Tanglewood Stores

1. Answering this question demonstrates that processes underlie all of our jobs. What efficiency be surprising is how galore(postnominal) savants would put their job in the fellowship of separate, suggesting that m any jobs do not fall neatly into any i operational atomic trope 18a. Perhaps many in the other category big trademan best be h termlded ope balancens on further reflection. clients, both intimate and external, are small-arm of each process, and the goal is to manage the processes to add the nearly value for them. 2. Amazon. com invites a very broad range of dos and branchs at free-enterprise(a) values.Its warring priorities would admit fast talking to time, on-time bringing, customization, variety and low- hail ope dimensionns. As a business, Amazon. com is actually assembling a customized b subscribeet of goods that moldinessiness be delivered in a short window of time in a dependcapable fashion. Low-monetary value ope rations are sine qua n championd to abide hawkish. To remain in business, Amazon. com sine qua nons to retain high volumes of traffic. Operations dodging must center on on stock availability and quick, economical, and dependable delivery. 3.The hospitals commitment to raise attendance to patients arriving to the emergency unit in less than 15 minutes and never to turn away patients who inquire to be hospitalized implies that the facility must be designed to put on placeicular cognitive content in both beds and emergency room facilities. It must aim on having extra personnel in the emergency room and alike plan on having additional emergency personnel on call to take care of unprecedented heavy loads. In line with the armorial bearing rumor, maximum utilization of the facilities (i. e. beds and emergency room personnel) would not be one of the performance objectives for the hospital.4. FedEx traditionally has deald on the basis of fast, dependable delivery. Before the smack in Internet applications, many businesses relied on FedEx to get things to other businesses overnight. Now, this need is beginning to diminish as sophisticated systems are being installed to facilitate companies in proviso trading trading operations better. And, the internet based companies are adding much than take ups for low cost ground deliveries to specific node doors.FedEx, in tramp to remain agonistic with companies such(prenominal) as UPS, has moved into the door-to-door delivery business, possibly by acquisition. Nonetheless, it result require changes to this companys competitive priorities. 5. engine room Management. To identify a alimentstuff segment, we need to determine issues to questions such as Which colleges and subdivisions currently offer the subject? What do instructors desire in the way of textbook put forward? Is thither a trend toward Technology Management courses? Are thither other Technology Management texts? most(a) needs assessment shag be accom plished by survey, only when the response rate whitethorn be low.A high-investment funds outline would be to ask or hire instructors to review and critique a list of topics, thus an outline, therefore a draft. Explicit proceedss complicate supplying info most the subject in the form of a textbook and instructor support in the form of ancillary publications. 6. It is often not a good idea for a company to try to excel in all of the competitive priorities because it is generally impossible to do so. Mediocrity is a predictable result. The choice and the minimum level of one or more of the competitive priorities are stripe by the value qualifiers for the particular harvest-festival or help.The choice of the competitive priorities that the company should emphasize is usually governed by the companys strategy driven by its mission statement and the core competencies that the company wants to harness to count onk the best competitive advantage. 7. nerve centre processes sh ould link to a firms core competencies. Core processes are those processes that provide the firm the best competitive advantage. Essential to the definition a firms core processes is the concept of interaction be. These costs embroil the time and money that are expended whenever plenty and companies exchange services, products, or ideas.If the consummation costs are higher to retain a process indoors the firms organization than to outsource the process, the process should be outsourced. 8. Wendys assembles hamburgers to order. When materials are held at the stage just before final assembly, they digest be used to complete a wide variety of contrastive sandwiches. Because no finished-goods stock exists, when customers say, Hold the sauce, there is no delay or waste of materials. Service clerks specialize. angiotensin converting enzyme clerk takes orders and payment. Others fill bunchs of the order.Orders are graceful in single file. Throughput is normally restricted by tra nsactions at the cash register. At busy times, throughput is change magnitude by splitting the blockade operation. One clerk takes customer orders, another receives payment. The Wendys operation has some characteristics of assembly. Therefore, the bear upon of peeledborn menu items on the issue operations must be carefully considered. 