NAME _________________________________________________
SA1 – (4 pts) We talked in class about the importance of anticipating customer needs and pleasing the customer. Assume you work in a product industry for a manager who is ‘numbers-driven.’ She does not see the overall benefit of satisfying the customer. You have been asked by the marketing department to make a short presentation to her that will persuade her of the importance of meeting/exceeding customer expectations. What are four hard-hitting points you would make? She has a short attention span, so be concise.
The art of any good business enterprise lies in the need of realizing higher levels of effectiveness i.e. doing the right things.
Moreover, by executing its daily operating activities efficiently, it means such a business will have the capacity of offering the right services to their clients, whilst remaining cost-effective.
By meeting customer expectations, and putting flexibility at the forefront of efficiency, it will be easier to bringing the firm’s objectives into line through.
Lastly, meeting customer expectations has the ability of increasing their lifetime value as well as reducing customer churn (Brink & Berndt, 2008).
SA2 – (4 pts) Do waiting lines only form when the service operation is understaffed? Explain?
Waiting line is part of the business’s everyday life. Waiting lines might be as a result of congestion, overfilling, or overcrowded. Any time that there is high demand for services, waiting line forms. Waiting time mainly depends on the amount of customers who are waiting to be served, the time taken serve each one of them, and number of servers serving line (Fitzsimmons & Fitzsimmons, 2000).
SA3 - (4 pts) Briefly discuss the concept of order winners and order qualifiers
Order winners offer reasons as to why clients ought to select the business, its products, or services. Contrary to that, by not in the position of meeting the minimum standards on the order qualifiers offers reasons as to why clients will ignore or reject the business, its products, or services (Hofmann, 2012).
BONUS! (2 points) Who developed the concept of order winners and order qualifiers?
Terry Hill
Problem 1. (8 points) Consider an espresso stand with a single barista. Customers arrive at the stand on average, every 2 minutes according to a Poisson distribution. Service times are exponentially distributed with a service rate of 35 customers per hour. What is the probability that there are more than 2 customers in the system?
Stand time (λ) = 2minutes, Service rate (μ) = 35 customers per hour
Probability (P2) = Stand time (λ) / Service rate (μ
= λ/μ
= 2/3
Problem 2. (10 points) Dumplings –To-Go (DTG) provides take-out dumplings and noodle dishes to customers at its chain of drive-through restaurants. The target for a customer’s waiting time is 3.0 minutes +/- 1 minute. Each month, one of the managers observes the drive-through process and collects a sample of 4 waiting times a day over a 6 day period. The data from one restaurant appears below.
|
Samples |
Observations (mins) |
||||
|
1 |
2 |
3 |
4 |
Row Sums |
|
|
1 |
5.4 |
4.6 |
6 |
1.5 |
17.5 |
|
2 |
2.8 |
3.9 |
4.6 |
5.4 |
16.7 |
|
3 |
5.7 |
3.1 |
2.8 |
2.2 |
13.8 |
|
4 |
4.1 |
4.3 |
5.3 |
2.8 |
16.5 |
|
5 |
2.9 |
1.3 |
4.1 |
3 |
11.3 |
|
6 |
3.3 |
4.3 |
4.2 |
3.9 |
15.7 |
|
Total of Row Sums |
91.5 |
||||
- a) (3 pts) Find the centerline, UCL and LCL for an X-bar chart for this data
Center Line = median or average of the data
= 91.5/6
=15.25
Upper control limit (UCL) = (17.5 + 13.8 + 16.5 + 11.3 + 15.7)/6 + 3(x/ )
= 15.25 + (16.5-16.1)6
=15.25 + 0.4x6
= 17.65
Lower control limit (UCL) = (17.5 + 13.8 + 16.5 + 11.3 + 15.7)/6 + 3(x/ )
= 15.25 + (16.1-15.7)6
= 15.25 + 0.4x6
= 17.65
- b) (4 points) Is the process in control? Why or why not?
No. this is because the control limits which are used to monitor the mean and the variance of the data lie outside (Sower, 2011).
Problem 3 – (8 points) The PlayBetter Golf Company has begun using QFD in an attempt to improve their declining sales. They commissioned a customer study that resulted in the following assessment. Your job is to clearly and succinctly tell PBGC where they should focus their design efforts and why.
