Covolo Diving Gear

Covolo Diving Gear, Part 2

Karen Ward

Bus307

Instructor Sherrie Lewis

June 14, 2011

Covolo Diving Gear, Part 2

What are the advantages and disadvantages of this plan?

A big advantage would be stable work, while a disadvantage would be the building inventory that may not be consumed.

Could Covolo implement a pure chase plan, given the current capacity? Why?

I think it best that Covolo does not go to a chase plan because it does not seem to have a constant flow of production throughout the entire year.

If sales continue to grow, what are the implications for production capacity at Covolo?

If sales grow Covolo production capacity is 35,000 a month and it will cost them $8 per set held at their facility.

How will a monthly S&OP update with rolling planning horizons help alleviate Patricia’s concerns?

A monthly update of all the output in the facility will help Patricia see the changes and she will be able to visually see what is happening.

Are there still advantages to S&OP, even though the forecasts may change?

Yes. Forecasts will never be 100%, but the S&OP helps see how close the forecasts and the actuals are.

I think that if a worker is not making sets, it is pointless to keep them on the payroll, not all layoffs are permanent, I think it is better to give the worker the time off. Not only does it cost to store parts that are not being shipped, but it also costs to pay a worker to be at work when they are not making the company money. Many workers are willing to take a short-term voluntary layoff.

References

Bozarth, C.C. and Handfield, R.B. (2008). Introduction to operations and supply chain management (2nd ed.).