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Description

Academic Year
Coursework Assignment
Instructions
2021/2022
Module Code: BUS002
Level
5
Module Title: Operations Management
Assessment Name: Individual Report
Weighting %
Word Count
100%
Group
N
2,000 words
Module Organiser
Eun-Seok Kim
Date Submitted
20th October 2021
Internal Reviewer
Xue Zhou
Date Reviewed
20th Oct 2021
External Examiner
Date Approved
Module Level Learning Outcomes to be assessed (Reference to Module Proposal Form)
No
Module Learning
Outcome
Description
1
A1
Assess key factors influencing effective management of operations
2
A2
Evaluate the fundamental concepts, tools and techniques of operations
management
3
B1
Apply operations management tools and techniques to business problems
4
B2
Approach and manage data and information, problem solving and decision
making effectively
5
B3
Analyse data and information using relevant operations management tools and
concepts
6
C1
Apply analytical and problem-solving skills to decision problems in business
management
Assessment instructions for students (as per QMplus ‘Assessment Information’ tab)
In this report, you are required to answer ALL FIVE QUESTIONS. Your answers are to be presented in a single report format,
and in answering these questions, please
•
state and explain all assumptions, on which your answers are based;
•
support any answers with the appropriate calculations to arrive at the answer.
While each individual answer might have a different word count from the others, the overall word count should not
exceed 2,000 (+ or – 10%) words excluding calculations (numbers and equations, etc.).
Q1. (20%) A production operation is making 150 units of a product by engaging five workers for 300 hours. However, 40
percent of the units appear to have various quality problems, and the company decides to sell them as seconds at a price
of £50 each when a normal unit is sold for £150. To improve the situation, several initiatives are proposed, including a
scheme where, for every improvement, 50 percent will be given to workers and the other 50 percent will be held by the
company. This results in a significant drop in defects as now only 10 units are faulty out of an output of 130 units.
a) Compare the productivity after Bonus with the initial productivity. (10%)
b) Determine the appropriate bonus per hour for the workers under the bonus scheme if the cost per piec
e is £70 both before and after the scheme. (10%)
Q2. (20%) As the Cottrell Bicycle Co. of St. Louis completes plans for its new assembly line, it identifies 25 different tasks
in the production process. VP of Operations Jonathan Cottrell now faces the job of balancing the line. He lists precedences
and provides time estimates for each step based on work-sampling techniques. His goal is to produce 1,000 bicycles per
standard 40-hour workweek.
Task
Time (sec)
K3
K4
K9
J1
J2
J3
G4
G5
F3
F4
F7
F9
E2
60
24
27
66
22
3
79
29
32
92
21
126
18
Immediate
Predecessors
K3
K3
K3
K3
K4, K9
K9, J1
J2
J2
J3
G4
G5, F3
Task
Time (sec)
E3
D6
D7
D8
D9
C1
B3
B5
B7
A1
A2
A3
109
53
72
78
37
78
72
108
18
52
72
114
Immediate
Predecessors
F3
F4
F9, E2, E3
E3, D6
D6
F7
D7, D8, D9, C1
C1
B3
B5
B5
B7, A1, A2
a) Balance this operation using shortest operation time rule and compute the efficiency of the line. (10%)
b) Discuss how this balance could be improved. Is it possible to improve this balance to 100%? (10%)
Q3. (20%) Thomas Smith is the purchasing manager for the headquarters of a large insurance company chain with a central
inventory operation. Thomas’s fastest-moving inventory item has a daily demand of 24 units. The cost of each unit is £100,
and the inventory carrying cost is £10 per unit per year. The average ordering cost is £30 per order. It takes about 5 days
for an order to arrive, and there are 250 working days per year.
a) To minimize the cost, how many units should be ordered each time an order is placed? What is the total
annual inventory cost, including the cost of the units? (10%)
b) Even if there is substantial uncertainty in the parameters in the EOQ-model, it is still quite a useful model.
