Question: Whew, I’m glad the town hall
Whew, I’m glad the town hall meeting is over. The audience was hostile!†Tom Bourbon commented as he was escorted by a police officer to his car in the high school parking lot. The officer replied. “There were over 1,000 people in the gymnasium, sir, and they were in an uproar. Let’s get you out of here safely.â€
Tom and the other City Council members had just finished a town hall meeting open to the public to discuss four alternative locations for a new $80 million baseball stadium in Lee County, Florida. The City Council originally evaluated 16 sites and had arrived at the final four locations. The new 10,000-seat ballpark also includes practice fields, batting cages, and weight rooms. The stadium facility design and layout is to mimic the regular season Fenway Park in Boston, Massachusetts. However, the new park planned on “going green†by reducing energy consumption, allocating a carpooling parking lot close to the stadium to reduce patron traffic congestion and transportation costs and fuel use, and changing some of its work practices.
The five board members of City Council have to make a location decision in three weeks if they are to meet the contractual requirements of previous agreements. Once the stadium for spring training was complete, the Red Sox would sign a 30-year lease. Two economic impact studies indicated the stadium would generate $25 to $40 million annually to the local economy and support thousands of jobs in airports, hotels, restaurants, and retail stores.
The four possible locations were described as follows:
• Site A includes 241 acres and is big enough to build a sports village; it is located next to a shopping mall (denoted as 1 in Exhibit 6.12) and within 4 miles of Florida Gulf Coast University and an 8,000-seat indoor arena for events such as hockey and basketball games in a second shopping mall (denoted as 2 in Exhibit 6.12). The land cost to the City Council is $18 million.
• Site B includes 209 acres and is located between the two shopping malls 1 and 2. The site is about 2 miles from Florida Gulf Coast University. The land cost to the City Council is $22 million.
• Site C includes 2,000 acres of wetlands and habitat for animals. The area is within 3 miles of shopping mall 2 and Florida Gulf Coast University. The developer planned to donate 100 acres to the city, so the stadium land cost is free. The developer also offered to place 20 acres in a nature preserve for every acre that is developed for commercial purposes.
• Site D includes 106 acres located close to the airport and about 8 miles from the shopping mall 2 and Florida Gulf Coast University. The airport also includes a research park that hopes to attract high-tech industries and jobs. The land cost to the City Council is $22 million.
Exhibit 6.12 provides the coordinates for the population centers and the four possible locations. The populations for the five population centers are as follows: 1 (290,000), 2 (95,000), 3 (145,000), 4 (80,000), and 5 (120,000). Exhibit 6.13 summarizes the cost and judgments of the five City Council members for each site. It was thought that locating the Red Sox stadium close to the existing retail malls, restaurants, hotels, Florida Gulf Coast University, and the 8,000-seat indoor arena would create a retail and leisure service cluster where all could benefit. In the 10-month off-season for the Red Sox stadium, for example, local, regional, and national baseball clinics and tournaments could be played using this cluster of assets. Another view- point argued that locating the stadium next to the airport would encourage commercial development in this area, including the airport’s research park
Case Questions for Discussion:
You just finished your college’s spring semester and have been working for the City Council as a summer intern. Your major is Information Systems & Operations Management (ISOM), and you want to earn a good recommendation from your summer intern boss. Your boss asks you to build an electronic spreadsheet model that scores, weights, and evaluates each quantitative and qualitative criterion and arrives at a summary score for each stadium site. To organize your analysis, you decide to answer the following questions:
1. Using the center-of-gravity model and Exhibit 6.12, compute the center of gravity for the population of the county. Show all computations, explain, and justify. Based solely on this criterion, where is the best stadium location?
2. Using a weighted scoring model of your own design, what are the summary scores for each stadium site for the qualitative criteria in Exhibit 6.13? (You must decide how to scale and weight each criterion and whether to include or not include cost estimates.) Show all calculations and explain your approach. You might wish to use Excel to perform these calculations. The data in Exhibit 6.12 are available in the Excel worksheet Red Sox Case Data on MindTap.
