The owner of Pearl Automotive Dealers is trying to decide whether to expand his current facility. If he expands and customer demand turns weak, there is a chance he could lease part of his newly constructed facility to another dealer.If he doesn’t expand and strong demand occurs, he could attempt to lease another facility across town. Analyze the decision tree in Figure A8. What is the best set of decisions and the expected payoff? V FIGURE A.8Strong Product Demand (50%)Average ProductDemand (20%)$2,000,000· $1,200,000Property is Leased (20%)Property Is Not$400,000Weak ProductDemand (30%)Lease New FacilityLeased (80%)$100,0002Do not Lease New Facility$200,000Property is Leased (20% )Property Is Not$1,800,000Lease New FacilityStrong ProductDemand (50%)Average ProductWeak Product Demand (30%)Leased (80%)$1,200,0003Do not Lease New Facility $1,300,000Demand (20%)$900,000· $400,000Do Not ExpandFacilityFacilitypuadx3

Decision tree is graphical representation to all options available for decision with associated…

V FIGURE A.8 Strong Product Demand (50%) Average Product Demand (20%) $2,000,000 · $1,200,000 Property is Leased (20%) Property Is Not $400,000 Weak Product Demand (30%) Lease New Facility Leased (80%) $100,000 2 Do not Lease New Facility $200,000 Property is Leased (20% ) Property Is Not $1,800,000 Lease New Facility Strong Product Demand (50%) Average Product Weak Product Demand (30%) Leased (80%) $1,200,000 3 Do not Lease New Facility $1,300,000 Demand (20%) $900,000 · $400,000 Do Not Expand Facility Facility puadx3

V FIGURE A.8 Strong Product Demand (50%) Average Product Demand (20%) $2,000,000 · $1,200,000 Property is Leased (20%) Property Is Not $400,000 Weak Product Demand (30%) Lease New Facility Leased (80%) $100,000 2 Do not Lease New Facility $200,000 Property is Leased (20% ) Property Is Not $1,800,000 Lease New Facility Strong Product Demand (50%) Average Product Weak Product Demand (30%) Leased (80%) $1,200,000 3 Do not Lease New Facility $1,300,000 Demand (20%) $900,000 · $400,000 Do Not Expand Facility Facility puadx3

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

ChapterC: Cases

Section: Chapter Questions

Problem 5.3SD: Scenario 4 Sharon Gillespie, a new buyer at Visionex, Inc., was reviewing quotations for a tooling...

