Kelpies Furniture Business Analytics
Quality Diagnosis at The Kelpies Furniture Scotland
Introduction
The Kelpies Furniture Scotland (KFS) is a family-run business that started in 2007 from a workshop near Stirling with only 5 staff producing innovative products from recycled wood and locally sourced fabrics. It has evolved into a business with over 200 staff focusing on serving niche market segments for upmarket customised contemporary furniture with strong ethical credentials. It also maintains a full design and manufacturing capability inhouse. When the company’s demand driven steady growth required an expansion of workshop
space a second site, about 20 miles away at Saline in Fife was chosen. Compared to available Stirling facilities, the new site offered the right workspace for a much lower rental cost. Both locations run the same production
processes and can make any of the furniture products in the range. The company’s CEO however still anticipates eventually being in one location for all operational activities in Stirling by 2025. The Fife expansion increased production capacity by 200%. Workstations were added for each process in the production lines, increasing from the 2 initial workstation per process to 6. The new facility also provided a much bigger warehouse area to store finished product, providing flexibility in production planning.
The CEO and the management team were initially concerned about the scale of the expansion and the future robustness of the demand to justify this growth investment. Now, they also experiencing what the production manager calls “growing pains”, with issues of staff wellbeing including absenteeism, quality problems as well as persistent demand concerns (Excerpt).
MANU9DA Business Analytics Assignment 2: Expansion Options at The Kelpies Furniture Scotland
Introduction
So far during the Simul8 preparation activities in the computer labs you have been asked to work in a group to discuss and develop a basic Simul8 model of the case.
However, from receiving this Assignment 2 task you are now required to work individually on the development and production of the outputs to address these tasks. This individual work will be a demonstration of your abilities with Simul8 to explore and assess expansion options for KFS.
Demand and Plans
Detailed data has been previously provided describing the production of 1021 furniture orders between 2021 and 2022 for Model 1 – 4. The success of expansion at Fife has demonstrated the capability of the business to grow and increase production while maintaining the high-quality standards expected of the company products
and services.
The CEO is keen to replicate the effective operation at Fife and aims to have only one location for all activities in Stirling by 2025.
Expansion options & task
Using a working basic Simul8 model and analysis from assignment 1:
1. Show how the factory is coping at current capacity using the historical data (KFS data.xls).
2. Show how the factory could operate at an expected output of 3000 models per year (equally between models) if Model 3 and 4 to discontinue with 2, 4 and 6 staff at each workstation.
a. the current shift
b. the 24-hours shifts – option 1 Monday to Friday
c. option 2 – Monday to Sunday 7am-11pm
d. Option 3 – Monday – Saturday 9-5pm
3. Produce the lower and upper figure estimates for the year of working with 2 people per activity per shift; 4 people per activity per shift and 6 people per activity per shift.
4. Describe the models you have made, ensuring that you describe all elements used in the model, justify each model produced with trials and verification, and refer to outputs you have produced in Simul8.
5. Run the models for one year, reporting on the number of orders that can be completed, utilisation and any issues you see in production. This means you need to validate the models using the various historical data.
6. Interpret the results of the simulation made, answer direct questions of management, and offer suggestions to management on the viability of this arrangement and any production issues they should prepare for. In particular, if there are any queues that cause significant backlogs, make suggestions to management for dealing overcoming the problems.
7. Use the enhanced models to assess the expansion options. Any assumptions should be clearly highlighted in the report.
8. Write an accompanying technical note (Word document: 1500 words) containing:
Highlights of your simul8 model (key features)
From the developed model(s) of potential solution(s), produce a table of the main features of your analysis and what this will mean for the business with reference to the key objectives.
Show evidence of validation of the enhanced model
Make recommendation(s): interpret the results of the analyses and produce a ranked list of proposals for management action
Develop suggestions of further analyses
Technical Notes: Make good use of structured tables and figures to address the tasks for this assignment. The 1500 word count limit excludes all tables or figures.
9. Provide a copy of your Simul8 model to evidence and corroborate your analyses reported in your technical note.