Case Article—Agile Auto Sub Assemblies: Challenges in Managing Growth, Resource Productivity, and Demand Variability

Abstract

The key objective of the case study is to help students understand the nuances of assembly line design without having to manage a huge problem context. The case study provides a platform for an engaging discussion on assembly line balancing and related concepts. The case is developed in a setting of an auto subassembly manufacturer that currently operates two lines. The management is confronted with a situation in which the production requirements are increased. The management needs to decide between hiring additional workers, reconfiguring the assembly lines, or both to meet the new demand. The production manager suggests a simple linear allocation of resources based on demand. Its validity and various other options are investigated to manage the projected volume. The following considerations are used to evaluate each option: capacity utilization, labor utilization and flexibility of operations, cost of overtime, cost of new recruitment, and inventory. As an extension, we also discuss the trade-offs involved in level-production strategy and a market-driven strategy when the demand profile is variable.