9. Grandmothers Chicken. a. Kathryn shoemakers strategicalal plans include the following Product and service plans Should the new location offer a new mix?Competitive priorities If the product mix and service mix are unlike at the new location, the thrust could be on low volumes and high quality. Quality management Should the goal be reliability or top quality? branch strategy What processes testament be needed to make chicken dinners in the addition or new facility? New technologies Is it time to automate? Is this why there is a problem in service times? Capacity How braggart(a) should the addition or new facility be? Location Should we de cide in Uniontown or expand in Middlesburg? b. Attitudes toward nutrition could change the demand for chicken.Competitors such as Boston Market may be planning to move to Uniontown or even Middlesburg. There may be a trend toward demands for ever-faster service, which erectnot be supported by the processes specified in the whimsical recipe. The economy of Uniontown might not be supportive of restaurant services. Shoemaker should also consider the availability of key resources, such as servers, self-coloured chickens, spices, and cooking oil. Will Uniontown grate organize?c. The possible distinctive competencies at Grandmothers Chicken Restaurant include the alone(predicate) recipe, the homelike atmosphere, and friendly, prompt service. 0. Wild West, is recognizable as US WEST, which was bought out by Qwest in a hostile takeover in June, 2000. But many other sister Bells are in a similar position. a. strategic plans include reducing strike, reengineering operations, and inve sting in new technologies to meet emulation. The do-nothing option of remaining a local monopoly telephone company is not viable because of competition from cable systems and wireless systems that are capable of business and personal communication. If the mission is too broad, Wild West should take its monetary services and commercial real-estate businesses.Those businesses do not match their distinctive competencies. b. One surroundingsal issue is whether communication, like health care, pass on be viewed as a right and therefore should be free. A significant portion of Wild Wests business is governed by regulatory agencies. Customer service in their core business is essential to bearing a well-to-do regulatory environment. Other business opportunities, such as manufacturing and providing information services, are prohibited by the analogous court order that formed the Baby Bells from AT&T. c.Wild Wests distinctive competency is in connecting people (or machines) for the p urpose of communication. A weakness is high overhead inherited from the era of telecommunication monopoly. 11. Although the answers may deviate depending on the niche elements of the business, the competitive priorities would include on-time delivery, low-cost operations, and customization. The latter competitive priority comes from the capability to assemble unique baskets of viands items for each customer. There may be a need to coordinate a given basket between two opposite stores.Capabilities to develop would include information systems and Web page design, efficacious programing of delivery trucks (which must first collect the items in the basket and then deliver them to the customers door), and an adequate fleet of trucks with drivers. PROBLEMS 1. Boehring University a. appraise of payoff pic valuate of excitant labor + material + overhead pic Multifactor productivity ratio Productivity pic Compared to Solved problem 1, multifactor productivity has outgrowthd fr om 1. 25 to 1. 76. b. cherish of turnout is the similar as in part a pic labor-hours of input pic Productivity ratio Labor Productivity pic The $192 season ticket price is not used in this calculation. It is a red herring. 2. Suds and duds Laundry a. Labor productivity Number of arousal proceeds Output/Input week Workers (Labor-hours) (Shirts) Ratio 1 2 24 68 2. 83 shirts/hour 2 2 46 130 2. 83 shirts/hour 3 3 62 152 2. 45 shirts/hour 4 3 51 125 2. 45 shirts/hour 5 2 45 131 2. 91 shirts/hour b. Output per person does not vary much whether it is Sud, Dud, or Jud working. Productivity declines when all three are present.Perhaps there isnt enough work to keep three persons occupied, or perhaps there is not enough work space or equipment to harmonise three workers. 3. Compact disc players Value of Output $300 Value of Input Labor + Materials + crash Productivity pic 10% productivity receipts pic Given productivitypic, and the value of rig pic we solve for the cost of inputs Productivity pic Input pic or $136 The cost of inputs must decrease bypic. a. A $14 reduction in material costs is pic b. A $14 reduction in labor costs is pic c. A $14 reduction in overhead is $14/$50 = 28. 00% . The rig of a process is valued at $ atomic issuance 6 per unit. The cost of labor is $50 per hour including benefits. The accounting department provided the following information about the process for the past four weeks calendar week 1 Week 2 Week 3 Week 4 Units Produced 1124 1310 1092 981 Total Value 112,400 131,000 109,200 98, degree Celsius Labor ($) 12,735 14,842 10,603 9526 Labor (hrs) 254. 7 296. 8 212. 1 190. 5 Material ($) 21,041 24,523 20,442 18,364 Overhead ($) 8,992 10,480 8,736 7,848 Multifactor Productivity 2. 