Week Two Individual Assignment
Iscom/305 - Systems operations management
May 11, 2015
Week Two Individual Assignment
Annandale= $ 40,000 in 250 hours, per hour production is 40000/250 =160 Blacksburg = $12,000 in 60 hours, per hour productivity is 12000/60= 200 Charlottesville = $60,000 in 500 hours per hour productivity 60000/500=120 Danville = $25000 in 200 hours per hour productivity is 25000/200= 50 The location with the highest productivity
Using the per hour production, Blacksburg has the highest labor productivity as stated with the number of sales per hour. Problem 1-2
Annandale at $6.75 an hour, and rent $1800, labor 250
Blacksburg pays $6.50 an hour, rent $1200, labor hours 60
Charlottesville $6, rent $2000, labor hour 500
Danville $5.50, rent $800, labor hour 200
Therefore for cost of production would be
Annandale= (6.75 X250) + 1800= 3487.50
Blacksburg = (6.50 X 60) + 2000= 2390
Charlottesville = (6 X 500) + 1200= 4200
Daville = (5.5 X 200) +800= 1900
The most productive site is will be gotten by finding the ratio of sales and cost of production. Annandale =$ 40,000/3487.50= 11.45
Blacksburg= 12,000/2390 = 5.02
Charlottesville =$60,000/4200= 14.29
Daville = $25000/1900= 13.16
Blacksburg remains the one with the biggest productivity due to the lowest ratio b.
To know the store to close using the cost multifactor will depend on the ratio of the cost of labor and the total cost of productivity. Therefore
Cost of labor
Annandale= (6.75 X250)/3487.50= 0.48
Blacksburg = (6.50 X 60)/2390 = 0.16
Charlottesville = (6 X 500)/4200= 0.71
Daville = (5.5 X 200)/1900= 0.58
The company can close the Charlottesville location, but deliberation of other things such as consumer satisfaction, the need to serve the market, the market effectiveness as well as the raw materials required in the region. Problem 2-1
(Please see excel file given)
a. Looking at the percentage failure cost as a percentage of total quality for the years, it is easy to tell that the company has been decreasing for the last five years. The increase in failure may be attributed to factors such as failure of the supply chain or reduction in sound management in the company. Also, the trend may be, because of the growth in the cost of production. b.
The company quality strategy in the five years percentage keeps on shifting. The avoidance of failure has risen over five years meaning that the business has taken considerable attention to giving superiority to the consumers. c.
Looking at the index values of the organization one may not be able to guess the quality management given that there are minor fluctuations detailed as per the index values is apprehensive. If they were steady, it would be possible to make a proper assumption. d. The appraisal cost and the prevention cost are the primary quality associated cost that might result from the manufacture of parkas in the company.
Russell, R., & Taylor III, B. W. (2011). Operations Management. Creating Value Along the Supply Chain (7th ed.). Hanboken, NJ: John Wiley & Sons Inc..
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