Smarmy Sales, Inc. (SSI) sells herbal remedies through its Web site and through phone reps. Over the
Question:
Smarmy Sales, Inc. (SSI) sells herbal remedies through its Web site and through phone reps. Over the past six years, SSI has started to depend more and more on its Web site to generate sales. The figures below show total sales, phone rep costs, and Web site costs for the past six years:
a. Calculate productivity for the phone reps for each of the past six years. Interpret the results.
b. Calculate the productivity for the Web site for each of the past six years. Interpret the results.
c. Compare your results in parts a and b. What are the limitations of these single-factor productivity measures?
d. Now calculate a multifactor productivity score for each year, where the “input” is the total amount spent on both the phone reps and the Web site. Interpret the results. What can you conclude?
Step by Step Answer:
Introduction to Operations and Supply Chain Management
ISBN: 978-0134740607
5th edition
Authors: Cecil B. Bozarth, Robert B. Handfield