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 Ã¢â‚¬ËœAssessment InformationÃ¢â‚¬â„¢ 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

Ã¢â‚¬Â¢

state and explain all assumptions, on which your answers are based;

Ã¢â‚¬Â¢

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 Ã¢â‚¬â€œ 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 Ã‚Â£50 each when a normal unit is sold for Ã‚Â£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 Ã‚Â£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 Ã‚Â£100,

and the inventory carrying cost is Ã‚Â£10 per unit per year. The average ordering cost is Ã‚Â£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 Ã‚Â£3.33 (because of spoilage), and estimates order costs to be Ã‚Â£10 per order. The cost schedules of four suppliers

are as follows:

Vendor 1

Quantity

Price/LB (Ã‚Â£)

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 (Ã‚Â£)

1-99

34.50

100-199

33.75

200-399

32.50

400+

31.10

Vendor 2

Quantity

Price/LB (Ã‚Â£)

1-74

34.75

75-149

34.00

150-299

32.80

300-499

31.60

500+

30.50

Vendor 4

Quantity

Price/LB (Ã‚Â£)

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

Ã¢â‚¬Â¢

Ã¢â‚¬Â¢

Ã¢â‚¬Â¢

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 Ã‚Â£50 each when a normal unit is sold for Ã‚Â£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 Ã‚Â£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 Ã‚Â£100,

and the inventory carrying cost is Ã‚Â£10 per unit per year. The average ordering cost is Ã‚Â£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 Ã‚Â£3.33 (because of spoilage), and estimates order costs to be Ã‚Â£10 per order. The cost schedules of four suppliers

are as follows:

Vendor 1

Vendor 2

Quantity Price/LB (Ã‚Â£) 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

Purchase answer to see full

attachment