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Unformatted text preview: search. 5.3.3 Management Implications Barriers to right-sizing
The MTSA machine also provides a good case study for the barriers to right sizing equipment. At
the time of the researcher's arrival at IADC, the current MTSA machine was due to be replaced
with a brand new, custom designed version that was only half as large. However, this re-design
and installation project, still not completed at the time of writing, had already taken over a year
from the date of kickoff. Long cycle times for capital allocation projects and the long lifetimes of
specialized process equipment such as the MTSA machine (measured in decades) naturally result in
large buffers continuing to be built into equipment, in order to accommodate variability in future
demand. At the same time, however, the long lifetimes of the equipment also argue for maximum
flexibility at a minimal operating cost.
Another barrier to right-sizing is the current procurement process at the plant. In a short analysis
of capital equipment purchasing forms at the IADC, there is no clear indication that anticipated
customer demand has been analyzed from the perspective of sizing the equipment appropriat...
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This document was uploaded on 03/03/2014 for the course ADMIN 1 at Universidad Nacional de Colombia.
- Spring '14