MAN 3504 SFCC Operations & Supply Chain Management Kempfer Furniture Inc Discussion
This week we are building on our prior exploration of process flow and your "hypothetical" site-visit to Modell's Sporting Goods/Undercover Boss. Please read the Kempfer Furniture case study below (Ch. 18). Then scroll down to see the instructions. Chapter 18: Kempfer Furniture Inc. Marta Tompkins, a graduate in industrial engineering from Purdue University, was excited. She had accepted a new job in South Carolina as the Operations & Logistics manager at Kempfer Furniture, Incorporated. Marta had work for Honda Manufacturing in Marysville, Ohio for twelve years as the director of Lean Operations. Her resume documented extensive experience with lean manufacturing and Six Sigma strategies and methodologies. Many of her improvement initiatives created fast throughput, and less waste and inventory. She had also led projects on new environmental quality standards outlined by ISO 14000. Kempfer hired her to be the factory manager at their South Carolina facility.During her first two weeks on the job, Marta learned the processes that produced some standard and some customized furniture orders. Kempfer manufactured wood furniture, such as kitchen and dining room tables and chairs, beds, and bedroom dressers and night stands. They specialized in specialty hardwoods, such as cherry and red oak. The firm was known for producing high-quality furniture at low to moderate prices. Delivery time was a problem.Kempfer was one of a handful of American based furniture manufacturers because most furniture was built in Asian factories. But Kempfer Furniture had not been profitable for two years. The owner, Mr. Tomas Luke, hired Ms. Audubon to help turn the business around and make it profitable. His mandate to the 156 factory employees was if the business didn’t make a profit in two of the next three years, he would close the business and declare bankruptcy.Marta keep notes on all that she heard and saw. Below is a sample of her notes. She also documented that work center, loading dock, and shipping managers often missed her meetings because they were too busy getting the product out the door.Marta’s Notes During Factory Walk-Arounds and Meetings1. Sawdust was everywhere. The factory was not clean. The air smelled of dust and wood finishing varnishes. Varnish spray booths were not fully enclosed with adequate exhaust systems.2. The factory layout was best described as a process layout to accommodate a job shop structure.3. Our selling price is 20 percent above our manufactured cost, we think.4. The cash flow of the factory was not sufficient to fully fund the factory and leased public warehouse. Mr. Thomas Luke acquired a promissory note from a regional bank to fund operations.5. Customer orders ranged from one unit to thirty units but factory practice is to build one unit at a time. One work center manager said, “We setup way too many times for a single customer order.”6. Inventory was scattered throughout the factory. Some component inventory and finished products were stored in heavy canvas tents outside.7. Third party contract truckers often showed up at the loading docks with their orders not ready. This happened 15 percent of the time and many truck drivers avoided working for Kempfer Furniture, Inc.8. A shop foreman said that “two old planing machines often breakdown.”9. Customer orders were often changed but these changes didn’t get to the factory floor about one-third of the time resulting in rework and starting the order anew.10. Wood saws blades were dull and seldom sharpened.11. All work centers, employees, and equipment were utilized 100 percent of the time, six days a week.12. Last year, three accidents happened at the factory. One employee was hit by a forklift truck out of its lane on the loading dock, another employee tripped on scrap wood and broke his wrist, and a third employee slipped on the sawdust on the floor and had a severe concussion.13. Kiln drying capacity held up about one-half of all jobs.14. $3 million dollars of finished furniture was stored in a leased public warehouse four miles away from the factory. It was unsold due to overproduction or cancelled customer orders.In this "hypothetical" Applied Mgt. Exercise, you will: 1. Create a 3-5 minute video presentation in Zoom. For your reference, here are instructions: "How to Make a Local Recording in Zoom".2. Put yourself in Marta's shoes. You have been hired as the Operations & Logistics manager. Based on Marta's notes (1-14) you will recommend: Actions you believe should be taken for the issues Marta (you) documented above Methods you believe Kempfer should utilize (ie. Six Sigma, Theory of Constraints, Lean tools). ExplainHere are the guidelines:Creatively design a well-researched: concise overview, analysis, and recommendation to the Executive Committee via audio/visual presentation. The Executive Committee will be your "hypothetical" audience. Example: "Good afternoon Executive Committee, I have been tasked with...".Make sure your audio/visual presentation is professional. Use first person. Example: "While I was in the factory, I documented the following 14 issues..."; "I recommend XYZ actions...."; "I further recommend XYZ methods...". Utilize content directly from the text to support ALL of your recommendations. *****PLEASE NOTE, this is a very concise presentation. We want to aim for all meat and no fluff. Your presentation MUST NOT contain any unresearched or unsupported opinions. As much as I love to hear your ideas and input, this is not the place or time to include any recommendations that are not thoroughly supported by the text. Keep in mind, this is your 3-5 minute window of opportunity to demonstrate that you understand the reading and can clearly/concisely articulate and apply it in a "real-world" project.