Assignment 2 (Dore Dore Case Analysis)

GROUP 1
PGP 2015-17
About the Company:
Dore Dore(DD) was established by Jean Baptiste in 1819.It was the world
class manufacturer of fashionable knitted products. Its hosiery division
produced socks and stockings for men, women and children & that
accounted for 88% of Dore Dores sales. Its knitwear division produced
children's knitwear such as play clothes, sweaters and nightclothes. It
focused on both quality and fashion. It produced hose not only under its
DD trademark, but also for famous designers like Yves Saint Laurent, Nina
Ricci etc. DD commented a 30% to 40% market share in this segment.
One of DDs competitive strengths was its superior customer service for
hosiery.
The operations were carried out in two of its main plants : The Mery plant
which performed the childrens knitwear operations and The Gres Plant
which housed the companys headquarters and central hosiery factory.
The problems that the company was facing were:
1. Forecasts were uncertain as all production took place before
observing consumers demand in Hosiery Division.
2. High inventory costs were incurred. Many items were left unsold.
3. Inventory maintenance costs were quite high.
In childrens knitwear division, the company is uses its traditional method
i.e., a product design layout for the production. After the procurement of
Yarn and Fabric Supplies this method involves:
1. Knitting
2. Dyeing
3. Cutting
4. Sewing and Finishing
The company wanted to get into Cellular Design Layout for better Production
and Operational Utilization which involves formation of groups, re defining
supply chain, remuneration structure, change number of employees and other
such problems.
Hence we are to check which method will be more efficient.

Process Flow Diagrams:

Knitwear
Traditional Method:
Knitting

Dyed

Un-Dyed

Cutting

Dyeing

Sewing and
Finishing

Finished Goods

Analysis of the Traditional Process:

Factory Output per day: 2000 units per day
Labour Hours available: 8 hrs per day x 60 minutes = 480 minutes
Therefore, Cycle time for Children Knitwear division = 480/2000 = 0.24 minutes
per unit
The modification that is to be done is in the Sewing and Finishing goods between
both Traditional and Cellular method. For the sewing and finishing process:
For traditional Production:
Throughput time= 3x5 days = 15 days
Batch Size = 200 units
Now,
MLT=WIP/Production capacity

WIP= 15 x 2000 = 30,000 units (Here MLT=Throughput time for sewing and
finishing process alone)
For Cellular production:
Throughput time: 1 day = 8 hrs
Batch Size: 200 units
Therefore,
WIP = 1x2000=2000 units
Comparison of Traditional batch production vs Cellular production
Traditional Production
WIP = 30,000 units
Throughput time: 15 days
Defect rate: 5%
Cost on Machine = Low
No of workers involved: 42
*WIP/worker = 715 units
*Cycle Time = 10.06 minutes

Cellular production
WIP=2000 units
Throughput time: 1 day
Defect rate: 2.5 %
Cost on Machine = High
No of workers involved per cell: 6
*WIP/worker/cell = 334 units
*Cycle Time/cell = 1.45 minutes

* for Traditional Process:

WIP/worker = 30000/42 = 715 units
Cycle Time = (3x5x8x60)/715 = 10.06 minutes
* for Cellular Process:
WIP/worker = 2000/42 = 48 units
WIP/worker/cell = 2000/6 = 334 units
Cycle Time = (1x8x60)/48 = 10 minutes
Cycle Time/cell = 1.45 minutes
Hence by converting to Cellular method the changes that can be seen:
1.
2.
3.
4.
5.

The WIP of Sewing department reduced from 720 to 48 by converting from

traditional to cellular setup.
Reduced labour idle time and hence increase in labour utilization.
Results in low inventory and in turn low cost of inventory management
freeing idle capital
Workers in cellular operations are more flexible due to cross training.
Wait time between each operation is reduced.
Hosiery
Traditional Method:
Knitting

Blind Loop

Regular Loop

Ironing

Embroidery

Quality

Brand

Packaging

For hosiery operations, the cellular structure will include all processes except
the knitting process.
Production Output = 37000 units per day
In this case Each of the processes has Throughput time as: Closing of Toe
(40hrs), Knitting (40hrs), Ironing (40hrs) , Quality Control (80hrs) and
Embroidery (40hrs).
The Cycle Times are:
Closing of toe : 1min
Knitting : 7 min
Ironing : 1 min
Quality Control : 1-4 min
Embroidery : 1-4 min

For Traditional operations in Hosiery divisions :

Total Throughput time = 6 weeks = 6 x 5 = 30 days
Hence, WIP = 30 x 37000 = 11,10,000 pairs
Our goal is to reduce the throughput time of each of the post knitting
process to 1 day.
For this cellular manufacturing layout is considered:
Cellular Layout:

Production time per pair = 1 min (Given that the ironing process will determine
the production rate. Therefore the considered production rate is 1 min per pair
of hosiery)
To reduce throughput time to 1 day from 1 week, a cellular layout with 7
workers is suitable.
Capacity = 7*480 = 3360 pairs per cell
Manufacturing lead time is reduced to 1 day
WIP = 37,000 pairs and hence it is a huge reduction from traditional
operation where WIP = 11,10,000 pairs
Also,
Total throughput time for the 3 operations combined is 4 weeks (not including
embroidery process) = 160 hrs.
Therefore, for traditional process, WIP= 160*37000/8= 7,40,000 units
For cellular process, given proposed throughput time = 1 day = 40 hrs
WIP = 40 x 37000/8 = 1,85,000 units
Hence we should implement cells in its Hosiery Production too.