Chad’s Creative Concepts

Q1. What types of decisions must Chad Thomas make daily for his company’s operations to run effectively? Over the long run?

Tactical decisions or short term decisions have short term impact and consequence to the organization:

1) Layout of the manufacturing process and equipment configurations- the importance of the relayout is to reduce the setup time

2) Resource allocation-daily raw materials allocation and replenishment

3) Management of resource- manpower allocation and staff allocated for each process.

4) Job scheduling – production scheduling on how much to produce

5) Shipment scheduling –planning and organizing the number of shipments to end customer

6) Inventories management

Strategic decisions or long term decisions have long term impact and consequence to the organization:

1) Develop forecasting methodology and techniques to understand the demands

2) If making the “Make” or “Buy” decision, it is important as the decision will impact on the relayout of the equipment, production

3) Reorganization of people- required to retrain people and check on their capabilities to perform the work (Cross training and flexible workforce are critical components in the organization to meet the complexity of the products)

4) “Outsourcing” or “Buy” decision- when volume is increasing at a constant rate, outsource non core activities to others.

Q2. How did the sales and marketing affect operations when they began to sell standard pieces to retail outlets?

Firstly, there is a need to focus on the company competitive dimensions before embarking on the decisions. In this aspect, the Competitive capabilities are the Cost, Quality, Time, and Flexibility dimensions that a process or value chain actually processes and is able to deliver.

The four groups to be assessed and explore:

1) Time-

It is important to fulfill the customer delivery. In the scenario, it is describing the promises to fulfill the orders and deliver on time to customers. In an example illustration of a retail outlets or shops, failure of timely delivery will cause a stock-out.

Operations Impact- Production and delivery complete for resources for delivery and it will impact on the shipment and delivery

2) Cost –

It is another factor as customer will be looking at delivering a service or product at the lowest possible cost and getting the maximum satisfaction. It could mean good cost product that will meet all the specifications and demands from customers

Operations Impact – Tendency to produce more to gain the economical of scale however it will incurred higher inventory and holding cost in return.

3) Quality –

Customer expect a top quality product delivering at a high consistent level. As customer trusts in the products, it is natural that the expectations on product must be of top quality and reliability.

Operations Impact- Lead time will be longer if demand is high in quality

4) Flexibility-

Flexibility gives more choices for customers.

Operations Impact- With less variety, machine setups and changeovers are reduced and created a better productivity. This gives more lead time for delivery to customers.

Q3. How has the move to producing standard furniture affected the company financial structure?

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