1. To compromise on the customer expectation is serious jeopardy in the competitive environment. Today, Tom is junior employee and Carl is superior. Tom never knows about tomorrow; he might be the superior the other day. He should make decision not informed solely by unit of command that Carl is making use of his position. Customer loyalty and retention is key than taking advantage of too precious offer in expense of customer expectation. Tom should take more step to advice Carl on the significance of meeting customer expectations, customer needs, customer loyalty and customer retention as more long term goals as opposed to short term goals of profit maximization. To maintain competitiveness in such a scenario, companies need effective leaders who understand both technology and business. Tom should know that Engineers with proper management training have great opportunities to make valuable and lasting contributions and should not accept directives meant for short term gains in place of long term.
2. Make or buy decision is portfolio choice that lies on opportunity cost. Nancy should support her idea only if it leads to cost minimization while achieving company objectives. As the plant manager, Nancy should perform an investment appraisal to determine the best decision for the company and advice the supervisors on the best alternative without fear or favor. She should make decision based on deduction method. Based on adequate data, she ought to invoke general administrative and economic principles to this situation, weigh alternatives, and make rational choices.
3. The pressure on the student on completion means there could be loophole(s) in system or complacency on one party. However, given the situation the student is in, a collaborative method of conflict resolution need to be adopted where the three parties; Professor, student and institution should forge for a holistic solution. It may not be detrimental for institution if they compromise the dateline and offer the supervisor and student a special timeline to compile data available on 20th for next couple of days and is included in graduation. By doing this, it will foster mutual respect and trust, nurturing common interest to achieve success, and converging on commitment to task.
4. The objectives of the company determine the fate of automation or labor based performance. As the president of the company, I would agree with the automation cost-benefit analysis as per the engineer. This is because as companies need to minimize wastes, streamline operations, and enhance productivity to maximize profitability through operational excellence. By adopting the technology of automated bar-code scanner, it saves on cost and time and employees could still be engage in other commercial activities.
5. Business mangers face some challenges which include globalization, job-migration, initiation, development, and implementation of major technological projects that contribute to the long-term profitability of the company
6. Services have distinct characteristics that differentiate them from products which make innovation absolute challenging. While products can be easily standardized, services cannot be standardized. For producing products, there is a fixed cost structure, which allows realizable gross margin to increase with production scale, whereas services are predominantly produced on a variable cost structure, which can hardly scale to raise gross margin. Intellectual property rights are very important to products, but not so to services. Innovation on product is easier and cheaper since products are important as complementarities to other offerings of the same companies, whereas services are not so.
Moreover, products can be used in a variety of contexts because of the inherent generic design knowledge which makes their innovation worthwhile whereas services, on the other hand, may require extensive customization to clients’ specific needs.
7. Data mining refers to the analysis and non-trivial extraction of information from databases for the purpose of discovering new and valuable knowledge. The knowledge is in the form of patterns and rules derived from relationships between data elements. Data mining emphasizes the use of computationally intensive machine learning tools in the analysis of large and complex databases.
According to Ahlemeyer-Stubbe and Coleman (2014) and Zaki and Meira (2014) data mining is a useful tool for profiling customers (by segmentation) and predicting their purchasing behaviors. Data mining applications related to customer relations management may be of direct benefit to business. Assuming that customer data (e.g., prices paid, items bought, purchasing habits, and payment methods) are collected and available, a detailed analysis could lead to an in-depth understanding of customer behavior, not available heretofore, thus allowing companies to structure customized selling and marketing programs to achieve better customer satisfaction, enhanced brand loyalty, and improved company profitability.
Additionally, a data mining application could help in getting the information organized and ferreting out valuable knowledge from the wasteful piles of raw data. The application of such knowledge could lead to productivity enhancement in plant operations.
CHAPTER TWO
1. I would advise Stacy to put-up a specific personal plan which include; setting objectives and specify sub-goals: Stacy should be ready to acquire variety of job related skills from current jobs to enable her pursue more careers in future. To set up road map for her objectives by first developing action plans. Secondly she needs to build commitment to achieving her set objectives. Thirdly she needs to invest the proper amount of resources such as time, money, and effort to ready herself for the life challenging stages.
