National Cranberry Cooperative 1996 Harvard Case Solution & Analysis

Process flow diagram:

Please refer to excel spreadsheet for the process flow diagram

Capacity at each step in bbls:

INPUTS

Operation

Available Capacity

Number to be added

Cost

Dumpers

3000.00

bbls/hr

Wet storage

3200.00

bbls

NA

0

Dry storage

4000.00

bbls

Dryers

1000.00

bbls/hr

2.00

50000.00

Destoning

4500.00

bbls/hr

Dechaffers

4500.00

bbls/hr

Separators

1200.00

bbls/hr

 

Proportion of wet berries (between 0 and 1) =

0.700

Proportion of berries bagged (between 0 and 1) =

0.00

Hourly arrival rate of berries =

1500.00

bbl
    

Bottlenecks identification through calculating utilization:

Peak harvesting day situation:

As given, the total supply of the cranberries is of 18000 bbls along with its uniform span time that is about 12 hours. The supply capacity is about 1400 barrels per hour.

national cranberry cooperative case solution

national cranberry cooperative case solution

During the peak harvest day case, production capacity of wet berries will be of  12600 bbls and 5400 for dry berries. The calculation has been shown in the spreadsheet.

Peak Harvest day scenario

Cranberry supplies

18000

bbls per hour

Supply Capacity

1400

bbls per hour

Span time

12

Hours

Demand for wet berries

70%

Demand for dry berries

30%

Wet berries

12600

bbls

Wet berries supply capacity

1050

Dry Berries

5400

Dry berries supply capacities

450

This has shown that the bottleneck exists in the drying section of the process. In addition to this, it has shown the largest utilization of capacity.

PROCESSAvailable CapacityRequested by SupplyImplied Utilization
Receiving and Testing

3000

1400

46.7%

For Dry Cranberries
Temp Holdings

6000

Destoning

4500

420

9.3%

Dechaffing

1500

420

28.0%

For Wet Cranberries
Temp Holdings

3200

Dechaffing

3000

980

32.7%

Drying

600

980

163.3%

Separation

1200

1400

116.7%

Processing on peak days:

As it has been assumed that the arriving time of the trucks are the same that is about twelve hours, the processing of cranberries will be started as soon as the first trucks arrive at the plant that is at 7 a.m.

Processing time for dry cranberries:

As mentioned din the case that the trucks need to be held until the unloading of cranberries for RP1. The processing capacity and temporary holding bins for dry cranberries surpasses the capacity of holding bins from 420 barrels per hour and this in turn will permit the plant to continue its process exclusive of any problems and delays. However, the total capacity for holding cranberries is affected because of the wet berries that has been processed.

Processing time for dry berries:

The total sum of time for wet berries is 19 hours and thirty-six minutes precisely. Therefore, the processing of wet berries is expected to be completed by 36 past 2 in the morning.

Unloading of last truck and its waiting time:

The truck that came to the plant from 7 am in the morning. However, the waiting time of the truck will start when the holding bins that are used for temporary holdings have become fully occupied in the noon at 3.25 p.m. the last truck will leave the plant for delivering berries at 9.16 pm. Therefore, the total waiting time the last truck would have to wait will be five hours and 51 minutes precisely.

Changes to bring improvement in the process:

In order to bring improvement and efficiency in the overall processing system at NCC plant, there should be installation of equipment that can judge the quality of the cranberries correctly. For this, there is a need to install the light meter system that would cost around $40,000. In this way, there will be no requirement left for Receiving Plant 1 to pay an additional amounton an annual basis for 2B quality berries instead of A. Installation of light meter system would not require any additional cost as the receiver will be trained.

In addition to this, there is a high need to bring improvement in the drying part of the process. Improvement in the drying process can be made to determine through making purchase of extra dryers. Along with this, the company can also arrange extra shifts to cover that bottleneck. The cases mentioned above are backed on the basis of per peak day with a shift of twenty hours. The options available for the plant are as follows:

  • Buying of 2 dryers each of the $60,000 and 2 of $120,000 along with one shift.
  • Buying of 2 dryers each of the $60,000 and 2 of $120,000 along with two shifts.

Buying of one dryer at the rate of $60,000 along with one shift................................

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