Operations Management Case Study Assignment Questions and Answers
SECTION A – CASE STUDY
Read the following case study and answer the questions that follow:
1200 jobs created as Ford prepares for new Ranger production at Silverton plant
24 September 2021
By: Irma Venter
Ford South Africa (Ford SA) has created about 1 200 incremental jobs by reintroducing a third shift to its operations at the Silverton assembly plant.
The additional shift forms part of the US automaker’s $1.05-billion investment in the Pretoria plant to produce the next-generation Ranger bakkie, starting next year.
The plant is in the process of wrapping up a seven-week shutdown, which saw the extensive modernisation of the facility in preparation for the new model.
Production at the plant will include the new Volkswagen Amarok, as part of the global production agreement between Ford and Volkswagen.
The implementation of a third shift sees the local Ford SA workforce grow from the current 4 200 employees to about 5 000 employees, with an additional 440 jobs created at the plant’s on-site service provider.
The additional shift is the first use of a three-shift production schedule since it was implemented as a temporary measure during the second half of 2019 to achieve higher production volumes for the current Ranger.
The added working hours will see the Silverton plant operate around the clock, five days a week.
The employees who were brought on board and trained in 2019 were given first option to take up the new positions.
With the additional shift, the Silverton assembly plant will be capable of producing up to 720 vehicles a day, or 240 units a shift, which equates to one Ranger coming off the line every two minutes.
Two-thirds of the Rangers produced will be exported to more than 100 global markets, as is the case with the current Ranger. The balance will be sold in South Africa.
When the next-generation Ranger is launched in 2022, the Silverton facility will have a yearly installed capacity of 200 000 vehicles a year, which is nearly double the 110 000-unit-capacity when production of the current Ranger pick-up began in 2011.
Ford SA has produced about 732 000 Rangers since 2011.
To realise the new production targets, the Silverton plant’s assembly line is undergoing extensive transformation to modernise the facility, enhance efficiency and improve production quality, says plant manager Tim Day.
The vehicle manufacturer is currently constructing an all-new body shop and stamping plant on the Silverton site, along with a new in-house frame line in the adjacent Tshwane Automotive Special Economic Zone.
“The seven-week shutdown enabled us to implement the largest and most comprehensive upgrade and modernisation of the Silverton assembly plant to date,” adds Day.
“Our entire focus is on being world-class and comparable with the best Ford manufacturing plants globally.”
The biggest change has been a total redesign of the plant layout, notes Day.
“The progressive evolution of the plant saw it growing organically over the years, which resulted in a less-than-ideal layout. Accordingly, we’ve completely reworked the assembly line to maximise efficiency through the vehicle assembly and validation processes.
“We’ve removed roughly a kilometre and 20 transactions (vehicle-worker interactions) out of the previous assembly line flow by eliminating the back-and- forth movement of vehicles within the plant during the various stages of production,” explains Day.
“This will result in all of the manufacturing processes and quality checks being performed in the zone where it’s manufactured, contributing towards greater efficiency and more effective quality control before the vehicle moves to the next station.”
The changes at the plant have also seen a new emphasis on ergonomics, with a shift from fixed vehicle carriers to a flexible new skillet system transforming the way individual tasks are performed by employees on the line.
“We did away with the previous vehicle carriers and replicated the skillet system that is used at Ford’s leading plants around the world, including the Ranger plant in Thailand and the F-150 plant in the US,” says Day.
“The skillet system is far less bulky and restrictive, and eliminates the various platforms and levels that people had to work around previously.”
With the skillets, the vehicle is automatically raised or lowered based on the ideal height for the completion of the required assembly task.
It can also be adjusted to suit the height of the individual operators, thereby improving working conditions for employees, while also improving cycle times and enhancing safety.
“An additional benefit of the skillet system is that it is based on a moving platform, which eliminates the need for operators to continuously reposition themselves to perform the assembly operations while keeping up with the vehicle as it progresses down the line,” says Day.
“This allows the operators to focus all of their attention on building the vehicle, driving big improvements in efficiency, quality and first-time-through.”
The modernisation of the Silverton plant has also seen the introduction of a new box line for the Ranger’s load compartment, a new fully automated robotic station for the application of the windscreen seal, and a specially designed instrument panel subassembly line.
There is also a new vac-and-fill facility that integrates the filling of the Ranger’s liquids (fuel, brake fluid and engine coolant) and the air-conditioner gas, with the new system replacing the inefficient multistation configuration used previously.
The final integration of the automated wheel-and-tyre facility, which was launched in September last year, has also been completed.
The fitted wheels and tyres are now automatically sequenced on to the assembly line through the roof of the main plant, eliminating the use of trolleys and the movement of vehicles and people.
Latest-generation wheel and headlight alignment booths are another new feature at the plant, complemented by a new water-test facility that uses high-pressure jets to pinpoint any water intrusion into the cabin of the vehicle.
New CAL Facility
The modernisation of the Ford assembly plant has also seen the launch of a new customer acceptance line (CAL) facility. This allows quality inspectors to scrutinise every aspect of the vehicle on a brightly lit audit line, validating the accurate fitment of parts, paint and bodywork quality, and the operation of all vehicle systems.
