A systems study on Daifu Enterprises

Daifu Enterprises is a bag manufacturing company. The company started its operations in 1990. The owners of the company are Mr. Roger Chua, Mr. Ronnie Ong, Mr. Lorenzo Yap, and Mr. Lincoln Lim. Daifu Enterprises produces different kinds of bags, which are excellent for promotional advertisements and sales premiums for major department stores in Metro Manila. Daifu Enterprises, like other bag manufacturing companies, have experienced problems concerning the process of accepting and scheduling job orders; these job orders go through the processes in the production department and until the finished goods are stored and delivered. With the permission of owners, Mr. Roger Chua and Lincoln Lim, the group was able to conduct a systems study of the company. From the analysis of the present system, we were able to gather information on that can be useful in the assessing the current situation. In the situation appraisal, weaknesses based on people, machines, materials and information were discovered, namely, a total of 3,410 man-hours of overtime was experienced that resulted to P 98,880.15 in cost per year, occurrences of unnecessary workload due to reworks and additional cost of P 4,106.25 was incurred, frequency of breakdown of machines resulted to opportunity cost of P 23,006, sorting of mixed up inventory lead to a cost of P 40,717.44 of unproductive expenses, and the group conducted a time study, and it was discovered that the main problem of the company is that it encounters production delays that results to delivery delays in producing job orders from customers and an incomplete documentation of information relevant to production and decision making ascertained. From the time period of study, it was found out that Daifu Enterprises experiences production delays of 4.5%, incurring an additional cost of P 342,889 per year. The causes of the problem can be attributed to a number of reasons, namely, improper scheduling of jobs, which contributed to 42.74% of the problem; actual capacity is lower than what is expected, which contributed to 27.27% of the problem; poor housekeeping practices, which contributed to 24.03% of the problem; tendency to produce defects, which is 2.76% of the problem and machine breakdowns of the single and double needle sewing machines are 1.55% and 1.65%, respectively. To minimize the production delays, the group proposed that new work methods be implemented. The group devised a computerized scheduling program that will enhance decision making in accepting and rejecting jobs based on the actual capacity of the company. A new records management system that will help in monitoring the production operations. A housekeeping program will be introduced to the employees and workers, accordingly, incentives will be given. This will generally improve overall housekeeping. The company will be able to derive benefits if the proposed solution is implemented such that it will minimize the current problems and improve work methods. From the proposed solution, the group will be able to solve 4.232% out of the 4.5% of the total quantity that experienced production delays that resulted to delivery delays and a cost-savings of P 322,452.75 can be realized