Operation Management - report

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Numbers Sheet Name Numbers Table Name Excel Worksheet Name
Instructions
Table 1 Instructions
Student Report 0
Table 1 Student Report 0
Student input 1
Table 1 Student input 1
Student Report 1
Table 1 Student Report 1
Student Input 2
Table 1 Student Input 2
Student Report 2
Table 1 Student Report 2
Student input 3
Table 1 Student input 3
Student Report 3
Table 1 Student Report 3
Student input 4
Table 1 Student input 4
Student Report 4
Table 1 Student Report 4
Student input 5
Table 1 Student input 5
Student Report 5
Table 1 Student Report 5

Instructions

Instructions
You have just been hired as the Operations Manager of a factory that builds speakers.
It is a fairly simple process where the following steps occur:
You receive weekly demands from your customers and you must try to fill those orders that week.
You order on Fridays for the demand that you expect for the next week and the material shows up Sunday before the work week. If you do not order enough that week, you will not be able to fill all of your orders (you have a stock out)
You have five employees that you can put at any of the five work stations. However, you can not hire more and you can't have more than one person at a workstation.
You make two different speakers (Model A and Model B). Each speaker has 5 components that are soldered together to make a solid state speaker.
The difference between Model A and B is that Model B is a higher end speaker and has two upgraded parts (Part 1 and Part 3).
The current process is set up as an assembly line. Each morning every employee goes to receiving and gathers enough parts to last them an hour. They then work on those parts and until they are finished and then go get another hours worth of parts. This effectively means that each person is spending about 10 minutes each hour stocking their area.
Everyone starts the day at the same time and everyone works until the work for that day is done.
The current workload has you people working overtime. The fully loaded pay (including insurance and taxes) is $18.12 per hour and everyone gets paid the same. Overtime is paid at time and a half.
Each week you team needs to make the following decisions
Review the information on the Student Report for that week. This first weekly report is Student Report 0
You will find a lot of information on the Student Report 0. Perhaps the most important part is the weekly demand data
Please notice that you have 11 weeks of demand before you started the job.
You also have the current demand for the first week that you are employed. In this case Model A total demand is 333 and Model B is 144
Fill out your team's Student input 1 to make your first decision
Please do not change the format of the page since the information will be used in this manner by the instructor
Decide how many Model A and Model B you want to make that week and put that informtion into the sheet
Decide which of your employees will work at each work station
Decide how many additional parts you need to order to meet the expected demand for the next week
And then decide what changes you want to make to the factory or the operations of the factory. You are allowed three requests to the CEO each week, so pick the things that you think will matter the most.
Submit the entire Excel worksheet back to D2L before the due date.

