Uploaded by eric507052012

National Bicycle Case Assignment

National Bicycle Case
Po-Wei, Huang
What are the differences between the new POS and mass production processes?
The biggest difference between the new POS and mass production processes is the
improvement of the order system and the supply chain. For the mass production process, at the first
step, they will use the machine to automatically construct the bicycle frame. However, they have to
spend a lot of time to change the line from one model to another in this section. It is really a timewasted step. Second, the bicycle will go into a unique computer inspection system to test welds.
Third, the bicycle will be washed and be ready for painting. In this step, the bike will be automatically
painted by the machine first. Then it will be painted by workers for the decorative designs on bike
frames and chain guards. Fourth, The bike will go to the assembly lines, which consisting of about
100 workers. This section contains one-third of the labor content and 5% of the cost of a bicycle.
Fifth, the completed bicycle will be automatically boxed and sent to the warehouse. Sixth, the bike
will be distributed to the retailers by hansha, which is a distributor cooperating with National Bicycle.
Nevertheless, there is a big problem in this section. When retailers want to increase their inventory,
they have to spend more two weeks to get what they want. As we can see, this is an inefficient system.
For the new POS, they have several improvements. First, this system will start operating when
receiving a customer order. And this process will only take one day. Second, parts will be gathered
once the order is confirmed. They use the same replenishment system that used for mass production.
But they tried to keep inventories low to prevent the change of the bicycle design. Third, it will go to
frame production. By the advanced computers, they can automatically adjust every bike type. Fourth,
it will go through the painting process. This part is totally identical to mass production. Fifth, the
bicycle is finally completed for shipping. Therefore, the difference between the new POS and mass
production processes are the order system and the improvements in the supply chain in the National
Bicycle company.
What criteria will you use to decide whether POS system is right for the new supply chain?
In my opinion, I will use the following criteria to say that the POS system is right for the new
supply chain. First, the POS system will only begin producing when the company receives the
customer order. This can totally solve the existing problem in mass production, which is the excessive
inventory. Once we use the new POS system, we can reduce the massive unpopular model stock in
the retailer. Moreover, the holding cost can also become lower. Second, by using the computer to
accurately record every order. Besides, this entry system will only take one day, which can reduce
the lead time in the supply chain. Third, the bar code label is really a critical essential in this supply
chain. Because the machines and the employees can easily know what to do next by scanning the bar
code label on the bike. All of these processes managed by the computer can reduce the error rate.
Therefore, this is an efficient action. Fourth, connecting the production line with the main computer
can automatically adjust the equipment for each type of bike. This is an automated manufacturing
process, which increases the yield rate. Fifth, National Bicycle selects 23 best workers who have
worked in the mass production to work in the new POS system. This means all of the employees in
the system are professional and also elite in the industry. They are all highly skilled, so the lead time
will definitely decrease and the productivity will be raised. Additionally, because these outstanding
workers can get familiar with the new system in a short period, the company can also reduce their
labor costs. Therefore, the numerous advantages stated above are the reasons that I think the POS
system is right for the new supply chain.