Question 1

Globalisation offers companies opportunities to grow revenues and decrease costs. However, opportunities from globalisation are often accompanied by considerable uncertainties and risks. Consider your company or one that you are familiar with.

(a) Explain the important aspects of this companys operations and its relation to the supply chain. In your answers, you should describe the major concepts that define this companys operations and supply chain management.

(8 marks)

(b) Relate TWO (2) strategies employed by this company to win customers. In your answer, you should provide specific activities used by the company that support the strategy.

(7 marks)

(c) You have recently been appointed as the production manager of the company. To meet the demands of its global market, the company has set up production locations in two different countries: one in the USA and the other in a Southeast Asian country. To find out the productivity of the current operations at the two locations, you have obtained the following results from the production supervisor (Table 1).

Table 1

	USA	Southeast Asia
Sales (units)	100,000	20,000
Labour (hours)	20,000	15,000
Raw materials (currency)	$20,000	*FC 20,000
Capital equipment (hours)	60,000	5,000

*FC The foreign currency is in US Currency Equivalent

(i) Calculate partial labour and capital equipment productivity figures for the two production locations. Do the results make sense? Why?

(5 marks)

(ii) Calculate the multifactor productivity figures for labour and capital equipment together. Do the results make sense? Why?

(5 marks)

Question 2

OptiMart is a discount optical shop that can fill most prescription orders in around one hour. In striving to provide better service to its customers, the management is analysing the process so as to understand the service encounters at the store.

The tasks performed at the store and the estimated time required is showed in Table 2.

Table 2

Currently, there is one person assigned to each task (A-E). The optometrist assigned to task B takes an hour off for lunch and the other employees work the entire day.

(a) Describe the characteristics of service processes.

(4 marks)

(b) What is capacity management and why is it strategically important to OptiMart? (4 marks)

(c) Analyse the service process of OptiMart to help the store manager calculate the following for a typical 10-hour retail day (10 am 8 pm):

(i) What is the current maximum output of the process per day (assuming every patient requires glasses)?

(6 marks)

(ii) If another person were to be added, which task would be the one to be filled?

(2 marks)

(iii) What effect would a mail order laboratory (where the glasses are made off-site and returned in 57 days) have on the process?

(2 marks)

(d) Examine the strategies to manage service encounters. You should provide details on any TWO (2) possible customer-introduced variability in the service processes and propose THREE (3) accommodating strategies to effectively address these variabilities.

(7 marks)

Question 3

Consider your organisation or one that you are familiar with that plays a role in the global supply chain network. This organisation can be a supplier, manufacturer, distributor, logistics service provider or retailer in a particular industry (e.g. fast- moving consumer goods, electronics, oil and gas, and pharmaceuticals). In your answer, you should relate the concepts and strategies in operations and supply chain management to the work environment.

(a) Discuss how demand forecasting is essential for this organisation. Assume the following organisations actual sales data for the past six months.

Month Actual units sold

1 340

2 350

3 360

4 400

5 420

6 500

(b) Apply the two-month moving average and linear regression methods (where the SLOPE is 30 and INTERCEPT is 290) to forecast the demand for the seventh month. Calculate the Mean Absolute Deviation (MAD) and Mean Absolute Percent Error (MAPE) for each method.

(10 marks)

(c) If the expected demand during the next four months is 600, 450, 480 and 300 and each worker can produce 10 units each month.

Develop the aggregate production plans to meet the expected demand using the Chase and Level strategies. Show how each aggregate plan affects the workforce size for each month.

(10 marks)

Question 4

Mr Tan is running a coffee shop in Foodclique in UniSIM campus. This coffee shop sells in-house brewed coffee that serves customers dining in Foodclique. Business has been good since it started.

Assume the annual demand for a product is D is 1000 units and lead time L is 10 days. The cost of placing the order (S) is $10, cost per unit (C) is $10 and annual holding cost (H) is $2 per unit. There is no stockout cost and unfilled orders are filled as soon as the order arrives. Assume sales occur 250 days of the year.

The desired probability of non-stockout P is 0.95 and standard deviation of demand during lead time is 20 units.

(a) Examine Mr Tans inventory situation using the multi-period inventory model. (i) Compute the economic order quantity, the reorder point.

(ii) Identify the total annual cost in managing the inventory.

(10 marks) (5 marks)

(b) Explain ONE (1) scenario when one should apply fixed-time period inventory model.

(5 marks)

(c) If the lead time is decreased from 10 days to 5 days and standard deviation of demand during lead time is 10 units, calculate if there are any changes in

terms of order quantity and reorder point.