operation management

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Case study FHE inc

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Item Cost – $7.00 Order Cost – $283.00 Annual Hold – 32% of item cost Annual Demand – 22,100 Average Demand – 442 per week Standard deviation of weekly demand 20
per week lead time – 1 week service probability – 95% Determine the order quantity and reorder point. Determine the annual holding and order costs.

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A local market research firm has just won a contract for several thousand small projects involving data gathering and statistical analysis. In the past, the firm
has assigned each project to a single member of its highly-trained professional staff. This person would both gather and analyze the data. Using this approach, an
experienced person can complete an average of 10 such projects in an eight-hour day. The firm’s management is thinking of assigning two people to each project in
order to allow them to specialize and become more efficient. The process would require the data gatherer to fill out a matrix on the computer, check it, and
transmit it to the statistical analysis program for the analyst to complete. Data can be gathered on one project while the analysis is being completed on another,
but the analysis must be complete before the statistical analysis program can accept the new data. After some practice, the new process can be completed with a
standard time of 20 minutes for the data gathering and 30 minutes for the analysis. a. What is the production (output per hour) for each alternative? What is the
productivity (output per labor hour)? b. How long would it take to complete 1,000 projects with each alternative? What is the labor content (total number of labor
hours) for 1,000 projects for each alternative?

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Matthew Yachts, located in Montauk, Long Island, manufactured sailing yachts of all descriptions. The company had begun by building custom-designed yachts for a
largely New York-based clientele. Custom-designed yachts still accounted for three-fifths of Matthew’s unit sales and four-fifths of its dollar sales and earnings.
Over the years, as Matthew Yachts’ reputation for quality design and workmanship spread, sales broadened to cover all of the eastern seaboard. In an effort to
capitalize on this increased recognition and to secure a piece of the fastest growing market in sailing, Matthew Yachts began manufacturing a new standard,
fixed-design craft. Matthew attacked only the high end of this market, as the boat measured 37 feet long. Nevertheless, even this end of the market was more
price-sensitive and less conscious of performance than Matthew Yacht’s custom-design customers were. All of the company’s yachts were manufactured at the Montauk
plant and shared the same equipment and skilled labor force. Custom designs were given priority in scheduling, and the new boat was rotated into the schedule only
when demand slackened. As sales of the fixed-design boat increased, however, scheduling the new boat on a regular basis became necessary. Matthew Yachts were built
basically from the bottom up. Fabricating hulls was the first step. Increasingly, fiberglass hulls were demanded for their speed and easy maintenance. Afterward
came the below-deck woodworking, followed by the fiberglass and woodworking on the deck itself. The masts were turned and drilled separately. Masts and hull were
then joined and the finish work completed. Over the past year, as the fixed-design craft continued its steady increase in sales, costs and deliveries began to
slide precipitously, especially on the fixed-design yachts. During this period, when push came to shove, construction of the fixed-design craft always yielded time
and resources to the higher-profit-margin custom designs. As a result, many fixed-design yachts were strewn around the yard in various stages of construction.
Moreover, space in the existing shipyard was becoming scarce, and a plant expansion of one sort or another appeared inevitable. Discuss questions: Should Matthew
Yachts, Inc. stay in the business of building standard, fixed-design yachts? If Matthew Yachts does so, how should it continue?

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1. What are the key characteristics that would classify Wheeled Coach as a repetitive focus process strategy?

2. Let’s assume you are a new hire at Wheeled Coach. Your manager asks you to review their manufacturing process to
see if there are any steps that can be eliminated as not adding value. What tools would you employ to complete this assignment? Please include a brief
description of each one, a diagram is not needed.

3. What Operation Management decisions would need to be made to change their repetitive focus process strategy
to: a.Process Focused?

b. Product Focused?

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1. The monthly sales for Telco Batteries, Inc., were as follows: Month Sales
Jan 20
Feb 21
Mar 15
Apr 14
May 13
Jun 16
Jul 17
Aug 18
Sep 20
Oct 20
Nov 21
Dec 23
a. Plot the monthly sales data on a sheet of graph paper.
b. Forecast January sales for the new year using each of the followin

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operation management

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1. What operation management decisions would need to be made to change wheeled coach repetitive forcus strategy to:

a. process focused?

b. product focsed?