Discuss why. (10%)
Q4. (20%) Emery Pharmaceutical uses an unstable chemical compound that must be kept in an environment where both
temperature and humidity can be controlled. Emery uses 200 pounds per month of the chemical, estimates the holding
cost to be £3.33 (because of spoilage), and estimates order costs to be £10 per order. The cost schedules of four suppliers
are as follows:
Vendor 1
Quantity
Price/LB (£)
1-49
35.00
50-74
34.75
75-149
33.55
150-299
32.35
300-499
31.15
500+
30.75
Vendor 3
Quantity
Price/LB (£)
1-99
34.50
100-199
33.75
200-399
32.50
400+
31.10
Vendor 2
Quantity
Price/LB (£)
1-74
34.75
75-149
34.00
150-299
32.80
300-499
31.60
500+
30.50
Vendor 4
Quantity
Price/LB (£)
1-199
34.25
200-399
33.00
400+
31.00
a) What quantity should be ordered, and which supplier should be used? (10%)
b) Discuss factor(s) should be considered besides total cost. (10%)
Q5. (20%) A process considered to be in control measures an ingredient in ounces. A quality inspector took 10 samples,
each with 5 observations as follows:
Samples
1
2
3
4
5
6
7
8
9
10
1
10
9
13
10
12
10
10
13
8
10
2
9
9
9
10
10
10
11
10
8
12
Observations
3
10
11
10
11
9
8
10
8
12
9
4
9
11
10
10
11
12
8
10
12
8
5
12
10
9
10
10
9
9
8
9
12
a) Using this information, obtain three-sigma (i.e., z=3) control limits for a mean control chart and control
limits for a range chart, respectively. It is known from previous experience that the standard deviation of
the process is 1.36. (10%)
b) Discuss whether the process is in control or not. (10%)
Submission Information
The report should be submitted via QMplus by Friday, 20th December 2021 at 4PM. Late submissions will
be penalised according to School regulations. Under no circumstances can submissions via email be accepted.
Under no circumstances should you attempt to hand in your work directly to the lecturer or to the class teacher.
In any case you are affected by EXTENUATING CIRCUMSTANCES that might prevent you from submitting
your work on time, you should contact the module organiser (Dr. Eun-Seok Kim, e.kim@qmul.ac.uk) AND
student support officer (Ms Ripa Parvin, r.parvin@qmul.ac.uk) as soon as possible when the problem occurs
and no later than the deadline for submitting the report. Extenuating circumstances will be evaluated in
accordance with college regulations.
Guidelines and Late-Work Policy
1. Coursework submitted late (and there are no extenuating circumstances) will incur a late penalty. Five
percent of the total marks available shall be deducted for every period of 24 hours, or part thereof, that an
assignment is overdue there shall be a deduction of five per cent of the total marks available (i.e. five marks
for an assessment marked out of 100). After seven calendar days (168 hours or more late) the mark shall
be reduced to zero, and recorded as 0FL (zero, fail, late).
2. You should ensure that your submission is in either Microsoft Word or PDF format.
3. Failure to submit in either one of these formats will result in a mark of 0 being awarded for the assessment.
It is therefore your responsibility to ensure that the file format is correct and it can be opened by the
receiving party.
4. You should ensure that the correct piece of assignment is uploaded as the document downloaded on the
due date by the module organiser will be marked regardless of content. You will not have another
opportunity to submit the work again if you mistakenly uploaded the wrong document.
5. ALLOW YOURSELF PLENTY OF TIME TO SUBMIT YOUR COURSEWORK. DO NOT LEAVE IT UNTIL
THE LAST MINUTE
6. Computer problems, such as computer viruses, failure to make a back-up copy or temporary internet
access problems, will NOT be viewed as a valid reason for late submission.