63 2. 63 2. 75 2. 75 Labor Productivity 4. 1 units/hr 4. 41units/hr 5. 15 units/hr 5. 15 units/hr a. Use the multifactor productivity ratio to see whether recent process melioratements had any effect and, if so, when the effect was noticeable. Value of output pic Value of input labor + material + overhead $12,735 + $21,041 + $8,992 = $42,768 Productivity ratio Labor Productivity pic Week 1Productivity pic Week 2Productivity pic Week 3Productivity pic Week 4Productivity pic pic better 4. 45% noticeable in Week 3 b. Has labor productivity changed? Use the labor productivity ratio to support your answer.Labor-hours of input Labor $50/hour Labor costs Week 1 = $12,735/$50 = 254. 7 Week 2 = $14,842/$50 = 296. 84 Week 3 = $10,603/$50 = 212. 06 Week 4 = $9,526/$50 = 190. 52 Productivity ratio Labor Productivity pic Week 1 = Labor Productivity pic Week 2 = Labor Productivity pic Week 3 = Labor Productivity pic Week 4 = Labor Productivity pic pic Improved 16. 68% 5. Alyssas Custom Cakes a. pic pic Solve for x = $850/1. 25 = $680 Total costs = $680 average cost per cake = $680/10 = $68/cake b. Labor productivity Birthday cake = $50/ 1. 5 hours = $33. 30/hourWedding Cake = $cl/ 4 hours = $37. 50/hour Specialty Cake = $ 100/1 hours = $100/hour c. Based on labor productivity, Alyssa should try to sell specialty cakes the most. d. Yes, Alyssa should stop selling birthday cakes. Based on answer a, she loses $68 $50 = $18 everytime she sells a birthday cake. advanced PROBLEMS 6. bragging(a) Black Bird lodge The Big Black Bird Company problem is based on a product made by Raven Industries. None of the numbers are representative of actual costs or volume. a. Multifactor Productivity Original Situation Value of output pic Value of input picProductivity ratio Productivity pic Overtime Situation Value of output pic Value of input pic Productivity ratio Productivity pic Productivity decreases by pic b. Labor Productivity Original Situation Value of output (from part a) is $500,000 Labor-hours of input pic Labor productivity pic Overtime Situation Value of output (from part a) is $800,000 Labor-hours of input pic Labor productivity =$800,000 / 7200 hours = $111. 11/hours Labor productivity decreases by (12 5/111. 11) / 125 x 100% = 11. 1% c. Gross lettuce Original SituationpicOvertime Situationpic Weekly profits increased. 7. Macks Guitar Company a. Labor productivity = output/input Output = 100 guitars x 80% design rate x price/guitar = 80 guitars/ month x $250/guitar = $20,000 Input Labor = 10/hours per guitar x 100 guitars = 1000 hours Labor productivity is $20,000/1000 = $20/hour Multifactor productivity ratio = output/input Output = 100 guitars x 80% completion rate x price/guitar = 80 guitars/ month x $250/guitar = $20,000 Input Labor = $10/hour x 10/hours per guitar x 100 guitars = $10, 000 Material = $40/guitar x 100 guitars = $4, 000Overhead = $4,000 Multifactor productivity ratio = $20, 000/$18, 000 = 1. 11 b. substitute(a) 1. Increase sales price by 10% Output = 100 guitars x 80% completion rate x ($250 x 1. 1) = $22,000 Input Labor is same as in part (a) = $10,000 Material is same as in part (a). = $4,000 Overhead is same as in part (a) = $4,000 Multifactor productivit y ratio = $22,000/$18,000 = 1. 22 Option 2. Improve Quality Output = 100 guitars x 90% completion rate x $250/guitar = $22,500 Input Labor is same as in part (a) = $10,000 Material is same as in part (a). = $4,000 Overhead is same as in part (a) = $4,000Multifactor productivity ratio = $22,500/$18,000 = 1. 25 Option 3. Reduce costs by 10% Output = same as in part (a) = $20,000 Input Reduce costs by 10% yields 90% of the input costs from part (a). = $18,000 x 0. 90 = $16,200 Multifactor productivity ratio = $20,000/$16,200 = 1. 23 Darren should ask Option 2 and improve quality because it yields the greatest improvement in multifactor productivity. CASE CHADS yeasty CONCEPTS* A. Synopsis This chance exposits a small piece of furniture manufacturing company that has gained a paper for creative designs and quality by focusing on producing custom-designed furniture.As its reputation grew it began to sell some hackneyed furniture pieces to retail outlets. The overall ontogenesis in sales volume and the diversification into the production of step furniture pieces adopt caused a number of issues to arise concerning both the internal manufacturing operations and its relationship to the other functional areas of the company. B. Purpose This case is designed to be used as either a cold-call case for class word or an assigned homework reading. Major points to be brought out in the sermon include 1. The range of decisions that are made in conception and run processes 2.The impact that these run decisions generate on the organization as a whole, such as on merchandise and finance 3. The impact that decisions made in other functional areas of the organization train on the operating(a) function 4. The need to go beyond the functional silo humor and manage in an integrative manner C. Analysis headspring 1 What types of decisions must Chad Thomas make daily for his companys operations to run effectively? Over the coherent run? The students should be able t o discuss a number of short-term-oriented decisions that are facing Chad Thomas.These should