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Rochester Manufacturing Corparation - Case Study Example

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The sales manager will view the benefits of moving with the FMS to have more advantages than limitations. In evaluating the FMS, analysts consider the expected value. The…
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Rochester Manufacturing Corparation
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Download file to see previous pages The firm believes that 30% of the people use a good estimate of products suitable for the FMS. This provides a good incentive for moving ahead with the FMS now. The 30% is viewed to fit very nicely into a “family”.
Moving ahead with the FMS, it is also viewed to reduce the variety. The traditional numerically controlled machine has a high variety. Therefore, moving ahead with the FMS now will be associated with a reduction because of higher utilization in the number of pieces of the machinery. In addition, the resources are scarce and hence proper utilization should be enhanced. By utilizing the resources, the profits will also be utilized. In return, the production will be increased if the variety is utilized (Khanna, 2007).
The main objective of any firm is profit maximization and cost minimization. If the FMS will have a lower variety, the costs will be minimized and profits will be maximized. The lower variety is a very big motivation of moving ahead with an FMS now. The firm should be able to go from 15 to perhaps as low as 3. This shows a reduction of 12 in the variety. This variety reduction will create more room for an extra production. The firm will be able to expand its production by perhaps four times. It means that the efficiency of the firm will increase by moving ahead with the FMS now.
Moving ahead with the FMS now is also associated with a reduction in the floor space from 20,000 square feet to about 6,000 square feet. This shows a reduction by 6,000 square feet. Any organization strives to have a suitable space to carry out its operations. A suitable space will reduce the congestions within the organization. Congestions are associated with various disadvantages.
Also, moving ahead with the FMS now will also be associated with the through put of orders improving with the processing of the family parts in1 or 2 days rather than 7 to 10. This shows a good processing efficiency. If orders are processing very fast, it will ...Download file to see next pagesRead More
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