MGMT311:7:Online Supply Chain Management

Chapter 5 assignment

Quincy Snodgrass Enterprises—Forecasting

Quincy Snodgrass is an entrepreneur and a lover of the outdoors. He has worked for various companies since he graduated college with his business administration degree in management. Over the years, he has saved every extra penny and now has the starting capital he needs; consequently, he plans to open his own business. Quincy plans to open a landscaping business. The primary services he’ll offer are grass cutting, edging, and bush trimming. Obviously, this will only provide income in the spring, summer, and early fall. Therefore, he plans to offer snow removal in the winter. His goal is to continue to provide those baseline services and expand into actual landscaping work.

Quincy’s initial challenge is to develop a forecast of how many customers he’ll have each month. This is essential to determine if he needs to hire any additional labor throughout the season. Unfortunately, none of the jobs Quincy has had involved forecasting. Quincy is digging deep into his memory to recall his supply chain management course and the chapter on forecasting. He knows he has two methods to choose from, qualitative and quantitative.

Quincy is a numbers guy and is partial to using a quantitative method if possible, but he doesn’t rule out the option of using one of the qualitative methods. He had worked many summers for other yardwork companies. Knowing he wanted to own his own business someday, Quincy took notes on how things went. Since his customer base would be in a series of small towns, Quincy knows he cannot charge as much as the companies that served larger communities. Consequently, volume is necessary to earn the revenue he will need.

Quincy focused on three small towns, Smithburg with a population of 700, Emeryville with 1,800, and Golf Creek with 2,500. He believes he can get 10 percent of the homes in each town to hire him. Quincy used information from the county files to estimate that on average, the number of homes is equal to about 25 percent of the population, meaning in Smithburg (700) the potential number of homes is about 175. Quincy believes his calculations are reasonable and could be the foundation for using a qualitative method to kick off his forecasting.

Discussion Questions

Quincy has been gathering data for over five years now. He has a record of how many customers he has each month. He also has information on the weather, for example, which month has the most rain. Quincy wants to use these data to improve his forecasting. He has a choice of cause-and-effect models. Based on what data he has and what he wants to do, what would be the best method from the choices he has? Explain the elements of the forecasting equation.

Midterm Exam

Teen’s Scene

 Myrtle Mendez is an entrepreneur. She started a clothing manufacturing business and established a store a few years ago that focused on teens. Her brand and store are called Teen’s Scene. Initially, Myrtle worried about just getting the business running and keeping the financials above water. As her success grew, Myrtle realized that she needed to think more about the big picture. What was the direction she wanted her company to go? Did she want her business to stay as a single store? Did she want to get her brand sold in other clothing stores? Did she want to expand locally, that is, just within the city of Chicago? Or, was there another avenue of growth she should pursue?

Although her company was relatively small, Myrtle had a senior staff, a director of operations (DO), a director of finance (DF), and a director of supply chain management (DS). Myrtle was a very hands-on owner and president of her company. Myrtle knew that each of her senior staff were experts in their areas; therefore, she decided the best course of action was to engage them in the planning of her company’s future.

Myrtle and her staff spent many weeks discussing the situation. Rolando Curry (DF) was concerned about the financial effect expansion. Rolando supported expansion; however, he emphasized that the specific strategy selected should be based on its financial impact. For example, how would it affect labor costs? What about inventory costs?

Essie Floyd (DO) agreed with Rolando that the selection of a specific strategy was a crucial first step. Essie explained that the type of production strategy the company chose to utilize would be one that they would be “stuck” with for at least a year, maybe more. The production strategy would dictate such things as capacity, scheduling, and training. Therefore, while she understood Rolando’s concerns, she disagreed that the financials were the primary consideration. Essie believed that they should instead look at it primarily from the perspective of production. What strategy would enable them to run the production smoothly? Essie preferred a strategy where she would have a stable workforce she could count on.

 Andy Allen (DS) said that in theory both Essie and Rolando were correct. However, as director of supply chain management, Andy’s perspective was different. If they planned to sell their clothing line to other stores, they must focus on ensuring that the availability of the product was constant and consistent. If they didn’t have the inventory to provide to local stores, then those stores may eventually drop them as a supplier. Andy’s argument to Rolando was that if they were too cautious about the financials, they may be putting the company in a position where they would fall short of meeting customer expectations.

Myrtle listened to their views and realized that each one had valid points. Selecting the wrong strategy could result in her company failing financially in the long term. Furthermore, technically, her store was her manufacturing company’s customer, although the teens were the ultimate end users. If she added other intermediate suppliers between her manufacturing company and the teens, that is, other clothing stores, they would be her manufacturing company’s critical customers. Obviously, as her own customer she knew about any problems that would cause a disruption in supply; however, other stores wouldn’t care about the reasons. Consequently, a disruption in supply would be a major cause of customer dissatisfaction. Finally, she understood Essie’s point of view very clearly. A stable trained workforce was essential to the quality of their product. A strategy that may seem more attractive from a financial perspective, that is, keeping labor costs low, could affect their ability to maintain the level of quality they currently had.

 Myrtle met again with her senior staff. She shared that she had thought a lot about their individual views. While the discussions had provided a lot of food for thought, Myrtle said she needed each director to formally present their case in writing. Once she had those documents, they would meet and discuss the merits of each case. The desired outcome of that meeting would be to make a decision on an approach that minimized the negative effects each of them had identified and maximized the Teen’s Scene’s opportunity for success.

 Questions: Answer in detail and provide examples to support your analysis

1.       If Myrtle and her staff decided to expand the business by selling the Teen’s Scene brand to other clothing stores, which production strategy would be the best? Explain why your choice would be the best by addressing how the concerns of each director are resolved or at least minimized.

 2.       One of the options that Myrtle is considering is the lead capacity strategy. Based on the case and the issues all three directors voiced, do you agree that this is the best capacity strategy? Explain why or why not. If you don’t agree, describe what would be a better capacity strategy.

 3.       Essie Floyd (DO) and Andy Allen (DS) have different concerns. What system or systems can Teen’s Scene procure and implement that would provide a resolution for both directors? Identify the system or systems and explain why they would alleviate the specific concerns of each director. Be specific.

Week 5 discussion 1

What are 3PLs and why are they used? What types of companies use them? Why is their use growing so rapidly?

Week 5 Discussion Question 2

Why is the determination of customer lifetime value important?

MRKT110:7:Online Principles of Marketing

Discussion 5.1

How can marketers exploit characteristics of digital marketing to improve relations with customers?

Discussion 5.2

How do industry profits change as a product moves through the four stages of its life cycle?

MGMT230:7:Online Organizational Behavior

Discussion 5.1

If you were about to be fired, how would you want to hear the news? Why? How would you least want to hear the news? Why?

Discussion 5.2

If two of your subordinates were experiencing relationship conflict, what would you do to manage it? Why?

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