Muller systems assembly line optimizationMGMT 5060 – Harvard University

Prof. Paul Tumolo

Team MAT Maria Hevia Nick Dion Fatih Avci

Chaitanya Misal

Mueller Systems

Smart Metering Solutions

Increase Efficiency Reduce Cost Improve Customer Service

Electricity Water Gas

Mueller Systems

Data is communicated wirelessly from meter to the mobile unit

Data is transferred from mobile unit to data server

Municipal data serverMeter

Mobile Data Collection

AMR Hot Rod - Device of interest

Product Overview AMR Hot-Rod (radio transmitter unit)

Highest selling product for Mueller Unchanged assembly line for last 10years

Circuit Board CHINA Unit Assembly

MEXICO

Shipped to USA

Current Assembly ProcessRemove latex from board

Solder antenna to the board

Solder battery

Push wires and seal openings with epoxy

Solder wires Assemble unit

Test and label the unit

Potting – Seal unit with epoxy

Vacuum units to remove air bubbles (Batch of 5 units)

Seal Units (O-ring) Epoxy

Curing

Final quality test

Stn. 1

Stn. 2

Stn. 3

Stn. 4

30 30 45

30 25 10 60

50

150 150

Note: Each color represents one worker

Metrics for current process

6 Line Workers

5 hand-offs

Cycle Time: 65 seconds

DELIVERYCapacity/Year:133,000 units(48 hour work week)

Per unit cost: $3.08

Cost /year: $409,640

First Pass Yield:97%

QUALITY

Idle time:90 seconds

COST

Suggested Improved Process

Stn. 1

Stn. 2

Stn. 3

Stn. 4

Remove latex from board

Solder antenna to the board

Push wires and seal openings with epoxy

Remove latex from board

Solder antenna to the board

Push wires and seal openings with epoxy

Solder battery

Solder wires Assemble unit

Test and label the unit

Solder battery

Solder wires Assemble unit

Test and label the unit

Potting – Seal unit with epoxy Potting – Seal unit with epoxy

Vacuum units to remove air bubbles (Batch of 4 units)

Seal Units (O-ring) Epoxy

Curing

Final quality test

30 30 45

30 25 10 30

50 50

120 120

Improved metrics

6 Line Workers

3 hand-offs

Cycle Time: 60 seconds

DELIVERYCapacity/Year:144,000 units(48 hour work week)

Per unit cost: $2.84

Savings $34,000

First Pass Yield:97%

QUALITY

Idle time:25 seconds

COST

Net value of improvement• Potential price reduction: $0.24/unit (negotiable)

• Potential savings up to: $34,000/year

• Cycle Time reduction by: 5 seconds

• Increase throughput by: 11,000 units/year

• No change in number of workers or working hours

• Reduce hand-offs, potentially improve FPY

• 200 fewer hours required to produce the original output (133,000 units/year)

• Reduced Idle time from 90 seconds to 25 seconds

• Investmentment of 1 extra test computer

Our Suggestions Option 1:

Mueller continues buying 133,000 units/year (Number equals the output old process)

New process can produce them in 200 fewer hours Mexican facility can use this free time to take other clients orders Negotiation per unit ($2.84/unit vs. $3.08/unit) Potential savings up to $34,000 per year

Option 2: Mueller buys 144,000 units/year (Total output with newer process) Negotiation per unit ($2.84/unit v. $3.08/unit) No change in number of workers or work duration Potential savings up to $34,000 per year

Mueller and Mexican facility should share the savings in order to leverage process improvement

Mueller can also negotiate to pay per hour instead of pay per unit to leverage any further improvement in process