Additionally she needs to make a firm commitment to carry out the action steps stated in the plan. Finally she ought to carry out a review and update on her plan progress: Review the plan and make adjustments regularly to exercise proper control of this career path. Knowing what it takes to move to the next stage, and preparing herself in time for that big opportunity ahead.
2. The company understands its customers’ specific behavior and needs, so as to develop a manufacturing strategy that best counteract the competitor such as fair price-high quality products. The company should utilize the stage-gate process to guide the development process of their products/services, so that specific objectives are met at predetermined stages. These stages represent a go/no go decision in view of the advancement of technologies, customer preferences, competitive actions, and governmental regulations.
The company should design and develop products/services that have the functional features desired by the customer in the marketplace, possess the acceptable product/service quality, and are deliverable at a price that enables the company to earn a satisfactory profit margin.
3. The mission statement of a company defines why the company exists in the first place, which market segments it serves, and what it will do to serve them. The vision statement spells out the aspirations of the company with respect to its asset size, market position, business standing, ranking in industrial sectors, and other such metrics. The value system is the externalization of five or six specific corporate values emphasized by the company. Some typical values favored by U.S. industrial companies include quality, innovation, social responsibility, stability, honesty, quality of life, and empowerment.
4. In the typical operational quality, innovation, social responsibility, stability, honesty, quality of life, and empowerment should be included.
Besides training employees, managers are also expected, as a part of the guidelines, in recruitment and selection. Typically, the corporate objectives of industrial companies should also include growth, profitability, and return on investment (ROI).
5. The company should apply Monte Carlo methods to assess projects involving risks and uncertainties. It should engage emerging technologies, motivate a professional workforce of diverse backgrounds, develop new generations of products and services in a timely manner, and constantly surpass the best practices in industry. The company should make decisions whether to proceed or not based on available information and those assumptions that have been introduced. It should check the validity of all assumptions and adjust the decisions accordingly if they decide to continue. Take necessary risks and avoid becoming paralyzed by stress or uncertainty. The proper level of risk that can be accommodated should be within the normal probability density. Otherwise any deviation beyond the normal density should be deemed adequate to abandon the course of action.
6. She should consider factors such as type of business the company should invest in, the changes company needed to change its product portfolio, market coverage, production system, or service capabilities.
Additionally, she should consider the specific goals (such as profitability, market share, sales revenue, technology leadership position, global penetration, etc.) should the company accomplish, duration, investment type and core competencies. She should also consider the business networks the company should establish as well as new products. The core technologies should also be considered, the performance metrics that will be used for monitoring the company’s progress. Lastly she should consider how the company could tackle the daunting challenge of making innovation central to the company’s products, processes, or relationships.
7. With the advent of prototype software that suits proprietor operating system, XYZ Company has to adopt a transformational change from product-bundling manufacture and sale strategy to secure their market share by modifying its ERP software to march the competitors. Innovation to their existing product is inevitable. For creating innovations in these application categories, a team of qualified professionals with knowledge and work experience ought to be tasked. Enterprises will be best served by pursuing combination innovations in a number of the aforementioned application categories. XYZ should adopt a mix of approaches where some technologies are developed in-house to serve as the core part of the product while others that are less critical are typically purchased outright or acquired through license, partnership, and alliance.
8. She should develop a strategic plan to achieve her specific goals. To do so she should needs to build commitment to the course of action and adhere to set objectives. She needs to invest the proper amount of resources such as time, money, and effort to ready herself to achieve the specified goal. Additionally she needs to make a firm commitment to implement all the steps stated in her plan. Finally she ought to carry out a review and update on her plan progress: Review the plan and make adjustments regularly to exercise proper control of this career path. Knowing what it takes to move to the next stage, and preparing herself in time for that big opportunity ahead.
CHAPTER FOUR
1. I would follow all the testing phases as outline previously to avoid the uncertainty brought by the shipped product and ignore the pressure. By doing so I would abide by the laid plan which clearly outline all phases of project implementation.