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Operation Management

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1. Briefly describe each of the four quantitative methods used to evaluate location alternatives. 2. How does a geographical information system help companies like
Red Lobster or LaQuinta with location strategies? 3. The textbook suggests that location strategies for Goods focus on minimizing costs while Services focus on
maximizing revenue. I would consider Fed Ex as a service provider. Yet, Fed Ex likely employed a transportation model (a cost minimization technique) in selecting
Memphis as their hub. What are the key considerations in choosing a location methodology? (i.e.; is it Goods versus Services or are other factors involved)? (shoot
for a paragraph for an answer not a lengthy response.)

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Stan Fawcett’s company is considering producing a gear assembly that it now purchases from Salt Lake Supply, Inc. Salt Lake Supply charges $4 per unit with a
minimum order of 3000 units. Stan estimates that it will cost $15000 to set up the process and then $1.82 per unit for labor and materials. a- draw a graph
illustrating the crossover (or difference) points. b- determine the number of units where either choice has the same cost.

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The Following table contains data about the inventory for five items at Jones Corporation and the rate of sales for each of the five items in the upcoming year

Item# Beginning Unit Inventory Ending Unit Inventory Annual Unit Sales Unit Sales Per Day

1 230,000 200,000 430,000 5,400

2115,00086,000114,000 4,800

3 132,000 129,000 225,00022,500

4410,000510,000560,000 14,500

5105,000 113,000176,0008,200

What is the day supply for each item

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Determine the utilization and the efficiency for each of these situations: a. A loan processing operation that processes an average of 7 loans per day. The
operation has a design capacity of 10 loans per day and an effective capacity of 8 loans per day. (Round your answer to 1 decimal place. Omit the “%” sign in your
response.) Utilization % Efficiency % b. A furnace repair team that services an average of four furnaces a day if the design capacity is six furnaces a day and the
effective capacity is five furnaces a day. (Round your answer to 1 decimal place. Omit the “%” sign in your response.) Utilization % Efficiency % c. Would you say
that systems that have higher efficiency ratios than other systems will always have higher utilization ratios than those other systems? This is not necessarily .
If the design capacity is relatively , the utilization could be even though the efficiency was .

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operation management

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A manager just received a new price list from a supplier. It will now cost $1.00 a box for order quantities of 801 or more boxes, $1.10 a box for 200 to 800 boxes,
and $1.20 a box for smaller quantities. Ordering cost is $82 per order and carrying costs are $10 per box a year. The firm uses 3,650 boxes a year. The manager has
suggested a “round number”? order size of 800 boxes. The manager’s rationale is that with a U-shaped cost curve that is fairly flat at its minimum, the difference
in total annual cost between 800 and 801 units would be small anyway. What order size would you recommend? (Round your intermediate calculations to 2 decimal
places and final answer to the nearest whole number.)

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1. A state department of tourism and recreation collects data on the number of cars with out-of-state license plates in a state park. (The
group’s position is that more out-of-state plates means the state’s advertising programs are working.) The sample size is fixed at n=90 each day. Data from the
previous 20 days indicate the following number of out-of-state license plates:

Day

Out-of-state Plates

1

24

2

33

3

18

4

21

5

26

6

31

7

15

8

18

9

23

10

13

11

22

12

15

13

25

14

33

15

16

16

22

17

34

18

10

19

23

20

13

a. Calculate the overall proportion of “tourists” (cars with out-of-state plates).

b. Calculate the LCL and UCL for these data.

c. Plot the control chart. Are all points within the control limits?

d. What action do you suggest for improving this process?

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Operation Management

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A state department of tourism and recreation collects data on the number of cars with out-of-state license plates in a state park. (The group’s position is that
more out-of-state plates means the state’s advertising programs are working.) The sample size is fixed at n=90 each day. Data from the previous 20 days indicate
the following number of out-of-state license plates:

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Operation Management
Question Detail:

Many companies require their suppliers to meet what standards as a condition for obtaining contracts?

