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Currently three individuals were employed moving product within the production area. The
vast percentage of this time could be replaced by the installation of conveyor systems to
move valves within the factory. Carron Associates estimated that remodelling the
production process in this way and installing conveyor systems would cost in the region of
€ 50,000. This system could be independent of all other proposed changes.
Within the warehouse many things could be improved by the use of relevant technology.
First, manual stacking could be replaced by the use of fork lift trucks with the installation of
racks in the main body of the warehouse. This would substantially reduce the labour
content for a relatively minor cost of € 20,000. Further automating the warehouse was
possible but this would involve a much greater investment of around € 250,000. The use of
fork lift trucks would also substantially increase the speed of the loading process.
Currently the manual stock control system was very labour intensive, and could be
significantly improved by the introduction of a computerised stock control system which
could link up with the finance and production departments to provide continual and up to
date stock and despatch data. The cost of the programme was relatively low at € 1,500.
This programme would also effectively remove the need to produce reports, a time
consuming process under the current regime. The use of the production scheduling
system introduced in the manufacturing plant would also reduce the amount of dead time
within the warehouse.
These new systems would require substantial increase in the amount of training. This
could be reduced by the use of one of the existing expert systems for warehouse
management which could be purchased for around € 5,000. In common with other areas of
the company, you are determined that the warehouse staff should be more closely
involved in the running of the company and have insisted that time is laid aside for their
involvement in quality control discussions. The impact of all the changes forecast in the
business plan are listed in Table 14 in Appendix A.
Finance
As Burke Engineering MD, you have already decided that the data processing of the
company accounts and pay should be subcontracted. Carron Associates also have
investigated the remaining activities of the finance department and reported that there
could be major improvements in most areas, even though the work load envisaged by the
plan is likely to significantly increase with the greater number of customers the firm will
have.
Substantial improvements were possible in invoicing, payments, reports, data collection
and analysis (including costing function which had been previously a joint responsibility
with the production department), and the preparation of reports. Various integrated
systems could be introduced as part of the network system with an additional software
cost of € 5,000.
In common with other areas of the company, these changes would involve the need for
substantial training and this combined with the involvement of the finance department in
work progress meetings would mean that the pattern of hours worked would be very
different in the future. Details of which are listed in Table 14 in Appendix A.
Secretarial
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