Operations Management
ajatho
MGMT3060MAY2020ASSIGNMENTandMARKKEY1.pdf
MGMT3036 Operations Planning and Control
Course Code and Title: MGMT3060 Operations Planning and Control
FINAL ASSIGNMENT
DUE DATE:
INSTRUCTIONS TO CANDIDATES: This paper has 4 pages and 3 questions.
YOU ARE REQUIRED TO ANSWER ALL QUESTIONS
EACH QUESTION IS WORTH 25 MARKS
THE UNIVERSITY OF THE WEST INDIES
OPEN CAMPUS
SEMESTER 2 2019-2020
MGMT3036 Operations Planning and Control
QUESTION 1
The following is a BOM/product tree diagram for product A. Sixty (60) units of the product are required
in week 9. The beginning inventory for the components are given in the table below.
Component A B C D E F
Beginning Inventory
30 0 10 0 60 70
The lot sizes for the components are as follows:-
Component A B C D E F
Lot Size Lot for lot Lot for lot 100 100 100 Lot for lot
Required:
a. Formulate equations that will be used to calculate the gross requirements for all components (A,
B, C, D, E and F) [5 marks]
b. Calculate the gross requirements for E and the planned order release for F. [18 marks]
c. When should orders be placed for component D? [2 marks]
[TOTAL 25 MARKS]
MGMT3036 Operations Planning and Control
QUESTION 2
Mrs. Rosi is a coconut vendor in the middle of the city. The coconut water business is a growing
business as consumers are looking for healthier alternatives to soda. Sales are increasing and Mrs. Rosi
has a relatively large customer base. Her customers like the fresh coconut water and Mrs. Rosi would try
her best to ensure that she does not run out of stock. At the same time, she does not want to hold too
much stock as these products are highly perishable.
Her records show that the demand for coconut water is normally distributed with a mean of 300
coconuts per day with a standard deviation of 30 coconuts. Her business is opened 250 days in the year.
The price for a coconut is $5. The holding cost is 20% of the selling price and the costs of placing an
order is $150. The lead-time is 3 days. Mrs. Rosi wants to maintain a service level of 98% which is
equivalent to a Z value of 3.
I. Calculate the annual demand for the coconuts. [2 marks]
II. Calculate the EOQ. [3 marks]
III. Calculate the optimal number of orders. [2 marks]
IV. Calculate the time between orders. [2 marks]
V. Calculate the total annual inventory costs of ordering the EOQ
[5 marks]
VI. Calculate the reorder point. [6 marks]
VII. If Mrs. Rosi currently orders 900 coconuts every time she places an order, what is the total
annual costs of this policy? [5 marks]
[TOTAL 25 MARKS]
QUESTION 3
A company employs plumbers to service, repair and replace pipes and other fittings for customers
throughout the country. These plumbers are based at different locations. Four requests for service
have been received and the company finds that four plumbers are available. The distances each of the
plumbers is from the various customers are given in the following table. The company wishes to assign
plumbers to customers to minimise the total distance to be travelled.
PLUMBERS CUSTOMERS
1 2 3 4
1 25 18 23 14
2 38 15 53 23
3 15 17 41 30
4 26 28 36 29
MGMT3036 Operations Planning and Control
a. Using the Hungarian (manual) method, determine the optimal assignment of plumbers to
customers in order to minimize the total distance travelled. Indicate this overall distance and
show all working. [12 marks]
b. Write an LP formulation that could be used to solve this problem with the relevant LP software
packages. [13 marks]
[TOTAL 25 MARKS]
QUESTION 4
A manufacturer of car transmissions wants to develop a cost estimate for a customer’s order for 25
transmissions. It is estimated that the first transmission will take 100 hours of shop time and an 80%
learning curve is expected. Using the learning curve tables:-
a. How many labour-hours should the 25th transmission require? [5 marks]
b. How many labour-hours should the whole order for 25 transmission require? [5 marks]
c. If the labour hour rate is $50 per hour and the pricing policy of the company is to double the
labour costs of the order, what is the customer price for each transmission? [6 marks]
d. Total Quality Management (TQM) can be an excellent quality management technique if properly
implemented. Discuss the obstacles associated with the implementation of TQM. [9 marks]
MGMT3036 Operations Planning and Control
ITEM:
Period 0 1 2 3 4 5 6 7 8 9 10
Gross Requirements
Net requirements
Net receipts
ITEM:
Period 0 1 2 3 4 5 6 7 8 9 10
Gross Requirements
Net requirements
Net receipts
ITEM:
Period 0 1 2 3 4 5 6 7 8 9 10
Gross Requirements
Net requirements
Net receipts
ITEM:
Period 0 1 2 3 4 5 6 7 8 9 10
Gross Requirements
Net requirements
Net receipts
[ IF YOU USE THEM PLEASE DIS-ATTACH THESE PAGES ONLY AND INCLUDE WITH YOUR ANWER BOOK - DO NOT ATTACH THE REST OF
THE QUESTION PAPER
BLANK MRP SCHEDULES STUDENT NUMBER:
Planned order release
Planned order release
Planned order release
Planned order release
On Hand Inventory -
Ending
On Hand Inventory -
Ending
On Hand Inventory -
Ending
On Hand Inventory -
Ending
MGMT3036 Operations Planning and Control
ITEM:
Period 0 1 2 3 4 5 6 7 8 9 10
Gross Requirements
Net requirements
Net receipts
ITEM:
Period 0 1 2 3 4 5 6 7 8 9 10
Gross Requirements
Net requirements
Net receipts
ITEM:
Period 0 1 2 3 4 5 6 7 8 9 10
Gross Requirements
Net requirements
Net receipts
ITEM:
Period 0 1 2 3 4 5 6 7 8 9 10
Gross Requirements
Net requirements
Net receipts
[ IF YOU USE THEM PLEASE DIS-ATTACH THESE PAGES ONLY AND INCLUDE WITH YOUR ANWER BOOK - DO NOT ATTACH THE REST OF
THE QUESTION PAPER
BLANK MRP SCHEDULES STUDENT NUMBER:
Planned order release
Planned order release
Planned order release
Planned order release
On Hand Inventory -
Ending
On Hand Inventory -
Ending
On Hand Inventory -
Ending
On Hand Inventory -
Ending
MGMT3036 Operations Planning and Control
MGMT3036 Operations Planning and Control
END OF ASSIGNMENT
Course Code and Title: MGMT3060 Operations Planning and Control
FINAL ASSIGNMENT-Mark Key
QUESTION 1
The following is a BOM/product tree diagram for product A. Sixty (60) units of the product are required
in week 9. The beginning inventory for the components are given in the table below.
