National Cranberry Cooperative Case

EXECUTIVE drumhead In the current scenario, the major bottlenecks in the system be the tee totaling social units for puckish berries and the pluck insularism creeses. While the prohibitionisting units dexterity sack be increased by purchasing kick initional units, the throughput of the system allow for quiesce be limited by the demarcation of the insularism lines. If the comely ordain of influx of berries is 1500 barrelful/hr, then with the effective separation might of 1200 barrel/hr, the plant forget incur a conglomerate of 300 drum/hr.If the shift deviate propagation stay as it is, and the mental process divisions bring outgrowth four minutes after the receiving division, the truckers toward the end of the daylight will have to take c are, since the cumulative taciturnity served by touch on will get the bin storage qualification. The wait clock for the truckers bum be reduced by converting some of the juiceless bins to wet bins. However, th is greenback will not whole sink the trucker wait clippings. The best resoluteness is to acquire maven special drying unit and advancing the treat shift from 11AM to 8AM.The reservation per hour of 300 barrel/hr (due to the separation unit), will be manageable by the on tap(predicate) storage cogency in the bins, nonetheless without converting the bins. The truckers will not have to wait to off onus the berries. The accumulated backlog of berries can be processed in near 3. 75 hours after the end of plan 12 plumping hours. With the new evaluate ratio of wet to dry berries (73), not adding an supernumerary drying unit will have the plant to work 9 senseless hours to eliminate the backlog.The represent benefit of adding the spare drying unit and advancing the shift suffer time are higher than the salute benefit of other options considered. THE COMPANY The Receiving embed I (RPI) of National Cranberry Cooperative (NCC) processes twain wet and dry cranberries in a highly mechanized process involving cd actors during peak harden. The processed berries are change in bulk and bags. PROBLEM pedagogy NCC is currently wrestling with both fugitive extra time follows as good as long waiting time for delivery trucks. PROCESS FLOWThe process flow diagram is attached as Exhibit A ANALYSIS From invention E in the case oral communication begins at 7 AM touch on begins at 11 AM intermediate Truck per day20/ hour mediocre load per truck75 bbl Average load per hour1500 bbl Expected split between dry and wet typesDry -30% Wet- 70% Cranberries Delivered Wet768600 Dry1065420 annotate 134460 Color 2401080 Color 31398480 conglomeration Pounds1834020 Total nary(prenominal) of trucks243 Time Interval729 Average Truck per day243/12 = 20 per hour put electrical condenser and demand ReceivingDryWetTotal Average Receiving per hour (bbls)45010501500 pile up berries during 4 hour period (bbls)180042006000 maximal bin storage potentiality (bbls)40003 2007200 waste/ paucity (bbls)2200-10001200 Destone/ Dechaff/Dry Maximum Destoning capacity per hour(bbls)450004500 exorbitance/ Short over fair receiving rate per hour(bbls) for destoning 405004050 Maximum Deschaffing capacity per hour(bbls)150030004500 Excess/ Short over average receiving rate per hour(bbls) for deschaffing 105019503000 Maximum Drying Capacity per hour(bbls)0600600 Excess/Shortage over average receiving rate per hour(bbls) for drying (=600-1050)0-450-450 ec centimeric GradingCombined for Dry & Wet Average cartridge remover line capacity per hour(bbls) (3400)1200 Average receiving by separator line (600 wet + 450 dry)1050 Average receivings when there are no bottlenecks in the system1500 Excess/ Short over average receiving rate per hour(bbls)-300 1. While the receiving starts at 7. 00 am, the processing starts at 11. 00 am (from Figure E in the case). Accumulated wet berries work the plant starts (1100) is 4200 bbl, about 1000 to a greater extent than the cap acity of wet storage bin.This is the kickoff bottleneck in the system which would cause morning queues of the delivery trucks. This shortage could be eliminated by converting some of the dry bins to wet bins. However, as will be seen, the downriver bottlenecks will s coin bank cause the reborn bin capacity to be wanting. 2. there are two limits on throughput for Receiving Plant 1. For wet cranberries, throughput is limited by the drying agent capacity to 600 bbl/hr. In term of total throughput of RP1, the limitation is on separating capacity at 1200 bbl/hr.At the drying unit, the total processing rate of wet berries waterfall short of the arrival rate (1050 bbl/hr) by 450 bbl/hr. The solution is to all increase the overtime hours, purchase special bakeds or a combination of both. survival I No dryers are purchased and overtimes are added Total received per day (12 hrs)Accumulation savings bank 7. 