Operations Analysis

Another issue that McCormick had to deal with was productivity and efficiency.  The processes that go on in the production plants are: drying, grinding, labeling, packaging, sealing, and distribution.  There has been some bottlenecking and delays observed between the labeling and packaging stations, and an abnormally high rate of rejects in the sealing station.  The operations manager decided to look at the sealing rejects first.  After analyzing the efficiency of the sealing machines, it was noticed that one of the machines was only sealing ¾ of the top of the package. A decision had to be made whether to replace the machine which would cost $15,000 or hire someone to fix it for $3000.  The go with the lower cost and the machine begins to work perfectly.  Next, they analyze the bottle necks and delays in the packaging and labeling stations.  Currently, the process time for the labeling is 45 seconds per label and the time it takes to packages is 90 seconds.  There problem lies in the fact that although these processes are done in order, the stations are located on opposite sides of the plant.  This because the labeling process can be done in ½ of the time the labeling station can out put a high volume at one time, however it takes 8 to 10 minutes to move the labeled bottles to the packaging station.  This leave the packaging station in a cycle of being overloaded and just waiting not doing anything.  After his full evaluation the manager decided to not only move the 2 stations closer, but he switch the 2 processes around to make the total process more efficient.  This cut the 10-minute transport out of the total time and also shaved 15 seconds from the packaging time, and which cause the labeling station to also pick up the pace by 10 seconds.