04 Jul PRODUCT AND PROCESS PROBLEM SET
Product and Process Problem set
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Product and Process (PP)
PP1 Mass-Customization in a Supermarket
Suppose you have been hired as a consultant for a supermarket chain to advise on a plan to prepare ahead of time and cook complete “package” meals to be sold as convenience items for customers. A complete package meal will include one choice from each module, i.e., 1 meat, 1 potato, 1 salad, and 1 bread item. The food menu will vary from day to day, but a typical menu looks like:
Module 1 (Meat): Roast leg of lamb / Filet mignon / Fried chicken
Module 2 (Potatoes): Rosemary potatoes / Pan roasted potatoes / Mashed potatoes
Module 3 (Salad): Garden peas / Garden salad / Fruit salad
Module 4 (Bread): Roll, butter / French bread, butter / Biscuit, honey
(a) [5 pts] How many different complete package meals can be created? Show detailed calculations.
(b) [15 pts] Write a memo to Brad Marlow, Manager of Special Services, proposing the use of modular approach for delayed differentiation. Explain how it would work and outline the potential benefits as well as the potential disadvantages of your idea.
PP2 Zrox Copiers
Zrox is planning to add a new line of copiers. The manufacturing process involves the following activity times and precedence relationships:
G
(a) [10 pts] Draw the process flow diagram. What are predecessors and immediate predecessors of D? What are descendants and immediate descendants of D?
(b) [10 pts] Find all paths and their completion times. Identify the critical path and project completion time. What are non-critical activities?
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PP3 Cellular Layout
[10 pts] What are the advantages of cellular layout? How is group technology used in cellular manufacturing?
PP4 Original vs Wrecked Cars
[10 pts] According to a study by the Alliance of American Insurers, it costs more than three times the original purchase price in parts and labor to reconstruct a wrecked Chevrolet. Explain the reasons for this large discrepancy in terms of the processes used to assemble the original car and those required to reconstruct the wrecked car.
PP5 Mini-Case: De Mar
De Mar, a plumbing, heating, and air-conditioning company located in Fresno, California, has a simple but powerful strategy: Solve the customers problem no matter what, solve the problem when the customer needs it solved, and make sure the customer feels good when you leave. De Mar offers guaranteed, same-day service for customers requiring it. The company provides 24-hour-a-day, 7-day-a-week service at no extra charge for customers whose air conditioning dies on a hot summer Sunday or whose toilet overflows at 2:30 A.M. As assistant service coordinator Janie Walter puts it: “We will be there to fix your A/C on the fourth of July, and its not a penny extra. When our competitors wont get out of bed, well be there!”
De Mar guarantees the price of a job to the penny before the work begins. Whereas most competitors guarantee their work for 30 days, De Mar guarantees all parts and labor for one year. The company assesses no travel charge because “its not fair to charge customers for driving out.” Owner Larry Harmon says: “We are in an industry that doesnt have the best reputation. If we start making money our main goal, we are in trouble. So I stress customer satisfaction; money is the by-product.” De Mar uses selective hiring, ongoing training and education, performance measures and compensation that incorporate customer satisfaction, strong teamwork, peer pressure, empowerment, and aggressive promotion to implement its strategy. Says credit manager Anne Semrick: “The person who wants a nine-to-five job needs to go somewhere else.”
De Mar is pricing high. Yet customers respond because De Mar delivers value— that is, benefits for costs. In 8 years, annual sales increased from about $200,000 to more than $3.3 million.
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