Computer ResidualsComputer ResidualsDe-manufacturing De-manufacturing

Method and Its Economic ValueMethod and Its Economic Value

Project Site: PSE&GProject Site: PSE&G

Resource Recovery CenterResource Recovery Center

Paulsboro, N.J.Paulsboro, N.J.

Group Members:Group Members:Sheila NavarroSheila NavarroHazel SavellanoHazel SavellanoRebecca SuttonRebecca Sutton

Dilbert Dilbert by Scott Adamsby Scott Adams

OutlineOutline

Problem StatementProblem Statement Current SolutionCurrent Solution Scope of ProjectScope of Project Operational AnalysisOperational Analysis Economic AnalysisEconomic Analysis RecommendationsRecommendations ConclusionConclusion

Problem StatementProblem Statement

Approximately 2000 computers per yearApproximately 2000 computers per year 50% refurbished and donated50% refurbished and donated 40% remanufactured and resold40% remanufactured and resold 10% residual10% residual

Problem:

What to do with the residuals?

Current SolutionCurrent Solution

Contracted to outside sourceContracted to outside source• Take Monitors and CPUTake Monitors and CPU• Storage requiredStorage required• Optimal truckload capacity Optimal truckload capacity • ““Out of sight, out of mind.”Out of sight, out of mind.”

Scope of ProjectScope of Project

Alternative SolutionAlternative Solution Establish a method of de-manufacturingEstablish a method of de-manufacturing

• consider CPU onlyconsider CPU only• environmental issues with monitorsenvironmental issues with monitors

Economic evaluation against current Economic evaluation against current solutionsolution target costingtarget costing break-even analysisbreak-even analysis comparing alternativescomparing alternatives

Operational AssumptionsOperational Assumptions

IBM family of CPUIBM family of CPU Optimal working Optimal working

environmentenvironment Tools allow for Tools allow for

easiest disassemblyeasiest disassembly

Establishing the Work StandardEstablishing the Work Standard

Predetermined motion time systemPredetermined motion time system Determines amount of time requiredDetermines amount of time required

MOST (Maynard Operation Sequence MOST (Maynard Operation Sequence Technique)Technique)

•planningplanning•performance ratingperformance rating•establishing costsestablishing costs

Basic MOST TechniqueBasic MOST Technique

General MoveGeneral Move (for movement of object through air) (for movement of object through air) Controlled MoveControlled Move (for the movement of object in (for the movement of object in

contact with surface or other object)contact with surface or other object) Tool UseTool Use (for use of hand tools) (for use of hand tools)

MOST WORK MEASUREMENT TECHNIQUEACTIVITY SEQUENCE MODEL SUB - ACTIVITIESGeneral A B G A B P A A - action distanceMove B - body motion

G - gain controlP - placement

Controlled A B G M X I A M - move controlledMove X - process time

I - alignmentTool Use A B G A B P A B P A F - fasten

L - loosenC - cutS - surface treatM - measureR - recordT - think

Application of MOSTApplication of MOST

Removing Fasteners or ScrewsRemoving Fasteners or Screws

LH: ALH: A1 1 BB0 0 GG33 A A1 1 BB00 P P11 A A11 RH: ARH: A11 B B0 0 GG11 A A1 1 BB00 (P (P33 A A0 0 LL1616) A) A11 B B00 P P11 A A00

Operations of DisassemblyOperations of Disassembly

Remove Metal Casing Remove Power & Data Cablesfrom Floppy Drive

Unfasten Floppy Drive Unfasten Supporting Bar

Operations of DisassemblyOperations of Disassembly

Remove Support &Floppy Drive

Remove Power & Data Cablesfrom Power Supply

Remove Mother Board Unfasten & removePower Supply

Operations of DisassemblyOperations of Disassembly

Unfasten Drive Housing Remove Rubber Feet

Work Area

** Pictures taken from actual disassembly at PRCC**

Work Method Work Method ResultsResults

Assume 2 hour work period per dayAssume 2 hour work period per day Allowances taken into consideration (26%)Allowances taken into consideration (26%)

Use of force, energy 5%Use of force, energy 5%Mental Strain 1%Mental Strain 1%Monotony 1%Monotony 1%

Personal allowance 5%Personal allowance 5%Unavoidable delay 10%Unavoidable delay 10%Basic fatigue 4%Basic fatigue 4%

De-manufacturing rate for one unit:De-manufacturing rate for one unit:8.16 units per hour = 7.35 minutes per unit8.16 units per hour = 7.35 minutes per unit

Economic AssumptionsEconomic Assumptions

Costs are analyzed Costs are analyzed as present economy as present economy studiesstudies

Analysis designed to Analysis designed to break-evenbreak-even

No MARRNo MARR

Economic DataEconomic Data

Outside service costs:Outside service costs:

Labor = $10 per unitLabor = $10 per unit

Transportation = $1.70 per unitTransportation = $1.70 per unit

Total = $11.70 per unitTotal = $11.70 per unit**

* * prices based on full capacity truck loadprices based on full capacity truck load

Tools and Equipment Tools and Equipment **

Computer Screwdriver Computer Screwdriver $20.55$20.55 Grip Floor MatGrip Floor Mat $14.79$14.79 HammerHammer $5.91$5.91 Industrial StoolIndustrial Stool $59.38$59.38 Protective EyewearProtective Eyewear $3.77$3.77 Utility BarUtility Bar $4.24$4.24 Utility KnifeUtility Knife $0.59$0.59 Utility Table BinUtility Table Bin $0.45$0.45 Wire CutterWire Cutter $9.90$9.90 Wood TableWood Table $310.00$310.00 Worker’s GlovesWorker’s Gloves $6.50$6.50

*(unit prices)

Target Cost AnalysisTarget Cost Analysis

Unit Elements Factor Estimates RowDE-MANUFACTURING COST ELEMENTS Units Cost/Unit Factor ofRow Total

A: Factory Labor 24.51 13.48* 330.39$ B: Quality Costs - Training 10% A 33.04$ C: TOTAL LABOR 363.43$ D: Factory Overhead - Set up Costs 521% C 1,893.47$ E: Outside Manufacture - Transportation Cost 22% C 79.95$ F: TOTAL DIRECT CHARGE 2,336.85$ G: Facitily Rental -H: TOTAL DE-MANUFACTURING COST 2,336.85$ I: Quantity - Lot Size 200J: De-manufacturing Cost/Unit 11.68$

Outside Cost/Unit - Target Cost 11.70$

* U.S. Department of Labor, Bureau of Labor Statistics - March 1998* U.S. Department of Labor, Bureau of Labor Statistics - March 1998

Cost & Time EvaluationCost & Time Evaluation

Equipment cost per worker = $286.03Equipment cost per worker = $286.03 Set-up cost of $1,893.47 = 6 workersSet-up cost of $1,893.47 = 6 workers Disassembly rate for 200 units = 24.5 Disassembly rate for 200 units = 24.5

hourshours

RecommendationsRecommendations

Demanufacturing task as part of unused Demanufacturing task as part of unused computer handling operationcomputer handling operation

Schedule 2 workers per week for Schedule 2 workers per week for demanufacturingdemanufacturing

Set-up 2 workstationsSet-up 2 workstations 1 workstation for CPU disassembly1 workstation for CPU disassembly 1 workstation for sub-disassembly1 workstation for sub-disassembly Set-up cost = $572.06 Set-up cost = $572.06

Final ThoughtFinal Thought

Implementing an efficient de-Implementing an efficient de-manufacturing operation will result manufacturing operation will result in a 70% cost reduction. in a 70% cost reduction.