Operations Process Upgrades

Running head: OPERATIONS PROCESS UPGRADES

Operations Process Upgrades

Paul Dobranic, Glinda Parker, Aldo Torre, and Jason P. Walters

University of Phoenix

December 6, 2006.

Operations Process Upgrades

Currently as of 2006, Riordan Manufacturing expanded its manufacturing base with three additional plants and recently acquired an overseas location in Hangzhou, China. Riordan Industries is advancing in the Fortune 1000 companies by reaching $1 billion in revenues with sales of $46 million. Although, the expansion and target of sales increase, problems are arising. The Albany department's present inventor system is hindering potential large sales and ineffectively making use of storage facilities. The existing business system is working but savings could be achieved through automation (e.g. reduce redundancy and help forecast accurately). Georgia department's current processes are inadequate to meet the company's objectives of higher revenues. As a whole, the existing business system has insufficient structure, high degree of waste, loss of useful data, human error and incomplete connectivity.

Areas to Improve

In particular, Albany's Georgia facilities have to deal with many manual checks and balances consisting of multiple forms and handling time slowing down the system. Individual records are maintained by various tools (some paper based); therefore, the proposed system will aim at significantly eliminating the paper trail. Consolidating historical production figures should be managed efficiently and accurately for production forecasts. In order to accomplish this, files which are scattered among many databases, in rooms full of paper files, and thousands of microfiche containing past information have to be digitized. Other room for improvement includes the storage for short orders and raw material emergency stock. Also, corrected would be the expense of last-minute freight charges. The VMI application can exactly calculate maximum truck loads to further decrease freight charges. A new system would address the problem of contract penalties thereby being able to handle more large-scale sales. An inventory management system would create an even higher success rate, especially within the North and North-Eastern delivery areas. Problematic information transfer to the home office and other departments from operation will be rectified with speed and conformity. The present barrier of incompatibility resulting in hard copies being re-entered (date entry errors), and/or re-coded (integrity issues) can be reduced saving time and labor. There is no company-wide or internal database or web hosting which is a loss in income and control. The proposal deals with integration, via hardware and software upgrades, data handling via the use of database management systems, and system automation and communication via a Vendor Manage Inventory.

Purpose of Project

A new system is in order to accomplish Dr. Rio and the executive's proposed objective of increasing the yearly revenues by over $5 million. The Direct Plant Operations goal is develop a business module for a supply chain by the end of the year. The recommend business system will, "implement a plan to meet customer required due dates in the North and North-Eastern parts of the United States when winter conditions set in" (Riordan Corporate Site, 2005). Also, Craig Granbeig intends to, "deliver Pyramid Bottle on-time within specification" (Riordan Corporate Site, 2005). The proposed system will provide pertinent numbers for production and accounting department so they all can consent on goals and forecasts. Continuing with the current IT plan at Riordan Manufacturing to install a VMI system coincides with the request.

The proposed IT system will help with these managers' goals:

1. VP Operations (Bob Havings): aid in reviewing potential outsourcing for Albany, using ERP and MRP to lower expenses 10% and cycle time -15%, use Albany as a test for other plants

2. Direct Plant Operations (Pontiac): implement JIT for custom plastic

3. Direct Plant Operations (Albany): implement proposed plant for VMI to, among other benefits, deliver quality products on-time

4. VP Transport (Clyde Cousin): reduce carrier costs 5%, decrease carrier cycle time 5%, aim is for a competitive advantage

5. VP International Operations (Charles Williamson): obtain a formidable 99% on-time delivery rate through out the organization

Stakeholders

The stakeholders encompass every entity and individual the corporation's system comes into contact with. Starting at the bottom of the pyramid are the systems frontline operators who will have to live with the structure imposed and be trained on it. The next stage up is the various company departments such as marketing, sales, finance, production, and human resources that will be given information from the system. They all realize that a new information system would be an indispensable tool for furthering the executive agendas. Saving (i.e. profit) and efficiency would be realized from timely deliveries of products, eliminating man hours, reducing time for repetitive tasks, and eradicate data entry mistakes. The head of Direct Plant Operations will have to support his investment proposal with accurate information making Mr. Granbeig a primary stakeholder. On the third tier the CEO sits with the president of Riordan Industries who have the responsibility to govern the organization. Finally, at the peak are the customers/suppliers (who are keenly aware of the debacle caused by the acquisitions) and the investors (who are the major consideration from the point of view of the firm). Total reengineering of the IT inventory system is necessary to reach the corporate goal of integration and customer satisfaction.

Business Requirements

Mr. McCauley's service request requires that the inventory and manufacturing processes implement the use of computer systems to become more efficient. To fulfill this request, this project will address efficiency issues in four key areas: time expenditures, money expenditures, space allotment and waste production. To improve efficiency in