Tesc Writting #3

Ken Richardson Writing #3 3/15/14

I will use the Congruence model in the 1st analysis to understand the issues in a different perspective.

Tooling is required for customer specific product formats and is an industry standard that the customer pays for the tooling. The tooling procurement philosophy is very different between Philadelphia and Rockford packaging sites. The analysis will cover the following elements that are critical to the business as well as the customer. The strategy for Philadelphia is 100% outsourcing and the Rockford strategy is 100% insourcing

Congruence model

* Identify the symptoms- The primary symptom currently is the current insourced tooling strategy at our Rockford site is not delivering the tooling to the customer’s expectation. This is both internal and external customer requirements. The main requirements not being met today are Quality, Delivery and Cost.

* The tooling is currently NRFT (not right first time) and causes delays

* The lead-time is currently longer than our external vendors

* The cost to produce tooling internally is higher than the external vendors

* Identify the input- The current strategy is to insource the tooling utilizing company resources ie machinery, material and labor. This current practice has been ongoing for ~ 10 years.

* CNC Equipment

* 7 Direct cost FTE’s

* 10 Indirect cost FTE’s

* Identify the output-

* Current state

* 60% NRFT

* 10 weeks lead-time

* $94,000

* Desired state

* 5% NRFT

* 6 weeks lead-time

* $65,000

* Identify the problems-

* NRFT- the errors in the tooling create production delays, rework cost and customer misses

* Lead-time- the long lead-time impacts our competitiveness and flexibility to service the client

* Cost- the hire cost directly impacts our profit margin and competitive advantage

* The four components of the current...