Reference no: EM133047217
Specialty Luggage Manufacturing produces several different styles of soft and hard-sided luggage, briefcases, hanging bags, and purses. The best selling item in their product line is their line o hard-cover luggage called "Toughie". It is produced in a basic five-stage assembly process that can accommodate several different outer coverings and colors.
The assembly process includes constructing a heavy-duty metal and plastic frame, attaching the outer covering, joining the top and bottom and attaching the hinge mechanism, attaching the latches, locks, and handle, and doing the finishing work including the luggage lining.
The market is extremely competitive, and product quality is a very important component in luggage sales and market share. Customers normally expect luggage to be able to withstand rough handling while retaining its shape and an attractive appearance while protecting the clothing and personal items inside the luggage. Customers also prefer the luggage to be lightweight and not cumbersome. Furthermore, customers expect the latches and locks to work properly over an extended period of time. Another key factor in sales is that the luggage must be stylish and visually appealing.
Because of the importance of quality, Specialty Luggage Manufacturing management has established a process control procedure that includes inspection at each stage of the five major stages of the assembly process. The table below shows the percentage of good-quality units produced (yielded) at each stage of the assembly process and the percentage of bad units that can be reworked, on average.
Assembly Stage
|
Average Percentage
|
|
Good Quality
|
Reworked
|
1 - frame construction
|
0.94
|
0.23
|
2 - attaching the covering
|
0.96
|
0.91
|
3 - joining top and bottom
|
0.95
|
0.67
|
4 - attaching latches
|
0.97
|
0.89
|
5 - finishing work
|
0.98
|
0.72
|
The first stage of the process is the construction of the frame, and it is very difficult to rework the frame if it is defective, which is reflected in the low percentage of reworked items.
Five hundred new pieces of luggage of a particular style and color are initiated through the assembly process every week. The company would like to know the weekly product yield and the number of input units that would be required to achieve a weekly yield of 500 units. Furthermore, Specialty Luggage Manufacturing would like to know the impact on product (given 500 initial starting units) if a quality improvement were introduced that would increase the average percentage of good quality units at each stage by 1%
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