Professional Documents
Culture Documents
Process flow charts---for identifying bottlenecks and non value added activities.
Using the QFD methodology, buyer and supplier integration into the process can
benefit the organization by
(1) reducing or eliminating engineering changes during product development
(2) reducing product development cycle time, (
3) reducing start-up cycle time,
(4) minimizing product failures and repair costs over the product life and
(5) creating product uniformity and reliability during production.
Quality Control:
Quality control: making sure that the requirements are met and being able to
demonstrate this objectively.
Process Control:
Statistical quality control.
Process capability refers to the ability of the process to meet specifications
consistently. Statistical process control (SPC) is a technique that involves
testing a random sample of output from a process in order to detect if non-
randum changes in the process are occurring.
Control charts-----upper and lower limits of process variable help in monitoring
the process
Six sigma
Sampling.
Sequential Sampling.
.
Inspection and Testing
Inspection and testing ----- done at two different stages in the acquisition
process.
1, Before commitment is made to a supplier,
Testing and Samples: Use of samples to test for intended purpose and
Laboratory Tests to ascertain conform ation to specific values of parameters.
One of the major areas of cost leaks is in the area of Inventory Management.
To increase profits,It is important to plug cost leaks before they become cost
holes.
It is sometimes true that a company loses more on non-availability of mater\al
despite high inventory investment.
Inventory control is a goldmine for saving. Understanding where (and why)
inventory should be positioned in the supply chain can improve customer
service, lower total costs, or increase flexibility
Why Inventories?
• To gain economy in purchasing
--ordering cost / set up cost minimisation
-- to avoid frequent order.
• Hoarding to prevent future price increase.
• To satisfy demand during period of replenishment.
• To carry reserve stocks to avoid stock out.
• To stabilise production and ensure smooth flow of goods through the
productive process :
- Seasonal demand vendors
- Peak and through of demand to be managed
- To levelise resource allocation
• To prevent loss of sales.
• To satisfy other business constraints.
- Condition of minimum order
- Seasonal availability.
• To provide and maintain good customer service.
Classification of inventory functions
Transit or pipeline inventories ---to stock the supply and distribution
pipelines linking an organization to its suppliers and customers as well as
internal transportation points.In just-in-time (JIT) production, the use of local
suppliers, small batches in special containers and trucks specifically designed
for side loading in small quantities used to reduce transit inventories.
Cycle inventories ----to purchase, produce or sell in lots rather than
individual units or continuously.
Buffer or uncertainty inventories or safety stocks ---to address variability
in demand . efforts to may have substantial payoffs in reduced inventories. ----
increasing supply alternatives, using local sources, reducing demand
uncertainty, reducing lead time or having excess capacity can reduce supply
variability ------ should be determined by balancing carrying cost against stock
out cost.
Anticipation or certainty inventories are accumulated for a well-defined
future need.
Decoupling inventories make it possible to carry on activities on each side of
a major process linkage point independently of each other.
COSTS OF INVENTORIES
For every items carried in inventory, the costs of having it must be less than the
costs of not having it. Inventory exists for this reason alone.
Stock out costs are the costs of not having the required parts or materials on
hand when and where they are needed. They include lost contribution on lost
sales (both present and future), change over costs necessitated by the shortage.