Eray Cavus 030060022 Week2

Capital Cost (Cost)

-Capital Cost(old):
These costs represent the investment buildings, land, machinery, tooling, and equipment. Cost of machines and systems vary widely. In view of the generally high equipment costs, particularly those involving transfer lines and flexible manufacturing cells and systems, high production rates and production quantities are essential to justify such large expenditures and to maintain product costs at or below the all-important competitive level. Lower unit costs can be achieved by continious production involving around the clock operation but only as long as demand warrants it. Equipment maintenance also is essential to ensure high productivity. Any breakdown of machinery leading to downtime can be very costly- by as much as thousands of dollars per hour. (Kalpakjian, Smith; Manufacturing Engineering and Technology,p. 1262)

-Capital Cost(new):(better)
The cost of capital is defined as the rate of return that a company must offer on its securities in order to maintain its market value. Financial managers must know the cost of capital in order to make decisions concerning leasing, bond refunding, and working capital management, to make capital budgeting decisions, and help to establish the optimal capital structure. The cost of capital is computed as a weighted average of the cost of each type oh capital. The weight for each type of capital is the ratio of the market value of the securities representing that source of capital to the market value of all securities issued by the company. The term security on the right-hand side of the balance sheet includes common and preferred stocks and all interest- bearing liabilities, including notes payable.(Capital Cost Planning: Topically Orientated Trend Adjustment on the Swedish Market , Yazar: Ibrahim Filiz, page:4)

Production and Inventory Control (Control System)

-Production and Inventory Control(old):(better)
The design of production and inevntory(PIC) policy is an important factor for effective supply chain. This rule determines the dynamics in the supply chain and the costs for production and inventory holding. Inventory costs rises based on inventory holding increase which is created by uncertainties in demand, supply, production and control policy. Production costs increase with ramp- up and phase out of production and capacity holding, caused by changing order and production rate.
(Dynamics in Logistics,Hans- Dietrich Haasis,page143)

-Production and Inventory Control(new):
A production and inventory control system that is a part of a Lean Manufacturing system is radically different from one that is part of a traditional manufacturing system. Because of this predictability, production fluctuations from period to period will be part of the plan. This more predictable production plan and more uniform production rate will result in hassle-free, and therefore simplified, production and inventory control systems.
(Future Capable Company: What Manufacturing Leaders Need to Do Today to Succeed Tomorrow, Yazar: James A. Tompkins,page 90)

Hard Automation (Automation,Manufacturing)

Hard Automation:(old)

 The machines are designed to produce a standard product,such as gear, a shaft or an engine block. Although product size and processing parameters (such as speed, feed, and depth of cut) can be changed ,these machines are specialized and lack flexibiity.They cannot be modified to accomodate products that have different shapes and dimensions.Because these machines are expensive to design and build, their economical use requires the production of parts in very large quantities.The machines used in hard automation applications usually are built on the modular principle.They generally are called transfer machines and consist of two major components: powerhead production units and transfer mechanism.

(Serope Kalpakjian- Steven R. Schmid p:1150)

Hard Automation (Fixed Automation): (new)(better)

Fixed automation refers to the use of special purpose equipment to automate a fixed sequence of processing or assembly operations. It is typically associated with high productionrates and it is relatively difficult to accommodate changes in the product design. This is also called hard automation. For example, GE manufactures approximately 2 billion light bulbs per year and uses fairly specialized, high-speed automation equipment. Fixed automation make sense only when product designs are stable and product life cycles are long. Machines used in hard automation applications are usually built on the building block, or modular principle. They are generally called transfer machines, and consist of the following two major components: powerhead production units and transfer mechanism.

(Industrial Automation and Robotics, Yazar A.K.Gupta,Gupta, page:4-5)

The KK-3 Systems (Coding System)

The KK-3 system: (old)

  

         The kk-3 system is a general purpose system for parts that are to be machined or ground.It usesa21 digit decimal system.This code is much greater in length than the two previous systems described,but it classifies dimentions and dimentional ratios, such as the length to diameter of the part.The structure of a kk-3 system for rotational components.

           (Kalpakjian S. & Schmid S., Manufacturing Engineering and Technology, p.1215)

The KK-3 System (new) (better)

The KK-3 coding system was developed by the Japan Society fort he Promotion of Machine Industry (JSPMI) and was first presented in 1976. The KK-3 system is basically a general-purpose classification and coding system that uses 21 digits to code predominantly metal-cutting and grinding components.The KK-3 system is structured such that much more detail about a part can be represented in the coding. For example, KK-3 can classify 100 functional names for rotational and non-rotational components.

(Computerized Manufacturing Process Planning Systems,Yazar: Hong-Chao Zhang, Leo Alting, Page:89)

Lead Time (Manufacturing Time)

Lead Time(old)

The lead time for a jop is the time that must be allowed to complete the jop from start to finish.There are two kinds of lead times in MRP:oredering lead times and manufacturing lead times.Oredering lead time is the time required from initiation of the purchase requisition to receipt to the item from vendor.Manufacturing lead time is the time required to produce the item in the company's own plant, from order relaese to completion.

(Mikell P.Groover "Fundamentals of modern manufacturing" Second edition,page 935)

Lead Time (new) (better)

What is lead time? The traditional interpretation of “lead time” for components is the total time it takes a supplier to procure raw material, manufacture the product, ship, and fort he receiving plant to receive it. Today the traditional version of lead time applies only to new products that have never been produced by a supplier or if raw materials, dies, tools, and/or the process for making product are new. It also applies to some long lead times.

Today the phrase “lead time” is synonymous with “transit time” which refers only to the time it takes to  move product from the supplier to the customer.

(Materials Management: An Executive`s Supply Chain Guide, Yazar: Stan C. McDonald, page:51)