Operations Management

| December 3, 2015

You are the VP of Operations for your company and own all of your company’s operations/supply chain (R&D, Planning, Procurement, Manufacturing, Inventory Control, Warehousing/ Distribution/ Transportation, and Customer Service). You are now 5 years into the 5-10 year Strategic Management Process and the company has delivered on a number of the Corporate level Objectives and Goals. The changes that impact you follow:

  • Your company acquired a cracker brand 2 years ago and the company you bought it from has been producing the product for you. You have one more year left on the original manufacturing contract, but they have already informed you that they are increasing their pricing at the end of that year to a level that you are not willing to pay. You have decided to search for other options.
  • The new 10 oz tomato soup has sold better than anticipated (our original forecast was not very good) and we are now at 80% of our capacity within our existing facilities.
  • The forecast for all domestic products for the next 5-10 years shows a slow, but sure increase of about 2%/year.
  • Sales in China have exploded and the forecasted for the next 5-10 years there is 10%/year growth.
  • You have been successful at reducing Costs of Goods Sold (COGS) by 7%, but you still have 3% more to accomplish.
  • Your inventory is averaging 4 turns/year and your boss views this as an opportunity.
  • Aggregate top line sales have grown by 7% since the original strategic plan with another 3% expected over the next 5 years. Your boss is asking you to make sure your supply chain/operations organization play a role in this sales growth.
  • The production and quality problems you were experiencing have been resolved by way of total quality team work.
  • Your most recent problems are:
    • That your perfect order % (on-time, complete and billed accurately) has dropped from an acceptable 99% to an unacceptable 90%, dissatisfying many of your larger customers
    • The performance of your two biggest suppliers have slipped as they are missing delivery dates and times

It is your responsibility to determine how your supply chain/operations organization will handle all of the above issues.

There are no formatting requirements. Your assignment is to explain in 3 pages (or less):

  1. How you would go about dealing with the changes, new opportunities and issues above

You do not necessarily have to solve the new opportunities and problems, but instead just tell me how you would go about it. Any insight into how you would solve the new opportunities and problems will add positive points to your grade though.

You will be graded on the completeness, accuracy, quality of your response and how well you convince me that you understand the subject matter. There are numerous concepts to take into consideration here and I would not expect anyone to be able to identify all of them, let alone combine them into a 3 page response. So you will be graded on how many of these concepts you are able to identify and utilize correctly within your response.

You can include: Lean system, total quality management, increase success rates, quality and performance, capacity planning, inventory pressures, ABC analysis, operations planning and scheduling, S&OP strategies, Resource planning, MRP, supply chain design, effective supply chain, outsourcing, mass customization, Load distance method, transportation method, GIS method, inventory placement, supply chain integration, SCOR model, supplier relationship process, order fulfillment process, sustainability, closed-loop supply chain etc.

Please do not just mention it, but extend it.

Corporate Strategies Goalsjective
Corporate Goals Goalsjective
Corporate Objective
Corporate Measures Goalsjective














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