7. Check that your assignment submission has been successful, and print a copy of the confirmation screen.
8. If you submit your assignment after the deadline, you will still be able to submit your coursework via QMplus
however you will be penalised for late submission, the only exception to this is if you have an approved
extension due to extenuating circumstances.
Submission Deadline
Date
20th December 2021
Time
4:00PM
QMplus Link/Page
https://qmplus.qmul.ac.uk/course/view.php?id=918
Help and Support
•
•
•
Module Organiser: Dr Eun-Seok Kim (e.kim@qmul.ac.uk)
Disability and Dyslexia Service (DDS): Ms Ripa Parvin (r.parvin@qmul.ac.uk)
Quantitative Skills Tutor: Ms Athanasia Kalaitzi (a.kalaitzi@qmul.ac.uk)
01. (20%) A production operation is making 150 units of a product by engaging five workers for 300 hours. However, 40
percent of the units appear to have various quality problems, and the company decides to sell them as seconds at a price
of £50 each when a normal unit is sold for £150. To improve the situation, several initiatives are proposed, including a
scheme where, for every improvement, 50 percent will be given to workers and the other 50 percent will be held by the
company. This results in a significant drop in defects as now only 10 units are faulty out of an output of 130 units.
a) Compare the productivity after Bonus with the initial productivity. (10%)
b) Determine the appropriate bonus per hour for the workers under the bonus scheme if the cost per piec
e is £70 both before and after the scheme. (10%)
Q2. (20%) As the Cottrell Bicycle Co. of St. Louis completes plans for its new assembly line, it identifies 25 different tasks
in the production process. VP of Operations Jonathan Cottrell now faces the job of balancing the line. He lists precedences
and provides time estimates for each step based on work-sampling techniques. His goal is to produce 1,000 bicycles per
standard 40-hour workweek.
Task
Time (sec)
()
Task
Time (sec)
Immediate
Predecessors
K3
60
E3
109
=
K4
24
D6
53
K3
K3
Immediate
Predecessors
F3
F4
F9, E2, E3
E3, D6
D6
K9
27
D7
72
K3
D8
78
J1
J2
66
22
K3
D9
37
J3
3
C1
78
F7
G4
79
B3
72
G5
29
K4, K9
K9, J1
J2
B5
D7, D8, D9, C1
C1
B3
F3
32
108
18
52
B7
F4
J2
A1
B5
92
21
FZ
J3
A2
72
B5
F9
A3
114
B7, A1, A2
126
18
G4
G5, F3
E2
a) Balance this operation using shortest operation time rule and compute the efficiency of the line. (10%)
b) Discuss how this balance could be improved. Is it possible to improve this balance to 100%? (10%)
Q3. (20%) Thomas Smith is the purchasing manager for the headquarters of a large insurance company chain with a central
inventory operation. Thomas’s fastest-moving inventory item has a daily demand of 24 units. The cost of each unit is £100,
and the inventory carrying cost is £10 per unit per year. The average ordering cost is £30 per order. It takes about 5 days
for an order to arrive, and there are 250 working days per year.
a) To minimize the cost, how many units should be ordered each time an order is placed? What is the total
annual inventory cost, including the cost of the units? (10%)
b) Even if there is substantial uncertainty in the parameters in the EOQ-model, it is still quite a useful model.
Discuss why. (10%)
Q4. (20%) Emery Pharmaceutical uses an unstable chemical compound that must be kept in an environment where both
temperature and humidity can be controlled. Emery uses 200 pounds per month of the chemical, estimates the holding
cost to be £3.33 (because of spoilage), and estimates order costs to be £10 per order. The cost schedules of four suppliers
are as follows:
Vendor 1
Vendor 2
Quantity Price/LB (£) Quantity Price/LB (E)
1-49
35.00
1-74
34.75
50-74
34.75
75-149
34.00
75-149
33.55
150-299
32.80
150-299
32.35
300-499
31.60
300-499
31. 5 2 of 5 500+
30.50
500+
30.75
Vendor 3
Vendor 4

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