Reference no: EM132978655

Goshogun Sdn Bhd is a medium size manufacturing firm with annual sales of three millions. After working in a high ranked education institution for twenty years, Mr. Ho joined Goshogun Sdn Bhd as an executive. The company produces and sells stationeries and it is currently growing steadily. With the growing sales, the firm has produced a variety of products to meet the local market. More products mean more categories of raw materials needed to be purchased and stored. Coupled with the growing volume of raw materials for each category of raw materials, the tiny raw materials warehouse is fully congested with the storage of raw materials.

Currently the production floor is managed with manual activities. About 50 percents of the workstations needed to be handled manually. The former executive, Mr. Yong, plans all the information of the production in the office desktop. All information of raw materials retrieved or stored and the production progress are keyed in either manually or scanned using barcode. With the increasing business volume, the traffic of retrieving and supplies of the raw materials through the warehouse is getting higher. Besides, errors of records is also increasing. There is a lot of backlogs of records not attended to. The owner, Miss Ng is thinking to certify the production process and the raw material warehouse to increase the credibility of the firm but she knows the record is so messy that certification is difficult to achieve.

Mr. Ho new task is to take over the position of Mr. Yong to manage the production and the warehouse activities. "Why not computerized the production process and the warehouse system ?", says Mr. Ho to Miss Ng. "But the package of the system could be too expensive. Our current system still manages to handle the the production activities and the raw materials with a little bit of problem arising only. Our current concern is to reserve the capitals into expanding the production capacity to meet the rising market", says Miss Ng.

Mr. Ho feels that a good production system is crucial to the manufacturing firm. He needs to explain the advantages of new production and warehouse system to convince Miss Ng to switch the manual activities of production to more automated system.

Question 1

Describe the problems that Goshogun manufacturing Sdn Bhd is currently facing.