RFO 6000
PUR 8000
ISO 9000
MACH 5000
SUP 2000

Empire West displays what by specializing in making a wide variety of products?

outsourcing
SCM
quality
flexibility
efficienc

Environmental scanning would not provide information on:

sources of highly trained workers
the firm%u2019s internal inefficient distribution system
opportunities and threats
changes in information technology
changes in global competition

During the 1970s and 1980s, firms from which country provided the most serious competitive threat to U.S. companies?

Germany
Canada
Mexico
Japan
United Kingdom

Suppose that a plant has a daily productivity of 0.85 parts per employee? What can we conclude?

the plant must be very labor-intensive
the plant is not earning profits
the plant must be highly automated
the plant should lay off workers
nothing

Which of the following is a disadvantage of automation?

inefficiency for producing large volumes

harder to monitor quality

inconsistency of products

frequent interruptions of production

inflexibility for product and process changes

Which of the following is not an argument in favor of having a single supplier?

Quantity discounts may be achieved.
Partnering becomes more possible.
Consistency of input materials is achieved.
Probability of assured supply is better.
Deliveries can be scheduled more easily.

To perform the financial calculations of the make-or-buy decision, which costs are needed?

Fixed and variable
Fixed and average
Variable and average
Variable only
Average only

Benetton is well known for the practice of assembling all white sweaters and waiting to dye them much closer to the time of sale. This is an example of what?

Stupidity
Postponement
Fractionalization
Partitioning
Genericness

Leveraging core competence is about sharing:

workers
knowledge
machines
expenses
financial hedges

Quality at the source is the belief that it is far better to _______ quality problems and _____ them than to discard defective items after production.

uncover the person generating, fire
uncover the source of, correct
discover new methods of, implement
discover new processes of, implement
allow returns of, fix

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Operation Management

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%u2022 %u2022 4.2

Year 1 2 3 4 5 6 7 8 9 10 11

Demand 7 9 5 9 13 8 12 13 9 11 7

a) Plot the above data on a graph. Do you observe any trend, cycles,

or random variations?

b) Starting in year 4 and going to year 12, forecast demand using a

3-year moving average. Plot your forecast on the same graph as

the original data.

c) Starting in year 4 and going to year 12, forecast demand using a

3-year moving average with weights of .1, .3, and .6, using .6 for

the most recent year. Plot this forecast on the same graph.

d) As you compare forecasts with the original data, which seems to

give the better results? PX

%u2022 4.3 Refer to Problem4.2.Develop a forecast for years 2 through

12 using exponential smoothing with %u03B1 = .4 and a forecast for year 1 of

6. Plot your new forecast on a graph with the actual data and the naive

forecast. Based on a visual inspection, which forecast is better? PX

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23. Figure 16.42 shows the BOMs for two products, A and B. Table 16.5 shows the MPS quantity start date for each
one. Table 16.6 contains data from inventory records for items C, D, and E. There are no safety stock requirements for any of the items.

Please see image for details of the question.

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Operation Management

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22. The following information is available for three MPS items:

Product A An 80-unit order is to be started in week 3.

Product A 55-unit order is to be started in week 6.

Product B A 125-unit order is to be started in week 5.

Product C A 60-unit order is to be started in week 4.

Develop the material requirements plan for the next 6 weeks for items D, E, and F. The BOMs are shown in Figure 16.41, and data from the inventory records are
shown in Table 16.4. (Warning:A safety stock require- ment applies to item F. Be sure to plan a receipt for any week in which the projected on-hand inventory
becomes less than the safety stock.)

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operation management

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1.Respond to this statement: “The importance of the location decision is often vastly
overrated; the fact that virtually every type of business is located in every section of the country means there should be no problem in finding a suitable
location.”?

7. Some Japanese firms have a policy of rotating their managers among different
managerial jobs. In con- trast, American managers are more likely to specialize in a certain area (e.g., finance or operations). Discuss the advantages and
disadvantages of each of these approaches. Which do you prefer? Why?

i need the answer as fast as possible please

thank you

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operation management

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Customers arrive at a suburban ticket outlet at the rate of 14 per hour on Monday mornings. This can be described by a Poisson distribution.
Selling the tickets and providing general information takes an average of 3 minutes per customer, and varies exponentially. There is 1 ticket agent on duty on
Mondays. Determine each of the following:
(A) system utilization.
(B) average number in line.
(C) average time in line.
(D) average time in the system.