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Student Report 0

Week 0 Report
Total Costs $ 99,755 7 min 5 min 7 min 3 min
Total Revenue $ 124,122 Central Shipping Receive Part 1a Part 2 Part 3a Part 4 Part 5
Profit $ 24,367 and Receiving Step 1 Step 2 Step 3 Step 4 Package Label Pickup
Part 1b Part 3b Finished Assembly Ready to ship
Week 1 demand
Model A 333 Customer Satisfaction 85%
Model B 144
Employee Employee Assignment
Inventory Accuracy Step 1 Step 2 Step 3 Step 4 S&R Work Station 1 2 3 4 S&R
Part 1a 328 Joshua 0.98 0.98 0.98 0.98 0.98 Employee Joshua Jessica Jim Jennifer Jeff
Part 1b 155 Jessica 0.75 0.97 0.97 0.97 0.97
Part 2 462 Jim 0.75 0.98 0.98 0.98 0.98
Part 3a 302 Jennifer 0.95 0.95 0.95 0.95 0.95
Part 3b 155 Jeff 0.75 0.75 0.75 0.75 0.94
Part 4 462
Part 5 462
Model A 0
Model B 0
Parts Current Supplier Alt Supplier 1 Alt Supplier 2
Labor cost $ 3,566.62 Returns Model A Model B Part 1a Cost $25 $27 $28
Inventory holding cost $539.97 Returns for next period 72 31 Part 1a quality 0.97 0.98 0.995
Cost of inaccurate inventory $ 779.96 Defects due to raw materials 32 14 Part 1b Cost $41 $40 $38
Transportation costs $ 700.00 Defects due to processes 26 11 Part 1b quality 0.97 0.98 0.995
Material Cost $ 91,168.00 Erroneous shipments 14 6 Part 2 Cost $45 $50 $61
Equipment Maintenance costs $ 3,000.00 Part 2 quality 0.97 0.98 0.995
Part 3a Cost $36 $39 $41
Part 3a quality 0.97 0.98 0.995
Part 3b Cost $46 $53 $55
Part 3b quality 0.97 0.98 0.995
Part 4 Cost $112 $105 $107
Part 4 quality 0.97 0.98 0.995
Part 5 Cost $54 $57 $55
Part 5 quality 0.97 0.98 0.995
a $272 $278 $292
b $298 $305 $316
Demand
Model A Previous Weeks Current
Customer Week 1 Week2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9 Week 10 Week 11 Week 1
1 31 35 36 36 34 35 36 33 32 36 35 34
2 70 75 78 84 88 93 99 104 110 115 120 127
3 88 100 119 135 151 88 103 120 140 148 91 100
Returns 72 119 151 151 151 82 65 71 77 85 90 72
Total 261 329 384 406 424 298 303 328 359 384 336 333
Model B Previous Weeks Current
Customer Week 1 Week2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9 Week 10 Week 11 Week 1
1 16 17 14 14 14 15 16 16 17 14 17 15
2 30 30 31 33 33 30 31 33 33 29 27 31
3 31 36 37 41 44 45 49 52 59 63 66 67
Returns 31 48 71 71 71 27 27 29 30 33 32 31
Total 108 131 153 159 162 117 123 130 139 139 142 144
369 460 537 565 586 415 426 458 498 523 478

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Student input 1

Week 1 This is the first decision that you will make. The information on Student Report 0 will help you make your decisions.
3 requests for CEO 1 Jeff needs more training in all steps to have a better accuracy percentage. Jessica and Jim need more training for step 1.
2 Jennifer needs more training in all steps to have a better accuracy percentage.
3 Jessica and Jim need more training in Step one to improve there accuracy percentage.
How much to make Quantity Model A assemblies are made first, then Model B assemblies
Model A 302 Model A consists of parts 1a, 2, 3a, 4, and 5
Model B 144 Model B consists of parts 1b, 2, 3b, 4, and 5
Part 1a Part 1b Part 2 Part 3a Part 3b Part 4 Part 5
How much to order 385 160 555 411 160 555 555 All orders are placed on Monday and arrive on Sunday
Manpower You can put any employee in any of the work stations. Changing work stations does not count as a request/question to CEO
Work Station 1 2 3 4 S&R You cannot request more employees. The CEO says that you have to do the job with the people you currently have working.
Employee Joshua Jim Jessica Jennifer Jeff
Current employees to choose from
Joshua Jessica Jennifer Jim Jeff

