PURES COLLEGE OF TECHNOLOGY

Course Code Course Name Section Code

BU1193 Business Process Development BU1193-SCM G1

Percentage Weight of Total

Semester Type of Evaluation
Evaluation
Winter 2024 Assignment #1
10%

Course Instructor Due Date

Total Marks: / 10
Tony Bejjani Week 5 (Friday, Feb. 9, 2024) at 12:00 pm

Student Name Student ID # Team #

PARDEEP 202302938

GURPREET SINGH 202302582

ANGES MARTIN 202207143 6

MOHIT 202303296

1) Wriston Manufacturing Corporation operates several plants with large differences in overhead rates. The
Detroit plant has the highest overhead rate—more than twice the rate of the lowest overhead plant,
Maysville. As a result, the corporation is considering closing down in Detroit and transferring its production
to a lower overhead facility such as Maysville.
What will be the effect of transferring the entire production of Detroit to Maysville and why? (Assume
capacity is not an issue) (2.5 Marks)

The Wriston Manufacturing Corporation (WMC) faces a critical decision regarding the future of its Detroit
plant. Such a high overhead rate at the Detroit facility has made the site more of a financial burden, hence the

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reason why it was looking at options for a transfer of production to such a low-cost plant like Maysville. Now,
let us look at the potential impacts of such a strategic move.

Detroit Issues:

Operational Inefficiency:

High variability in the product offering of Detroit is shown among the product lines, families, and models. This
high variability in product offerings has led to subpar returns on assets (ROA) and lackluster sales.

There are operational inefficiencies that are due to a mismatch of the product and process layout. The
machinery in Detroit is functionally organized, so the batch process would fit better.

Such operational challenges are added to by poor sales per employee and a high burden rate1.

Under Investment

WMC measures plant profitability in silos, negatively impacting Detroit. As products reached volumes, they
were transferred to other plants perpetuating Detroit's inefficiency. The flawed accountability system benefits
other factories at Detroit's expense.

Potential Effects of Transferring Production:

Cost Reduction:

Production cost in Maysville is very low as compared to Detroit. This shifting of production will result in a
dramatic reduction in overhead costs.

The overhead rate in Maysville is lower, so transferring production from Detroit to Maysville would help WMC
in better financial performance overall. The closure of Detroit would also help eliminate the high variance and
operational inefficiencies linked to its complex product lines.

Better profitability:

Maysville's excess capacity and efficiency in operations would enhance profitability. The transfer would enable
Maysville to accommodate Detroit's volume of production.

Streamlining operations of WMC can lead to economies of scale and better utilization of resources1.

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Risk Mitigation

The potential for loss to WMC in case the sales shift from Detroit, in turn, makes this a risk to the stability of
WMC's overall sales. In this scenario, the production could shift to Maysville to reduce the risk by combining
the operation with a more efficient plant. Apart from this, transferring production to Maysville could reduce
overhead costs, improve efficiency, maximize capacity utilization, streamline operations, and provide a
competitive advantage.

To sum up, closing Detroit is a means to redeploy the focus and resources of WMC to such plants that yield
better monetary returns. It would essentially be a change in its approach towards consolidation of business
lines and therefore a strengthening of its market standing.

The decision would unquestionably demonstrate that WMC is dedicated to operational brilliance and fiscal
practicality. Moving the entire production activities from Detroit to Maysville would amount to a cost-saving
measure, profitability improvement, and reducing risk and thus will strategically place WMC for success. This,
however, should be well planned and executed in order to lead to a smooth transition and the benefits that
shall come with it.

2) Sustaining a competitive advantage requires strategic positioning and operational effectiveness. Define
both concepts and graphically illustrate their difference using the competitive space graph. (2.5 Marks)

Sustaining a competitive advantage requires Strategic positioning and operational effectiveness this is true in
today’s cutthroat competition where within hours companies launch new products and services to catch
eyeballs and copy other products swiftly.

Strategic positioning is a business strategy where an organization that produces products or services
differentiates itself from competitors by creating better value for its customers (4K Videos in iPhone)

This can help them create a competitive advantage over other similar companies and ultimately increase the
company's profit. Strategic positioning can work well alongside a traditional sales strategy. We can takes the
best example ofiPhonehonee (APPLE) when Apple’s positioning strategy focuses on attracting specific
customers with unique needs. Primarily, the company positions itself as a high-quality brand, which means its
products feature premium prices and are often more expensive than competing solutions.