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Scenario 4 Sharon Gillespie, a new buyer at Visionex, Inc., was reviewing quotations for a tooling contract submitted by four suppliers. She was evaluating the quotes based on price, target quality levels, and delivery lead time promises. As she was working, her manager, Dave Cox, entered her office. He asked how everything was progressing and if she needed any help. She mentioned she was reviewing quotations from suppliers for a tooling contract. Dave asked who the interested suppliers were and if she had made a decision. Sharon indicated that one supplier, Apex, appeared to fit exactly the requirements Visionex had specified in the proposal. Dave told her to keep up the good work. Later that day Dave again visited Sharons office. He stated that he had done some research on the suppliers and felt that another supplier, Micron, appeared to have the best track record with Visionex. He pointed out that Sharons first choice was a new supplier to Visionex and there was some risk involved with that choice. Dave indicated that it would please him greatly if she selected Micron for the contract. The next day Sharon was having lunch with another buyer, Mark Smith. She mentioned the conversation with Dave and said she honestly felt that Apex was the best choice. When Mark asked Sharon who Dave preferred, she answered, Micron. At that point Mark rolled his eyes and shook his head. Sharon asked what the body language was all about. Mark replied, Look, I know youre new but you should know this. I heard last week that Daves brother-in-law is a new part owner of Micron. I was wondering how soon it would be before he started steering business to that company. He is not the straightest character. Sharon was shocked. After a few moments, she announced that her original choice was still the best selection. At that point Mark reminded Sharon that she was replacing a terminated buyer who did not go along with one of Daves previous preferred suppliers. Ethical decisions that affect a buyers ethical perspective usually involve the organizational environment, cultural environment, personal environment, and industry environment. Analyze this scenario using these four variables.
Scenario 4 Sharon Gillespie, a new buyer at Visionex, Inc., was reviewing quotations for a tooling contract submitted by four suppliers. She was evaluating the quotes based on price, target quality levels, and delivery lead time promises. As she was working, her manager, Dave Cox, entered her office. He asked how everything was progressing and if she needed any help. She mentioned she was reviewing quotations from suppliers for a tooling contract. Dave asked who the interested suppliers were and if she had made a decision. Sharon indicated that one supplier, Apex, appeared to fit exactly the requirements Visionex had specified in the proposal. Dave told her to keep up the good work. Later that day Dave again visited Sharons office. He stated that he had done some research on the suppliers and felt that another supplier, Micron, appeared to have the best track record with Visionex. He pointed out that Sharons first choice was a new supplier to Visionex and there was some risk involved with that choice. Dave indicated that it would please him greatly if she selected Micron for the contract. The next day Sharon was having lunch with another buyer, Mark Smith. She mentioned the conversation with Dave and said she honestly felt that Apex was the best choice. When Mark asked Sharon who Dave preferred, she answered, Micron. At that point Mark rolled his eyes and shook his head. Sharon asked what the body language was all about. Mark replied, Look, I know youre new but you should know this. I heard last week that Daves brother-in-law is a new part owner of Micron. I was wondering how soon it would be before he started steering business to that company. He is not the straightest character. Sharon was shocked. After a few moments, she announced that her original choice was still the best selection. At that point Mark reminded Sharon that she was replacing a terminated buyer who did not go along with one of Daves previous preferred suppliers. What should Sharon do in this situation?
Scenario 4 Sharon Gillespie, a new buyer at Visionex, Inc., was reviewing quotations for a tooling contract submitted by four suppliers. She was evaluating the quotes based on price, target quality levels, and delivery lead time promises. As she was working, her manager, Dave Cox, entered her office. He asked how everything was progressing and if she needed any help. She mentioned she was reviewing quotations from suppliers for a tooling contract. Dave asked who the interested suppliers were and if she had made a decision. Sharon indicated that one supplier, Apex, appeared to fit exactly the requirements Visionex had specified in the proposal. Dave told her to keep up the good work. Later that day Dave again visited Sharons office. He stated that he had done some research on the suppliers and felt that another supplier, Micron, appeared to have the best track record with Visionex. He pointed out that Sharons first choice was a new supplier to Visionex and there was some risk involved with that choice. Dave indicated that it would please him greatly if she selected Micron for the contract. The next day Sharon was having lunch with another buyer, Mark Smith. She mentioned the conversation with Dave and said she honestly felt that Apex was the best choice. When Mark asked Sharon who Dave preferred, she answered, Micron. At that point Mark rolled his eyes and shook his head. Sharon asked what the body language was all about. Mark replied, Look, I know youre new but you should know this. I heard last week that Daves brother-in-law is a new part owner of Micron. I was wondering how soon it would be before he started steering business to that company. He is not the straightest character. Sharon was shocked. After a few moments, she announced that her original choice was still the best selection. At that point Mark reminded Sharon that she was replacing a terminated buyer who did not go along with one of Daves previous preferred suppliers. What does the Institute of Supply Management code of ethics say about financial conflicts of interest?
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Case Study 1. Co.PL Manufacturing makes many components for print machines and copy machines. The company makes 20 different items. The company do not have forecast for production planning. That’s why the manager decides which items to produce and the batch size, based on orders and the amounts in inventory. The products with fewest inventory are given the highest priority. And since that the demand is somewhat erratic the company has experienced being overstocked on some items and out of others. Because of the falling profits because of overstocked and uneven inventories, the manager wants to start forecasting for product A which has a larger share of the company’s profit. The manager gathers the historical sales of this product for previous 14 weeks. Week 1 Product A 1 50 2 54 3 57 4 60 5 64 6 67 7 90* 8 76 9 79 10 82 11 85 12 87 13 92 14 96 Questions: What are the advantages of using…
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Q: Model the following business process at a supplier. . After a supplier notifies a retailer of the approval of a purchase order, the supplier can receive an order confirmation, an order change, or an order cancelation from the retailer. It may happen that no response is received at all. If no response is received after 48 h, or if an order cancelation is received, the supplier will cancel the order. If an order confirmation is received within 48 h, the supplier will process the order normally. If an order change is received within 48 h, the supplier will update the order and ask again the retailer for confirmation. The retailer is allowed to change an order at most three times. Afterwards, the supplier will automatically cancel the order.
Operations Management CH 3 QUESTION 22 Tucson Machinery, Incorporated, manufactures numerically controlled machines, which sell for an average price of $0.5 million each. Sales for these NCMs for the past two years were as follows: Use Exhibit 3.10. QUARTER LAST YEAR QUANTITY (UNITS) QUARTER THIS YEAR QUANTITY (UNITS) I 12 I 16 II 18 II 24 III 26 III 28 IV 16 IV 18 a) Find a line using regression in Excel. Note: Round your answers to 3 decimal places. y = ________ + ________ t b)Find the trend and seasonal indexes. Note: Round your answers to 3 decimal places. Period Trend Forecast Seasonal Factors Last Year I Last Year II Last Year III Last Year IV This Year I This Year II This Year III This Year IV This is left blank This is left blank This is left blank c) Forecast sales for next year. Note: Round your answers to 2 decimal places. Period Forecast (Units) Next Year I Next…
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Question 35 Suppose the actual sales and the forecasted, or smoothed sales, for the past 5 months have been Actual Smoothed 54.4 76.8 54.4 75.5 72.3 53.2 74.8 39.2 57.6 What is the Mean Square Error of the smoothed series? (please round your answer to 1 decimal place)
Q The manager of a fast food restaurant featuring hamburgers is adding salads to the menu. For each of the two new options, the price to the customer will be the same. The MAKE option is to install a salad bar stocked with vegetables, fruits and toppings and let the customer assemble the salad. The salad bar would have to be leased and a part-time employee hired. The manager estimates the fixed cost at $12000 and variable costs totalling $1.5 per salad. The BUY option is to have pre-assembled salads available for sale. They would be purchased from a local supplier at $2 per salad. However, offering pre-assembled salads would require installation and operation of additional refrigeration, with fixed annual cost of $2400. What is the rational decision if A) the manager expects to sell 25000 salads per year and B) the manager expects to sell 18000 salads
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