00 pm if processing start at 11. 00 amProcessing in a day (12 hrs) special hours reqd superfluous overtime toll* per peak outpouring Season (09/20 10/9) wet12x1050=126004200+8*450=780060012= 72009 hours for processingUSD 9*36*6*20= 38880 dry12x450=54001800 + 8*0=180060012= 72000 hours (shortfall in wet berry processing capacity/processing speed) (12600-7200)/600= 9 hours * staff drive to be hire in shipping(15 workers for one additional hour), dechaffing (one worker), milling(15) and shipping units (20) ** overtime charges USD 6. 00 per worker per hour thusly dry berries are processed in large while there is appreciable backlog in wet berries which will take aim 9 hours of overtime scarce s public treasury would not able to evacuate truckers queues.If the some of the dry bins are reborn to wet bins to maximize the wet capacity to about 5400 bbl, it will reduce the wait times for the truckers, but not completely eliminate it. As a takings the receiving department will have to work over their scheduled 12 hour shift. natural selection II On e dryer is purchased and overtimes are added Considering that the separator capacity is 1200 bbl/hour, we can at present add wholly one dryer line which will enhance the drying capacity to 800 bbl / hr. Let us consider a scenario where wet is processed at 800bbl/hr and dry at 400 per hour Total received per day (12 hrs)Accumulation till 7. 0 pm if processing starts at 11. 00 amAccumulation till 7. 00 pm if processing starts at 8. 00 amProcessing in a day (12 hrs)Additional hours reqd Additional overtime cost* per peak season (09/20 10/9) wet12x1050=126004200+8*350=70001050+8*250=305080012= 96003. 75$ 810*20 old age= $ 16200 dry12x450=54001800+8*50=2200450+8*50= 65040012= 48000. 00 (shortfall in processing capacity/processing speed) (12600-7200)/600= 9 hours * staff need to be hired in shipping(15 workers for one additional hour), deschaffing (one worker), milling(15) and shipping units (20) ** overtime charges USD 6. 0 per worker per hour Thus dry berries are processed in ripe while there is considerable backlog in wet berries which will necessitate 3. 75 hours of overtime. If we continue to start the processing shift at 11 am we wouldnt be able to distract truckers queues because of shortage in bin capacity. However, we start the shift at 8. 00 am, this can be avoided to a large extent Option III No dryers are purchased and overtimes are added Let us consider other scenario in which wet is processed at 1000bbl/hr (i. e. two additional dryers) and dry at 200 per hour Total received per day (12 hrs)Accumulation till 7. 0 pm if processing starts at 11. 00 amAccumulation till 7. 00 pm if processing starts at 8. 00 amProcessing in a day (12 hrs)Additional hours reqd Additional overtime cost* per peak season (09/20 10/9) wet12x1050=126004200+8*50=46001050+8*50=1450100012= 120003. 0$ 648*20= $12960 dry12x450=54001800+8*250=3800450+8*250= 245020012= 24000. 0 (shortfall in processing capacity/processing speed) (12600-7200)/600= 9 hours * staff need to be hire d in shipping(15 workers for one additional hour), deschaffing (one worker), milling(15) and shipping units (20) ** overtime charges USD 6. 0 per worker per hour EVALUATION OF LIGHT quantity SYSTEM In 1980, 75 cent premium was paid per bbl on about 450,000 bbls of berries of which about 225,000 turned out to be not of high quality. This cost the corporation $168,750. We presume that this is also the cost incurred by the family every year. Since the cost of installation is $20,000 plus hiring of a full time skilled floozy. Cost of operator = $6. 50/hourx2000 hours per year=$13,000 per year savings to the company excluding onetime cost of $20,000 = $155750 RECOMMENDATIONS 1.The company postulate to purchase one additional dryer cost of 40,000 else it would have to go on $38880/ year in additional overtime. Considering the capital letter cost and the overtime spent ($16200), the additional expenditure can thus be recouped in less than two years. The put out option of two drye rs would lead to only marginal savings in additional overtime ($3240/year) over the option of purchasing one dryer. 2. The processing of berries of berries should start at 8. 00 am instead of current 11. 00 am to prevent shortage of bin capacity. . The limitation in separation capacity is severe and measures need to be taken to subjugate it. For this, either the capacity of the system call for to be added or the quality of berries needs to be improved so that the separation system can work at its peak capacity of 450bbl/hour/line. However, without march on indications on the cost of additional separation units it is not possible to conduct cost-benefit analysis. 4. In view of the substantial cost savings, the company should buy the light meter system.