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Operational efficiency is something that organizations achieve when they maximize the use of their inputs to
produce any outputs. Operational effectiveness is all about achieving or extending practices. Fundamentally,
you’re in business to generate a surplus. So, it follows that to do this, you need to be more effective. Looking
at the things that cost you money and finding ways to do them more efficiently.

The graph above, designed by Michael Porter, sums up why operational effectiveness without a differentiated
strategy as compared to other players in the me business will fail to provide sustainable profitability.

On one axis you have value to the customer and d the other your cost position relative to your competitors.
Operational effectiveness pushes you towards the productivity frontier (which is the state of best practice) and
your strategic positioning decides where on the frontier your business is going to live. When businesses copy
each other, they all end up in the same place as – SAMSUNG, NOKIA, Oand PPO, VIVO arand e the cAne android
phonAndroidater same segments of customers

However, when strategic positioning is part of the mix, you may, for example, consider reducing your cost to
bring you further down the arc. Or maybe you improve your product/service resulting in a greater willingness
to pay, which takes you further up. Either way, you need to decide where you’re going to play in your market.
And the bits of execution that you should focus on are those that enable this strategy.

There’s a cost there that your ideal customer won’t care about or want so the product needs to be designed to
suit the core customer. You need to be completely clear about what segment of the market you’re goi

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sergoing tolilikenow wellknowihow ngir product is cacateredo needs the of peoplincomes high inhigh-incomer
video content makers. Launching a new phone every year is also part of their strategy

In the end, businesses need to master both operational effectiveness and strategy to grow. It’s about trade-
offs. Learning to say no when something doesn’t fit with your strategy. This is harder than saying yes to things
that take you in the wrong direction.

3) As a product moves through its life cycle from introduction to growth to maturity and phases out, which
process type (job shop, batch, line flow, or continuous flow) is most appropriate at each stage? (2.5 Marks)
The Product Life Cycle in the Process Type Selection

Just as the product undergoes its life cycle, the best-suited process type for its production also changes.
Following are the characteristics for each of the stages and the best-suited process type:

Stage 1: Introduction

For this particular stage of the product life cycle, what normally characterizes the stage is low demand, high
uncertainty, and frequent product modifications.

Suitable Process: Job Shop

Flexibility to process changes and process units in small volumes. It has the ability for customizations and
caters to early adopters.

- Example: Launching of a new type of phone case. Job shops can easily adapt to the different models of
phones and different user preferences.

Job Shop Process * Low Volume * High Flexibility * Customized

References: Heizer, J. H., & Render, B. (2020). Operations Management: Sustainability and Supply Chain
Logistics. Pearson. Exclamation Slack, N., Chambers, S., & Johnston, R. (2023). Operations Management.
Pearson.

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Stage 2: Growth

Ideal for growing demand product specs stability. Batch Flow: It strikes a balance between flexibility and
efficiency. It may have some level of possible customization with increased volume.

Example: Manufacture of laptops haconfigurationsconfiguration. Batch flow allows the production of several
variants in a batch with shorter set-up times as compared to job shops.

Batch Flow Process * Moderate volume * Balanced flex *Standardized

Citations: Stevenson, W. J. (2018). Production/operations management. McGraw-Hill Education.

Chase, R. B., Jacobs, F. R., & Acquilano, D. M. (2017). Operations management

Stage 3 Line Flow: High volume, low flexibility, and standardization.

Example: assembling smartphones on a conveyor belt. Line flow ensures rapid production of standardized
phones at competitive prices. Suitable Process: Line Flow: Most efficient for large-volume production of
identical units: costs and setup times are reduced.

Process: Line Flow * High Volume * Low Flexibility * Standardized

Schroeder, R. G., Goldstein, S. M., & Rungtusanatham, M. J. (2022). Operations management: Contemporary
concepts and cases. McGraw-Hill Education.

Stage 4: Phase Out

Characteristics:

• Appropriate Process: FlexiThis may Approach: May consist of a job shop and batch operation of the balance
demand with permissible changes in the product.

Producing spare parts for specific models of cars for which production is slowly phasing out. This way, it is
possible to make short production runs with limited customization towards a particular order.

Hybrid Process * Variable Volume * Adaptive * Limited scale

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Citation: Vollmann, T. E., Berry, W. L., Whybark, D. C., & Raynor, D. (2005). Manufacturing and design planning
and control. McGraw-Hill

Fisher, M. L., Hammond, J. H., Oberhelman, W. L., & Raman, A. (2020). Supply chain management: A
retrospective and reflection.