include a. How to set priorities and schedule unalike orders. Chad is receiving orders for both custom-made, low-volume furniture pieces and higher-volume, sample pieces. Sales have increased, but the amount of equipment and the production susceptibility of the company have not. diametrical orders with different manufacturing requirements are now competing for the same productive capacity. b. What orders to accept and how long of a lead time to plan for in promising a delivery date. c. What type of work policies should be adduceed for his employees?Decisions such as the number and type of employees to employ, the number of hours to work per day, and the amount of overtime to seize are all work policy decisions that impact the available capacity level. d. The allocation of resources, equipment, labor, and money to each product line. e. The level of list to maintain at various stages of the production process for both the custom and standard furniture lines (i. e. , raw material, WIP, finished goods). These decisions are linked to the longer-term, total breed-investment decision.Examples of longer-term decisions that lawsuit Chad Thomas include . Amount of money to tie up in the total inventory investment. b. The type of equipment to invest in to support efficient production. At what point should more specialized equipment be purchased to manufacture high-volume, standard furniture pieces more efficiently? c. What should be the overall workforce level to maintain, and what should be the proper mix of skills and capabilities? d. How should the facilities be laid out to nurse the two different product lines? This gets the students into a whole range of capacity and equipment allocation decisions including size, type, and configuration.In these decisions it is pregnant that the students see the significance of consistency of both strategic and operating decisions across functional areas. school principal 2 How did sales and food marketing accept operations when they began to sell standard pieces to retail outlets? Standard furniture pieces compete on a different set of competitive priorities than custom-designed pieces. punctual delivery and low costs are much more definitive than product tractableness. Quality may also be defined differently. The animate facilities are set up to provide flexibility with its job-shop orientation and general equipment.By introducing a standard line that should be manufactured on a flow line with some dedicated, more specialized equipment, a bout has developed, and scheduling problems have resulted. Question 3 How has the move to producing standard furniture pieces affected the financial structure of the company? Inventory investment and operating costs are rising because of the frequent changeovers to accommodate the two different product lines and their scheduling conflicts. Profit margins for the standard line are smaller, which puts military press on manufacturing to increase productivity and reduce costs.There may also be an issue concerning the denomination of overhead costs to each product line. Finally, the strength need to rent warehouse space to store either WIP or finished-goods inventory cuts into the profit margin for the standard furniture line. Question 4 What might Chad Thomas have through differently to help reverse some of these problems? Chad needs to address issues relating to functional areas. Make sure the student is able to identify decisions that relate to more than one functional area. Examples include the following Operations Function 1. Monitoring capacity and utilization of facilities 2.Formulating inventory policiesdollars, items, and unit levels 3. Setting scheduling policies and priorities 4. Maintaining product line quality trade and Sales 1. Accurately forecasting orders for standard pieces 2. Defining market segments and customer needs 3. Determining what delivery schedules can be promised to customers Finance 1. deciding level and type of investment 2. Investigating the effect of capacity investment decisions on ROI Distribution/Logistics 1. Managing distribution and pipeline inventory 2. Comparing cost and advantages of various transportation modes 3. Meeting delivery lead timesThree possible avenues that students may focus on are Thomas might have a. complete a plan for a more controlled growth. Part of this plan would be the development of the appropriate infrastructure to manage a controlled growth as to what markets to enter, what product lines to develop, and how to develop the proper manufacturing capabilities. b. Maintained the company focus on custom-designed furniture only.This utility(a) presents a whole different set of issues and decisions pertaining to future growth, but it would have avoided the issues of mixed competitive priorities and scheduling conflicts. . Realized the different requirements f or each product line and focused the manufacturing facilities into two separate sets of production facilities designed to cater to each product lines specific needs. D. Recommendations This case is not designed to be a decision-making case per se but rather a vehicle to get students thinking about the types and the integrated nature of decisions that operations managers face. The students may, indeed, have suggestions as to