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operation management

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Problem 4 (15 points) In the precedence chart to the right, times are in seconds. 1 Assume that the plant runs one 7.5 hour shift per day and the assembly line
is designed with 5 stations (one worker per station) with one task per station. (Stations 1, 2, 3, 4, and 5 respectively perform tasks 1, 2, 3, 4 and 5.) (a)
What is the capacity of this line (units per shift)? ???????????????????(b) How many such lines would you need if you wanted to produce 2000 units per day? (c)
What would be the actual capacity for one day? (d) What would be the total number of workers? Using the same precedence diagram: Suppose you design a batch
layout with 3 departments (Dept 1 “?o Tasks 1 & 3; Dept. 2 “?o Task 2; Dept 3 “?o Tasks 4 & 5). Calculate number of workers needed for each department to
produce 2000 units per day and complete the table below to assist you in answering questions e.)Af¨?j.). (e) What is the total time per worker per day (in
seconds)? Dept 1 ?? Dept 2 ?? ? Dept 3 ? Total time needed in seconds / shift f.) ? Number of workers g.) ? # workers needed ? h.) (f) What is the total time
needed in seconds /shift in department 1? (g) What is the calculated number of workers needed in department 2? 4 (h) What is the actual number of workers
needed in department 3? (i) What is the capacity of department 2? (j) What is the actual capacity of the whole process?

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Operation management

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As we agreed

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Operation management

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questions #5 and #20.. look at the attachments 

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operation management

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Customers arrive at a suburban ticket outlet at the rate of 14 per hour on Monday mornings. This can be described by a Poisson distribution.
Selling the tickets and providing general information takes an average of 3 minutes per customer, and varies exponentially. There is 1 ticket agent on duty on
Mondays. Determine each of the following:
(A) system utilization.
(B) average number in line.
(C) average time in line.
(D) average time in the system.

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operation management

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1.Respond to this statement: “The importance of the location decision is often vastly
overrated; the fact that virtually every type of business is located in every section of the country means there should be no problem in finding a suitable
location.”?

7. Some Japanese firms have a policy of rotating their managers among different
managerial jobs. In con- trast, American managers are more likely to specialize in a certain area (e.g., finance or operations). Discuss the advantages and
disadvantages of each of these approaches. Which do you prefer? Why?

i need the answer as fast as possible please

thank you

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Operation Management

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22. The following information is available for three MPS items:

Product A An 80-unit order is to be started in week 3.

Product A 55-unit order is to be started in week 6.

Product B A 125-unit order is to be started in week 5.

Product C A 60-unit order is to be started in week 4.

Develop the material requirements plan for the next 6 weeks for items D, E, and F. The BOMs are shown in Figure 16.41, and data from the inventory records are
shown in Table 16.4. (Warning:A safety stock require- ment applies to item F. Be sure to plan a receipt for any week in which the projected on-hand inventory
becomes less than the safety stock.)

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Operation Management

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23. Figure 16.42 shows the BOMs for two products, A and B. Table 16.5 shows the MPS quantity start date for each
one. Table 16.6 contains data from inventory records for items C, D, and E. There are no safety stock requirements for any of the items.

Please see image for details of the question.

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operation management

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1. What are the key characteristics that would classify Wheeled Coach as a repetitive focus process strategy?

2. Let’s assume you are a new hire at Wheeled Coach. Your manager asks you to review their manufacturing process to
see if there are any steps that can be eliminated as not adding value. What tools would you employ to complete this assignment? Please include a brief
description of each one, a diagram is not needed.

3. What Operation Management decisions would need to be made to change their repetitive focus process strategy
to: a.Process Focused?

b. Product Focused?

