A manufacturing company is using a two container Kanban system between a downstream (using) and an upstream (producing) work center. Each container holds 25 parts. The using work center can handle 100 parts per day. The average elapsed time for the entire cycle is currently 0.4 days. The company is concerned about the efficiency (and safety stock policy) of the operation. The safety stock factor for the current operation is _____.
A) less than 0.20
B) more than 0.20 but less than or equal to 0.3
C) more than 0.3 but less than or equal to 0.4
D) more than 0.4 but less than or equal to 0.5

Question

Quizplus · Accepted Answer

To calculate the safety stock factor, we need to first calculate the lead time demand, which is the average usage during the elapsed time (0.4 days) plus the safety stock. The average usage during the elapsed time is (25 parts/container)*(2 containers)/(0.4 days) = 125 parts/day. The using work center can handle 100 parts per day, so the safety stock should be at least 25 parts/day. The safety stock factor is then (25 parts/day) / (125 parts/day) = 0.2. Therefore, the best choice is B, more than 0.20 but less than or equal to 0.3.

A Manufacturing Company Is Using a Two Container Kanban System