All the questions in the online test (50%) operations management

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All the questions in this online case study pertain to following the case of Copper Kettle Catering Please make sure to answer all questions, by clicking next.

Copper Kettle Catering (CKC)

Copper Kettle Catering (CKC) is a full-service catering company that provides services ranging from boxed lunches for picnics or luncheon meetings to large weddings, dinners, or office parties Established as a lunch delivery service for offices in 1972 by Wayne and Janet Williams, CKC has grown to be one of the largest catering businesses in Raleigh, North Carolina

The Williamses divide customer demand into two categories: deliver only and deliver and serve The deliver-only side of the business delivers boxed meals consisting of a sandwich salad, dessert, and fruit The menu for this service is limited to six sandwich selections, three salads or potato chips, and a brownie or fruit bar Grapes and an orange slice are included with every meal, and iced tea can be ordered to accompany the meals The overall level of demand for this service throughout the year is fairly constant, although the mix of menu items delivered varies The planning horizon for this segment of the business is short: Customers usually call no more than a day ahead of time CKC requires customers to call deliver-only orders by 10:00 A.M to guarantee delivery on the same day

The deliver-and-serve side of the business focuses on catering large parties, dinners, and weddings The extensive range of menu items includes a full selection of hors d'oeuvres, entrees, beverages, and special-request items The demand for these services is much more seasonal, with heavier demands occurring in the late spring-early summer for weddings and the late fall-early winter for holiday parties However, this segment also has a longer planning horizon Customers book dates and choose menu items weeks or months ahead of time

CKC's food preparation facilities support both operations The physical facilities layout resembles that of a job process Five major work areas consist of a stove-oven area for hot food preparation, a cold area for salad preparation, an hors d'oeuvre preparation area, a sandwich preparation area, and an assembly area where deliver-only orders are boxed and

deliver-and-serve orders are assembled and trayed Three walk-in coolers store foods requiring refrigeration, and a large pantry houses nonperishable goods Space limitations and the risk of spoilage limit the amount of raw materials and prepared food items that can be carried in inventory at any one time CKC purchases desserts from outside vendors Some deliver the desserts to CKC; others require CKC to send someone to pick up desserts

at their facilities

The scheduling of orders is a two-stage process Each Monday, the Williamses develop the schedule of deliver-and-serve orders to be processed each day CKC typically has multiple deliver-and-serve orders to fill each day of the week This level of demand allows a certain efficiency in the preparation of multiple orders The deliver-only orders are scheduled day to day, owing to the short-order lead times CKC sometimes runs out of ingredients for deliver-only menu items because of the limited inventory space Wayne and Janet Williams have 10 full-time employees: 2 cooks and 8 food preparation workers, who also work as servers for the deliver-andserve orders In periods of high demand, the Williamses hire additional part-time servers The position of cook is specialized and requires a high degree of training and skill The rest of the employees are flexible and move between tasks as needed

The business environment for catering is competitive The competitive priorities are high-quality food, delivery reliability, flexibility, and cost in that order “The quality of the food and its preparation is paramount,” states Wayne Williams “Caterers with poor-quality food will not stay in business long.” Quality is measured by both freshness and taste Delivery reliability encompasses both on-time delivery and the time required to respond to customer orders (in effect, the order lead time) Flexibility focuses on both the range of catering requests that a company can satisfy and menu variety

Recently, CKC began to notice that customers are demanding more menu flexibility and faster response times Small specialty caterers who entered the market are targeting specific well-defined market segments One example is a small caterer called Lunches-R-Us, which is located a in facility in the middle of a large office complex to serve the lunch trade and competes with CKC on cost

Question 1

5 / 5 pts

The frequency of their equipment breakdown is given in the following table Repairs cost an average of $240 A service firm is willing to provide preventive maintenance which cost $400/month How much will CKC save each month when using the service contract?

