.25pt; background: white;”>Assignment: Managing
the Supply Chain (Operations and Inventory) Details: Operations
Simulation … Inventory Management, Forecasting and Process Information.
Complete with TeammateReport: Word Document
and/or Excel (Attached in the assignment area)Format: None …
Student Submission Should Look Professional and Answer the Questions BelowLength: No Requirement
… Requirement is to Answer all the Questions in the Assignment__________________________________________________________Your need to evaluate
data and make recommendations and decisions shown below..Excel Spreadsheet
ExplanationWhat you have is an
Excel spreadsheet with 6 models we assembly at our facility. Giving more
description, here are the details of the Excel file.Sheet “A” …
picture and bill of material of Model ASheet “C”
… picture and bill of material of Model CSheet “Annual
Customer Requirements” … past 12 months of actual demand from our
customers.Sheet
“Inventory” … actual on hand quantities of models A and C.Assignment is broken
up into 3 sections:1) Inventory
Management … the Materials
department has not been doing their job. Inventory levels have not been managed
for over a year. Assembly outages have caused the group to just order “a
lot” of parts to make sure the build goes as schedule. Major opportunity
for cost saving in inventory. Calculate the annual demand for each component
of Models A and C Calculate the EOQ for each component of Models
A and C Adjust inventory levels as compared to current
on-hand quantities of each component Calculate inventory costs saving based on your
EOQ calculationsHints and Tips for Section 1 You will need to research EOQ and make
assumptions for some of the components of the equation. Make sure you add a buffer … don’t go with
the actual EOQ number Don’t forget the inventory holding costs in
you saving calculations I would use the spreadsheet to assist with the
EOQ calculations … will save much time 2) Forecasting… using the spreadsheet data, graph the forecast for Model A,
Model C and all the models I want to see the visibility for the next 3
months on the graph, with a trend line. What are you going to do with one specific
datapoint (Model A – September) in your calculationsHints and Tips for Section 2 You will need to research forecasting You will *probably* use a different
forecasting technique for the individual forecasting of Model A and Model C
than you use for all the models together3) Process Documentation… using the picture of Model A and Model CComplete
a process drawing for the operator to assembly this product.Hints and Tips for Section 3 Don’t go crazy here … just complete a
diagram where the model can be assembly correctly. Less words the better

NOTES-Lesson One EOQThe
often asked questions … how much to order and when to order? .EOC
– Economic Order Quantity is a great tool to assist with this. The link below
describes the components of the equation.http://scm.ncsu.edu/scm-articles/article/economic-order-quantity-eoq-model-inventory-management-models-a-tutorial.Beware
when using this equation from experience. First you have to make some
assumptions. Cost of placing an order … basically, how much does it cost the
company to call the supplier, get a quotation, fill out a purchase requisition,
get it signed, and place the order. Technology has improved this activity …
but there is still a cost associated. A second assumption is a holding cost of
the inventory. Industry guidelines estimate there is a 2% to 15% of the price
of the good to hold it in storage.You will have to make an estimate and justification of each of
these for your case study..WARNING
… don’t go cutting your inventory levels. This equation works under ideal
environments … and we all know that never happens. For supplies with long
lead times you need to order more frequent. For equipment with historical
problems or downtime, or tooling that breaks a lot order more frequent. For
troublesome and new supplier that do not have a documented performance history,
you need to order more frequent..My major project while working on my MBA was
with EOQ. My company did a very bad job of managing supplies and inventory and
enabled me to look like a guru. After super conservative estimates, I took the top
25 tools and top 25 raw materials and applied EOQ to my companies’ inventory. I
was able to turn in an annual cost savings of $430K! SWEET!

NOTES-Lesson 2 Forecasting TutorialGood
luck with the forecasting section of this assignment … how is that for
support and encouragement. Lets start with the bad of forecasting. Think of the
weather … although technology has vastly improved forecasting it is still
inaccurate often. Think of the stock market, if I could “half-way”
predict the movement of the market or a stock, I would not be sitting here …
I would own an island somewhere and be retired. In both cases there are too
many unknowns to predict the outcomes. Here is a final thought on forecasting:
Forecasts are usually wrong. (Do not
treat as known information!).
Forecasts must include analysis of
their potential errors.
The longer the forecast horizon, the
less accurate the forecast will generally be.
Benefits can often be obtained from
transforming a forecasted quantity into a known quantity (when this can be
done, it comes at a cost however).
Systems that are agile in responding to
change are less dependent on accuracy in forecasts.So lets move onto the good of
forecasting … in the right environment, it can be a great tool used by
managers and those responsible for strategic planning. To simplify, most books
state there are 2 types of forecasting with different techniques in each. I
would do some brief research for this part of the assignment. Each technique
has its own pros and cons …your forecasting for this part
of the assignment can be more accurate with the techniques highlighted in red.Read up and select
the proper technique.Qualitative Forecasting [HINT …
you will not be using any of these methods]
Jury of Executive Opinion (I think that is
like “the boss said so”)
Delphi Method
Composite of Sales Force
Consumer SurveyQuantitative Forecasting
Time Series – Simple Moving
Average
Time Series – Weighted Moving
Average
Time Series – Exponential Smoothing
Linear Trend – Simple
Regression
Linear Trend – Multiple Regression
Nonlinear Trend Analysis (way beyond
the scope of this course)

