Manufacturing Systems Hawkesbury Cabinets Pty Ltd

Question: Discuss about the Manufacturing Systems for Hawkesbury Cabinets Pty Ltd. Answer: Introduction As per the details given in the case study, the Hawkesbury Cabinets Pty Ltd established in 2008, design and manufacture custom made build cabinet solutions for the kitchen. Slowly the demand of the products manufactured by the company increased steadily. The owners enabled Fung and Mei Chen, thereafter expanded the operations donning various roles themselves in the company. The rising demand was realized by the company by manufacturing high quality but standardized kitchen cabinets instead of custom made for each customer individually. Though, the profit margin is higher in the custom made kitchen cabinet than that in the set standard ones, thus the owners of the company give it higher priority. The company has only one manufacturing unit in Mulgrave. This unit is equipped with machines which have flexibility to build both the standard as well as custom made kitchen cabinets. Because of tremendous increase in the demand for the company products, the manufacturing unit was facing high performance pressure. With an increase in the demand, there was more pressure on the manufacturing facility. The owners noticed that the cost related to the line of standard builders was increasing. This causes a higher capital sum to be tied up in the inventory of raw materials, work in process and the finished goods (Wang Disney, 2015). The prime goal of this report is to analyze and explore and current state of operations of Hawkesbury Cabinets Pty Ltd. The present production system used in the company by Fung and Mei Chen would be scrutinized. Also the impact of the use of new builders line of kitchen cabinet on the product operations is studied in the present essay. The financial implication of moving to production of builders line of kitchens on the balance sheet of Hawkesbury Cabinets Pty Ltd is also considered in this essay. Analysis of the current production and processes As per the details given in the case study, the Hawkesbury Cabinets Pty Ltd was founded as a small scale company with only one manufacturing facility at Mulgrave. Therefore, when there was huge growth in the market demand for the company products, it became difficult for it to manage them. It is also apparent that the company is unable to reach the equilibrium in managing the demands of standard and custom made kitchen cabinets. This is the prime reason for the higher lead times for either type of products manufactured by the company. The present production arrangement of the company is rather simple with respect to the procedures. There is only one manufacturing unit owned by the company in Mulgrave. This unit is equipped with machines which have flexibility to build both the standard as well as custom made kitchen cabinets. The layout of the production unit has different spaces with related equipment assembled together. While one section has cutting tables and saws, shapers and routers form another section. There is a separate area devoted for the lathes and machines which are used less frequently. For manufacturing standard as well as the custom made cabinets the company has common craftsman or employees. Thus in the present operation system the work scheduling is done for manufacturing standard and custom build kitchen cabinets (He, Zhang, Li, 2014). Since there is higher profit margin in the custom made kitchen cabinets, they tend to get preference in the work schedule procedure. This causes negative effect on the lead time of the cabinets made in standard format. The effect of the new builders kitchen line on Hawkesbury Cabinets operations When the company began to focus on accommodating the new builders kitchen line, actual problems began to surface in its operational processes. Though the company sales were good in the custom made kitchen cabinet segment, but after sensing the market opportunities available in the standard kitchen cabinet segment, the owners of the company started manufacturing it. One of the main problem was that the company only has one manufacturing unit that produces both standard as well as custom built cabinets. The operational line or the procedure for both the products was also the same. The products were produced on the basis of job scheduling in a particular scheduling algorithm manner. The priorities in this system is based on the achievement of higher profit margins (ElMaraghy, AlGeddawy, Samy, Espinoza, 2014). Thus the prime issue with the operations of the company is that it is unable to reach the equilibrium in managing the demands of standard and custom made kitchen cabinets. This pr oblem results in higher lead times for both standard as well as custom built cabinets (Hameri, 2011). Moreover, in this operational process arrangement, the custom cabinets tend to get higher preference as they give higher profit margins, thus affecting the profitability and lead time for the standard cabinets. The effect the move to producing builders kitchens might have on the companys financial structure The emphasis on the production of new builder line kitchen cabinets could be positive or negative on the financial structure of the company. In order to grow and expand the company this decision is a good and logical one (Thamhain, 2013). Nevertheless, the owners, Fung and Mei Chen have to focus to handle the risks and obstacles. They should also acknowledge that the only manufacturing unit of the company is already under pressure of increasing demand and working in its full capacity. Thus, further work overloading could have highly negative influence on the quality, delivery as well as cost of the products (Falck, rtengren, Hgberg, 2009). With the beginning of new product line, the short term financial impact could be negative as the company has to make investments in the initial phases. Nevertheless, in the long run, company can achieve greater profits from its new product line. The company has to develop appropriate management strategies and ensure that it takes cares of all the positive and negative influences of the expansion. Also it has to ensure that the employees are equipped with adequate skills to handle the manufacturing process of the new product line. When the supply chain and operational issues are managed effectively the builders line kitchen cabinets would prove profitable to the company in the coming future (Tompkins et al., 2002). The balance between both types of product lines would enable the company to emerge as a market leader in the Australian market. Conclusion It can be concluded that the impact of the new builders kitchen line products on the operations and finances of the Hawkesbury Cabinets Pty Ltd depends on the appropriate strategies and planning by the owners. Since the only manufacturing unit of the company is already overloaded with the work, resulting in negative influences such as higher lead time for the standard cabinets and greater operations cost (Hajmohammad, Vachon, Klassen, Gavronski, 2013). Also the balance between the job scheduling for manufacturing of standard and custom made cabinet is urgently needed by the company to handle the current operational issues. It could be suggested that considering two distinct production lines for manufacturing the standard and custom products separately. References ElMaraghy, H., AlGeddawy, T., Samy, S. N., Espinoza, V. (2014). A model for assessing the layout structural complexity of manufacturing systems. Journal of Manufacturing Systems, 33(1), 5164. 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