Bayonne packaging case study solution

ANALYSIS OF BAYONNE PACKAGING INC. 1
ANALYSIS OF BAYONNE PACKAGING INC.

Week 4 Assignment: Systems Analysis of Bayonne Packaging Inc.

Eliane Barbosa

Walden University

November 19, 2015

Analysis and Overview of System Diagrams

This analysis includes a review of operations at Bayonne Packaging Inc. The operations strategy of a company is the prioritization of the five key performance measure; Cost, Quality, Speed, dependability and flexibility. The president of Bayonne Packaging, Inc. indicates that the problems of the company are” they have incurred their losses since 2001, there are complaints about quality and they are delivering late more often. The other department managers, except for the absent finishing department manager, also indicate to the new vice president of operations that they have problems in their departments that relate to the performance measures dependability, quality and speed. Bayonne is packaging company and it had grown from just over $10 million in sales in 1982 to $ 32 Million in 2001. But for the 1st time company ran a loss since 2001. There are a large number of complaints about the quality. Delivery of packaged products is also late more often.

Based on the priorities given by the key personnel of Bayonne Packaging we have determined the operations strategy of Bayonne packaging to be as follows (Key performance measure in descending order of importance.

1. Dependability

2. Quality

3. Speed

4. Costs

5. Flexibility

Dependability:

· Percentage of full (i.e. not partial) deliveries that is on time period

· Average delay time of an order for the customer per time period

· Down time per machine as a result of poor maintenance per time period.

Quality:

Quality problem: Quality problems concentrated in fold and glue with either missing glued lines or excess glued. In the 2011 6% of products were found defective due to glue problems and were scrapped with a further 1% of shipped products rejected by customer due to glue problem. There are some problems in finishing a much lower volume department. For fold and glue department orders are already late. Therefore delivery of final products is late by the due date.

Speed:

· The number of days between the signing of a proof by the customer and the delivery date.

· The amount of time spend on set up times per order/per period

· The number of materials flowing through operations per period

· The average critical ratio (should be as close to target ratio as possible.

Its total COGS significantly went up from 83.2% in September 2011 to 90.7% in October 2011. (Yearly averages 2010. 74.4 % 2009: 72.1. For these reasons, Bayonne packaging is not performing well on the cost performance measure.

Flexibility:

Bayonne Packaging, Inc. is doing well on flexibility. It is grabbing into new markets’ (p4) such a packaging for candies, corporate gift sets and packages meeting FDA requirements. Flexibility defined as being able to serve different markets is a performance measure Bayonne Packaging, Inc. is doing well at.

The very survival of Bayonne packaging is at stake and if the John Milliken does not give the right recommendations to Dave Rand this company which is already losing money will cease to exist as it has lost goodwill among its customers, faces quality issues and is losing money as well.

Recommendations

Based on this analysis my recommendations are the following:

The president of the company should look at. If there is any problems in the finishing of packaging and customer returns it. Then that package should be scrapped and no rework should be done on it. Number of inspectors should be increased so that material is properly inspected before shipping.

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References

Meadows, D. H. (2008). Thinking in systems: A primer. White River Junction, VT: Chelsea Green.

Olson, M. S., van Bever, D., & Verry, S. (2008). When growth stalls. Harvard Business Review, 86(3), 50–61. Retrieved from the Walden Library databases.

Shapiro, R., & Morrison, P. (2012). Bayonne Packaging, Inc. [Case study]. HBS Case 4420. Boston, MA: Harvard Business School. Retrieved from https://cb.hbsp.harvard.edu/cbmp/pl/23347758/23347900/44a19a9aaa7d615f02938a4202f21edd