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Student Report 1

Week 1 Report
Total Costs $ 136,294 7 min 5 min 7 min 3 min
Total Revenue $ 165,561 Central Shipping Receive Part 1a Part 2 Part 3a Part 4 Part 5
Profit $ 29,267 and Receiving Step 1 Step 2 Step 3 Step 4 Package Label Pickup
Part 1b Part 3b Finished Assembly Ready to ship
Week 2 demand Items made Week 1
Model A 354 Model A 302 Customer Satisfaction 83%
Model B 146 Model B 144
Employee
Inventory Accuracy Step 1 Step 2 Step 3 Step 4 S&R Questions/requests Reply
Part 1a 411 Joshua 0.99 0.99 0.99 0.99 0.99 1 All of the training has been done
Part 1b 171 Jessica 0.985 0.985 0.985 0.985 0.985 2 The CEO is a big believer in training and trained all employees on every workstation. You should see that the accuracy went up and your defects/returns due to processes improved as well
Part 2 571 Jim 0.99 0.99 0.99 0.99 0.99 3 The CEO also trained everyone in quality, so you are ready to start quality initiatives
Part 3a 411 Jennifer 0.975 0.975 0.975 0.975 0.975
Part 3b 171 Jeff 0.97 0.97 0.97 0.97 0.97
Part 4 571
Part 5 571
Model A 0
Model B 0
Parts Current Supplier Alt Supplier 1 Alt Supplier 2
Labor cost $ 5,440.53 Returns Model A Model B Part 1a Cost $25 $27 $28
Inventory holding cost $750.23 Returns for next period 70 32 Part 1a quality 0.97 0.98 0.995
Cost of inaccurate inventory $ 1,083.66 Defects due to raw materials 43 20 Part 1b Cost $41 $40 $38
Transportation costs $ 964.00 Defects due to processes 18 8 Part 1b quality 0.97 0.98 0.995
Material Cost $ 125,056.00 Erroneous shipments 9 4 Part 2 Cost $45 $50 $61
Equipment Maintenance costs $ 3,000.00 Part 2 quality 0.97 0.98 0.995
Part 3a Cost $36 $39 $41
Part 3a quality 0.97 0.98 0.995
Part 3b Cost $46 $53 $55
Part 3b quality 0.97 0.98 0.995
Part 4 Cost $112 $105 $107
Part 4 quality 0.97 0.98 0.995
Part 5 Cost $54 $57 $55
Part 5 quality 0.97 0.98 0.995
Demand
Model A Previous Weeks Current
Customer Week 1 Week2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9 Week 10 Week 11 Week 1 Week 2
1 31 35 36 36 34 35 36 33 32 36 35 34 31
2 70 75 78 84 88 93 99 104 110 115 120 127 134
3 88 100 119 135 151 88 103 120 140 148 91 100 119
Returns 72 119 151 151 151 82 65 71 77 85 90 72 70
Total 261 329 384 406 424 298 303 328 359 384 336 333 354
Model B Previous Weeks Current
Customer Week 1 Week2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9 Week 10 Week 11 Week 1 Week 2
1 16 17 14 14 14 15 16 16 17 14 17 15 15
2 30 30 31 33 33 30 31 33 33 29 27 31 29
3 31 36 37 41 44 45 49 52 59 63 66 67 70
Returns 31 48 71 71 71 27 27 29 30 33 32 31 32
Total 108 131 153 159 162 117 123 130 139 139 142 144 146

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Student Input 2

Week 2 This is the second decision that you will make. The information on Student Report 1 will help you make your decisions.
3 requests for CEO 1. On Part 1b - Go to Alt Supplier #2 - cheaper and better quality.
2. On Part 4 - Go to Alt Supplier #2 - cheaper and better quality.
3. On Part 5 - Go to Alt Supplier #2 - Only $1 increase but better quality. Money saved from other 2 requests will cover this increase for this part.
How much to make Quantity Model A assemblies are made first, then Model B assemblies
Model A 385 Model A consists of parts 1a, 2, 3a, 4, and 5
Model B 146 Model B consists of parts 1b, 2, 3b, 4, and 5
Part 1a Part 1b Part 2 Part 3a Part 3b Part 4 Part 5
How much to order 354 135 500 354 135 500 500 All orders are placed on Monday and arrive on Sunday
Manpower You can put any employee in any of the work stations. Changing work stations does not count as a request/question to CEO
Work Station 1 2 3 4 S&R You cannot request more employees. The CEO says that you have to do the job with the people you currently have working.
Employee Jim Joshua Jessica Jennifer Jeff

