Post on 05-Jul-2015
description
An Operations Management Analysis and Audit Case of
Mitsubishi Motors Philippines Corporation
Alvarado – Ang – Tinio - Pinpin
in the automotive industry
Only one picture comes to mind.
Logo of three diamonds
Quality and
Excellence
Mitsubishi motors
Philippines
corporation
Company Profile
SHORT HISTORY
• Established: February 20, 1963• Chrysler Philippines Corporation
State of the art
• technology in automotive manufacturing• painting technology
• Hikasaburo Shibata• Supplier of world class products and services
Today
Mitsubishi Motors Sojitz Corporation
L E =A 153,305 50,299 104,836
These are all In millions of dollars
857EMPLOYEES
Ortigas Avenue Extension,
Cainta, Rizal
Luzon, visayas, Mindanao
Sta. Rosa, Laguna, Naga, Davao
Industry Background
GDP31.5% of the GDP is the Industrial Sector
Output:P368 billion(3.8% of total gdp)
26% growth in sales!(July 2014)
* Major companies in the industry are independent
Development Trends
96,588
44,582
1,079
35,851
57,796
108,324
48,328
1,500
40,231
64,261
0
20,000
40,000
60,000
80,000
100,000
120,000
CommercialVehicle (CV)
PassengerVehicle
Trucks andBuses
Asian UtilityVehicle
Light Trucks
2011 Sales (in units) 2012 Sales (in units)
1. High demand of commercial vehicles and light trucks
2. Increasing every year
Toyota Motors Philippines
52%Mitsubishi Motors
Philippines Corporation
26%
Ford Motors Philippines
9%
Isuzu Philippines
Corporation7%
Honda Cars Philippines
Inc.6%
Value Share of Total Sales
Development Trends
Mitsubishi Motors capture 26% of the Total
Shares!
Core Strategies and Key Programs
1) 50, 000 units produced in the year 2014
2) 20% market share
3) PLANT expansion
4) Mirage
goals
Objectives
• Shoki hoko (corporate responsibility)
• Shoji Komei (Integrity)
• Ritsugo Boeki (Global Perspective)
• Driving pleasure and safety
Current Performance
Driving Pleasure and Safety for Customers
Financial
Customer InternalProcess
LearningAnd Growth
Balance
d
scorecar
d
Products
Cars
SUV and UV
mitsubishi
ProductsCustomer Friendly
Competitive
Handled Well
Process
Knock down and local parts warehouse
METAL FINISHING
Paint shop Finalassembly
Body Welding
Tester line
QualityAudit
Dealer
• Assembly process of L300
• Chassis,Trim, Final Line
• Main assembly of vehicle: 6
minutes per station
• Observation: 4 minutes, 18
seconds.
Note
Engine: assembled on the chassis on a separate line
(3 minutes, 3 seconds)
focus
Spray Bot
8-Dip Paint Process
Spot Welding Robot
Capacity Planning
Demand Forecasting
• Annual Management Plan Target
• 10-20% back up for allowances
• Production of vehicles done 3 months in advance
Proposed Methodology
L o n g r a n g e forecasting
EconomicSee how the economy will affect the
company
TechnologicalBeing updated can help speed up the processes
CapacityAnalysis
Total: 54, 000 units
L300 and Adventure Production
13, 500 vehicles per shift per vehicle
LancerProduction
4,000 vehicles per shift per vehicle
Total: 8, 000 units
CapacityAnalysis
• Produce 62,000 vehicles per year
• Design Capacity: 100, 000 vehicles
• Utilization: 62%
• Bottleneck: Vehicle Assembly of 70 units
(30 units of L300, 30 units of Adventure, 10 units of Lancer)
Facilities Layout
BU St ock
Ser vi ce
Tr a in ing
Center
Par t s
Total Land Area 190,295 sq.m.
Plant 1(Bldg Area: 40,013 sq.m.)
Plant 2(Bldg Area: 42,111 sq.m.)
BU
St ock
BU St ock
Ser vi ce
Tr a in ing
Ser vi ce
Tr a in ing
Center
Par t s
Center
Par t s
Center
Par t s
Total Land Area 190,295 sq.m.
Plant 1(Bldg Area: 40,013 sq.m.)
Plant 1Plant 1(Bldg Area: 40,013 sq.m.)
Plant 2(Bldg Area: 42,111 sq.m.)
BU
St ock
The Compound layout of the MMPC Plant
Floor Plan of the Vehicle assembly flow
Work Systems
mono
ZukuriHaving the state of mind in creating QUALITY PRODUCTS and HAVING THE
PASSION to improve it even more
Kaizen
new approach
Murairregularity of movement
Muridifficulty of task
MuDaidleness of the worker
Importance of MINIMAL body movements
utilize
movements
inventory
Rawmaterials
suppliers
• Wip inventory• Jit• FIFO
Bureau of Customs
Recommendations
KEY
FINDINGS
1 Plant
62% utilization
Inventory in Bureau
of Customs
Demand
forecasting based
on volume targetsBottleneck at Vehicle
Assembly with 70 units
Local suppliers in
Cavite and Laguna
Prioritization
Operations Management Areas:
(1) Utilization and Scheduling
(2) Layout Design
(3) Inventory
1Insufficient Raw Materials
2Capacity utilization and
demand forecasting
3One plant
4Longer delivery time
Final
Ranking
Pareto Analysis
Recommendations
SOLUTION #1
Find local suppliers
SOLUTION #2
Purchase raw
materials earlier than
usual
Find local
suppliers
Strengths
Less idle time,
shipping costs,
more cars
produced
Weaknesses
Difficult to find
local suppliers
with same quality
Opportunities
Increase
competitiveness
Threats
Relocation to
other ASEAN
countries
Purchase
Raw Materials
earlier
Strengths
Delay is
avoided
Weaknesses
Forecasting
and holding
costs
Opportunities
Raw materials
readily available;
higher
productivity
Threats
More vulnerable
to sudden
changes
Main recommendation
Purchase raw materials
in advance
Justifications
• No investment required
• May increase Holding Costs
• Raw Materials helD up at the bureau of customs
• Forecasting changes
• Costs can be handed by the company
Monitoring Plan
Effectiveness
Changes needed
Holding and inventory costs
Forecasting techniques