Component A B C D E F
Beginning Inventory
30 0 10 0 60 70
The lot sizes for the components are as follows:-
Component A B C D E F
Lot Size Lot for lot Lot for lot 100 100 100 Lot for lot
MGMT3036 Operations Planning and Control
Required:
a. Formulate equations that will be used to calculate the gross requirements for all components (B,
C, D, E and F) [5 marks]
1 mark for C, 1 mark for B, 1 mark for D, 1 mark for E and 1 mark for F.
b. Calculate the gross requirements for E and the planned order release for F. Show all working by
using the schedules. [18 marks]
3 marks each for schedule A, B, C and D (3x4= 12 marks) and 2 marks for the gross requirements
in schedule E(2x3= 6 marks
c. When should orders be placed for component E? [2 marks]
2 marks each (2x3=6).
[TOTAL 25 MARKS]
MGMT3036 Operations Planning and Control
QUESTION 2
Mrs. Rosi is a coconut vendor in the middle of the city. The coconut water business is a growing
business as consumers are looking for healthier alternatives to soda. Sales are increasing and Mrs. Rosi
has a relatively large customer base. Her customers like the fresh coconut water and Mrs. Rosi would try
her best to ensure that she does not run out of stock. At the same time, she does not want to hold too
much stock as these products are highly perishable.
Her records show that the demand for coconut water is normally distributed with a mean of 300
coconuts per day with a standard deviation of 30 coconuts. Her business is opened 250 days in the year.
The price for a coconut is $5. The holding cost is 20% of the selling price and the costs of placing an
order is $160. The lead-time is 3 days. Mrs. Rosi wants to maintain a service level of 98% which is
equivalent to a Z value of 3.
I. Calculate the annual demand for the coconuts. [2 marks]
1 mark for the correct formula and 1 mark for the correct answer.
II. Calculate the EOQ. [3 marks]
1 mark for the correct formula and 2 marks for the correct answer.
III. Calculate the optimal number of orders. [2 marks]
1 mark for the correct formula and 1 mark for the correct answer.
IV. Calculate the time between orders. [2 marks]
1 mark for the correct formula and 1 mark for the correct answer.
V. Calculate the total annual inventory costs of ordering the EOQ [5 marks]
2 marks for the correct formula and 3 marks for the correct answer.
VI. Calculate the reorder point. [6 marks]
2 marks for the correct formula and 4 marks for the correct answer.
VII. If Mrs. Rosi currently orders 900 coconuts every time she places an order, what is the total
annual costs of this policy? [5 marks]
2 marks for the correct formula and 4 marks for the correct answer.
[TOTAL 25 MARKS]
MGMT3036 Operations Planning and Control
QUESTION 3
A company employs plumbers to service, repair and replace pipes and other fittings for customers
throughout the country. These plumbers are based at different locations. Four requests for service
have been received and the company finds that four plumbers are available. The distances each of the
plumbers is from the various customers are given in the following table. The company wishes to assign
plumbers to customers to minimise the total distance to be travelled.
PLUMBERS CUSTOMERS
1 2 3 4
1 25 18 23 14
2 38 15 53 23
3 15 17 41 30
4 26 28 36 29
a. Using the Hungarian (manual) method, determine the optimal assignment of plumbers to
customers in order to minimize the total distance travelled. Indicate this overall distance and
show all working. [12 marks]
2 marks for the correct row penalties, 2 marks for the correct column penalties, 4 marks for
the correct crossing out of zeroes, 2 marks for the correct assignments and 2 marks for the
calculation of the correct total distance totalling 12 marks.
b. Write an LP formulation that could be used to solve this problem with the relevant LP software
packages. [13 marks]
4 marks for the objective function, 4 marks for the customers’ constraints, 4 marks for plumbers’
constraints and 1 mark for the non-negativity constraint totaling 13 marks.
[TOTAL 25 MARKS]
QUESTION 4
a. How many labour-hours should the 25th transmission require? [5 marks]
2 marks for correct formula and 3 marks for the correct calculation.
b. How many labour-hours should the whole order for 25 transmission require? [5 marks]
2 marks for the correct formula and 3 marks for the correct calculation.
c. If the labour hour rate is $50 per hour and the pricing policy of the company is to double the
labour costs of the order, what is the customer price for each transmission? [6 marks]
2 marks for the correct formula and 4 marks for correct calculation
d. Total Quality Management (TQM) can be an excellent quality management technique if properly
implemented. Discuss the obstacles associated with the implementation of TQM. [9 marks]
The student should discuss at least 4 points.
1 mark for defining TQM and 2 marks for each correct point adequately discussed.