3. How will you combine these results (your center-of-gravity results, cost, and qualitative criteria analyses)? How might you compute a summary score for each site using all three criteria? Explain and justify.
4. Research and explain at least three ways a sports stadium can “go green,†including at least one work practice for stadium employees. Do jobs and processes have to change too? Explain the role of OM.
5. What is your final stadium recommendation? Explain and justify.
> Nighthawk Airlines measured their numbers of lost bags in one month and found that they had lost 35 bags for 10,000 customers. If the average number of bags per customer is 1.2, how many errors per million opportunities (epmo) does this represent? The wo
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> Garden Manufacturing is a small, family-owned garden tool manufacturer located in Florence, South Carolina. The bills of materials for models A and B of a popular garden tool are shown in Exhibit 14.35 and other additional component information is provid
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> Given the information below, complete the MRP record and explain what it tells the inventory analyst to do. Lot Size Rule: Fixed Q 5 100 units Safety Stock 5 0 units Lead Time 5 three weeks Current On-Hand Quantity 5 80 units
> Lilly Hillcrest started a custom drapery business in Naples, Florida in 2014. Her market segment is for owners of homes over one million dollars. Her prices are high, but the customer receives exceptional personal service and a service guarantee on all w
> Given the bill of material in Exhibit 14.31, if the gross requirements to build 250 units and an on-hand inventory for A of 40 units, what are the net requirements for all items? All component parts have zero on-hand inventory except item D with 200 unit
> Consider the same bill of material in Exhibit 14.30 and information in Problem 31 including the on-hand component quantities. Assume that two of component B are needed for each A and that the gross requirement for A is 220 units. Compute the net requirem
> Given the bill of material for the printer cartridge in problem 31 and Exhibit 14.30, and the following on-hand quantities, compute the net requirements for each item. The gross requirement for A is still 200 units.
> Given the bill of material for the printer cartridge (A) in Exhibit 14.30; a gross requirement to build 200 units of A; an on-hand inventory level for end- item A of 80 units; and assuming zero lead-times for all items A, B, C, D, and E, compute the net
> The Silver Star Bicycle Company will be manufacturing men’s and women’s models of its Easy-Pedal 10-speed bicycle during the next two months, and the company would like a production schedule indicating how many bicycles of each model should be produced i
> A lawn chair company, Leisure Furniture, manufactures two types of deck and lanai reclining chairs. Contribution to profits and overhead for Model A chairs are $35 and for Model B chairs $26. One independent process cuts and sews the weather proof fabric
> Metal Fabricators, Inc. manufactures gas grill tanks, Model # 1420, for four original equipment manufacturers (OEMs). Demand is forecast to be as follows: Quarter 1 – 2,800 tanks, Quarter 2—3,400, Quarter 3—3,600, and Quarter 4—2,900. Due to a hedging pr
> Jet skis and snowmobiles are assembled by Mobile Incorporated. Because both end-items use the same small engine, you can aggregate demand for the engine assembly. Develop an aggregate plan that uses a level production strategy each quarter and the inform
> Rapallo Corporation manufactures industrial vacuum cleaners with forecasted sales for the next five weeks as follows: Week 1 5 2,000 units, Week 2 5 2,500, Week 3 5 3,000, Week 4 5 3,000, and Week 5 5 3,500. Beginning inventory equals 13,000 units and th
> The forecast demand for fudge for the next four months is 120, 160, 20, and 70 pounds. a. What is the recommended production rate if a level strategy is adopted with no backorders or stock outs? What is the ending inventory for Month 4 under this plan? b
> 1. Explain whether the global diamond supply chain a push system or a pull system, and whether the global diamond supply chain is an efficient or responsive system for make-to-order and make-to-stock jewelry. Provide some examples to justify your reasoni
> Using the data in Problem 38, assume the operating manager reduces total average inventory on-hand by 21 percent by using better operations and supply chain methods. What is the revised cash-to-cash conversion cycle in weeks? What does this change in the
> As an operations management consultant, you have been asked to evaluate a furniture manufacturer’s cash-to-cash conversion cycle under the following assumptions: sales of $23.5 million, cost of goods sold of $20.8 million, 50 operating weeks a year, tota
