Realco Breadmaster Company

1036 WordsJul 29, 20125 Pages
BUS307- Operations Management & Quantitative Techniques Ashford University Student: Tyrone A. Neal Instructor: Judith Ray Date: 6/11/2012 First, it is important to provide some foundation support of what operations and supply chain management entail. Every firm or organization must make a product or provide a service to someone that is needed or valued. Operations are the collection of people, technology, and systems that are in a firm whose primary responsibility is to provide the company’s products or services (Bozarth & Handfield, 2008). “Supply chain is the network of manufacturers and service providers that convert and move good from the raw materials state through to the end user” (Bozarth & Handfield,…show more content…
As noted earlier, master scheduling plays the role of controlling the manufacturing process rather than the customer demand. This means that orders would only be accepted following availability of units. Master scheduling enables a company to know the number of units or products available for sale. Knowledge of the available units of products guides the order placement and acceptance process. It is thus appropriate to refuse a customer’s order upfront in cases where units are not available. Additionally, accepting an order and then failing to deliver may result to losing of customer base or market share due to false promises. Customers tend to rely on companies that are trustworthy. Hence, failing to deliver an order may break the trust and rapport between a customer and a business. (Bozarth & Handfield, 2008) What impact will this have on average inventory level? The study further states that the reasons for choosing this inventory management practice strategy are that it helps a company to become more profitable by combining the benefits of make-to-stock and make-to-order policies. This new plan would mitigate stock-outs and large amounts of inventory. Production postponement and the new revised forecasting lowers inventory carrying cost and risk, as the stocked parts inherit flexibility to respond to customer demand. Capturing actual customer ordering patterns is crucial to a valid model, and this
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