Essay by lauryn02 August 2008

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In deciding the appropriate production of the ECUs and RFIDs, Kuiper Leda chose to outsource a portion of the ECUs to the e-business portal, which provides Kuiper Leda the lead-time necessary to fulfill the safety stock requirements. Kuiper Leda’s customers demand a delivery lead-time per order of four weeks for ECUs. Through outsourcing a portion of the ECUs, Kuiper Leda maintains the excellence in product production the customers have appreciated for several years. The outsourcing a portion of the ECUs also provided Kuiper Leda more flexibility with machine usage with the production of the RFIDs, which the new company is interested in selling.

Kuiper Leda has a centralized demand management system, which involves the recognition and management of the demands for the products. “It is done to ensure that the master scheduler is aware of the demand,” (University of Phoenix, 2004). In having the centralized demand management system, Kuiper Leda can forecast the additional need in the central supply by calculating the MPS.

By centralizing the demand, Kuiper Leda eliminated overstocking the parts through the communications channel. All communication is now centralized as to how the company will handle the demands placed in each department.

Kuiper Leda changed to just in time inventory system to create a more lean production process. With the ever-increasing amount of orders coming into the company, the management needed a way to reduce inventory costs, bring to light the bottlenecks, and implement a streamlined production system. “Kuiper Leda changed to lean production because of the increasing demand for the company’s products” (Henson, 2007). Lean purchasing tools, such as “material resource planning, just-in-time delivery, make or buy studies, component kitting, best supplier evaluations and outsourcing--are commonplace in private industry” (Stundza, 2000, ¶ 19). Since lean purchasing has proven to reduce costs and enhance quality,