2. The sales manager ought to take the rational decision pedigree. She should adopt the idea after carrying out a preliminary review about the changes probably by collecting adequate data from the companies that have implemented the changes and succeeded. She should later advices the sales staff accordingly and provides a roadmap for implementation.
3. The director should direct the supervisor to evaluate the workload of each engineer. The supervisor later brings enough report concerning the workload of each engineer to the director which will enable to make a choice on whom to go abroad to assist in the installation of equipment.
4. Bill Taylor and Stanley should keep their temper and displeasure cool. May be Henry King has a vital point in the design with all his enormous expertise in the field. They should request the review panel for more inclusive consultation with the staff in their sections about the design rather than using design drafted by Bill Taylor with no sufficient facts on practicability.
5. Jerry Lucas as division director should not ignore the advancement by the section chiefs despite the hierarchy of command. He should listen to their grievances and set up a showdown talks with Bob Sanford on these grievances. He should emphasize more of team work, involvement, group morale, creating job satisfaction among employees rather than the more authoritarian leadership he is imposing. If Bob is less willing to support the information sharing, core values, respect for junior employees, delegation of duties his immense expertise in the field could be nothing worthwhile if the team is disintegrated and the top management should consider replacing him. But before the latter is taken, Jerry should encourage him to avoid creating fear, threat and suspicion on the section chiefs which jeopardizes their productivity in the sections.
6. The company should accept the proposal. The priority of the company is to make profit and the status of country’s democracy should come last. First the attractive financial terms and future marketing outlook should influence the decision more than political set-up. The market base provides a decent opportunity to yield profits while taking a stronger grip on customer loyalty before any advent of competition. Neglect to the environment could be best address by leading as an example of this company while improving the local economy by creation of job opportunities and taxes remunerations.
7. The following are important characteristics of effective leaders; effective leaders have high degree of emotional intelligence as well as special knowledge in areas of their operations. Moreover, effective leaders exhibit natural activity to attract followers and are easily accessible. Effective leaders also possess authority to delegate some level of jobs to juniors to train them to take up leadership roles while also easing the pressure on their positions.
However, engineers have difficulty in adopting some of these characteristics. Some of these perplexing characteristics for engineers include political paranoia. Engineers hate company politics and are uneasy trying to fit into an organizational culture where social politics carries the day. Most engineers too lack willingness to delegate their responsibilities as they are weary of sabotage. Additionally, engineers have a mind-set that is rational, efficient, and introspective that may not be flexible as accommodating.
8. The employees are reluctant to adopt the changes in work practices since only the supervisors and the manager were involved in setting these practices. It would have been best to set up a taskforce which consist of selected employees to feel part of the changes and to motivate the other employees to take up the changes as it was meant for positive resolution to reduction of waste generated. Employees may have reason that their employment status could be under threat if the amount of waste generated are reduced. The plant manager could promise the alternative opportunities if their current jobs decline due to changes in the process.
9. Team talk and motivation should be a routine task for the managers as a tool for addressing any emerging issues such as project delays. It was wrong for the manager to imagine that some members of staff were demeaning him. It was his responsibility to instill the trust among his/her staff and leadership protocol. The manager would have called the team for induction talk earlier to clarify the timelines of project implementation and motivates the staff to take up the responsibility as failure to do so may ultimately lead to unemployment if the customer cancels the contract.
10. What went wrong was the duration taken by sales manager to avert the crisis. The financial manager would have used the available facts about the customer bankruptcy and take prompt action rather than waiting for failure. I would have taken actions to limit the amount of orders taken by customer drastically and encouraging the customer to pay for the previous outstanding orders before taking new orders.
11. It may be impractical to lead team of experts in field where one do not have skills and is prone to failure due to lack of understanding of the process. The person selected should be involved in the entire production process to gain an insight of the requirements of the product processing so as to be in better position to lead the team. It is important to have another technical expert leading the team together with the person who is leading the team from team leadership point of view to enable him consult in the production process.