what should be done to help out Chad Thomas.These recommendations volition more than likely follow the alternatives al fasten discussed. As recommendations are provided by students, make sure you push them to deduce the implications of their recommendations with respect to the company as a whole and the other functional areas. E. Teaching Strategy This case can be effectively discussed in 20 to 30 minutes by following the discussion questions provided at the end. The questions are interconnected and somewhat redundant on purpose to honour the interrelatedness of decisions made in various functional areas of the company.The intent is to have the students understand the range of decisions that face managers in the operating function and to induce that different types of products competing in different markets place different demands on the operating function. Therefore, productive systems depart take on a variety of configurations. point TN. 1 lays out a sample table to be create verbally on the board displaying important issues in the class discussion. Each tugboat can be used to compare and contrast the differences in the requirements enforce by custom versus standard furniture for each area.EXHIBIT TN. 1 Board Plan Important Issues Custom furniture Standard Furniture Marketing Quality level and quality control Process equipment Process flow Production scheduling system Purchasing Type of inventory and inventory control system Type of engineering Type of labor and supervi sion needed Wage/reward system Layout CASE BSB, INC. pizza pie pie Wars Come to Campus * A. Synopsis BSB, Inc. resents the situation where launching a pizza service at a forage service operation on a college campus turns out to be very successful. As the manager of the food service operation is contemplating an expansion of the service, an announcement by the university that a new food court willing soon be opening in the new student union causes some concern. The new food court will contain, for the first time on campus, other food service companies, including a new Pizza Hut kiosk. This causes the manager of BSB, Inc. to reevaluate the competitive environment and her own competitive priorities.B. Purpose BSB, Inc. provides the students an opportunity to discuss a number of strategically focused issues to include the following 1. Mission statements Mission statements describe the fundamental purpose for which the organization exists. The university decided tha t a focus on food service operations was not part of its primary mission, so it contracted the service out to BSB, Inc. Students should be able to describe a mission statement for BSB, Inc. This statement will help in discussing the scrap major focus of this case. 2.Comparison of competitive priorities When the pizza service was launched a course of instruction ago, the competitive priorities were to expand the product line to offer pizza that could be delivered quickly at a reasonable price. Costs were kept low, and retrogression time was short due to the contain combination of toppings available. With the addition of the food court and Pizza Hut on campus, competitive priorities may change. legal transfer may still be a differentiating competitive priority, but product flexibility (variety) and volume flexibility (large order sizes) may become more important. BSB, Inc. ay not be able to compete on low cost when compared to Pizza Huts operations. 3. The impact changing competi tive priorities has on operating decisions Students need to discuss the potential impact that different competitive priorities have on process design and operating systems. If product flexibility and volume flexibility become more important, then there are implications for a. Equipment needsconventional oven versus continuous chain drive b. Capacity requirementsorder size and delivery cycle c. Inventory issuesinventory needed to support product flexibility 4. Product life cycles Demand for pizza on campus has leveled off.Why? Has it reached its mature, steady state? What will be the impact of new competition? What can be done to reposition pizza into a growth stage? These are questions that should be asked of students to get them to think about pizzas product life cycle. C. Analysis A good epitome of the situation can be performed by going through the quintette questions at the end of the case. The following is what you can expect from a first-year MBA student given the case as a take-home assignment to read and to respond to the questions at the end. Question 1 Does BSB, Inc. enjoy any competitive advantages or distinctive competencies?BSBs competitive advantage is stopping point proximity to the customers. Though 43 percent of meals are eaten off campus, 57 percent of meals are still eaten at BSBs facilities. For pizza delivery the close proximity is critical, as it allows for quicker delivery. In addition, delivery can be done at a lower cost because bikes can be used. BSBs distinctive competencies are the location of facilities and market know-how. creation on campus, BSB can provide delivery service quicker and at a lower cost. In addition, by being on campus, BSB is next to the customer base, which allows Kershaw, the manager, to be more knowledgeable of her customers needs.She employs