3 The international Frozen Pizza Company (IFPC) operates in three markets globally. Market 1 is its largest market, where it sells 25,000 tons of pizza per year. In this market it trades under the name ‘Aunt Bridget’s Pizza’ and positions itself as making pizza ‘just as your Aunt Bridget used to make’ (apparently she was good at it). It is also known for innovation, introducing new and seasonal pizza toppings on a regular basis. Typically, it sells around 20 varieties of pizza at any one time. Market 2 is smaller, selling around 20,000 tons per year under its ‘Poppet’s Pizza’ brand. Although less innovative than Market 1, it still sells around 12 varieties of pizza. Market 3 is the smallest of the three, selling 10,000 tons per year of relatively high-quality pizzas under its ‘Deluxe Pizza’ brand. Like Aunt Bridget’s Pizza, Deluxe Pizza also sells a relatively wide product range for the size of its market. Currently, both Markets 1 and 3 use relatively little automation and rely on high numbers of people, employed on a shift-system, to assemble their products. Market 2 has always been keen to adopt more automated production processes and uses a mixture of automated assembly and manual assembly. Now the management in Market 2 has developed an almost fully automated pizza assembly system

(APAS). They claim that the APAS could reduce costs significantly and should be adopted by the other markets.

Both Markets 1 and 3 are sceptical. ‘It may be cheaper, but it can’t cope with a high variety of products’, is their response.

(a) Use the product–process matrix to explain the proposal by the management of Market 2.