man sci mexican a case

8/16/2019 Man Sci Mexican a Case

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I. Background of the Company

Mexicana Wire Winding, Inc is a subsidiary of a Texas firm called Westover Wire Works. The company is amedium-sized producer of ire indings, hich are described to be standardized design used in making electricaltransformers.

!elo is Mexicana"s plant layout, hich also portrays the different processes in its facilities#

$ffice Wire %raing &inished 'roduct

(torage

)eork %epartment

)eceivingand )aMaterial(torage 'ackaging

Winding )e*ected 'roduct

(torage

+xtrusion

Inspection

A. Personalities Involved

a )on arcia a management trainee in Mexicana Wire Winding Inc ho as hired because of his expertise in

$perations Management in his M!/ program.

b 0arlos /lverez the production control manager ho took time to describe the process in the inding businessc 1ivian +spania - general manager ho represented the Mexicana Wire Winding ith a key customer and promised

that the company ill manufacture 233 units of product W33345 and 673 units of product W33470 for him during/pril.

d 8os9 /rroyo production control manager. :e is assigned to determine hich orders to run to maximize profit.

II. Statement of the Problem

;noing that its !ooking $rders are greater than its current production capacity, hat strategy


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the ire orders that it has received. Mexicana Wire Works is currently booking more orders that it can fill, and thecompany is expecting that the upcoming month of /pril ill be very busy for it. Thus, it has ordered nee>uipment, and hired temporary employees to help it ith its capacity problems. /lso, Mexicana is planning torefinance some of its long term debts so it ants it profits to look good in /pril so that it could persuade its investorsto refinance its business.

&or the month of /pril, 1ivian +spania promised Mexicana"s key customer that they ill manufacture 233units of product W33345, and 673 units of of product W33470. The orders for /pril are the folloing#

"able #$ April Orders

Product %uantity Priority

W33470 6?33 673

W33@@0 A73

W33375 6763

W33345 6662 233

"able &$ Standard Costs

Standard Cost

product material labor overhead selling price

'(()*C ++.(( ,.,( &+.#( #((.((

'((++C &*.(( ).*( #).*( -(.((

'(((* +*.(( #(.*( &/.*( #+(.((

'((() )*.(( ##.&* 0+.)* #)*.((

"able +$ Plant and 1abor Capacity

/ccording to the company, it has no problem ith inspection capacity because its employees can orkovertime.

Plant Capacity 23ours4

dra5ing e6trusion 5inding packaging

?333 ?A33 A333 A@33

Bill of 1abor 23ours78nit4

product dra5ing e6trusion 5inding packaging

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W33470 6 6 6 6

W33@@0 A 6 @ 3

W33375 3 ? 3 @

W33345 6 6 3 A

I. Alternative Courses of Action

ACAs P9OS CO:S

ACA #$ Cancel some of its Orders There ould be no need to ad*ust itsoperating activities because it couldsufficiently fill all its orders for theupcoming months.

It ould forego of the profits that itcould have earned from thecancelled orders.

The company"s investors may notrefinance its activities because the

company is not aggressive hen itcomes to profit-making andadapting its company to presentcircumstances..

ACA &$ ;anagement should

come up 5ith 5ays to make its

operating activities more efficient

and profitable.

Mexicana ould be able to earnmore profit from its increasedorders.

If it is successful in making itsactivities more efficient and profitable, investors ill bemotivated to refinance its business.

The ad*ustment of the companiesoperating activities may be risky,and could re>uire plenty of research, time, and money so that itcould be successful.

. %uantitative Analysis

Objective !unction$ ;a6imi


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Bet Product '(()*C = # Product '((++C = &

Product '(((* = +

Product '((() = /

Constraints$

6. 6 $rders for 56 EF 6?33A. A $rders for 5A EF A73@. @ $rders for 5@ EF 6763

?. ? $rders for 5? EF 66627. 7 1ivian +spania"s commitment for 5? GF 2332. 2 1ivian +spania"s commitment for 56 GF 6734. 4 %raing time# 6H56 AH5A 6H5? EF ?333D. D +xtrusion time# 6H56 6H5A ?H5@ 6H5? EF ?A33C. C Winding time# 6H56 @H5A EFA33363 63 'ackaging time# 6H56 @H5@ AH5? EF A@33

1inear Programming

H'lease see the appendix for more Binear 'rogramming results

9ecommendations Based on the >iscussion %uestions$

#4 'hat recommendations should 9on ?arcia make@

!ased on the Binear 'rogramming results, )on arcia should recommend that Mexicana produce 6633units of 'roduct W3347, A73 units of W33@@, 3 units of W3337, and 233 units of W3334 to maximize its profit. Thisill yield J7C,C33 as the optimum profit of the company, details belo.

%uantity toProduce

Back Order Profit Per 8nit "otal Profit

'OO)*C 6633 @33 @? @4?33

'OO++C A73 3 @3 4733

'(((* 3 6763 23 3

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'((() 233 762 A7 67333

"otal Profit *,,((

&4 >iscuss the need for temporary 5orkers in the dra5ing department.

!ased on the given data for !ill of Babor, it is submitted that there is no urgent need to add more laborers of thedraing department because the number of hours per unit in the draing department is loer than the other departments. The departments that need more personnel ould be the extrusion and packaging departments. Tolessen the hours for extrusion and packaging and make them at par ith the draing and inding departments, thecompany could add more orkers in the extrusion and packaging departments rather than placing more orkers inthe draing department.