> Consider the following performance data for Modular Computers, Inc (MCI). Sales 5 $34 million, cost of goods sold 5 $30 million, total average inventory 5 $428,000, accounts receivable 5 $2,100,000, accounts payable 5 $2,900,000, and operating 365 days p
> Given the information in Exhibit 13.11, what are the procurement, oversight, transportation, order cycle inventory, pipeline inventory costs, and total supply chain costs for using the supplier Ebert, Inc. Ebert manufactures small speakers for automobile
> Given the information in Exhibit 13.10, compute the procurement, oversight, transportation, order cycle inventory, pipeline inventory costs, and total supply chain costs for an air conditioner coil purchased from the supplier Entity, Inc. The order size
> What is the annual transportation cost if annual demand is 240,000 units and the cost to transship a unit is $0.80 per unit?
> What are order cycle costs if annual demand is 8,000 units, the order quantity is 1,000 units, and annual order cost is $97? What if the order size changes to 500 units or 8,000 units?
> What is the pipeline inventory value if average daily demand is 82 units, the lead time is 20 days, and annual inventory carrying costs is $12?
> What are total purchase and oversight costs if annual demand is 1,000,000 units, the purchase price is $2.42, and the management oversight costs to monitor and expedite the trans-Pacific shipment are $0.16 per unit?
> Claiken Incorporated is a supplier of axles for light trucks. They held an average axle inventory of $1.6 million last year, with a cost of goods sold of $21.0 million. What is the inventory turnover for axles? A customer wants them to increase its inven
> Based on the following information, how many days of supply of inventory is the firm holding (assume 250 days of operation per year)? Interpret your answer if the industry average inventory days’ supply is 30 days.
> Andrew Manufacturing held an average inventory of $1.1 million (raw materials, work-in-process, finished goods) last year. Its sales were $8.0 million, and its cost of goods sold was $5.8 million. The firm operates 260 days a year. What is the inventory
> Bragg Johnson, materials manager at Johnson & Sons, has determined that a certain product experienced 3.8 turns last year, with an annual sales volume (at cost) of $975,000. What was the average inventory value for this product last year? What would be t
> A manufacturer of large industrial electric motors has a cost of goods sold of $111,690,000 and an average inventory value of $14,609,300. What is its inventory turnover? What does it mean?
> A big box electronics store sells 250 65-inch televisions during the year. The store maintains an average inventory of five units. What is its inventory turnover? What implications does this have for inventory management?
> Over the past year, Keto Grocery Store had a cost of goods sold of $24,500,000 and an average value of inventory of $1,100,500. What is its inventory turn- over? What does it mean?
> Keto Grocery Store sells 400 gallons of milk each month. The average on-hand inventory is 50 gallons. What is the inventory turnover? What does it mean?
> Tune Football Helmets Company is considering changing the current inventory-control system for football helmets. The information regarding the helmets is given below: a. The firm decides to use a fixed-period system to control the inventory and to review
> Wildcat Tools is a distributor of hardware and electronics equipment. Their socket wrench inventory needs better management. The information regarding the wrenches is given below. a. The company decides to use a continuous re- view system. What is the re
> Crew Soccer Shoes Company is considering a change of their current inventory-control system for soccer shoes. The information regarding the shoes is given below: a. The company decides to use a fixed-order quantity system. What would be the reorder point
> I’m going to Bookmaster to buy a book,” Luke Chris yelled as he walked out of his apartment. “I’ll be back in about ninety minutes,” he continued as his roommate la
> For the data given in Exhibit 12.26 for problem 50, illustrate the operation of a fixed-period-inventory system with a replenishment (M) level of 40, a re- view period of five days, a lead time of 3 days, and use Equation 12.1. Assume that orders are pla
> Allen’s Shoe Stores carries a basic black dress shoe for men that sells at an approximate constant rate of 500 pairs of shoes every three months. Allen’s current buying policy is to order 500 pairs each time an order i
> Apply the EOQ model to the quantity-discount situation shown in the data below: Assume that D 5 500 units per year, Co 5 $40, and the annual inventory-holding cost is 20 percent. What order quantity do you recommend?
