Texas Instruments is building on its commercialization of transistors and the development
of semiconductor technology to enter into the new consumer market of micro-electric
digital watches. The potential market for digital watches has considerable uncertainty
associated with the display type (LCD, LED, analog). Given the uncertainty surrounding
this competitive market in terms of future consumer demand, where a watch has
historically been a signifier of status, flexibility with regards to product change and
inventory management are essential to successfully growing market share.
Texas Instruments: Issues
Inconsistent supply of raw materials to line: There has been inconsistent supply of
materials and parts. Due to a lack of consistent supply, the assembly line may potentially
be significantly impacted by bottlenecks at any given station, which ultimately would hurt
profit margins.
Reduce production costs: You want to lower the manufacturing costs. Texas Instrument’s
costs are not high, but to achieve maximum profit on watch retailing at $20, you must
understand and implement ways in which production costs may be reduced.
Demand increasing beyond the capacity of assembly line: You have done an excellent
job of running the assembly line, considering a watch is being produced every 21 seconds.
An increase in demand, however, and the company’s aim to continuously improve are
obligating you to reduce cycle times in order to make TI more productive.
Quality Control on parts: Troubleshooting and non-standard operations are taking
considerable time on the production line. To increase production, time spent on
troubleshooting and repairing has to be reduced drastically. In particular, there is an
