HEC, PARIS PFSA-E-VI PFSA L. Presentation The PFSA Company manufactures two finished products FP] and FP2 which are composed of sub- assemblies (SA) and of purchased parts (PP). The bills of materials of the finished products and of subassemblies are the following: FP1 FP2 f 1 [ 1 SA1 (2) | [SA2(3)] [PPS (4) SAt (2) PP3 (4) Pr 2 PPS @ 72 @ PS @ ‘The numbers between brackets indicates the number of components per one parent item. The average manufacturing cycles of subassemblies and of finished products are two weeks. The average procurement lead times are two weeks for PPI and PP3 and one week for PP2, ‘The beginning inventories are 150 SA1, 100 SA2, 200 PPI and 500 PP3, ‘The finished products and the subassemblies are released in quantities equal to net requirements, but with a minimum batch of 100 for SAI and of 30 for SA2, The requirements1 to be delivered for the next 16 weeks is shown on the table below. Wk tl 2 se a Seen Oe Sn an ia ian ise ue. - = = © 2 - 10 2% 20 10 10 30 2 20 2 30 See OO Lee AD eet ae ‘The purchasing costs are the following: PPI: 45 €- PP2: 15 € PPS: 30€ ‘The unit production times for manufacturing or assembly are the following: SAL: 4h- SA2: 4h - FPL: 6h- FP2: 4h ‘The cost of one hour of operation is valued to 30 €. "Typically defined via a master schedule ~Tnmaton System & Oparatons Management Deparemet 7PFSA-EV HM QUESTIONS - Calculate the costs of subassemblies and of finished products. Determine the work orders for the finished products and the subassemblies. Determine the purchase orders. Calculate the average inventory value (based on the ending inventory of each period). Calculate the work load and draw the corresponding profile (consider that the load evenly distributed between the two weeks of manufacturing). The available capacity is of $50 hours per period. What do you suggest? Ifthe company would wish to put in stock sub-assemblies or finished products for a better balance between production and sales, on which item would you advise to create an inventory? AC the beginning of week 9, the sales department announces that the requirement should be doubled for FP1 for week 12. How do you take into account this demand? Taformation System & Operations Management Departement z