Competitive
Assessment
|
Customer Requirements |
1 |
2 |
3 |
4 |
5 |
|
Lightweight |
|
B |
A |
|
X |
|
Comfortable Carrying Strap |
|
|
XB |
A |
|
|
Stands upright |
|
|
|
X |
BA |
|
Sturdy handle |
|
|
BA |
|
X |
|
Easy to remove/replace clubs |
|
X |
B |
|
A |
|
Easy to identify clubs |
|
X |
|
|
BA |
|
Protects Clubs |
|
B |
X |
|
A |
|
Plenty of compartments |
|
B |
X |
|
A |
|
Place for towel |
|
|
BAX |
|
|
|
Place for scorecard/pencil |
|
X |
BA |
|
|
|
Easy to clean |
|
|
B |
XA |
|
|
Attractive |
A |
|
X |
B |
|
With regard to the above data, PBGC should focus their design efforts because its facilities have the potential of being revived. This is to say that they have not yet reached the bottom-line regardless of the current declining sales.
Problem 4 - (8 points) A company is evaluating which of three alternatives should be used to produce a product. The following cost information describes the three alternatives
|
|
Process A |
Process B |
Process C |
|
Fixed Cost |
$10,000 |
$70,000 |
$40,000 |
|
Variable Cost per Unit |
$5 |
$1 |
$2 |
Give the range over which each process will be preferred
Range = (maximum –minimum) of the fixed cost (Viswanathan, 2007).
= $ (70000 – 10000)
=$ 50000
Problem 5 (10 points). Oklahoma State is playing the University of Oklahoma for the Big 12 championship. OSU is trailing 21-14 when we score a touchdown with 1 second left in the game. Still losing 21-20, the Cowboys (OSU) can choose to either go for two points and the win, or go for one point to send the game into overtime. The conference championship will be determined by this game. The Big 12 champion will go to the Orange Bowl, with a payoff of $10 million; the loser will go to the Toilet Bowl with a payoff of $1.6 million.
Mike Gundy is a very analytical coach…..he has asked you, as an ETM graduate student, to create a decision tree to determine what he should do. He tells you that if OSU goes for two points against OU, there is a 30% chance of success (and the win), and a 70% chance of failure (and OSU will lose).
If the Cowboys go for one point, there is a 98% chance they will be successful and tie the ball game, and a 2% chance of failure. If they tie, the game will go into overtime and Coach Gundy believes his team has only a 20% chance of winning in overtime because of fatigue. What would you recommend that Coach Gundy do?
(YOU MAY ASSUME THAT NEITHER TEAM WILL SCORE ON THE KICKOFF FOLLOWING THIS PLAY)
T 20/100
T 80/100
W 3/10
L 7/10 T 20/100
OSU ½ T 80/100
T 80/100
OU 1/2 W 98/100 T 20/100
L 2/100 T 80/100
T 20/100
Probability of OSU winning in case they tie (PW) = ½ X 3/10 X 20/100
= 0.03
Probability of OU winning in case they tie (PW) = ½ X 98/100 X 80/100
= 0.392
From this computation, it then means that in case they tie, OU will have a higher chance of winning. Therefore, OSU should ensure that they have scored two points against OU so as to avoid being defeated during extra time because of fatigue (Hardaker, 2015).
Essay (8 points) Consider a service firm known for high quality, for example, the Ritz Carlton. Define ‘quality’ for RC, and create a Balanced Scorecard for the firm. Include at least two metrics in each category, and define the metrics in terms of how they would be measured.
Quality for RC mainly entails transcending from traditional notions about its daily operating challenges into improved problem solving and decision-making process which will translate into improved performances. This in return will translate to high profits hence making the firm to enjoy the economies of scale (Gordon, 2002).
Balanced Scorecard
|
Financial perspectives
Goal Measures |
How do shareholders view the firm?
How do our customers view us?
|
Customer perspectives
Goal Measures |
|
Internal business perspective
Goal Measures |
|
Learning an innovation perspectives
Goal Measures |
Can the firm continue with
its strategies for improving
and creating value?
(Niven, 2006)
References
Brink, A., & Berndt, A. (2008). Relationship marketing and customer relationship management. Lansdowne, South Africa: Juta.
Fitzsimmons, J. A., & Fitzsimmons, M. J. (2000). New service development: Creating memorable experiences. Thousand Oaks, Calif: Sage Publications.
Gordon, M. J. (2002). Six Sigma quality for business & manufacture. Amsterdam: Elsevier.
Hardaker, J. B. (2015). Coping with risk in agriculture: Applied decision analysis. Boston, MA : CABI
Hofmann, E. (2012). The supply chain differentiation guide: A roadmap to operational excellence. Berlin: Springer Berlin.
Niven, P. R. (2006). Balanced scorecard step-by-step: Maximizing performance and maintaining results. Hoboken, N.J: Wiley.
Sower, V. E. (2011). Essentials of quality: With cases and experiential exercises. Hoboken, NJ: John Wiley & Sons.
