AIC Netbooks: Optimizing Product Assembly History AIC Systems was founded in Taichung Taiwan in 1992 as a printed circuit board producer for the personal computer industry with specialization in motherboards and graphic cards. By the early 2000s, the company had evolved into an Original Design Manufacturer (ODM). As an ODM, the company actively strived in innovating and designing each new generation of components. In 2007, the company decided to diversify its product portfolio to include consumer electronics with focus on mobile technology.
By entering the netbook market, AIC was able to design and manufacture a branded product in the mobile industry. The production manager and chief industrial engineer established an assembly line process for netbook production. Issues The issues that AIC is having are the current demand and the lack of enough employees. The current employees work 10 to 12 hour shifts which are not sustainable. The Chief Strategy Officer expects demand to be 130,000 units within the next two months.
The company faces the obstacle of meeting that demand as well as improving the assembly line process in order to accomplish this goal. Analysis In order for AIC to meet the demand stated above, there are two options. The first option is to increase the number of shifts to three. The amount of production will increase while decreasing the shift hours to eight. This will allow the company to hire more people as well as keep the efficiency up. Also with this option, there will be no need to create another assembly line and the plant capacity will be utilized.
The downside to this option is that the company would have to take the time to train the new employees as well as possible resistance from the management team. The second option would be to create a new line of production. Production will also increase with this option but there will be the initial cost of starting a new assembly line. Management would be happy to only add a few more workers. This option does not resolve to long employee shifts. Also the capacity of the plant will not be utilized with this option.
Recommendations AIC should use the first option in order to meet the market demand. Although management is not for hiring and training more employees, the end result is worth it. By using this option, employees are not over worked, production is continuous, and efficiency does not decrease due to employee fatigue. The company will also save the money the new assembly line would have cost along with other fixed costs. Finally the plant capacity will be utilized in order to store more products.