**Joel Sims: Operations Management **

*Attention: **Part 1 is to be completed using Excel. (one Excel file with multiple excel worksheets. *

**Forecasting Case **

Joel Sims Cakes Shoppe is trying not only to get accurate forecasts for three types of his cakes that he sells, but also to determine which forecasting method should be used from now that will be suited for each of the cakes. His past sixteen months of sales data (in hundreds) are shown in the table below.a) By plotting the historical sales data of all the three cake types *on same graph*, please suggest the possible forecasting method(s) you may want to consider for each cake type. Please state your reasons.

b) For **Cinnamon Buns: **Suppose you have restricted your forecasting method to a choice of Moving Averages (3 months only), Exponential Smoothing (α=0.7, initial forecast F1=18), or Exponential Smoothing with Trend (**use optimal α and δ**, initial trend forecast T1=1, initial exponentially smoothed forecast F1=17).

a) Develop your forecasts using each method.

b) Using MAD, which method would you recommend and state why?

**Part 2**

Attention:* Part 2 is to be completed using Microsoft Word. (Show All Work)*

**Problem 1: Assembly-Line Balancing **

The desired daily output for an assembly line is 24 units. This assembly line will operate 480 minutes per day. The following table contains information on this product’s task times and precedence relationships:

a. Draw the network diagram.

b. What is the cycle time (in minutes) based on the desired production time?

c. Determine the theoretical minimum number of work stations needed.

d. Using your network developed in question a) to assign tasks to specific workstations.

e. What is the efficiency of your line balancing?**Problem 2: Single-Period Inventory Model **

The Fitness Shop is considering ordering a special model exercise machine. Each unit will cost the shop $410 and it will sell for $750. Any units not sold at the regular price will be sold at the year-end model clearance for $340. Assume that demand follows a normal probability distribution with μ = 20 and σ= 6. What is the recommended order quantity?

**Problem 3: Supply Chain EOQ – Collaboration **

CTC is an on-line retailer of prescription drugs and health supplements. Vitamin-C represents a significant percentage of its sales. Demand for Vitamin-C is 12000 bottles per year. CTC incurs a fixed order placement, transportation, and receiving cost of $150 each time an order for Vitamin-C is placed with the manufacturer. CTC incurs a holding cost of 25 percent. The price charged by the manufacturer is $4/bottle. Each time CTC places an order, the manufacturer has to process, pack, and ship the order. The manufacturer has a line packing 2 of 2 bottles at a steady rate and does not keep any inventory. The fixed cost of filling each order is $350 for manufacturer.

a) Under the non-collaborative environment, the above supply chain uses CTC’s EOQ policy. Please evaluate CTC’s annual ordering and holding costs and Manufacturer’s annual ordering cost and holding cost under the CTC’s EOQ policy. What is the total annual ordering and holding cost for this supply chain under this non-collaborative policy?

b) Under the collaborative environment, both manufacturer and CTC agree to use the Supply Chain EOQ instead of CTC’s EOQ. Please calculate this Supply Chain’s EOQ and evaluate CTC’s annual ordering and holding costs and Manufacturer’s annual ordering cost and holding cost respectively. What is the total annual ordering and holding cost for this supply chain under this collaborative policy?

c) Compare the results obtained in a) and b) and discuss your observations.