> The B&S Novelty and Craft Shop in Bennington, Vermont, sells a variety of quality, handmade items to tourists. It will sell 300 hand-carved miniature replicas of a colonial soldier each year, but the demand pattern during the year is uncertain. The repli
> A product with an annual demand of 1,000 SKUs has Co 5 $30 and Ch 5 $8. The demand exhibits some variability such that the lead-time demand follows a normal distribution, with a mean of 25 and a standard deviation of five. a. What is the recommended orde
> Nation-Wide Bus Lines is proud of the six-week driver-training program it conducts for all new Nation-Wide drivers. The program costs Nation-Wide $22,000 for instructors, equipment, and so on, and is independent of the number of new drivers in the class
> The maternity ward of a hospital sends one baby blanket home with each newborn baby. The following information is available for the baby blankets: a. As the new maternity ward manager, you decide to improve the current ordering methods used for items whi
> The XYZ Company purchases a component used in the manufacture of automobile generators directly from the supplier. XYZ’s generator production, which is operated at a constant rate, will require 1,200 components per month throughout the year. Assume order
> The reorder point is defined as the demand during the lead time for the item. In cases of long lead times, the lead-time demand and thus the reorder point may exceed the economic order quantity, Qp. In such cases the inventory position will not equal the
> Exhibit 12.26 gives the daily demand of a certain oil filter at an auto supply store. Illustrate the operation of a fixed-order-quantity inventory system by graphing the inventory level versus time if Q 5 40, R 5 15, and the lead time is three days. The
> The Hudson Jewelers case study found in MindTap inte- grates material found in each chapter of this book. Case Questions for Discussion: 1. Hudson Jewelers’ current layout displays jewelry designs from the CAD system on a screen in the front of the store
> Given the weekly demand data in Exhibit 12.25 illustrate the operation of a fixed-order-quantity inventory system with a reorder point of 75, an order quantity of 100, and a beginning inventory of 125. Lead time is one week. All orders are placed at the
> Bishop Manufacturing is implementing an economic order quality (EOQ) inventory-control system and needs a good estimate of the cost to process a purchase order (PO). It takes five total labor hours to process a PO. The average number of stock keeping uni
> JAZ Medical Supplies is implementing a new economic order quality (EOQ) inventory-control system and needs a good estimate of the cost to process a purchase order (PO); i.e, the order cost Co. It takes four total labor hours to process a PO. The average
> After one year you are promoted to assistant man- ager and realize current inventory management practices are not systematic with too much stock of some SKUs and too little of others. Your retail store operates 52 weeks per year and one SKU you stock is
> TV Galore is a new specialty store that sells television sets, video games, and other television-related products. A new Japanese-manufactured game sells cost $400. Because such games have a short life cycle and can be considered somewhat perishable, inv
> Brenda, in problem 43, wants to consider set- ting up a fixed-period inventory system for the 28-ounce bottle of Super Algaecide (SA) SKU. At the beginning of the current week, D. J. Kole, the materials manager, checked the inventory level and found 55 u
> Brenda opened a pool and spa store in a lively shop- ping mall and finds business to be booming but she often stocks out of key items customers want. She decides to experiment with inventory control methods, such as using a continuous review (fixed-order
> Cynthia Baker, manager of a large medical supply house that operates 50 weeks per year and six days per week, has decided to implement a fixed-period inventory system for all class A items. One such item has the following characteristics: If Cynthia wish
> If the EOQ 5 80 units, annual demand 5 500 units, and there are 50 weeks in a year, what is the fixed- order interval for a fixed-period system?
