Executive Post Graduate Programme

Batch 2016-17
Operations Management
Case Study The Company Sunwind A.B.
Submitted By:
OM EPGP Group 3
Name
Saikat Hazra
Santanu Dasmahapatra
Tanmoy Bose
Sreemoyee Saha

Roll No.
29
32
38
36

Questions and Answers

Q3
What are the challenges facing Sunwind?
The challenges faced by Sunwind can be categorised into external and internal
Internal (Process Oriented)
Sunwinds major customer was Volvo, however it was facing problem in its operation.
This is because
1. Sunwind was facing difficulty in meeting both quality and quantity as required
by Volvo. While Volvos expected requirement is 1400 units per week, the
current production for the Sunwind in 1200 unit.
2. Sunwind was not being able to run at the expected capacity due to equipment
failures.
3. Sunwind was facing rejections of shipment from Volvo.
4. Quality control was not being followed in Sunbeam as documented.
External (Market Oriented)
1. Sunwind had two factories in Sweden at Hogsater and the other at Save.
Hogsater had available space and the parent company of Sunwind, Perstorp
had the opinion that it should close the Save factory.
2. Sunwind was facing increasing competition. One of the competitor could be
the supplier of automobile seats to Volvos Ghent firm.
3. Volvo had implemented Just in Time and as per best practises rule of JIT the
vendors also need to be working in JIT.
4. Implement of JIT also results into decrease in number of vendors, as practise
as followed by automobile industry leader Toyota.

Do they need a change in strategy by Sunwind? Why?

Yes Sunwind need to change its strategy

It has a high batch size.

Inadequate amount of labour in operation like riveting and gluing carpet and
inadequate number of machine like in milling is causing high cycle time.
It has a high inventory causing high MLT.
As its major customer Volvo has already implemented JIT it has to implement
JIT too to keep in sync with the requirement lead time.

Also refer to the attached the excel for value calculation Sunwind
Case Santanu,Saikat,Sreemoyee,Tanmoy

Q4
What are the benefits to implement JIT for Sunwind?
The benefits of Sunwind to implement JIT are.
1. This will enable it to increase its quantity produced and will be able to meet
the demands of its customer Volvo. It will lead to improved quality, reduction
of inventory, reduction in lead time and decrease of loss due to rejections.
2. This will enable Sunwind to reduce its inventory cost.
3. As the batch size will be reduced amount of wastages for defects will get
reduced.
4. The Save plant due to its close proximity to Volvo plant can better utilizes JIT.
5. Sunwind can better demonstrate its capability by being the first Swedish Justin-Time supplier.
How Volvo will get benefited if Sunwind goes for JIT production and delivery?
If major vendors like Sunwind also implement JIT it will improve the lead time
across the supply chain for Volvo and will eventually give Volvo major benefit.

Q5
Draw the process flow diagram of Sunwind operations.
Perform capacity analysis Sunwinds operations ?

Attached above is the screenshot. Please also refer to the attached

the excel for more details Sunwind Case
Santanu,Saikat,Sreemoyee,Tanmoy

Is the capacity at plant sufficient to meet the requirement (Demand

and any other) of all VOLVO plants? How would you interpret the
capacity calculations? (Consider a batch size and process time
information in Exhibit 7).
No, because the present capacity required to meet the Volvo production is 1300 unit
per week. Expected capacity required is 1400/week. From the capacity analysis the
milling or shaping machine can manufacture 1091 unit per week. The rest of the
stations can be debottleneck by employing more number of workers like operation for
riveting and gluing carpet. To increase the line capacity capital investment is required
for milling operation.

What is the Manufacturing Lead time?

The WIP is 4.6% of save sales (approximately) and this is product is account for 17%
of the total sales revenue. So the average wip is calculated as 1346 approximately.
The bottleneck cycle time of the present line (with the data given in the exhibit 5 and
exhibit 7) is 18.65 min.
So manufacturing lead time = 18.65X1346= 25106 min= 418 hour = 17.43 days.
And now this operating cycle can be debottlenecked by employing more human
resource. So the bottleneck will come in the milling or shaping machine whose cycle
time is 6.6 min. So the manufacturing lead time will then be 6.6X1346= 8884 min=
148 hours= 6 days

Do you think it is right or a long MLT in line with JIT requirement? If

it is short or long, what is cause of such short/Long MLT?
No it is very long with respect to JIT requirement. Even after using more resources
and without deploying any capital expenditure, MLT is 6 days. As per the present JIT
requirement of Volvo, Sunwind has buffer of only 6 hours to meet the requirement of
Volvo. The MLT is as high as 6 days. The cause of this high MLT is batch size, cycle
time, setting time, improper utilization of resource.

Q7
Should Lars Olav were to design a JIT programme at Sunwind,
what should be its elements?
The elements of the JIT programme at Sunwind is improved MLT of 6 hours to meet
the demands of Volvo. The weekly production rate is projected at 1400. So the daily
production rate is 280. To reduce the MLT, Sunwind has to invest labour in all the
labour intensive operations like riveting and gluing carpet and adding into machines
like milling machine.

Give details about the current status and future requirement of

few essential ingredients of JIT/Lean elements requiring
improvement/change in Sunwind. Please suggest/show your
improved/changed version of the Sunwind operations process to
meet the requirement (Demand and any other) to all Volvo plants.

Attached above is the screenshot. Please also refer to attached

Sunwind Case Future projection
Santanu,Saikat,Shreemoyee,Tanmoyexcel.
The capacity has been increased by deploying another shipping or milling machine.
On another working station the capacity has been increased by deploying more human
resources to get a minimum production of the line 1500 per day. The batch size has
been reduced to 210 to meet the JIT requirement of 6 hrs MLT.