12. These conflicts exist in an organization when the technologists are designing, analyzing, and interpreting of test results so as to achieve the project success. When this is not carried out in mutual trust and respects conflicts will arose. The key requirement for conflict resolution is openness. By fostering mutual respect and trust, nurturing common interest to achieve project success, and focusing on commitment to task, most conflicts can be successfully resolved
13. Aluminum is a threat to steel. Aluminum is being used in automobiles this make a threat to steel. Aluminum also provides cheap alternative than steel. Decision will be made on the top level of management.
14. Since the work involves close cooperation and coordination with other both inside and outside the department it will be worthwhile choosing the personality that best expresses social silhouette. Based on this criteria, I would select candidate C because he/she will be friendly to other people in the department and also outside the department to foster mutual understanding as outline in the objective of the position.
15. I would accept company A. The choice of the company A is based on rational decision making methodology. In rational point of view, having compared the three companies, the amount of information available in these cases is evaluated against each other. The first step is to assess the apparent problem; to choose from the available alternatives. The second step is to collect relevant facts such as people; their personalities, management, friends, location of each company, timing for example to get promotion, and financial incentives. The third step is to define the real problem at hand by asking the question; what represents success based on well-defined metrics and the proper method of measurements?
The fourth step will be to assess the alternatives then select the optimal one. This will be done based on rational method that strives to avoid the adverse effect of chosen alternative and later setting the course of action to implement. Company A provides the rational option since it has relevant facts suitable for Joe; financial incentives, meeting mate, access to recreation facilities, good relationship with management and access to city where Joe would still be contemplating accessing often if he chooses either buffalo or Rochester. The financial power of the companies is worthwhile nothing more benefiting to employee but the competition for customers or palace in company offer healthy growth.
CHAPTER SIX
1. Question 1
Project A
Project B
PVif
( $)
( $)
Pvif
PV ( $)
Period
C/f
Initial cost ( 500000)
C/f
Initial cost (300000)
1
150000
0.909
136350
50000
0.909
45450
2
200000
0.826
165200
150000
0.826
123900
3
250000
0.751
187750
200000
0.751
150200
4
150000
0.683
102450
300000
0.683
204900
5
100000
0.621
62100
200000
0.621
124200
653850
648650
NPV= Pv-Ic)
153850
348650
Decision rule: the company accept should pick proposal B with higher NPV value
2. FIFO
Period
Units In
Unit price ($)
Units out
1
150
100
150
2
250
120
400
3
220
100
180
4
120
120
100
5
100
130
220
6
20
130
200
7
100
140
120
8
40
140
80
LIFO
Period
Units In
Unit price ($)
Units out
1
150
100
150
2
250
120
400
3
220
120
180
4
120
120
100
5
100
130
220
6
20
130
200
7
100
140
120
8
40
140
80
3.
Cost ($)
Probability
PVAF (40 years)
Damage cost (600000)
NPV
Design 1
500000
0.15
75000
9.779
733425
(600000)
133425
Design 2
625000
0.10
62500
9.779
611187.5
(600000)
11187.5
Design 3
900000
0.04
36000
9.779
352044
(600000)
(247956)
PVIFA (40 years) =
Decision rule: pick design 1 since it has the highest NPV
4. NPV is one of the methods used in evaluating the investment decision on capital projects that may deliver benefits and may also consume resources on an annual basis over a number of periods. This NPV formula represents the net total value added (before tax) to the firm by the project at hand. It will help evaluate the most profitable project while eliminating the more cost burden option for engineers. A project based on NPV will be selected based on the positivity or the highest
5.
