1. Explain the challenge Elizabeth faced in meeting her capacity needs. What should she have considered before moving into the larger facility?
2. What is wrong with the proposal made by the team of business students? Why?
3. What type of operation does Biddy’s Bakery currently have in place? What type of operation is needed to meet the proposal made by the team of business students? Explain the differences between these two operations.
4. Elizabeth senses that the business would be different if she accepts the proposal but does not know how and why. Explain how it would be different.
5. What would you advise Elizabeth?

Biddy’s Bakery was founded by Elizabeth McDoogle in 1984. Nicknamed “Biddy,” Elizabeth started the home-style bakery in Cincinnati, Ohio, as an alternative to commercially available baked goods. The mission of Biddy’s Bakery was to produce a variety of baked goods with old-fashioned style and taste. The goods produced included a variety of pies and cakes and were sold to the general public and local restaurants.
The operation was initially started as a hobby by Elizabeth and a group of her friends. Many of the recipes they used had been passed down for generations in their families. The small production and sales facility was housed in a mixed commercial and residential area on the first floor of “Biddy’s” home. Elizabeth (“Biddy”) and three of her friends worked in the facility from 6 a.m. to 2 p.m. making and selling the pies. The operation was arranged as a job shop with workstations set up to perform a variety of tasks as needed. Most of the customers placed advanced orders, and Biddy’s Bakery took pride in accepting special requests. The bakery’s specialty was the McDoogle pie, a rich chocolate confection in a cookie crust.