> Alice opens an aquarium store in a lively shop- ping mall and finds business to be booming, but she often stocks out of key items customers want. She decides to experiment with inventory-control methods, such as using a fixed-order quantity (FQS) and/or
> Tom’s Auto Service (TAS) is a regional quick-service vehicle oil-change and lubricant-change service somewhat similar to Jiffy Lube and Tuffy Tire & Auto Service. TAS seeks to differentiate its 32 stores from competition by focusing
> Using the information for Rapallo Sneakers, Inc. in Problem 38, how much could be saved by ordering the EOQ?
> Rapallo Sneakers, Inc. sells a pair of LG sneakers for $40. Due to the recent fitness craze, these shoes are in high demand: 45 pairs of shoes are sold per week. The ordering cost is $40 per order, and the annual holding cost is 20 percent of the selling
> What are the z-values for service levels of 80, 85, 90, 95, and 99 percent, assuming demand is normally distributed?
> If the order quantity is 220 units, inventory-carrying costs are 24 percent year, and each unit costs $18, what is the average cycle inventory? How much does it cost to carry this cycle inventory year?
> What is the inventory position if the on-hand quantity is 462 units, scheduled receipts are 200 units, and 130 units are on backorder?
> For Rambler Manufacturing in problems 49 and 50, would you rather invest the same amount of money to double the throughput rate of workstation B or C? Explain your reasoning.
> For Rambler Manufacturing in problem 49, suppose that sales of clutch plates 1, 2, and 3, respectively are 180, 300, and 200 units for the week, and workstation C works two shifts for a total of 90 hours this week. What is the workload in hours for the w
> Rambler Manufacturing produces three clutch plates for small automobiles at its factory in Columbus, Ohio. The three processes shown in Exhibit 11.32 are composed of common and different work activities to manufacture the clutch plates. Exhibit 11.33 pro
> Jefferson Manufacturing in problem 47 has another cellular layout and process shown in Exhibit 11.31. a. Where is the bottleneck workstation? Cite one TOC principle from Exhibit 11.23 that explains your answer. b. Where should the manager position extra
> Jefferson Manufacturing machines parts for assembly in air compressors. The process is shown in Exhibit 11.30. a. Where is the bottleneck workstation? Cite one TOC principle from Exhibit 11.22 that explains your answer. b. What is the longest throughput
> I know what we can do next; everything has been so successful so far,” said Kay Ebelhar, marketing services division manager. “How about designing and offering a courtesy service guarantee? We will promise to greet customers, give them our undivided atte
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> A manufacturer of air conditioner compressors is concerned that too much money is tied up in its value chain. Average raw material inventory is $50 million and work-in-process (WIP) production inventory is $20 million. Sales are $20 million per week and
> The Wilcox Student Health Center has just implemented a new computer system and service process to “improve efficiency.” The process flowchart and analysis framework is also provided. As pharmacy manager, you are conce
> What is the average time a loaf of sliced bread stays in an urban sandwich shop if the restaurant uses 46 loaves per day and they maintain an average inventory of 150 loaves?
> An accounting firm is capable of processing 20 EZ tax forms per day, and the average number of forms on-hand in the office is 64 forms. What is the average processing time per EZ tax form?
> A medical equipment testing and calibration service is depicted in Exhibit 11.28. The customer usually brings the equipment to the service center. The service process requires service technicians to per- form three process steps #1 to #3. Each technician
> How can you improve throughput for the process in part (b) of problem 35? Assume that all 17 workers have the ability to perform the work at each stage but that no additional workers may be hired.
