Great Northern Bank Beds, Inc.

Good Essays
Operations Management

Great Northern Bunk Beds, Inc.


Deciding whether to invest or not is a complicated task for today’s companies. Managers need to make thorough studies, analysing additional costs and revenues, in order to be able to make the most reasonable decision. A big investment implies a great expenditure and, generally, a late return. If a company does not consider thoroughly the requirements and the outcomes of a particular investment, the organization may suffer a big loss and even be severely prejudiced.

Matt Dorman, manager of Great Northern Bunk Beds, Inc, a high-quality custom-made beds manufacturing company, is considering a new big investment. Currently, Dorman only has a small size factory of 700
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However, Matt Dorman will impose some changes in the productive process thanks to the additional space available. Now the company is able to purchase new equipment that will decrease both operating time and set-up time and also remove the need for planning, despite the increase of sanding and the introduction of an 3

Group 10

Operations Management

additional step, shaping. This can be verified by the increase in the number of bunk-beds produced in a week, that is now nine, even if the number is independent of the batch size.


Group 10

Operations Management

Question 2

To answer the second question we will use similar procedures to the one conducted above. Now the difference is that we have two workers instead of one, which will allow GNBB to increase the production’s capacity in the firm. We will assume that an additional worker will enable the division of operations’ time per two, that is, a decrease of 50% in the total operational time of each batch. Regarding the new location Jessup, the factory will now be able to have a process with multiple tasks. This means that two workers can work in two different tasks at the same time. However, considering that the group decided to assume that the additional worker will imply a decrease in every operation’s time of 50%, it makes no difference having two workers doing different steps
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