Pert-Cpm and Transportation Problem Technique

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The IIMMPC is a producer’s cooperative composed of small scale manufacturers from Iligan City and Lanao del Norte. It was organized in 2007 to enable the members to engage in big projects that cannot be done singly by any member cooperators but only through the joint efforts of all the member-cooperators. The members of the cooperative come from the different sectors of manufacturing business. These include the food sector, the gift, toys and housewares (GTH) sector, the bamboo products sector and the furniture sector.

1n 2007, the IIMMPC through the furniture sector participated in the bidding for the supply of various school furnitures for the Department of Education of Region 10. The IIMMPC got the project at the winning bid of about P3,000,000.00. The duration of the project was 90 calendar days. The work was divided by the six furniture makers of the cooperative. In 2008, the IIMMPC again won two projects to supply the school furnitures requirements of DepEd- Region 10 and DepED-Lanao del Norte for a combined amount of about P 6,000,000.00. The work was divided by the seven furniture members of the cooperative (a new furniture maker was added). In 2009, the IIMMPC was able to win three projects – to supply the school furnitures requirements of DepEd- Region 10, DepEd-Lanao del Norte ,and DepEd-Region 7 (Negros, Cebu,Bohol) for a combined amount of about P 9,000,000.00. The work was divided by the eight furniture members of the cooperative with a new furniture maker based in Cebu City was added to help supply the Region 7 project.

This study will deal with the use of the quantitative tools of PERT-CPM and Transportation Problem Technique in providing assistance in solving the existing and potential problem of IIMMPC regarding production planning and scheduling and delivery cost minimization. STATEMENT OF THE PROBLEM

With the increasing volume of works and the increasing vista of opportunity, the IIMMPC particularly the furniture maker/members are faced with various production and delivery problems. All DepEd projects are penalty project. Suppliers will be fined 1% of the amount of the items undelivered per day of delay in delivery. Furthermore, the DepEd is very particular with quality. Inspection has to be requested before the items are delivered. One of the major cost elements of IIMMPC is the delivery or transportation cost. In anticipation to the possibility of getting projects in the R -13 (Caraga Region), in R-11 ( Davao), R-12 (Cotabato), R-9(Dipolog and Pagadian, Zamboanga ), in addition to the regular project in R-10( Misamis Oriental, Misamis Occidental, Bukidnon, and Lanao del Norte), the Cooperative is planning to set up other production centers on other parts of Mindanao possibly in Cagayan de OroCity and Butuan City.

This study will aim to answer the following problems:
1. What quantitative tool can be used by IIMPC in planning and controlling production to be able to deliver on time ( and prevent being penalized and possibly be blacklisted) 2. How can the IIMMPC use this production planning and control method. 3. What quantitative tool can be used by IIMMPC in minimizing delivery expenses if ever the coop will set up other production centers in other areas in Mindanao. 4. How can the IIMMPC use this quantitative method in minimizing delivery cost.

This study will demonstrate to the IIMPC the importance of the use of quantitative tools in planning, controlling and monitoring their production and delivery system.
To the businessman cooperators, using this tool could help minimize their cost of production, delivery, and other cost thereby improving their profitability.
Using the appropriate quantitative method can help the cooperative improve their delivery performance thereby saving penalty fines and prevent being blacklisted by the DepEd.
The IIMPC can be helped by these...
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