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Student Report 2

Week 2 Report
Total Costs $ 171,669 12 min 10 min
Total Revenue $ 177,582 Central Shipping Receive Part 1a Part 2 Part 3a Part 4 Part 5
Profit $ 5,913 and Receiving Step 1 Step 2 Package Label Pickup
Part 1b Part 3b Finished Assembly Ready to ship
Week 3 demand Items made Week 2
Model A 403 Model A 385 Customer Satisfaction 80%
Model B 157 Model B 146
Employee
Inventory Accuracy Step 1 Step 2 Step 3 Step 4 S&R Questions/requests Reply
Part 1a 380 Joshua 0.99 0.99 0.99 0.99 0.99 1 The instructions say that you must order all of your parts from one vendor. So, since all three of your requests asked to go to Alt Supplier #2, I switched all parts to Alt Supplier #2
Part 1b 160 Jessica 0.985 0.985 0.985 0.985 0.985 2
Part 2 540 Jim 0.99 0.99 0.99 0.99 0.99 3
Part 3a 380 Jennifer 0.975 0.975 0.975 0.975 0.975
Part 3b 160 Jeff 0.97 0.97 0.97 0.97 0.97
Part 4 540
Part 5 540
Model A 31
Model B 0
Parts Current Supplier Alt Supplier 1 Alt Supplier 2
Labor cost $ 6,659.10 Returns Model A Model B Part 1a Cost $25 $27 $28
Inventory holding cost $974.20 Returns for next period 86 33 Part 1a quality 0.97 0.98 0.995
Cost of inaccurate inventory $ 1,407.17 Defects due to raw materials 54 21 Part 1b Cost $41 $40 $38
Transportation costs $ 1,073.00 Defects due to processes 21 8 Part 1b quality 0.97 0.98 0.995
Material Cost $ 158,556.00 Erroneous shipments 11 4 Part 2 Cost $45 $50 $61
Equipment Maintenance costs $ 3,000.00 Part 2 quality 0.97 0.98 0.995
Part 3a Cost $36 $39 $41
Part 3a quality 0.97 0.98 0.995
Part 3b Cost $46 $53 $55
Part 3b quality 0.97 0.98 0.995
Part 4 Cost $112 $105 $107
Part 4 quality 0.97 0.98 0.995
Part 5 Cost $54 $57 $55
Part 5 quality 0.97 0.98 0.995
Demand
Model A Previous Weeks Current
Customer Week 1 Week2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9 Week 10 Week 11 Week 1 Week 2 Week 3
1 31 35 36 36 34 35 36 33 32 36 35 34 31 30
2 70 75 78 84 88 93 99 104 110 115 120 127 134 141
3 88 100 119 135 151 88 103 120 140 148 91 100 119 146
Returns 72 119 151 151 151 82 65 71 77 85 90 72 70 86
Total 261 329 384 406 424 298 303 328 359 384 336 333 354 403
Model B Previous Weeks Current
Customer Week 1 Week2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9 Week 10 Week 11 Week 1 Week 2 Week 3
1 16 17 14 14 14 15 16 16 17 14 17 15 15 13
2 30 30 31 33 33 30 31 33 33 29 27 31 29 33
3 31 36 37 41 44 45 49 52 59 63 66 67 70 78
Returns 31 48 71 71 71 27 27 29 30 33 32 31 32 33
Total 108 131 153 159 162 117 123 130 139 139 142 144 146 157

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Student input 3

Week 3 This is the third decision that you will make. The information on Student Report 2 will help you make your decisions.
3 requests for CEO 1. Additional training for Jeff in all steps
2. Change to Supplier #1 for all parts
3. Change the step process to allocate the fastest steps completed first.
How much to make Quantity Model A assemblies are made first, then Model B assemblies
Model A 372 Model A consists of parts 1a, 2, 3a, 4, and 5
Model B 157 Model B consists of parts 1b, 2, 3b, 4, and 5
Part 1a Part 1b Part 2 Part 3a Part 3b Part 4 Part 5
How much to order 427 172 599 427 172 599 599 All orders are placed on Monday and arrive on Sunday
Manpower You can put any employee in any of the work stations. Changing work stations does not count as a request/question to CEO
Work Station 1 2 3 4 S&R You cannot request more employees. The CEO says that you have to do the job with the people you currently have working.
Employee JOSH JESS JEN JEFF JIM

