Taylor Inc. manufactures widgets. There is a particular assembly line for Widget X. This assembly line includes the assembly of various raw materials, subassemblies, and packing of the finished widget. Currently, approximately 27% of the total labor time is utilized in walking by assembly line personnel to obtain the needed parts required to accomplish their assigned tasks. The average hourly cost, including all benefits, is $43 per hour. Seventeen people are required on the assembly line. Lifting containers that weigh approximately 42 pounds is required in several of the respective tasks. The current output of finished widgets is 208 per 8-hour shift. The company incurs an average of four worker’s compensation claims per year in back injuries due to lifting. An average claim equals $109,000 and the employee is out for an average of 280 hours. The injured worker must be replaced to sustain production. By improving the physical layout, productivity may be improved and worker’s comp claims reduced. Two layouts have been proposed.

Alternative One reduces wasted motion (walking) to 1% of total labor used on the assembly line. Physical lifting is reduced to no more then 12 pounds. Six people will be required on the assembly line. Productivity in finished goods per 8-hour shift will increase to 392. It is anticipated that worker’s comp claims will be reduced to .3 per year; however, a capital investment of $1.3 million is required in robotics and mobile storage carts. Useful life of the equipment is 7 years.

Alternative Two reduces wasted motion to 7% of total labor time while physical lifting is reduced to no more then 23 pounds. Nine people are required to staff the assembly line. Productivity will be 288 widgets per 8-shift. Worker’s comp claims are estimated at 1.9 per year. Capital investments are $967,000 with a useful life of 5 years for the equipment.

• Write a 350- to 500-word executive summary that provides justification for the particular alternative you select. As part of your justification, provide.

o a cost-benefit matrix that compares the alternatives showing the cost-benefit for each alternative.
o the effects the alternative will have on productivity.
o possible benefits of using a network strategy to streamline operational procedures.

Note. The lowest cost alternative may not be the best alternative.

1.a cost-benefit matrix that compares the alternatives showing the cost-benefit for each alternative.

2.the effects the alternative will have on productivity.
3.possible benefits of using a network strategy to streamline operational procedures.

o A cost-benefit matrix that compares the alternatives.

o The effects the alternative will have on productivity.
o Possible benefits of using a network strategy to streamline operational procedures.

answer for both

A cost-benefit matrix that compares the alternatives.

cost benefit matrix comparing alternatives for widgets

Possible benefits of using a network strategy to streamline operational procedures.

To select the best alternative for improving the physical layout of the assembly line and reducing worker's compensation claims, we must analyze the cost-benefit matrix and consider the effects on productivity and the possible benefits of using a network strategy.

Cost-Benefit Matrix:
Alternative 1:
- Cost: $1.3 million capital investment for robotics and mobile storage carts
- Benefit: Reduced wasted motion to 1% of total labor used, reduced physical lifting to a maximum of 12 pounds, reduced worker's compensation claims to an estimated 0.3 per year, requires six people on the assembly line, increased productivity to 392 widgets per 8-hour shift

Alternative 2:
- Cost: $967,000 capital investment for equipment
- Benefit: Reduced wasted motion to 7% of total labor used, reduced physical lifting to a maximum of 23 pounds, reduced worker's compensation claims to an estimated 1.9 per year, requires nine people on the assembly line, productivity of 288 widgets per 8-hour shift

To calculate the cost-benefit for each alternative, we need to consider the costs of the capital investment, worker's compensation claims, labor costs, and the benefits of increased productivity.

For Alternative 1:
- Capital investment: $1.3 million
- Worker's comp claims per year: 0.3 claims x $109,000 = $32,700
- Labor costs: $43 per hour x 6 people x 8 hours = $16,512
- Productivity benefit: increased from 208 widgets per 8-hour shift to 392 widgets per 8-hour shift

For Alternative 2:
- Capital investment: $967,000
- Worker's comp claims per year: 1.9 claims x $109,000 = $206,900
- Labor costs: $43 per hour x 9 people x 8 hours = $27,864
- Productivity benefit: increased from 208 widgets per 8-hour shift to 288 widgets per 8-hour shift

Based on these calculations, the cost-benefit for each alternative can be determined. It should be noted that the cost-benefit analysis is not solely based on monetary factors, but also takes into account productivity improvements.

Effects on Productivity:
Alternative 1 offers a higher productivity benefit of 392 widgets per 8-hour shift compared to Alternative 2, which offers 288 widgets per 8-hour shift. This indicates that Alternative 1 has the potential to significantly increase production output.

Possible Benefits of Using a Network Strategy:
Implementing a network strategy to streamline operational procedures can have several benefits. It can improve communication and coordination between different departments or units within the organization, leading to more efficient processes. By connecting various parts of the assembly line through a network, real-time data and information can be shared, allowing for better decision-making and resource allocation. It can also enhance collaboration and knowledge sharing among employees, fostering a culture of continuous improvement and innovation.

In conclusion, based on the cost-benefit analysis, the higher productivity benefit, and the potential benefits of using a network strategy, Alternative 1 appears to be the more favorable choice. While it requires a higher initial capital investment, it offers greater improvements in productivity, a significant reduction in worker's compensation claims, and the potential for long-term cost savings and process improvement through the use of robotics and mobile storage carts.