Operation Management Assignment Solution

OPERATIONS MANAGEMENT MGCR 472 ASSIGNMENT # 1 SOLUTION Question 1 (10 points)

a) Labor productivity: Before: After: = 7 / (3*8) = 0.292 titles per labor-hour. = 12 / (3*8) = 0.5 titles per labor-hour.

Growth = (.5 – .292) / .292 = .714 or 71.4%. b) Multifactor productivity Before: After: = 7 / ($480 + $300) = .008974 titles per $ cost. = 12 / ($480 + $600) = .011111 titles per $ cost.

Growth = (.011111 - .008974) / .008974 = .238 or 23.8%. c) Multifactor productivity is more appropriate because the overhead costs have changed.

d) Multifactor productivity = 14 / [($480 + (H*8*2)+$400)] = .011111 titles per $ cost. H= $ 23.75 per hour

Question 2 (20 points) a) Sales will always be ≤ demand and demand forecasts should always be based on demand data, not sales data. If past sales is used to predict demand, it is assumed that sales = demand. This is not always true.

63 58 53 48 43 38 33 28 23 18 13 1 2 3 4 5 6 7

Demand

There seems to be an upward liner trend in the data. b) See below. c) See below. d) See below. e) See below; DES is better. When actual demand has a trend, averaging techniques will either overestimate the demand (for downwards trend) or underestimate the demand (for upwards trend – as in this case). f) The forecasts for January-March 2010 are 59.14, 64.35 and 69.56, respectively.

Month (t) June July Aug Sept Oct Nov Dec Dem 24 30 33 41 45 39 58 27.0 31.5 37.0 43.0 42.0 6.00 9.50 8.00 4.00 16.00 8.70 MAD 36 90.25 64 16 256 92.45 MSE MA(2) AE SE Expo(0.3) 24.00 24.00 25.80 27.96 31.87 35.81 36.77 7.20 13.04 13.13 3.19 21.23 11.56 MAD 51.84 170.0416 172.344384 10.17354816 450.8283986 171.05 MSE AE SE F 24.00 30.00 34.80 40.74 45.92 46.55 53.93 T 6.00 6.00 5.76 5.80 5.67 4.67 5.21 30.00 36.00 40.56 46.53 51.59 51.22 59.14 64.35 69.56 3.00 0.44 1.53 12.59 6.78 4.87 MAD 9 0.1936 2.34457344 158.5439583 45.96508491 43.21 MSE FIT(0.4,0.1) AE SE

Question 3 (18 points)

a) A C B D E G F H

Critical path is ABEGH => Project completion...