NOTES Lesson 3 Process DocumentationNothing
fancy here … take the picture and create an assembly drawing. .Experience
here tells me you need pictures, drawing, and diagrams to have a great end
product. Get creative with this one. Take a look at documentation around your
work place and in fast food restaurants … they are (should be) simple. .If you have any questions or are confused with
this part of the assignment … call or email me.
Details: Operations
Simulation … Inventory Management, Forecasting and Process Information.
Complete with TeammateReport: Word Document
and/or Excel (Attached in the assignment area)Format: None …
Student Submission Should Look Professional and Answer the Questions BelowLength: No Requirement
… Requirement is to Answer all the Questions in the Assignment__________________________________________________________Your need to evaluate
data and make recommendations and decisions shown below..Excel Spreadsheet
ExplanationWhat you have is an
Excel spreadsheet with 6 models we assembly at our facility. Giving more
description, here are the details of the Excel file.Sheet “A” …
picture and bill of material of Model ASheet “C”
… picture and bill of material of Model CSheet “Annual
Customer Requirements” … past 12 months of actual demand from our
customers.Sheet
“Inventory” … actual on hand quantities of models A and C.Assignment is broken
up into 3 sections:1) Inventory
Management … the Materials
department has not been doing their job. Inventory levels have not been managed
for over a year. Assembly outages have caused the group to just order “a
lot” of parts to make sure the build goes as schedule. Major opportunity
for cost saving in inventory. Calculate the annual demand for each component
of Models A and C Calculate the EOQ for each component of Models
A and C Adjust inventory levels as compared to current
on-hand quantities of each component Calculate inventory costs saving based on your
EOQ calculationsHints and Tips for Section 1 You will need to research EOQ and make
assumptions for some of the components of the equation. Make sure you add a buffer … don’t go with
the actual EOQ number Don’t forget the inventory holding costs in
you saving calculations I would use the spreadsheet to assist with the
EOQ calculations … will save much time 2) Forecasting… using the spreadsheet data, graph the forecast for Model A,
Model C and all the models I want to see the visibility for the next 3
months on the graph, with a trend line. What are you going to do with one specific
datapoint (Model A – September) in your calculationsHints and Tips for Section 2 You will need to research forecasting You will *probably* use a different
forecasting technique for the individual forecasting of Model A and Model C
than you use for all the models together3) Process Documentation… using the picture of Model A and Model CComplete
a process drawing for the operator to assembly this product.Hints and Tips for Section 3 Don’t go crazy here … just complete a
diagram where the model can be assembly correctly. Less words the better

NOTES-Lesson One EOQThe
often asked questions … how much to order and when to order? .EOC
– Economic Order Quantity is a great tool to assist with this. The link below
describes the components of the equation.http://scm.ncsu.edu/scm-articles/article/economic-order-quantity-eoq-model-inventory-management-models-a-tutorial.Beware
when using this equation from experience. First you have to make some
assumptions. Cost of placing an order … basically, how much does it cost the
company to call the supplier, get a quotation, fill out a purchase requisition,
get it signed, and place the order. Technology has improved this activity …
but there is still a cost associated. A second assumption is a holding cost of
the inventory. Industry guidelines estimate there is a 2% to 15% of the price
of the good to hold it in storage.You will have to make an estimate and justification of each of
these for your case study..WARNING
… don’t go cutting your inventory levels. This equation works under ideal
environments … and we all know that never happens. For supplies with long
lead times you need to order more frequent. For equipment with historical
problems or downtime, or tooling that breaks a lot order more frequent. For
troublesome and new supplier that do not have a documented performance history,
you need to order more frequent..My major project while working on my MBA was
with EOQ. My company did a very bad job of managing supplies and inventory and
enabled me to look like a guru. After super conservative estimates, I took the top
25 tools and top 25 raw materials and applied EOQ to my companies’ inventory. I
was able to turn in an annual cost savings of $430K! SWEET!

NOTES-Lesson 2 Forecasting TutorialGood
luck with the forecasting section of this assignment … how is that for
support and encouragement. Lets start with the bad of forecasting. Think of the
weather … although technology has vastly improved forecasting it is still
inaccurate often. Think of the stock market, if I could “half-way”
predict the movement of the market or a stock, I would not be sitting here …
I would own an island somewhere and be retired. In both cases there are too
many unknowns to predict the outcomes. Here is a final thought on forecasting:
Forecasts are usually wrong. (Do not
treat as known information!).
Forecasts must include analysis of
their potential errors.
The longer the forecast horizon, the
less accurate the forecast will generally be.
Benefits can often be obtained from
transforming a forecasted quantity into a known quantity (when this can be
done, it comes at a cost however).
Systems that are agile in responding to
change are less dependent on accuracy in forecasts.So lets move onto the good of
forecasting … in the right environment, it can be a great tool used by
managers and those responsible for strategic planning. To simplify, most books
state there are 2 types of forecasting with different techniques in each. I
would do some brief research for this part of the assignment. Each technique
has its own pros and cons …your forecasting for this part
of the assignment can be more accurate with the techniques highlighted in red.Read up and select
the proper technique.Qualitative Forecasting [HINT …
you will not be using any of these methods]
Jury of Executive Opinion (I think that is
like “the boss said so”)
Delphi Method
Composite of Sales Force
Consumer SurveyQuantitative Forecasting
Time Series – Simple Moving
Average
Time Series – Weighted Moving
Average
Time Series – Exponential Smoothing
Linear Trend – Simple
Regression
Linear Trend – Multiple Regression
Nonlinear Trend Analysis (way beyond
the scope of this course)

NOTES Lesson 3 Process DocumentationNothing
fancy here … take the picture and create an assembly drawing. .Experience
here tells me you need pictures, drawing, and diagrams to have a great end
product. Get creative with this one. Take a look at documentation around your
work place and in fast food restaurants … they are (should be) simple. .If you have any questions or are confused with
this part of the assignment … call or email me.