4) Give two major benefits of a functional (process focus) layout and two major benefits of a cell (product
focus) layout. (2.5 Marks)

Functional Layout (Process focused)

A process layout arranges related machinery and equipment in a single department according to their
functional type. The processes are divided, and each process's machinery is maintained separately from the
others.

For example, the department housing the milling equipment would house all the milling machinery, the
department housing the grinding machinery, and the department housing the welding machinery. It needs a
sizable amount of specialized machinery run by a small crew.

Advantages

Optimal utilization of Resources:

One of the key advantages of functional layout is the efficient allocation of resources. By grouping similar
machines or tasks, companies minimize the duplication of equipment, tools, and materials required for specific
functions. In addition to that, it also helps to improve the overall operational efficiency.

Streamlined Workforce:

Achieving optimal productivity requires an efficient workflow. By reducing the amount of time spent moving
between various departments or activities, a functional layout optimizes the flow of information and resources.
Businesses can minimize the chance of bottlenecks, accelerate production cycles, and save transportation times
by optimizing the physical configuration of workspaces.

Cell Layout (Product Focused)

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The physical arrangement of a corporation that enhances productivity, efficiency, and workflow is called a
cellular layout. Work cells—micro units of three to twelve workers—must be created to implement this
structure. A specific amount of equipment and supplies are included in each unit. To avoid wasting time looking
for the tools or materials they need to complete their duties, it is intended for workers to have on-demand
access to machinery and supplies. A department may consist of three workers and one machine, or it may
consist of twelve workers and six or more machines, depending on the needs and scale of the business.

Advantages

Maximum Confidentiality:

Workers enjoy complete seclusion and anonymity while working because their cubicles are located in closed
office buildings. To create a happy atmosphere that will probably boost their general efficiency and production,
they can accept confidential conversations, handle confidential data, and customize their workspaces based on
how comfortable and cozy they are. For businesses where routine tasks must be accomplished in a calm, highly
private setting, this is the perfect office design plan.

Enhanced Concentration:

Employees may focus on their work in a calm and noise-free environment created by the cellular office layouts.
For analysts, programmers, and technical personnel who require a high level of focus and concentration, this is
the ideal workspace arrangement.

Instructions:
a) Complete this assignment with your student’s name and ID #, using font 11.
b) One and a half-space typed.
c) The team Captain/leader should fill out the “Group Peer Evaluation Form” and submit it with the
assignment.
No email submission is accepted whatsoever!
d) Provide references on the last page of the assignment using the APA style.
e) Plagiarism: ZERO MARKS.

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GROUP PEER EVALUATION FORM

Group Peer Evaluation Rubric Team Captain/Leader: PARDEEP

(to be completed by the team
captain/leader for each
assignment/project)

Criteria:

Mark Team Role fulfillment Communication Job proficiency

Always listens to, shares with, and

supports the efforts of others.
Participated in aand ll group Did more than others - highly
Provided effective feedback to
meetings, assumed leadership productive. Work is complete, well
4 other members.
roles as necessary. Did the work organized, with no errors, and is
Relays a great
that was assigned by the group. done on time or early.
dearelatednformation - all relate to
the topic.
Usually listens to, shares with, and Did their part of the work -
Participated In most group supports the efforts of others. cooperative. Work is generally
meetings. Provided leadership Provided some effective feedback complete, meets the requirements
3
when asked. Did most of the work to others. of the task, and is mostly done on
assigned by the group Relays some basic information time. Works well with others,
- most relates to the topic. rarely argues.
Could have done more of the work
Participated in some group Often listens to, shares with, and
- has difficulty, requires structure,
meetings. supports the efforts of others.
directions, and leadership. Work
2 Provided some leadership. Did Provided little feedback to others.
tends to be disorderly, incomplete,
some of the work assigned by the Relays very little information -
and not accurate and is usually
group. some relate to the topic.
late.

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Rarely listens to, shares with, or Minimal work - Minimum
Participate in few or no group
supports the efforts of others. contribution, does not work well
meetings. Provided no leadership.
1 Provided no feedback to others. with others. Work iswith sloppy
Did little or no work assigned by
Does not relay any information to and incomplete, excessive errors,
the group
teammates and is mostly late or not at all.
Did not do any work - does not
Did not listen, share with others, or contribute, does not work well
Little to no Participation. Did little
0 support the group. Provided no with others. Wowith rk is sloppy
or no work assigned by the group
feedback to others. and incomplete, excessive errors,
and is mostly late or not at all.

