National Cranberry Cooperative

National Cranberry Cooperative

Analysis and recommendations

1.

2.

The resource with least capacity determines the maximum long-term achievable throughput rate. Because wet and dry berries follow different routes at RP#1 there will be a maximum achievable throughput for each. The capacity of the dryers is the bottleneck for the wet berries. The maximum throughput for wet berries is 600 bbls/hr. For dry berries the separation process is the bottleneck. The maximum throughput for dry berries is 1200 bbls/hr.

The percentage of wet berries to dry berries would affect the throughput rate. Given the current proportion of berries received the capacity of the dryers would be the maximum throughput of the system. The dryers are the system bottleneck. And as the trend of water harvesting continues, this situation worsens. All the process/resources at RP#1 contribute to the throughput but the limitation is the bottleneck.

3.

The trucks wait because the processing capacity is less than the system input. And the temporary holding bins are inadequate to buffer the berries coming in and the plants processing capacity. But by using the Theory of Constraints to identify the system bottle necks we are able to discover the root cause of the waits. The large back log of berries is caused by several factors

The plant is not currently equipped to handle the supply of wet berries. This problem has likely been increasing over the years as more cranberries are being wet-harvested. This problem is evident in the lack of web berry temporary storage and inadequate berry drying capacity. These bottlenecks are slowing the entire system.

The demand for and production of cranberries is uneven. The seasonal nature of cranberry harvesting creates a need for a flexible system that can utilize full capacity in harvesting season and minimize loss from excess capacity during off season. NCC current system at Receiving Plan #1 is not meeting the input levels. NCC has two immediate options: increase the temporary storage capacity or increase the maximum throughput capacity of the system.

4.

Under the current system trucks carrying dry berries have no wait times because the plant has adequate temporary storage for them. The trucks that must wait are the ones carrying wet berries and have the following wait times.

11:00 AM Start 7:00 AM Start

Max Build up = (1500*.7*12) - (600*12) - 3200 4600 2200

Bottleneck (bbls/hr) 6000 600

Max wait time 7.67 3.67

Average wait time (for those who wait) 3.83 1.83

Weighted average wait time (hrs) 1.60 0.76

Weighted average wait time (min) 95.83 45.83

5.

Using the current system the RP#1 is not capable of receiving last years supply if 70% of the berries will be wet harvested. The first benefit is continued operation without a processing emergency.

Recommendations

a. Purchase the Light Meter System for color grading. While this system will not directly help the plants flow problems but it will pay for its self three times over within the first year and continue to save the plan money from erroneous berry quality premiums.

1980 Premium No. 3 Berries Paid (bbls) 450000

Premium per barrel 0.75

Total premium paid 337500

Berries not grade 3 225000

Premium per barrel 0.75

Total paid for berries not grade 3 168750

1981 Premium No. 3 Berries Paid (bbls) 292500

Premium per barrel 0.75

Total premium paid 219375

Premium savings 118125

Less:

Purchase price 20000