Vietjet will save per month when using the service contract

(*) Just type the number without "$"

Answer 1: 80

Solution :

- Repairs cost: $240

- Maintenance cost: $400

- The expected number of breakdowns:

(0.1) *0 + (0.2) *1 + (0.4) *2 +(0.2) *3 +(0.1) *4 = 2

- The costs of repairs = 2* $240 = $480

- The savings: $480 - $400 = $80

Excel Preparation

Question 2:

The following table contains information on the cost to run five jobs on five available processes at CKC

Q Determine an assignment plan that will minimise costs Calculate the total cost Only record the number without "$"

Answer 2 : 19

Solution:

Step 1: TÌM MIN CỦA MỖI ROW

Step 2: REDUCE MIN CỦA MỖI ROW

Step 3: Reduce Column and Test the Allocation of 0 following Column and ROW

- Scanning the column first and if finding the value of 0 at any column the it is need to eliminate the value of 0 horizontally But

it is notice that only eliminate the value of 0 if this scanning column have only a value of 0 If the column scanned have 2 or

more 0, please ignore this column and continuously move to scan another column.

- After column scanning => Moving to the row scanning Eliminate

the 0 value vertically Ignore the rows occupy 2 or more 0, just ‘ gạch bỏ theo chiều dọc những row có chứa duy nhất 1 giá trị 0’.

- Cuối cùng tìm Min của tất cả các số còn lại chưa bị gạch Trong trường hợp này các số còn lại chưa bị gạch sau column and row scanning là:

 4; 1 (job 1)

 2;1 (job 3)

 3; 4 (job 4)

 1; 4 (job 5)

- Tìm min của tất cả các giá trị chưa gạch => Min là 1

Step 4: Next elimination

- Đầu tiên xác định giao điểm của các đường gạch ngang and gạch

dọc (nhìn hình Step 3)

Trong trường hợp này có 3 giao điểm: 3 (job 2-A); 1 (Job 2- B) và 5 (job 2- C)

- Lấy giá trị của 3 giao điểm đó cộng với giá trị min vừa tìm ở Step 3:

là 1 Ta được các giá trị mới tại các giao điểm (như hình bên trên)

- Sau đó ta sẽ trừ các giá trị chưa bị gạch (Step 3 mới tìm) cho Min =1

(được một bảng allocation mới như trên)

- Sau đó tiếp tục column and row scanning and elimination process

cho đến khi số đường gạch bằng với số job và tất cả các giá trị trong bảng đều được gạch bỏ thì hoàn thành và bắt đầu đến bước cuối là Task Allocation

Step 5: Task Allocation for Optimizing Cost (The lowest cost)

- Nhìn theo row, chú ý row nào có duy nhất một gía trị 0 thì allocate

task cho worker đó trước tại giá trị 0 đó

- Outcome: 1A; 2D, 3E, 4B, 5C

- Quay về bảng giá trị của đề để xem tại các vị trị đã allocate job cho

từng worker thì giá cần trả là bao nhiêu:

- Costs:

 1A = 4

 2D = 3

 3E = 7

 4B = 2

 5C= 3

 Tổng là $ 19

Question 3:

The company needs to better manage its stock From their historical purchasing data, the demand during lead time follows a normal distribution with a mean of 2000 units and a standard deviation of 100 units The CEO only accepts the stockout risk of 3 percent Calculate the reorder point of CKC to meet that demand

Answer : 2188

Solution:

- Service level = 100%- Stockout Risk = 1- 0, 03 = 0.97

- The service level is 0.97 => the Z=1,88

- Safety stock = Standard deviation * Z =100* 1.88 = 188 (Safety Stock

= Lead time * Demand /day)

- Reorder Point = Expected lead time demand + Safety Stock = 2000 +

188 = 2188

Question 4:

The company uses an automatic filling machine to fill the drinks for their customers The machine’s output is approximately normal with a mean of

1000 milliliters and a standard deviation of 20 milliliters Output is monitored using means of samples of 25 observations

1 Determine upper and lower control limits that will include roughly 98 percent of the sample means when the process is in control (Type the number into the following blanks)

The upper control limit is 1009.32

The lower control limit is 900.68

2 Given these sample means: 1003, 1001, 999, 1011, 995, and 998, draw the control chart in your Excel file and answer if the process is in control (Type Yes or No into the following blank):

Is the process in control? => No

Solution:

- Tìm UCL (X)

- Tìm LCL (X)

- Draw the X chart

 If there is not any value larger the UCL (X) and lower LCL (X), hence we can conclude that the process is in control

 According to this case, the process is not under control (Following the picture below) because there is a value the larger the UCL (X) =>1011

Question 6

Wayne and Janet Williams are impressed by the lean systems concept, especially the ideas related to increasing flexibility, reducing lead times, and lowering costs They sound like what CKC needs to remain competitive However, the Williamses wonder whether lean concepts and practices are transferable to a service business

Write a short essay covering the following issues:

 Are the operations of Copper Kettle Catering conducive to the application of lean concepts and practices? Explain

 What, if any, are the major barriers to implementing a lean system

at Copper Kettle Catering?

