Operation Management - Ahmet and His Employees Have Discussed Redesigning the Process to Improve Efficiency. If They Can Increase the Rate to 125 Per Day, What Would Be Their New Productivity

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1. Ilhan’s, a local bakery, is worried about increased costs – particularly energy. Last year’s records can provide a fairly good estimate of the parameters for this year. Ilhan Balci, the owner, does not believe things have changed much, but he did invest an additional 3 000 MU for modifications to the bakery’s ovens to make them more energy efficient. The modifications were supposed to make the ovens at least 15 % more efficient. I. Balci has asked you, as a brilliant graduate of EMU, to check the energy savings of the new ovens and also look over other measures of the bakery’s productivity to see if the modifications were beneficial. You have the following data to work with:

| |Last Year |Now |

|Production (dozen) |1500 |1500 |

|Labour (hours) |350 |325 |

|Capital Investment (MU) |15 000 |18 000 |

|Energy (kw-hrs) |3 000 |2 750 |

2. Serra’s Ceramics spent 3 000 MU on a new kiln last year, in the belief that it would cut energy usage 25 % over the old kiln. This kiln is an oven that turns “greenware” into finished pottery. Serra is concerned that the new kiln requires extra labour hours for its operation. Serra wants to check the energy saving of the new oven, and also to look over other measures of their productivity to see if the change really was beneficial.

Serra has the following data to work with:

| |Last Year |This Year |

|Production (finished units)...