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Operation Management

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Matthew Yachts, located in Montauk, Long Island, manufactured sailing yachts of all descriptions. The company had begun by building custom-designed yachts for a
largely New York-based clientele. Custom-designed yachts still accounted for three-fifths of Matthew’s unit sales and four-fifths of its dollar sales and earnings.
Over the years, as Matthew Yachts’ reputation for quality design and workmanship spread, sales broadened to cover all of the eastern seaboard. In an effort to
capitalize on this increased recognition and to secure a piece of the fastest growing market in sailing, Matthew Yachts began manufacturing a new standard,
fixed-design craft. Matthew attacked only the high end of this market, as the boat measured 37 feet long. Nevertheless, even this end of the market was more
price-sensitive and less conscious of performance than Matthew Yacht’s custom-design customers were. All of the company’s yachts were manufactured at the Montauk
plant and shared the same equipment and skilled labor force. Custom designs were given priority in scheduling, and the new boat was rotated into the schedule only
when demand slackened. As sales of the fixed-design boat increased, however, scheduling the new boat on a regular basis became necessary. Matthew Yachts were built
basically from the bottom up. Fabricating hulls was the first step. Increasingly, fiberglass hulls were demanded for their speed and easy maintenance. Afterward
came the below-deck woodworking, followed by the fiberglass and woodworking on the deck itself. The masts were turned and drilled separately. Masts and hull were
then joined and the finish work completed. Over the past year, as the fixed-design craft continued its steady increase in sales, costs and deliveries began to
slide precipitously, especially on the fixed-design yachts. During this period, when push came to shove, construction of the fixed-design craft always yielded time
and resources to the higher-profit-margin custom designs. As a result, many fixed-design yachts were strewn around the yard in various stages of construction.
Moreover, space in the existing shipyard was becoming scarce, and a plant expansion of one sort or another appeared inevitable. Discuss questions: Should Matthew
Yachts, Inc. stay in the business of building standard, fixed-design yachts? If Matthew Yachts does so, how should it continue?

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Operation Management

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1. The monthly sales for Telco Batteries, Inc., were as follows: Month Sales
Jan 20
Feb 21
Mar 15
Apr 14
May 13
Jun 16
Jul 17
Aug 18
Sep 20
Oct 20
Nov 21
Dec 23
a. Plot the monthly sales data on a sheet of graph paper.
b. Forecast January sales for the new year using each of the followin

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operation management

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1. What operation management decisions would need to be made to change wheeled coach repetitive forcus strategy to:

a. process focused?

b. product focsed?

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Operation Management

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1. Briefly describe each of the four quantitative methods used to evaluate location alternatives. 2. How does a geographical information system help companies like
Red Lobster or LaQuinta with location strategies? 3. The textbook suggests that location strategies for Goods focus on minimizing costs while Services focus on
maximizing revenue. I would consider Fed Ex as a service provider. Yet, Fed Ex likely employed a transportation model (a cost minimization technique) in selecting
Memphis as their hub. What are the key considerations in choosing a location methodology? (i.e.; is it Goods versus Services or are other factors involved)? (shoot
for a paragraph for an answer not a lengthy response.)

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Operation Management

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Stan Fawcett’s company is considering producing a gear assembly that it now purchases from Salt Lake Supply, Inc. Salt Lake Supply charges $4 per unit with a
minimum order of 3000 units. Stan estimates that it will cost $15000 to set up the process and then $1.82 per unit for labor and materials. a- draw a graph
illustrating the crossover (or difference) points. b- determine the number of units where either choice has the same cost.

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Operation Management

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The Following table contains data about the inventory for five items at Jones Corporation and the rate of sales for each of the five items in the upcoming year

Item# Beginning Unit Inventory Ending Unit Inventory Annual Unit Sales Unit Sales Per Day

1 230,000 200,000 430,000 5,400

2115,00086,000114,000 4,800

3 132,000 129,000 225,00022,500

4410,000510,000560,000 14,500

5105,000 113,000176,0008,200

What is the day supply for each item

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operation management

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Case study FHE inc

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operation management

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A manager just received a new price list from a supplier. It will now cost $1.00 a box for order quantities of 801 or more boxes, $1.10 a box for 200 to 800 boxes,
and $1.20 a box for smaller quantities. Ordering cost is $82 per order and carrying costs are $10 per box a year. The firm uses 3,650 boxes a year. The manager has
suggested a “round number”? order size of 800 boxes. The manager’s rationale is that with a U-shaped cost curve that is fairly flat at its minimum, the difference
in total annual cost between 800 and 801 units would be small anyway. What order size would you recommend? (Round your intermediate calculations to 2 decimal
places and final answer to the nearest whole number.)

