FAR EASTERN UNIVERSITY

Case #5: FEUture, Inc.

Operations Management
MBA 703
FEU-Manila

Submitted by:
 Reporting Group  Reacting Group
Ely Ray Casuga
Angelica Gianan
Abegail Madurar

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Case Background

FEUture Inc. has been making microcomputer accessories for the past ten
years. Over the years, hard drives have served as the foundation of FEUture.

FEUture has made the decision to broaden its product offering in reaction
to a recent decline in sales. The choice was taken to produce plug-in 256 MB
backup systems for Dell laptop computers after significant discussion among
executives, engineers, production staff, and marketing staff. FEUture wants to
transition from its hard disk knowledge to plug-in competence and take the lead in
terms of price for this product type for this machine series.

After conducting a thorough analysis of machines and backup systems, the

marketing staff concluded that a fair sales goal after one year would be 60,000
units annually. Upper management, however, thinks that this might be being
unduly optimistic. The weekly output that management prefers is 1,000 units.

The operations vice president insists on preserving the regular forty-hour

workweek for the new product as it is for the current operations. A project in and
of itself was developing the processes for making the plug-in system. Engineers,
production managers, and assembly line employees collaborated to produce a
precedence graph and table. 25 distinct production steps were first recognized.
The group then decided on a hierarchy for each task. The line workers developed
the task timings at this point using estimates for tasks that were similar to the
present tasks, known task times for activities that were identical to the current
tasks, and supposition for some tasks. The assembly line table that is displayed
below is the result of all of this labor.

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Statement of the Problem

Will it be possible to reach a production output of 60,000 units per year?

Assumptions
Increased volume output will induce economies of scale minimizing costs
per unit.

Areas of Consideration
 Executive level – to prescribe and decide on feasible and effective
production activities

 Operations – Formulation of the process selection and facility layout.

 Human Resource Department – hiring of additional workers

 Design – the creation of product designs

 Engineering – Building, and design of possible facility and workstation

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Framework (e.g. SWOT, Porter’s, etc)

Strengths Weaknesses

FEUture Inc. has been producing Recent experience in Sales decline

microcomputer peripherals for over a
decade.

Hard disk drives have been their Overly optimistic targets 60,000 units
mainstay. a year

They are expanding their product Current operation use 40 hours a week
lines to include plug-in256MB.

Product Innovations

Opportunities Threats

Technology Advancement Government Regulations

Trendsetter in Plug-in devices Sensitive Consumer Behavior

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I. Alternative Courses of Action (at least 4)

ACA #1 Explore in Accommodating the production of 60,000 units

Advantage: Maximize the cycle time and workstation.

Disadvantage: May decline product quality.

ACA # 2 Increase operating hours

Advantage: the amount of output will significantly increase.

Disadvantage: quality output will decline

ACA # 3 Invest in new equipment for the new product.

Advantage: The production gap will be filled.

Disadvantage: Increased capitalization

ACA # 4 Look for a contractor for the new product.

Advantage: It will have no effect on the current staffing workload.

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Disadvantage: More costly than in-house production.

Action Plans

Activity Responsible Person/s, or Timeline

Department/s, Team/s, etc.

Establishing Line Operations 1 week

Balancing

Planning Operations and Engineering 1 day

Review and Testing Operations and Engineering 1 week

of the Line Balancing

Budgeting Finance 1 week

Material Sourcing Procurement 1 week

Recommendation
Because it assembles the manufactured parts at a succession of
workstations that are spaced apart by work tasks and balanced by movement
tasks, the researcher in Product Oriented Layouts is using the assembly line.

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Assigned Cumulative Remaining

Workstation Eligible Task Time Idle Time
Task Time Time
1 A, F A 1.00 1.00 1.40
B, C, D E, F D 1.10 2.10 0.30

B, C, E, F F 0.05 2.15 0.25 0.25

2 B, C, E, K C 0.45 0.45 1.95

B, E, H, K H 0.49 0.94 1.46
B, E, K B 0.40 1.34 1.06
E, G, K E 0.36 1.70 0.70
G, I, J, K I 0.54 2.24 0.16 0.16

3 G, J, K, M, N N 1.82 1.82 0.58

G, J, K, M K 0.35 2.17 0.23 0.23

4 G, J, M, S J 1.54 1.54 0.86

G, M, O, S M 0.30 1.84 0.56 0.56

5 G, O, S G 1.32 1.32 1.08

L, O, S O 0.89 2.21 0.19 0.19

6 L, Q, R, S L 2.10 2.10 0.30 0.30

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Assigned Cumulative Remaining

Workstation Eligible Task Time Idle Time
Task Time Time
7 P, Q, R, S S 1.30 1.30 1.10
P, Q, R, U R 0.62 1.92 0.48 0.48

8 P, Q, U U 1.80 1.80 0.60 0.60

9 P, Q, W, X Q 1.30 1.30 1.10

P, W, X W 0.87 2.17 0.23 0.23

10 P, X P 1.20 1.20 1.20

T, X T 1.20 2.40 - -

11 V, X X 1.20 1.20 1.20

V V 0.30 1.50 0.90 0.90

12 Y Y 1.90 1.90 0.50 0.50

Total Idle Time 4.40

Conclusion
WorkStation 12 is a reasonable number, with a tolerance of +/- 10%.
While 11 may be possible on the low end. The case study included some
educated guesses demonstrating that it is very likely higher than expected.

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