Get There Navigation Technologies: Operational Performance Collaborative Discussion

GTNT to find out how the company may optimize its operational performance. The company has also asked for a recommendation of which subcontractor to employ.

Resource: Get There Navigation Technologies: Customer Needs and Operational Performance

Read the scenario for more information regarding the situation in preparation for your Week 5 Learning Team assignment.

Address the following points with your team:

· What are the inventory reorder points and the quantities per order?

· What problems exist in the current operational strategy?

· Explain your rationale for selecting subcontractor A or subcontractor B. How does the selected subcontractor optimize operational performance?

· How would you plan around an emergency, such as a natural disaster? If a hurricane disrupted the supply of raw materials and the work-in-process inventory needed to produce finished goods, how would you modify the reorder points and quantities per order and why?

Get There Navigation Technologies: Customer Needs and Operational Performance

Read the scenario to complete the assignment outlined in the course syllabus.

background information

Get There Navigation Technologies (GTNT) was founded by John Zillon. The company is a producer of high-quality navigation systems used in the car rental and transportation industry. The company serves the international market. One facility for manufacturing and distribution of its products is located in Omaha, Nebraska. GTNT has limited space for production and storage of inventory. Qualified personnel for production of premium transportation navigation devices are in short supply, and training requires 11 weeks.

The company has introduced a new transportation-business navigational device called Get Me There, which will sell for $159.95. Based on the market research conducted by the Marketing and Sales Department, first-quarter sales are forecasted to be 15,000 units (per month).

current revenue and cost structuRe for the Get me there

The company can produce 15,000 units per month by working two shifts per day, 5 days per week. Adequate storage space for 10 days exists for raw materials, work-in-process, and finished goods to support the forecasted 15,000 units sold per month.

Lead time for ordering and receiving required raw materials and component parts (work-in-progress) is 55 days, which includes 5 days for transit. All raw materials and work-in-progress come from small, specialized single source suppliers. Production time requires 5 days, and transit time averages 3 days. Production for the first quarter is scheduled to begin in 60 days. All orders for raw materials and work-in-progress for the entire quarter have been placed.

the marketing and sales

Total

Per Unit

Manufacturing Costs

$ 58.00

Distribution and Storage

32.00

Sales and Administrative

48.00

Price per Unit

$ 159.95

All other cost categories equal $5 per unit, leaving a pretax profit of 13.04%.

working the CHALLENGE

The president and CEO of GTNT is aware that the company needs expert assistance to get through this production challenge. Assume that your team is a team of industry experts for a reputable consulting firm that has been brought in to help solve the problem.

Analysis of the situation reveals that you can add a third shift and work all shifts 6 days per week to get production up to 30,000 units per month. You must also rent an off-site facility to achieve this level of production. Initiation of this effort will increase total production costs by 63%.

Through your contacts in the manufacturing industry, you have located two small manufacturing companies that can meet the 15,000 unit per month shortfall for the quarter. Subcontractor A requires 45 days to ramp up for production with a total production cost of $84 per unit. All other cost categories remain the same. Subcontractor B requires a 35-day lead-time with a total production cost of $90 per unit. All other cost categories remain the same. Quality standards can be met by each of the subcontractors.

You are charged with meeting 45,000 units per month (or 135,000 units for the quarter) as your actual demand, even though the marketing department may have mistaken the demand target to only be 15,000 units per month (or 45,000 units for the quarter).

As consultants and industry experts, your assignment is to prepare a written recommendation to the president and CEO on how to meet the production and sales requirement of 45,000 units per month for the first quarter while preserving the good reputation of the company and minimizing losses due to the faulty sales forecast.

Please read INSTRUCTORS instructions carefully and completely

Please pay special attention to blue highlighted

Due date 5/28/15

No plagiarism in own words

Will run through a plagiarism checker

Will not accept if after due date will dispute

Please cite and reference

References and citation page must include a valid URL to take the reader to the electronic copy of each source.

If cannot complete with the given instructions do not reply

Please contact me if you have questions

I may ask to change some areas at later date

250 word count, can be longer if needed

Word count is counted by answer only

Please write with question first followed by answer

Please write clearly simplify

I am in the U.S.

No charts or graphs

Answer yellow highlighted part