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Operation Management

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1. A state department of tourism and recreation collects data on the number of cars with out-of-state license plates in a state park. (The
group’s position is that more out-of-state plates means the state’s advertising programs are working.) The sample size is fixed at n=90 each day. Data from the
previous 20 days indicate the following number of out-of-state license plates:

Day

Out-of-state Plates

1

24

2

33

3

18

4

21

5

26

6

31

7

15

8

18

9

23

10

13

11

22

12

15

13

25

14

33

15

16

16

22

17

34

18

10

19

23

20

13

a. Calculate the overall proportion of “tourists” (cars with out-of-state plates).

b. Calculate the LCL and UCL for these data.

c. Plot the control chart. Are all points within the control limits?

d. What action do you suggest for improving this process?

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Operation Management

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A state department of tourism and recreation collects data on the number of cars with out-of-state license plates in a state park. (The group’s position is that
more out-of-state plates means the state’s advertising programs are working.) The sample size is fixed at n=90 each day. Data from the previous 20 days indicate
the following number of out-of-state license plates:

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Operation Management

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Operation Management
Question Detail:

Many companies require their suppliers to meet what standards as a condition for obtaining contracts?

RFO 6000
PUR 8000
ISO 9000
MACH 5000
SUP 2000

Empire West displays what by specializing in making a wide variety of products?

outsourcing
SCM
quality
flexibility
efficienc

Environmental scanning would not provide information on:

sources of highly trained workers
the firm%u2019s internal inefficient distribution system
opportunities and threats
changes in information technology
changes in global competition

During the 1970s and 1980s, firms from which country provided the most serious competitive threat to U.S. companies?

Germany
Canada
Mexico
Japan
United Kingdom

Suppose that a plant has a daily productivity of 0.85 parts per employee? What can we conclude?

the plant must be very labor-intensive
the plant is not earning profits
the plant must be highly automated
the plant should lay off workers
nothing

Which of the following is a disadvantage of automation?

inefficiency for producing large volumes

harder to monitor quality

inconsistency of products

frequent interruptions of production

inflexibility for product and process changes

Which of the following is not an argument in favor of having a single supplier?

Quantity discounts may be achieved.
Partnering becomes more possible.
Consistency of input materials is achieved.
Probability of assured supply is better.
Deliveries can be scheduled more easily.

To perform the financial calculations of the make-or-buy decision, which costs are needed?

Fixed and variable
Fixed and average
Variable and average
Variable only
Average only

Benetton is well known for the practice of assembling all white sweaters and waiting to dye them much closer to the time of sale. This is an example of what?

Stupidity
Postponement
Fractionalization
Partitioning
Genericness

Leveraging core competence is about sharing:

workers
knowledge
machines
expenses
financial hedges

Quality at the source is the belief that it is far better to _______ quality problems and _____ them than to discard defective items after production.

uncover the person generating, fire
uncover the source of, correct
discover new methods of, implement
discover new processes of, implement
allow returns of, fix

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Operation Management

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%u2022 %u2022 4.2

Year 1 2 3 4 5 6 7 8 9 10 11

Demand 7 9 5 9 13 8 12 13 9 11 7

a) Plot the above data on a graph. Do you observe any trend, cycles,

or random variations?

b) Starting in year 4 and going to year 12, forecast demand using a

3-year moving average. Plot your forecast on the same graph as

the original data.

c) Starting in year 4 and going to year 12, forecast demand using a

3-year moving average with weights of .1, .3, and .6, using .6 for

the most recent year. Plot this forecast on the same graph.

d) As you compare forecasts with the original data, which seems to

give the better results? PX

%u2022 4.3 Refer to Problem4.2.Develop a forecast for years 2 through

12 using exponential smoothing with %u03B1 = .4 and a forecast for year 1 of

6. Plot your new forecast on a graph with the actual data and the naive

forecast. Based on a visual inspection, which forecast is better? PX

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