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Student Report 3

Week 3 Report
Total Costs $ 163,427 7 min 5 min 7 min 3 min
Total Revenue $ 183,330 Central Shipping Receive Part 1a Part 2 Part 3a Part 4 Part 5
Profit $ 19,903 and Receiving Step 1 Step 2 Step 3 Step 4 Package Label Pickup
Part 1b Part 3b Finished Assembly Ready to ship
Week 4 demand Items made Week 3
Model A 386 Model A 372 Customer Satisfaction 78%
Model B 153 Model B 157
Employee
Inventory Accuracy Step 1 Step 2 Step 3 Step 4 S&R Questions/requests Reply
Part 1a 435 Joshua 0.99 0.99 0.99 0.99 0.99 1 The boss said no more training right now
Part 1b 175 Jessica 0.985 0.985 0.985 0.985 0.985 2 Done, this will reduce the overall cost of your material
Part 2 610 Jim 0.99 0.99 0.99 0.99 0.99 3 The process has been changed and you will see a decrease in the amount of time it takes to produce all of your speakers
Part 3a 435 Jennifer 0.975 0.975 0.975 0.975 0.975
Part 3b 175 Jeff 0.97 0.97 0.97 0.97 0.97 You do need to find a way to reduce the returns. What are things you can do from a Quality Management standpoint?
Part 4 610
Part 5 610
Model A 0
Model B 0
Parts Current Supplier Alt Supplier 1 Alt Supplier 2
Labor cost $ 5,859.56 Returns Model A Model B Part 1a Cost $25 $27 $28
Inventory holding cost $871.38 Returns for next period 69 29 Part 1a quality 0.97 0.98 0.995
Cost of inaccurate inventory $ 1,258.67 Defects due to raw materials 36 15 Part 1b Cost $41 $40 $38
Transportation costs $ 1,136.50 Defects due to processes 29 12 Part 1b quality 0.97 0.98 0.995
Material Cost $ 151,301.00 Erroneous shipments 4 2 Part 2 Cost $45 $50 $61
Equipment Maintenance costs $ 3,000.00 Part 2 quality 0.97 0.98 0.995
Part 3a Cost $36 $39 $41
Part 3a quality 0.97 0.98 0.995
Part 3b Cost $46 $53 $55
Part 3b quality 0.97 0.98 0.995
Part 4 Cost $112 $105 $107
Part 4 quality 0.97 0.98 0.995
Part 5 Cost $54 $57 $55
Part 5 quality 0.97 0.98 0.995
Demand
Model A Previous Weeks Current
Customer Week 1 Week2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9 Week 10 Week 11 Week 1 Week 2 Week 3 Week 4
1 31 35 36 36 34 35 36 33 32 36 35 34 31 30 30
2 70 75 78 84 88 93 99 104 110 115 120 127 134 141 141
3 88 100 119 135 151 88 103 120 140 148 91 100 119 146 146
Returns 72 119 151 151 151 82 65 71 77 85 90 72 70 86 69
Total 261 329 384 406 424 298 303 328 359 384 336 333 354 468 386
Model B Previous Weeks Current
Customer Week 1 Week2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9 Week 10 Week 11 Week 1 Week 2 Week 3 Week 4
1 16 17 14 14 14 15 16 16 17 14 17 15 15 13 13
2 30 30 31 33 33 30 31 33 33 29 27 31 29 33 33
3 31 36 37 41 44 45 49 52 59 63 66 67 70 78 78
Returns 31 48 71 71 71 27 27 29 30 33 32 31 32 33 29
Total 108 131 153 159 162 117 123 130 139 139 142 144 146 195 153

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Student input 4

Week 4 This is the fourth decision that you will make. The information on Student Report 3 will help you make your decisions.
3 requests for CEO 1 Implement a poka-yoke application to avoid simple human errors in the production of the speakers.
2 Implement six sigma to find and eliminate causes of defects and errors in the manufacturing and service process.
3 Evaluate the quality using the gap model method.
How much to make Quantity Model A assemblies are made first, then Model B assemblies
Model A 386 Model A consists of parts 1a, 2, 3a, 4, and 5
Model B 153 Model B consists of parts 1b, 2, 3b, 4, and 5
Part 1a Part 1b Part 2 Part 3a Part 3b Part 4 Part 5
How much to order 361 148 509 361 148 509 509 All orders are placed on Monday and arrive on Sunday
Manpower You can put any employee in any of the work stations. Changing work stations does not count as a request/question to CEO
Work Station 1 2 3 4 S&R You cannot request more employees. The CEO says that you have to do the job with the people you currently have working.
Employee JOSH JESS JEN JEFF JIM

