Review The Riordan Manufacturing Virtual Organization

Review the Riordan Manufacturing Virtual Organization

Review the Riordan Manufacturing Virtual Organization. Write a paper of no more than 1,400-words that includes the following: Determine Riordan's manufacturing strategy (chase, level, or combination) and explain its benefits Create a process flow diagram for the electric fan supply chain Select two metrics to evaluate performance of the electric fan supply chain Describe the supplier relationship and the effects on the supply chain. As part of this consider the following: Type of relationship Supplier location, size of company, and financial stability Metrics used to measure supplier performance (on-time delivery, defects, etc) Supplier improvement strategies Describe how lean production principles may be used to maximize the efficiency and effectiveness of the electric fan supply chain process Select a business forecasting technique (qualitative or quantitative) for the electric fans and describe the forecasting process to be used at Riordan Create a sales forecast for electric fans using selected techniques Develop Aggregate Production Plan, Master Schedule, and Materials Requirement Plans for electric fans based off the sales forecast. Be sure to include the following: The determination of inventory requirements of the electric fans component parts and finished goods The selection of an appropriate inventory system (fixed order quantity, two bin method, etc.) to meet inventory requirements. However, only the following two specific tasks from this set are requested for completion:

Paper For Above instruction

Select two metrics to evaluate performance of the electric fan supply chain

Evaluating the performance of the electric fan supply chain is crucial for ensuring efficiency, responsiveness, and competitiveness. Two vital metrics that provide comprehensive insights into the health and effectiveness of the supply chain are "On-Time Delivery Rate" and "Defect Rate." These metrics collectively address both operational reliability and product quality aspects, which are fundamental for customer satisfaction and cost management.

On-Time Delivery Rate

This metric measures the percentage of orders delivered to customers or retailers within the agreed-upon timeframe. It is a critical indicator of the supply chain's responsiveness and reliability. In the context of Riordan Manufacturing, high on-time delivery rates ensure that electric fans reach markets promptly, supporting customer satisfaction and competitive advantage. Analyzing this metric involves tracking delivery dates against promised dates across different suppliers, production schedules, and logistics providers.

Improvement strategies for the on-time delivery rate include streamlining transportation logistics, optimizing inventory levels to prevent stockouts, and strengthening supplier relationships to mitigate delays. Regular performance reviews and collaborative planning with suppliers also help in identifying bottlenecks that cause late deliveries.

Defect Rate

The defect rate tracks the proportion of electric fans that do not meet quality standards upon inspection, expressed as a percentage of total units produced. Lower defect rates correlate with higher quality, reduced rework costs, and minimized customer returns or complaints. For Riordan, maintaining a low defect rate in electric fans enhances brand reputation and reduces warranty claims.

Metrics like statistical process control (SPC) and quality audits are used to monitor defects during manufacturing. Strategies to improve this metric include implementing Six Sigma practices, continuous process improvements, and supplier quality management programs to ensure component and product quality meet the required standards.

In essence, by monitoring the on-time delivery rate and defect rate, Riordan can better identify areas for process improvement, optimize operational efficiency, and strengthen supply chain resilience.

Create a sales forecast for electric fans using selected techniques

Developing an accurate sales forecast for electric fans is fundamental for effective capacity planning, inventory management, and production scheduling. For Riordan Manufacturing, the chosen forecasting technique is the quantitative method of "Time Series Analysis," specifically utilizing a Moving Average approach, which smooths out fluctuations in historical sales data to project future demand.

Forecasting Process

The forecasting process involves collecting historical sales data for electric fans over a defined period, such as the past 12 to 24 months. This data provides the basis for calculating the moving average, which is a simple yet powerful technique to identify trends and seasonal patterns. The steps include:

1. Data Collection: Gather monthly sales data of electric fans from internal records and sales reports.
2. Determine the Period: Select an appropriate period for the moving average, typically 3, 6, or 12 months depending on demand variability. For highly seasonal products, a longer period may be suitable.
3. Calculate Moving Averages: Compute the average sales for each period by averaging the sales of the most recent months within the selected window.
4. Forecast Generation: Use the latest calculated moving average as the forecast for the upcoming period.
5. Adjustment for Trends and Seasonality: If an identifiable trend or seasonal pattern exists, incorporate these adjustments to refine the forecast, potentially combining the moving average with seasonal indices or applying exponential smoothing techniques for better accuracy.

Electric Fan Sales Forecast

Based on historical sales data, suppose Riordan's monthly electric fan sales for the past 12 months are as follows: 1500, 1600, 1550, 1650, 1700, 1680, 1720, 1750, 1800, 1850, 1900, 1950 units.

Using a 3-month moving average, the forecast calculations would be:

• For month 4: (1500 + 1600 + 1550) / 3 = 1550 units
• For month 5: (1600 + 1550 + 1650) / 3 = 1593 units
• For month 6: (1550 + 1650 + 1700) / 3 = 1633 units
• For month 7: (1650 + 1700 + 1680) / 3 = 1676 units
• For month 8: (1700 + 1680 + 1720) / 3 = 1700 units
• For month 9: (1680 + 1720 + 1750) / 3 = 1716 units
• For month 10: (1720 + 1750 + 1800) / 3 = 1757 units
• For month 11: (1750 + 1800 + 1850) / 3 = 1800 units
• For month 12: (1800 + 1850 + 1900) / 3 = 1850 units
• Forecast for month 13: (1850 + 1900 + 1950) / 3 = 1900 units
• This forecast indicates a steady increase in demand for electric fans, aligning with historical growth trends. Based on these projections, Riordan can plan production and inventory levels accordingly, ensuring sufficient capacity to meet anticipated demand.
• Conclusion
• Effective performance measurement through the selection of meaningful metrics like on-time delivery and defect rate enables Riordan Manufacturing to maintain a high-quality, reliable electric fan supply chain. Coupling these metrics with accurate sales forecasting using time series analysis provides a robust foundation for strategic planning. By using data-driven insights and applying lean production principles, Riordan can optimize its supply chain operations, achieve cost efficiencies, and enhance customer satisfaction in a competitive marketplace.
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