environmental scanning, such as the customer surveys, to keep abreast of her market. Question 2 Initially, how did Renee Kershaw choose to compete with her pizza oper ations? What were her competitive priorities? Initially, Kershaw chose to compete on delivery service and price. She used quick delivery as a key selling point. In addition, without a reasonable price, she could not compete with the off-campus pizza companies. In effect, her order qualifier was price, and her order winner was service.Her initial competitive priorities for pizza were delivery speed and price. Her on-campus location and hold standard toppings make these priorities possible. Unfortunately, this policy limits the variety of pizzas available. The increased requests for additional topping combinations and the train of sales suggest this policy may be hurting BSB. Question 3 What impact will the new food court have on Kershaws pizza operations? What competitive priorities might she choose to focus on now? The new food court introduces new competition that has the same on-campus advantage as BSB.In addition, these companies can also provide products at reasonable prices, but unlike BSB, they have brand names. Her cipher competitor, Pizza Hut, can probably provide a similar price. more or less likely Pizza Hut will also have limited varieties however, BSB still maintains its delivery advantage. The most likely new competitive priorities for BSB will be spread out product variety and longer service hours. The increased requests for alternate toppings show a customer interest in variety, and the expanded hours will enable BSB to offer service when the Pizza Hut is close or when students are in their dorm rooms.Question 4 If Kershaw were to change the competitive priorities for the pizza operation, what are the gaps between the priorities and capabilities of her process? How might this impact her operating processes and capacity decisions? An increase in product variety will affect both service and cost. Kershaw probably cannot have as many premade pizzas ready to throw into the oven. She will also need to stock additional toppings. If she wants to maintain service, she will need to hire additional workers. She will inevitably have some trade-off between service and price if she adds product variety.Kershaw will also need to add capacity. At present, she is near capacity with her pizza ovens. She may even have to consider a new location, as there seems to be limited space at the grill location. distinctly she will need to determine the viability of pizza service before she takes this step. Question 5 Can you outline a service strategy for Kershaws operation on campus? If she chooses to stay in the pizza business, delivery will remain important. Food, most likely pizza, delivered from off campus, is a significant competitor. These competitive companies likely offer many pizza combinations.Therefore, BSB will need to increase variety to remain competitive. The key to this strategy is to maintain quality and to acquaint on product offerings. Kershaw must use her proximity to the customer to maintain her competitive advantage in determining their pizza delivery needs. The other strategy would be total price competition. This would require her to keep the limited menu and to push to keep costs at a double-dyed(a) minimum. Unfortunately this means maintaining the same basic strategy she has now. However, this strategy will most likely lead to an inevitable decline in market share.This strategy seems best if she decides to exit the market, but it gives her the opportunity to milk the market before exiting. In reviewing the student responses the instructor should note the following 1. On question three, the student overlooks the continued importance of convenient, quick delivery. The other food services do not provide this service. 2. Students tend to hedge on question five. They should be pressured into putting together a service strategy as opposed to describing alternative choices only. There are a number of positions Kershaw may take.What is important, however, is to look for consistency in the strategies that students provide. D. Teaching Strategy This case is best assigned as a take-home assignment. Have the students focus on responding to the questions at the end of the case. Tell them to pay particular attention to the persist question. The first four questions all lead up to the last one where students should describe a service strategy for pizza operations of BSB, Inc. Tell students you want them to settle on a specific strategy they can support. In class, start with the first question and cycle through to the final question, which describes their service strategies.It is helpful to try to get two or three different strategies on the board to compare and contrast approaches. It is important that students see that there are a number of good alternative strategies and not just one best one. A thorough discussion of this case will take 45 minutes to an hour, especially if alternative strategies are discussed. *This case was prepared by Dr. Brooke Saladin, fire up Forest Univers ity, as a basis for classroom discussion. *This case was prepared by Dr. Brooke Saladin, Wake Forest University, as a basis for classroom discussion.