Bill of 1abor 23ours per 8nit4

Product > ra5ing 6trusion 'inding Packaging

'(()*C 6 6 6 6

'((++C A 6 @ 3

'(((* 3 ? 3 @

'((() 6 6 3 A

"O"A1 / ) / 0

+4 >iscuss plant layout.

The company"s current plant layout is not se>uenced according to its process flo, to make its operations

more efficient it ould be best for the company to have its plant layout se>uenced in accordance ith its processflo. The diagram belo proposes that draing should be folloed by extrusion, inding, inspection and then packaging. /fter inspection, products that have passed >uality check are sent to the finished product storage or packaging, hile defective products are either reorked or re*ected.

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I. thical Considerations

1. Contractual/Casual Basis. inc! t"! co#$an% is in t"! #anu&acturin' &actor% t"! 'rou$ assu#!s t"at

t"!r! ar! #an% contractual !#$lo%!!s or*in' &or t"!#. W"!t"!r $artti#! &ullti#! s!asonal or r!'ular

contract t"is *in, o& !#$lo%#!nt #ust -! sto$$!, -!caus! it is un&air &or t"! la-or s!ctor. #$lo%!!s !xc!!,in'

#or! t"an six #ont"s o& t"!ir contract #ust -! r!'ulari!, &ro# or*. ,!all% it ill -! -!tt!r to r!,uc! ot"!r

costs inst!a, o& usin' t"! la-or s!ctor in r!,ucin' costs. sin' alt!rnati! !n!r'% can -! a 'oo, o$tion in

r!,ucin' costs. Causal !#$lo%#!nt #a% ,!cr!as! !#$lo%!!s #oral! an, it ill -! a&&!ctin' t"! ualit% o& or*.

2. lt!rnati! ourc! o& n!r'%. "! co#$an% #a% us! r!n!a-l! sourc! o& !n!r'% in t"!ir &actor% to

r!,uc! costs. "! 'rou$ assu#!s t"at t"! co#$an% us!s !l!ctricit% in $ro,uction $roc!ss. & t"!% consi,!r t"! us!

o& r!n!a-l! !n!r'% li*! solar $o!r or in, $o!r t"! co#$an% #a% cut ,on cost an, ,!cr!as! $ollution. t

&irst t"!s! alt!rnati!s ar! !r% ca$ital int!nsi! -ut in t"! lon' run its #or! sustaina-l! an, #or! !co&ri!n,l%.

3. C"il, a-or. M!xicana Wir! Wor*s #ust not tol!rat! c"il, la-or in t"!ir &actor%. inc! t"! natur! o&

-usin!ss is in $ro,uction an, !#$lo%!!s t!n, to r!si'n ,u! to r!,un,anc% o& or* t"! 'rou$ su''!sts t"at t"!

&actor% #ust not !n'a'! in an% &or# o& c"il, la-or -!caus! it is !r% ,an'!rous &or t"!ir "!alt". 8or#all% t"is

*in, o& &actor% us!s "u'! !ui$#!nts an, $ro,uc!s c"!#icals t"at can -! "aar,ous &or c"il,r!n. M!xicana

Wir! Wor*s #ust ta*! t"! l!a, in $ro#otin' a 'oo, !xa#$l! o& sociall% r!s$onsi-l! &actor%. "! 'rou$ also

su''!sts t"at inst!a, o& l!ttin' t"! c"il,r!n or* in t"! co#$an% t"!% #ust r!-uil, t"! co##unit% -%

constructin' r!cr!ation ar!as so t"at c"il,r!n can sta% aa% &ro# ill!'al ,ru's an, ot"!r ic!s.

4. ocial 9!s$onsi-ilit% an, 9!,ucin' :ollution. 8atural r!sourc!s ,i#inis" as t"is #anu&acturin'

&actori!s us! !art"s natural r!sourc!s. s it ,i#inis"!s it is t"! r!s$onsi-ilit% o& t"!s! &actori!s to r!$lac! t"!

,!$l!t!, natural r!sourc!s &or sustaina-ilit% $ur$os!s. s MB stu,!nts t"! 'rou$ -!li!!s t"at t"! co#$an%

#ust -! r!s$onsi-l! !nou'" to ta*! actions in r!storin' t"! -alanc! an, "ar#on% o& t"! co##unit%. 8or#all%

t"is *in, o& &actor% ,!stro%s t"! !cos%st!# -!caus! o& $oor cor$orat! social r!s$onsi-ilit%. n or,!r to r!stor! t"!

nor#al stat! M!xicana #ust ta*! t"! initiati! to r!$lac! t"! natural r!sourc!s li*! tr!! $lantin'. lso as t"!%

us! #ac"in!ri!s in t"!ir $ro,uction $roc!ss M!xicana Wir! Wor*s "!ail% contri-ut!s to t"! $ollution. "!

co#$an% #ust -! sociall% r!s$onsi-l! in $ro#otin' sustaina-l! &utur!. "! 'rou$ -!li!!s t"at !ac" &ir# #ust

a-i,! #oral an, !t"ical stan,ar,s in #a*in' a sustaina-l! co##unit% an, r!,ucin' $ollution "il! ,oin'

-usin!ss. "! 'rou$ also -!li!!s t"at it ill -! -!tt!r i& co#$ani!s li*! M!xicana can start a 'r!!n ca#$ai'n so

t"at ot"!r &actori!s &ollo t"!ir l!a, in $r!s!rin' natur!.

II. Conclusion

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APP:>I$ Other 1inear Programming 9esults from PO; %;

>ual "able

9anging "able

Solution 1ist

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Iterations

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man sci mexican a case

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