2018

Production Options at
Prime Safety Ltd.
WRITTEN ANALYSIS OF CASE
MUHAMMAD MOHSIN JALIL KHAN

Submitted by: Ahmad Saeed Khan

Muhammad Mohsin Jalil Khan
Company Overview
Prime Safety Limited (PSL) started its business 1997, as a glove manufacturer company. Since
2002, it has established itself as a manufacturer and exporter of corporate, industrial and protective
clothing in Karachi, Pakistan. As the orders of work-gear garments increased, PSL separated the
safety clothing unit to an independent facility to meet the growing demands from the customers.
The company gets its competitive edge through high degrees of product customization it offers,
and cost savings through its highly integrated and supply chain arrangements. Here and now, its
specialized safety products include gloves, safety shoes, jackets etc., and other work wear clothing
e.g. high visibility and fire retardant suits.

Problem
Previously, PSL used to have orders ranging from 50-5000 pieces, Assembly line or Chain Flow
process was practiced in sewing department. Bundled routing of material was practiced at large
scale with around 37 workers/operators on 30 machines. Each operator performed the same
operation on all parts. This led to worker specialization in a particular task assigned to him.
Since 2006 and onwards a majority of the customers have order size less than 500 pieces.
Therefore, the manufacturing process involved similar operations but varying work content. To
improve flexibility and operational efficiency, PSL has plans to implement modular manufacturing
in sewing department. The issue in the case is to analyze the impact of this shift on the operational
efficiency, employee coordination and customer service of the organization and recommend a
suitable course of action.

Comparison between the two processes

Assembly Line System
The traditional system was efficient in producing large quantities with similar designs and
measurements. Workers used to develop expertise after repetitive work which resulted in high
level of speed and productivity. The structure of the this manufacturing process

Parts/ Pre- Final

Bundles assembly Assembly
However, every process has shortcomings, as the order size began to decline, there were certain
problems with the existing process;
 Stitching time for a different style is very high, about 6 to 8 hours
 This led to underutilization of the existing machinery
 Lack of flow and rhythm in the work done by the operators
Modular manufacturing
PSL considered a shift from chain flow to cellular manufacturing for its sewing department,
believing that Modified bundle system would be best for the short order quantities
Analysis of Modular Layout:
Statistics for Statistics for Difference
Traditional Modular (Traditional -
Line Line Modular)

Actual sewing work content

(min/pc) 25 25 0
No. of required machines 30 14 16
No. of required operators 28 8 20
No. of helpers 5 3 2
End of line quality checkers 2 0 2
In line quality checkers 1 1 0
Supervisor 1 1 0
Available time 420 420 0
Output (pcs/day) 182 100 82
Bundle size (pcs) 65 7 58

Overhead cost (∗ $/mc/day) 6.94 6.94 0

Direct labor cost ($∗/head/day) 15 18.1 -3.1

Throughput time (hrs.) 9 6.5 2.5
Machines Cost/day 208.2 97.16 111.04
Direct labor Cost/day 420 144.8 275.2

Total cost/day (Machine + Direct

labor) 628.2 241.96 386.24
Cost/unit of output/day ($) 3.45 2.42 1.032
Throughput time (hrs.) 9 6.5 2.5
 Days to produce 900 units (approx.) 5 9 -4.00
Cost to produce 900 units
(approx.)$ 3106.48 2177.64 928.84

Days to produce 500 units (approx.) 2.75 5 -2.25

Cost to produce 500 units
(approx.)$ 1725.82 1209.8 516.02

Areas where modular layout is

better
Areas where Traditional layout is
better

The total cost/day for the modular layout is lower and so is the cost/unit per day. The throughput
time too for the modular layout is lower.
However for large order quantities the modular layout takes more time. The direct labor
cost/head/day is also greater for the modular layout, however it is not a reason for concern since
the labor employed is much less as compared to the traditional layout.
The following are the advantages and disadvantages of employing the modular layout:

Advantages
1. If a machine broke down, workers would not sit idle and can move to another machine while
the first is repaired.
2. The bundle size is reduced from 65 to 7 pieces which is an improvement on work in progress.
3. The throughput time is reduced from 9 to 6.5 hours, again a decrease in work in progress
inventory.
4. If there is a bottle neck in the line an operator can move further down the line and clear the
congestion.
5. Direct and indirect labor is reduced.
6. Only one quality checker is required who can identify defects earlier on, thus it can be quickly
and easily corrected. This reduces both wastage and work in progress inventory.
Disadvantages
1. Getting multi-skilled workers. Training workers to become multi skilled is an additional
investment. Furthermore if one multi-skilled worker is absent for a day it’ll become difficult
to find a replacement.
2. Operators are more productive when they perform repetitive tasks. Working on multiple
operations might make their productivity fall.
3. Labor costs will rise as the multi-skilled workers need to be paid more but the subsequent rise
in productivity is not proportionate.
4. Because all the machines in the cell will not be working at the same time, machine utilization
will be lower.
5. The attitude of the workers was another concern. Could they be convinced to work in a system
where they are responsible for the number of garments produced by the cell as a whole rather
than their individual production?

Recommendations
The modular layout seems to be a better choice if the company is not under time constraints.
Additionally the savings in monetary terms will be greater if the order size is larger. Also, the
capital investment in the modular layout is lower since there are fewer machines used. The
company however needs to add the cost of training of multi-skilled workers to the total cost per
unit from cell manufacturing to get a complete picture of costs per unit. It also needs to have a
pool of multi-skilled workers ready to accommodate absences and provide multi-skilled workers
further incentives to join the cellular structure. Lastly team building exercises need to be conducted
among cell workers to ensure there are no free riders and that everyone understands that their
individual benefit exists in the success of the cell as a whole.