Executive Shirt CompanyExecutive Shirt Company initially were producing standard size shirts and now want totake advantage in the custom sized dress shirt market as the general manager viewed itas tremendous opportunity. Mike and Ike have suggested an implementation plan basedon the operations and our objective is to identiy the optimum method that reduces thecost and time or production.Current Process:!he production o standard sized shirt consists o various stages as shown in the process"ow below# Description of Stages:!he initial stage o cutting process can handle $% layers o clothes and & patterns at thesametime. !hesewingprocessesaremanual intensivewhereonebatcho $%shirtswheeledromoneoperationtoanotherby'material handlers. (total o $'workersstarting rom cutting to packaging worked or & hours per day) *ve days a week and +%Make CollarMake CufsMakeSleevesMake FrontMake Backoin Shoul!er"ttachCollar"ttachSleevesStitch Do#nSleevesSe# Si!eSeam"ttachCufs$emBottom%nspect %ronPackagedays per month. Each worker was paid ,$ per hour and ,- per hour or overtime shits.(nd .actory is currently producing standard sized shirt at the volume o /$%%% shirts permonth.Custom shirt line!his re0uired an additional new cutting machine which small and can cut up to 1 layers oclothes. !his entire process o laying out the pattern and cutting the shirts took only +.1minutes. (nd it re0uired an additional worker to operate. Mike&s plan2ere the batch size was decided to be 1 in order to shorten the lead time. !he regularshirtswouldbe cutonthe oldmachinewhilecustomshirtswouldbecutonthe newmachine. !hesebatcheso customshirtswouldbesewnwiththebatcheso regularshirts.%ke&s Plan2ere the customshirt production was completely separated romstandard shirtproduction as there was an excess capacity o the workers in the actory3 he proposed tomove a single worker rom every operation resulting in a total o /1 workers on line post4cutting.Comparison of current metho! an! those suggeste! 'y Mike an! %ke CurrentProcess Mike(s Plan %ke(s Plan 5egular shirt5egular and Custom 5egular Custom(ctual Cycle !ime %.1 %.1 %.$6 7.-Manuacturing 8ead !ime9I: Inventory /&% 7% /&% 7:roduction Capacity -$% -$% 6+% /+7.%&Capacity utilization %.&7 %.-' /.// %.&/;irect 8abour Content +1.6$ +1.6-< +1.6$ +$.%/;irect 8abour =tilization %.$6 %.6' %.6- %.7';irect 8abour Costs 7.&' 7.'6 7.'7 6.$&*Weighted average of regular (25.76) and custom price (26.01))ecommen!ation Cost analysiso Mike>sandIke>splanshowthat cost o manuacturing/$%%%standardshirtsand+%%%customshirtsis+&/7$%incaseo Mike>splanand+&-+%% in case o Ike>s plan. 2ence Mike>s plan has lower manuacturing cost andis recommended.