 1,400 units. Lars estimated Sunwind’s current single shift capacity at approximately 1,250 units/week. To achieve this, he had hired an additional 20 people at the beginning of August and established three shift operations on a numerically controlled milling machine used to shape plywood parts.

Effective capacity was actually less than 1,250 units/week due to equipment failures, e.g. the gluing machine had proved particularly troublesome and had increased rejects. Recent causes of the rejects included seeping through the carpeting that covered the plywood forms. Volvo had also rejected a shipment of floor lids due to differences in the shade of carpeting covering the four separate pieces which made up a floor lid.

Such difficulties could not have come a worse time, when Lars was already concerned by the world-wide trend of major manufacturers in the automobile industry to rely on fewer suppliers. He knew that Toyota, which industry observers continually cited for its productivity gains, relied on only 320 suppliers, while Volvo had over 600. Headlines such as “Volvo will reduce number of suppliers; pressure on sub-contractors” in Dagens-Nyheter, one of Sweden’s major daily newspapers, did not help his peace of mind.

He was also aware that Just-In-Time deliveries had been implemented recently
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