Operations Management: An Integrated Approach, 5th Edition

CASE: Newmarket International Manufacturing Company (A)

Marcia Blakely, plant manager at the Newmarket International Manufacturing Company (NIMCO), was preparing for a meeting with her management team. Joining her would be Jack Novak, the company controller; Amy Granger, regional marketing manager; and Joe Barnes, the production manager. The goal of the meeting was to develop a staffing plan for the second quarter. A quick performance review covering the past two quarters proved disappointing. Customer service was poor in spite of higher component inventory levels. Stockouts of some components were a problem and caused production inefficiencies. Nothing seemed to be working smoothly.

Company History

NIMCO was founded by Marcia Blakely when she was only two years out of graduate school. Marcia's knowledge of mass customization has been the driving force behind NIMCO. The company produces three major custom products. Volume on the products is quite high even though each item is customized specifically for the customer. Each of the products is processed through up to four different work centers. Although each item is unique, the processing time at each work center is constant due to the sophisticated equipment used.

NIMCO currently has 75 full-time employees working in manufacturing. Each employee is scheduled to work 40 hours per week. Because mass customization is used, NIMCO carries no finished goods inventory. The company policy is to meet all demand each period; no back orders ...