 What would you recommend that Wayne and Janet Williams do to take advantage of lean concepts in operating CKC?

Your Solution:

1 To consider whether the operations of Copper Kettle Catering can conduct the application of lean concepts and practices, it is necessary to determine stages of Toyota lean approach

Firstly, regarding the Muda stage, the waste which is the non-added-value activities should be identified and eliminated It is important to identify value

of production line, which is evaluation whether CKC has a strong understanding of customers' preferences, tastes, and quality expectations

to reduce waste in incorrect information of customers' expectation and preference In the case of CKC, the company strategy is deliver only and deliver and serve, and trying to match the various demand of customers For example, They also have five major work areas consist of a stove-oven area for hot food preparation and the area to store the cool ingredients and preparation for the cool meal This implementation can optimize the two different types of meal preparation for different orders that eliminate waste

in operations This will be acceptable as the company is willing to align its operations accordingly and prioritize customer satisfaction through existing meal delivery can help determine the company's value proposition So the CKC can match the value identification

Kanba

Examining the current processes and activities involved in delivering the product to the customer, which means using manual systems to control the movement of parts and materials Parts are delivered in small batches as they're actually needed, not all at once to reduce waste of holding Identify areas of waste, bottlenecks, and inefficiencies from material supply In the case of CKC, it can be observed that they prepare, deliver and customize the food depend on the customers' request, thus, this can be determined the production is manipulated in small quantity The demand for these services is much more seasonal, with heavier demands occurring in the late spring-early summer for weddings and the late fall-early winter for holiday parties, which mean the production can be in large quantity so it is the potential for streamline operations, and reduce lead times reduce, and holding costs Hence, CKC can process the lean operations from this stage

Heijunka

In case of CKC, the company is willing to adopt principles such as reducing lead times, optimizing production lines, and implementing just-in-time practices, increasing flexibility, and lowering costs The demand of CKC also can be viewed constant that keep the production line running steady and the company's products are manufactured depend on customers' demand and seasonal variations instead of having big bursts of activity and then downtime, this produced in smaller batch following the demand to

reduce waste of demand drop and excessive holding costs Thus, we can consider CKC can match this stage in Toyota lean approach and highly potential to transform its process into lean operation

Kaizen

Evaluate whether the organization upholds a culture that fosters continuous improvement and demonstrates a dedication toward achieving excellence

in all facets of its operations It is accepted if there is a willingness of a team to observe excessive waste in the production line such as frequent overproduction, and large batch production that increases holding costs, resulting in waste in material and financial sources of the company Creating a team to identify waste in production lines to continuously improve forecasting, input and quality control, inventory control mechanisms, and embrace a more responsive approach However, CKC has not yet established the empowerment team to identify the waste in process But, we can see they rely on implementing a pull-based system where production is driven by actual customer demand and there is a focus

on product quality, employee skill engagement, and adaptability to market changes They pay high attention on high-quality food, delivery reliability, flexibility, and cost, which is also consistent with one of Toyota approach principle

In the conclusion, I think the CKC can successfully transform into lean operation in a certain extent

2 Major barriers can be faced in lean process implementation

a Lack of proper training:

Employees can better understand how their work affects the entire production process through proper training This, in turn, motivates them to improve their work environment With effective training, employees acquire the necessary skills to solve problems both independently and as a team Additionally, good training ensures employees know what is expected of them to maintain Lean production through commitment and performance improvement However, implementing Lean operations can be challenging due to a shortage of Lean experts who have the necessary competencies

to lead and manage Lean implementation, as well as a potential dearth of supervisory, managerial, and workforce skills to support the implementation

of Lean in the markets and the hiring costs for them is extremely high Poor