Operational Changes to Improve Performance, Lead Times and Production
What operational changes would you recommend to Wally to improve performance?
Improving lead times
In order to reduce lead times, Obermeyer can persuade retailers to place orders ahead of time by gathering sales at an earlier time of the year, allowing the company to satisfy these orders. Additionally, they can purchase greige fabric by Obersport ahead of time in order to decrease the lead times of acquiring fabrics during high demand. They can also look into manufacturing options closer to Hong Kong to reduce the lead time of production and preparation of raw materials. Additionally, since Obermeyer can’t predict future colors needed, they should look into dyeing basic colors early in the year and then dyeing fashion colors, such as patterns, late in the year, thereby decreasing lead times.
Improve production
In order to improve production, Obermeyer can look into increasing their production line efficiency. First they should look at the main differences between their Hong Kong and China facilities to determine why productions vary highly between the two lines. Once differences such as different machinery, work style, and process flow are found, Obermeyer can look into improving both plants equally. For example, through formalized trainings across workers and management in their China facilities, the company can increase efficiency to a level comparable to that of the Hong Kong plants.
Improving Forecasting Model:
Obermeyer should not be using the forecasts made by each of their managers. Instead they should be looking at past data from previous years in order to identify trends in demand and in the market which they can use to forecast demand. They can also use this historical data to classify the accuracy of each of the managers’ predictions in order to accurately account for each of the managers’ future demand forecasts. Another option is to also seek orders at an earlier time in order to forecast demand accurately. If Obermeyer were to achieve a high
Improving lead times
In order to reduce lead times, Obermeyer can persuade retailers to place orders ahead of time by gathering sales at an earlier time of the year, allowing the company to satisfy these orders. Additionally, they can purchase greige fabric by Obersport ahead of time in order to decrease the lead times of acquiring fabrics during high demand. They can also look into manufacturing options closer to Hong Kong to reduce the lead time of production and preparation of raw materials. Additionally, since Obermeyer can’t predict future colors needed, they should look into dyeing basic colors early in the year and then dyeing fashion colors, such as patterns, late in the year, thereby decreasing lead times.
Improve production
In order to improve production, Obermeyer can look into increasing their production line efficiency. First they should look at the main differences between their Hong Kong and China facilities to determine why productions vary highly between the two lines. Once differences such as different machinery, work style, and process flow are found, Obermeyer can look into improving both plants equally. For example, through formalized trainings across workers and management in their China facilities, the company can increase efficiency to a level comparable to that of the Hong Kong plants.
Improving Forecasting Model:
Obermeyer should not be using the forecasts made by each of their managers. Instead they should be looking at past data from previous years in order to identify trends in demand and in the market which they can use to forecast demand. They can also use this historical data to classify the accuracy of each of the managers’ predictions in order to accurately account for each of the managers’ future demand forecasts. Another option is to also seek orders at an earlier time in order to forecast demand accurately. If Obermeyer were to achieve a high