[20 marks]

You have just been appointed as a Operations Director at a company respecting that you have a MBA degree and to lead the operations in a very bad economy. You have decided to present to the board on how you hope to drive some of the operations management indicators shown below. Indicate for each of them if you will be increasing, decreasing, or not changing the set standard for the indicator. Include the motivation for this and how you will do it considering the factors that contribute to it.

[This should not be more than 10 sentences per item below and record any assumptions you make]

(a) Break-even volume is set at 5000 tons of product

(b) The economic batch quantity of the major raw material is 500 tons placed at 10 times per year. (c) Productivity is presently at 0.5 tons per hour (based on labour hours)

(d) Quality indicators as total of quality costs: Prevention cost/total quality cost 0,755 Appraisal cost/total quality cost 0,753 Failure cost/total of quality cost 0,8492