Evaluate group members (including yourself):

Team Role Total
Communication Job Proficiency
Name Fulfillment (Out of
(Out of 4) (Out of 4)
(Out of 4) 12)

PARDEEP 3.5 4 4 11.5

GURPREET SINGH 4 3 4 11

ANGES MARTIN 4 3.5 4 11.5

MOHIT 4 4 3.5 11.5

GeneraofComments: mber in the team workswithaborated work will full dedication and hard work

Evaluation Rubric

20 of the Final Mark

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Category Exemplary Skilled Minimal Insufficient
Compliance Evidence
8.0 – 10.0 6.0 – 7.9
5.5 – 5.9 0-5.4

C Questionis 1 All content covered, Majority of content Much of the content Inadequate
O clearly and generally well left uncovered or not coverage of the
-
N succinctly. All covered. Some referred to topic. Reference
m
T information refers to aspects lack specifically. Content to content
E - specific aspects of specificity. No too general to obtain incomplete. Very
N the topic. insights or depth full meaning; little effort was put
T Information is provided. reference to topics into making the
meaningful, vague, incomplete. report meaningful.
significant, and Incorrect topics
illuminating. covered.

Question 2 All content covered, Majority of cois Much of the cois Inadequate
clearly and ntent generally well ntent left uncovered coverage of
succinctly. All covered. Some or not referred to topics. Reference
information refers to aspects lack specifically. Content to content
specific aspects of specificity. No too general to obtain incomplete. Very
the topic. insights or were full meaning; little effort was put
Information depth provided. reference to topics into making the
meaningful, vand ague, report meaningful.
significant, and incomplete. Incorrect
illuminating. topics covered.

Question 3 All cois ntent Majority of cois Much of the cois Inadequate
covered, clearly and ntent generally well ntent left uncovered coverage of
succinctly. All covered. Some or not referred to topics. Reference
information refers to aspects lack specifically. Content to content
specific aspects of specificity. No too general to obtain incomplete. Very
the topic. insights or were full meaning; little effort was put
Information is depth provided. reference to topics into making the
meaningful, vand ague, report meaningful.
significant, and incomplete. Incorrect
illuminating. topics covered.

Question 4 All cois ntent Majority of contis Much of theis Inadequate

covered, clearly and ent generally well content left coverage of
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succinctly. All covered. Some uncovered or not topics. Reference
information refers to aspects lack referred to to content
specific aspects of specificity. No specifically. Content incomplete. Very
the topic. insights or dewere too general to obtain little effort was put
Information is pth provided. full meaning; into making the
meaningful, reference to topics report meaningful.
significant, and vague, incomplete.
illuminating. Incorrect topics
covered.

Category Exemplary Skilled Minimal Insufficient

Compliance Evidence
8.0 – 10.0 6.0 – 7.9
5.5 – 5.9 0-5.4

Overall Impact of
Case Study
Document

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M Writing Generally high level Maximum of 3-4 Maximum of 5-8 Poor grammar,
E of writing and errors in writing errors in writing and spelling, and
- grammar
C formatting. and formatting. formatting. formatting
H - spelling interfere with
A comprehension.
N - punctuation
Sourcing is complete Sourcing is Sourcing is a
I with many high- complete with a complete but small
Formatting
C quality sources. APA reasonable number number of low-quality Sourcing is limited
S - line spacing format is used of sources of good sources. APA format or has not been
correctly. quality. APA format used but incomplete done at all.
- margins
is used correctly. or inaccurate.
- paragraphs

- headings

- title page

Sourcing

- use of APA
forquality/nu
mbermber of
sources

References

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Kim, G. (2020) Wriston Case Memo.” Studocu1 https://www.studocu.com/en-ca/document/the-university-of-
british-columbia/supply-chain-management/wriston-case-memo/8015346
Janice, H (2022, January) Wriston Manufacturing Corporation. https://www.hbs.edu/faculty/Pages/item.aspx?
num=22886
Dominic, M (2023) Operational Effectiveness
https://www.monkhouseandcompany.com/guides-resources/strategy-vs-operational-effectiveness-are-you-
clear-on-the-difference/
Koral, M. (2023 March 16) Product Life Cycle Explained: Stage and Examples
https://www.investopedia.com/terms/p/product-life-cycle.asp
Accountlearning.com (2022) Process and functional layout. https://accountlearning.com/process-or-functional-
layout-suitability-advantages-disadvantages/
Hoga next Team (2023, November 12) Functional Layout: Maximizing Efficiency and Specialization.
https://hogonext.com/functional-layout-maximizing-efficiency-and-specialization-in-production-facilities

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