Daily Usage of an Assembly Is 100 in a Facility

question 109

Short Answer

Daily usage of an assembly is 100 in a facility that operates 300 days of the year. Setup cost is $5 and annualized carrying cost is $160 per unit. Production of this assembly occurs at the rate of 400 per day when production of the assembly is underway. Lead time is 3 days; safety stock is 1/2 day's production. What is the optimum kanban size, and number of kanbans?

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Definitions:

Rationalize

The process of providing logical, reasonable explanations or justifications for actions, decisions, or beliefs, often to make them seem more acceptable or sensible.

Pay-offs

The benefits or rewards received as a result of an action or decision.

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A form of outdoor advertising where large posters are displayed on billboards to promote products, services, or events.

Ethics Mindfulness

The practice of being fully aware of the ethical implications of one's actions and decisions in the professional environment.