Introduction Custom Molds Inc. was found in 1987 by Tom Miller and Mason Miller, father, and son. The company locates in Tucson, Arizona. Tom Miller is a mechanical engineer with more than twenty-year experiences from Amp Inc. Mason Miller graduated from Arizona State University with dual degrees of Chemical and Chemistry Engineer. The company, Custom Molds Inc., manufactures custom molds for plastic parts and plastic components, and plastic connectors for the electronics industry. Since 1990, the company had expanded and grew as a high-quality custom designed molds. However, in 2009, the company faced major issues from changing nature of the industry, competitive with custom molds’ process strategy. There are several alternatives, improvement and key factors to evaluate the alternative for Custom Molds Inc. to maintain and continue to expand the business’s market share.
Tom and Mason Miller’s Major Issues
In 2009, the changing in the electronics industry was changing impact to the overall demand that created a delivery problem and leaded to the force of process improvement.
The electronic industry businesses have developed and applied into integrated strategies, such as partnerships with suppliers, vendor managed inventory and lean manufacturing throughout supply chain management.
The changing in environment and industry has impacted to the volume of the order. Especially in between 2007 and 2008 the percentage of the change in the order size of 1000 pieces or more are 125% to 300% higher. Large batch order as mass production of plastic parts increased the products standardization and reduced the custom molds’ demand.
In 2008, most of the mass production drove the order size of the plastic parts into a higher volume. The assemble-to-order and lower customer contact strategy became the standard industrial practices as a large batch line process kicked in.
The order large size enforced the factory to revisit the process plan and the job shop layout. The traditional layout must be changed to match and support the mass production and overall larger order size.
The bottom line problem of Custom Molds Inc. was the delivery delay and customer complaint about the late delivery and performance. The order lead time was no longer competitive and created chain impact throughout the rest of the supply chain channel.
Competitive Priority for Custom Molds’ Processes and Changing Nature of the Industry Custom Molds Inc. was facing competitive priorities when the market shifted from custom molds to mass production of plastic parts. During the custom mold was a nature of the industry, the lead time was not critical. The quality was a significant as the order must meet a specific requirement. The price of the custom mold was not sensitive, and the volume is low as make-to-order strategy. Once the industry nature shifted into mass production as the size of the order was increased, the lead time became critical. The standardize quality and consistency for every part produced were imperative. The price was very sensitive to compete with high volume demand to maintain a competitive advantage. The designed process to become flexible to support variable volume, maintain and optimize profit were a primary focus for Custom Molds Inc. Custom Molds Inc. required a change to speed up the process of maintaining quality and competitive price.
Alternatives and Key Factors
There were several alternatives Custom Molds Inc. could consider to gain competitive advantage and continue to grow in the new industry demand. The incorporation’s focus should be on mass production. The reorganization and process restructure in terms of supply chain, and manufacturing layout are required to match with the current market demand. Increasing of the operation throughput and becoming a flexible workforce with resource would enable Custom Molds Inc. to maintain…