Transcript Value creating processes conceptual framework

Practicing exercises
Productivity
There is a small company with 3 employees (monthly
wage is €1000 each), machines that have a monthly
cost of €500 and overhead costs of €200 per month.
This company produces 1000 pieces of homogenous
goods in a month with a market price of €5 per piece.
What are the labour, the machine and the total
productivities? (Calculate in natural measures and
in money too)
Calculate the labour and the total productivity
change, if the mounthly production is increased
to 1500 pieces and the machine cost to €1000.
Shipping alternatives
Shipping alternatives
Shipping time
Total shipping cost
A
10 days
1200 dollar
B
12 days
1000 dollar
C
6 days
2000 dollar
There are 400 units to ship. Each unit has a holding cost
of 100 dollars per year. Which alternative is the best?
Location planning with CPV
analysis
Location
Fixed cost (FC)
Variable cost per unit (v)
A
10,000
40
B
20,000
30
C
50,000
20
D
20,000
50
Buffer stock

Lead time = 10 days
Average demand over lead time: 400 tons
Standard deviation over lead time: 100 tons
Accepted risk level: 5%

Safety stock (b) = ? Reorder quantity (ROP) = ?



EOQ & ROP








Number of days in the period = 250
Demand over the period = 4000 units
Lead time = 5 days
Safety stock = 100 units
Annual holding cost = 20 dollars per unit
Ordering cost = 500 per order
EOQ = ?
ROP = ?
Thank you for your
attention