Products
Material cost
Labor cost
Total
Labor
Rent
Safety
Total product cost
Sales
Gross profit
Gross profit margin (%)
A
5000+10000
=15000
4*25*250
25000
30000
20000
90000
100000
10000
10.00
B
8000+10000
=18000
3.5*20*400
28000
30000
20000
96000
140000
44000
31.43
C
4000+1000
=14000
30*1.5*900
40500
30000
20000
104500
135000
30500
22.59
a) product cost and individual gross margin for each product
Gross profit margin=
Question 6
Project A
Fixed Cost
Labor cost
Total
Material Cost
Purchases
Services
Total cost
Sales
Gross profit
Depreciation
200000
Machine set up
2*25*700
35000
665000
70000
14000
2708000
3500000
792000
Utility
700000
Machine operation
16*35*700
392000
Phone
20000
Assemblies
4*30*700
84000
Manufacturing
200000
Inspection
2*20*700
28000
Travel
150000
Total
539000
Supervision
150000
Total
1420000
Project B
Depreciation
200000
Machine set up
3*25*900
67500
387000
72000
27000
2468500
4050000
1581500
Utility
700000
Machine operation
12*35*900
378000
Phone
20000
Assemblies
3*30*900
81000
Manufacturing
200000
Inspection
2*20*900
36000
Travel
150000
Total
562500
Supervision
150000
Total
1420000
Project C
Depreciation
200000
Machine set up
4*25*550
55000
352000
49500
22000
2063500
2255000
191500
Utility
700000
Machine operation
8*25*550
110000
Phone
20000
Assemblies
2*30*550
33000
Manufacturing
200000
Inspection
2*20*550
22000
Travel
150000
Total
220000
Supervision
150000
Total
1420000
2565000
A) Production cost (Refer table above)
Product A=$2708000
Product B=$2468500
Product C=$2063500
B) Total profit for each product
Product A=$792000
Product B=$1581500
Product C=$191500
C) Total gross profit = 2565000
7.
Rate (6%)
Toyota
GM
Initial cost
28000
24000
Fuel
4000
2000
Maintenance
700
600
Resale value
11200
7200
Total
15900
9800
NPV
(15534.4)
(16316.8)
Decision criteria: Toyota car is better since it has higher NPV value than GM car.
8. For production volume up to 536,156 panels per year, the plastic panels are more economical.
Plastic
Price
Material
5
5x/units
Dl cost
40
40x/units
FO
500000
Maintenance
100000
Machinery investment ($)
3000000
Tooling investment ($)
1000000
4,600,000
45x
PVAF = 6%, 10 years =7.36*72847=536,156
9. Gross profit for product B= Sales-Variable cost
Sales=$1000*12=12000
Variable cost=1000*10=10000
Gross profit=12000-10000=$2000
10.
Product
Fixed cost
Materials
Labor
Total Labor cost
Total cost
Sales
Gross profit
Gross margin
A
Supervision
200000
Raw materials
800000
Machine set-up
64000
3670000
4800000
1130000
23.54%
Procurement
250000
Purchases
120000
machine operation
800000
Depreciation
250000
Services
24000
Assembly
140000
Utility
750000
Total
944000
Inspection
72000
Phone
25000
1076000
Manufacturing
175000
Total
1650000
B
Fixed cost
supervision
200000
Procurement
250000
Raw materials
500000
Machine set-up
160000
3450000
5000000
1550000
31.00%
Depreciation
250000
Purchases
120000
machine operation
750000
Utility
750000
Services
40000
Assembly
140000
Phone
25000
Total
660000
Inspection
90000
Manufacturing
175000
Total
1140000
Total
1650000
C
supervision
200000
Procurement
250000
Raw materials
490000
Machine set-up
140000
2962500
2800000
(162500)
(5.80%)
Depreciation
250000
Purchases
91000
machine operation
420000
Utility
750000
Services
35000
Assembly
73500
Phone
25000
Total
616000
Inspection
63000
Manufacturing
175000
Total
696500
1650000
a) Refer to table for answers
b) Product B has the highest gross profit margin
Works cited
Ahlemeyer-Stubbe, Andrea and Shirley Coleman (2014), A Practical Guide to Data Mining for Business and Industry, Chichester: Wiley.
Rokach, Lior and Oded Maimon (2014), Data Mining with Decision Trees: Theory and Applications, 2nd edn, Singapore: World Scientific.
Zaki, Mohammed J. and Wagner Meira Jr. (2014), Data Mining and Analysis: Fundamental Concepts and Algorithms, Cambridge, MA: Cambridge University Press.
