National Cranberry is a cooperative of berry growers around North America that share common production facilities and for the last several years have been experiencing capacity bottlenecks among other issues. After initial analysis, two main factors that contributed to a decrease in production were found. The first issue in the business is that the supply trucks and drivers delivering the harvest were not properly organized and there was not enough space and organization to allow for smooth offloading of several trucks a day. The second major issue is the rampant absenteeism and need for overtime work based on shortage of workers. This has driven the cost of running the business up and drastically reducing profitability. A lesser but still important problem at the plant was the grading system of berries which has been inconsistent and has cost the cooperative money as No.2A or No.2B fruit was categorized as No.3 when it should not have. This case will analyze several alternatives in numeric terms to develop the best possible strategy for the National Cranberry Cooperative.
Since National Cranberry is a cooperative of farmers and growers, any surplus profitability or loss should get funneled back to the farmers who are members of the cooperative. So when calculating what is best, the factors that need to be looked at not only what is good for the production plant but also for the growers themselves who buy into the combined resources of the cooperative.
Although it was determined in the winter of 1980 that another Kiwanee dumper would fix the issue of truck wait times and overtime costs, this was obviously not the case. It is apparent that the bottle neck in operations is not in the unloading of the raw materials but in further production processes down the line. As stated in the case, the trucks that show up on an average day can be dumped within five to ten minutes which allows for approximately 96 trucks to dump in a 12 hour window. (12Hours x 60mins)...
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