Touring the Factory in January 2012
John Milliken graduated in 2001 from Rensselaer Polytechnic Institute with a BS in Mechanical Engineering. For the past five years he had been the Operations Manager of a small packaging firm serving the northern New Jersey pharmaceuticals industry, so he came to Bayonne familiar with the general manufacturing processes Bayonne used to design and deliver customized small-unit packaging. During the hiring process he met most of the management at Bayonne and also the factory supervisors on both shifts, and had asked for several reports to be prepared for him when he came to work in January. Digging into the pile, Milliken focused on October 2011 since that was Bayonne's highest-volume month and, as October 31 closes the fiscal year, it would show him complete and audited 12-month financial statements for the company. He reviewed the Income Statement, keeping in mind Bayonne's practice—a common one—of recognizing revenue when it billed the customer, and it billed when it shipped product. Milliken then turned to a production report that listed standard setup and run times, as well as scheduled production and standard hours for October in key work centers (Exhibit 2). A second report showed "good pieces in/out" for the month (Exhibit 3). The last report presented the daily and cumulative dollar volumes shipped in October, net of customer returns (Exhibit 4). He also had his own chart showing the usual flow of orders through the plant's departments (Exhibit 5).