Exeter Corporation has recently begun a continuous improvement campaign. As a consequence, there have been many changes in operating procedures. Progress has been slow, particularly in trying to develop new performance measures for the factory. Management has been gathering the following data over the past four months: Month 1 2 3 4 Quality control measures: Customer complaints as a percentage of units sold 1.4% 1.3% 1.1% 1.0% Warranty claims as a percentage of units sold 2.3% 2.1% 2.0% 1.8% Defects as a percentage of units produced 4.6% 4.2% 3.7% 3.4% Material control measures: Scrap as a percentage of total cost 3.2% 2.9% 3.0% 2.7% Machine performance measures: Percentage of machine avaliability 80% 82% 81% 79% Use as a percentage of availability 75% 73% 71% 70% Average setup time (hours) 2.7 2.5 2.5 2.6 Delivery performance measures:
Throughput time ?Manufacturing cycle efficiency? Delivery cycle time? Percentage of on-time deliveries 84% 87% 91% 95% The president has attended conferences at which the importance of throughput time, manufacturing cycle efficiency, and delivery cycle time were stressed, but no one at the company is sure how they are computed. The data to compute these measures have been gathered and appear below: Month 1 2 3 4 Wait time per order before start of production, in days 16.7 15.2 12.3 9.6 Inspection time per unit, in days 0.1 0.3 0.6 0.8 Process time per unit, in days 0.6 0.6 0.6 0.6 Queue time per unit, in days 5.6 5.7 5.6 5.7 Move time per unit, in days 1.4 1.3 1.3 1.4 Required: 1. For each month, comput the following performance measures: a. Throughput time. b. Manufacturing cycl efficiency (MCE). c. Delivery cycle time.