Following this, the Ranger is driven on a newly constructed rattle-and-squeak test track, which incorporates a variety of road surfaces.
A new clear-vision track has also been constructed. This track ensures that the vehicle’s wheel alignment is accurately set when driving on the level surface, ensuring that it does not pull to one side.
Ford SA is also constructing a new modification centre, aimed at the on-site fitment of a variety of optional Ford-approved accessories.
Question 1
1. Identify the process design that a vehicle manufacturer such as Ford South Africa would employ in its Justify your choice. (2)
2. The Silverton facility is purposed to produce the new Ford Ranger and the new Volkswagen Amarok as part of the global production agreement between Ford and Volkswagen. What design stages would have been followed in the design of these products? (5)
3. The company has made a $1.05-billion investment in the Pretoria plant to produce the next-generation Ranger “bakkie”, starting next year. Considering that this is a profit-making firm, explain how the Net Profit (NP) and Return on Investment (ROI) equations can be used for making management decisions that will take the company closer to its goal: making (5)
4. With reference to the case study above, draw a well-labelled diagram to illustrate the supply chain of Ford South (4)
5. Using the evidence from the case study above, identify Ford SA’s quality Justify your answer. (2)
6. What, in your view, is the significance of innovation in operations management? (2)
Question 2
1. Ford South Africa is currently constructing an all-new body shop and stamping plant on the Silverton site, along with a new in-house frame line in the adjacent Tshwane Automotive Special Economic Zone. “The seven-week shutdown enabled us to implement the largest and most comprehensive upgrade and modernisation of the Silverton assembly plant to date. Our entire focus is on being world-class and comparable with the best Ford manufacturing plants ”
In the previous year, the company had 500 assembly stations renovated over 10 weeks at 40 hours per week. Each renovation took an average of two hours and 25 technicians to complete. In the current year, through the assistance of new technology, the company aims to upgrade 530 assembly stations over seven weeks (40 hours per week), taking an average of 1 and half hours.
How many technicians will be required to complete the current year’s upgrade process per week? Use the Little’s Law formula and show all calculations. (4)
2. As indicated in the case study, the new facility in Silverton has the design capacity of 720 vehicles a day, or 240 units a shift, which equates to one Ranger coming off the line every two The plant operates around the clock, five days a week (120 hours). The design capacity is: 1 x 30 x 24 x 5 = 3 600 vehicles per week.
However, the records show that the plant experienced loss of production time for a week as follows:
- Product setups: 13 hours
- Regular maintenance: 11 hours
- No work scheduled: 8 hours
- Quality checks: 5 hours
- Shift change: 3 hours
- Breakdown: 8 hours
- Quality failure investigation: 13 hours
- Paint stockout: 13 hours
- Staff absenteeism: 3 hours
- Waiting for material: 2 hours
During this week, the actual production was only 2 196 vehicles. The first five categories of lost production were reasonably unavoidable and amount to 40 hours. The last five were unplanned and could have been avoided, amounting to 31 hours lost.
Given the information above, calculate the plant’s capacity utilisation and its efficiency. (5)
3. Consider the details provided below and answer the questions that follow.
Once vehicles have been assembled at Ford SA’s Silverton plant, they are sold to different markets globally. Over a few weeks, the demand for new vehicles has been recorded, as follows:
| Week | Actual demand | Forecast |
| 1 | 2 480 | 2 480 |
| 2 | 3 100 | 2 900 |
| 3 | 3 680 | 3 740 |
| 4 | (2.3.1) | (2.3.2) |
- Calculate the actual demand for vehicles in week 4, using the simple moving average of the previous three weeks’ actual (3)
- Use the vehicle data in the table above. Assume it is now the end of week 3, so the actual number of arrivals at the storage is known to be 2 items. Where ? = 0.10, calculate the exponential smoothing forecast for week 4. (3)
SECTION B – RESEARCH QUESTIONS
Question 1
Read the following information and answer the questions that follow:
You are an Operations Management practitioner, and your role is to ensure that your organisation employs seamless design and management of products, processes, services and supply chains. You are charged with the acquisition, development and utilisation of resources that your organisation needs in order to deliver the goods and services that its clients and/or customers want. With this mind, identify an organisation of your choice and prepare a written report.
Prepare your written report based on the following information:
- Name of the organisation and the strategic objective/s of the (2)
- Using the Balanced Scorecard approach, outline the organisation’s position in relation to its overall strategic objective/s. (8)
- Every company is in business to make money (profit-making and non- profit making), now and in the future. In order to achieve this goal, companies fiercely compete in the markets in which they operate. What are your organisation’s order winners and order qualifiers? (4)
- Identify and explain the process design that the organisation (4)
- Having assessed the organisation’s operations, what would you say causes the bottleneck, and how could the organisation improve the process? (4)
- Evaluate the planning and control activities that the organisation undertakes in its operation. (5)
- How have the organisation’s operations impacted the triple bottom line? (4)
- Referencing: acknowledge the sources you have used, with both in-text citations and at the end of this question, by means of a reference list (4)
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