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Student Report 4

Week 4 Report
Total Costs $ 161,784 7 min 5 min 7 min 3 min
Total Revenue $ 152,427 Central Shipping Receive Part 1a Part 2 Part 3a Part 4 Part 5
Profit $ (9,357) and Receiving Step 1 Step 2 Step 3 Step 4 Package Label Pickup
Part 1b Part 3b Finished Assembly Ready to ship
Week 5 demand Items made Week 4
Model A 319 Model A 386 Customer Satisfaction 78%
Model B 146 Model B 153
Employee
Inventory Accuracy Step 1 Step 2 Step 3 Step 4 S&R Questions/requests Reply
Part 1a 410 Joshua 0.99 0.99 0.99 0.99 0.99 1 These are just buzz words. What are you really asking to do?
Part 1b 170 Jessica 0.985 0.985 0.985 0.985 0.985 2 These are just buzz words. What are you really asking to do?
Part 2 580 Jim 0.99 0.99 0.99 0.99 0.99 3 These are just buzz words. What are you really asking to do?
Part 3a 410 Jennifer 0.975 0.975 0.975 0.975 0.975
Part 3b 170 Jeff 0.97 0.97 0.97 0.97 0.97 You have earned just over $45k for the four weeks of managing the operations. At this point these results should be much higher ($80k+) Here are some things that you have done right, and things you could have fixed
Part 4 580 You did a very good job of training your employees early and switching your process to free up some time. You also switched to a supplier that had better quality parts.
Part 5 580 However, you could have addressed the quality issue more directly by inspecting parts when they arrived or inspecting assemblies along the way
Model A 62 Other things that you could have addressed were performing physical inventories which would have reduced you cost of inaccurate inventory
Model B 36 The last thing is that you ended up with too much inventory which actually caused you to lose money this last round
Parts Current Supplier Alt Supplier 1 Alt Supplier 2
Labor cost $ 4,464.32 Returns Model A Model B Part 1a Cost $25 $27 $28
Inventory holding cost $1,142.67 Returns for next period 105 42 Part 1a quality 0.97 0.98 0.995
Cost of inaccurate inventory $ 1,650.52 Defects due to raw materials 55 22 Part 1b Cost $41 $40 $38
Transportation costs $ 940.50 Defects due to processes 44 18 Part 1b quality 0.97 0.98 0.995
Material Cost $ 150,586.00 Erroneous shipments 6 2 Part 2 Cost $45 $50 $61
Equipment Maintenance costs $ 3,000.00 Part 2 quality 0.97 0.98 0.995
Part 3a Cost $36 $39 $41
Part 3a quality 0.97 0.98 0.995
Part 3b Cost $46 $53 $55
Part 3b quality 0.97 0.98 0.995
Part 4 Cost $112 $105 $107
Part 4 quality 0.97 0.98 0.995
Part 5 Cost $54 $57 $55
Part 5 quality 0.97 0.98 0.995
Demand
Model A Previous Weeks Current
Customer Week 1 Week2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9 Week 10 Week 11 Week 1 Week 2 Week 3 Week 4
1 31 35 36 36 34 35 36 33 32 36 35 34 31 30 30
2 70 75 78 84 88 93 99 104 110 115 120 127 134 141 141
3 88 100 119 135 151 88 103 120 140 148 91 100 119 146 146
Returns 72 119 151 151 151 82 65 71 77 85 90 72 56 68 69
Total 261 329 384 406 424 298 303 328 359 384 336 333 340 468 386
Model B Previous Weeks Current
Customer Week 1 Week2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9 Week 10 Week 11 Week 1 Week 2 Week 3 Week 4
1 16 17 14 14 14 15 16 16 17 14 17 15 15 13 13
2 30 30 31 33 33 30 31 33 33 29 27 31 29 33 33
3 31 36 37 41 44 45 49 52 59 63 66 67 70 78 78
Returns 31 48 71 71 71 27 27 29 30 33 32 31 26 26 29
Total 108 131 153 159 162 117 123 130 139 139 142 144 140 195 153

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Student input 5

Student

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Student Report 5

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