Question: ACCESS TO TABLE A: https://www.macmillanhighered.com/BrainHoney/Resource/6710/digital_first_content/trunk/test/psbe4e/asset/bm/supp_wins/tables/table_table-a.html To remain competitive, companies worldwide are increasingly recognizing the need to effectively manage their supply chains. Let us consider a
ACCESS TO TABLE A: https://www.macmillanhighered.com/BrainHoney/Resource/6710/digital_first_content/trunk/test/psbe4e/asset/bm/supp_wins/tables/table_table-a.html

To remain competitive, companies worldwide are increasingly recognizing the need to effectively manage their supply chains. Let us consider a simple but realistic supply chain scenario. ElectroWorks is a company that manufactures and distributes electronic parts to various regions in the United States. To serve the ChicagoMilwaukee region, the company has one warehouse in Milwaukee and another in Chicago. Because the company produces thousands of parts, it is considering an alternative strategy of locating a single, centralized warehouse between the two marketssay, in Kenosha, Wisconsinthat will serve all customer orders. Delivery time, referred to as lead time, from manufacturing to the warehouse(s) and ultimately to customers is unaffected by the new strategy. Consider comparing a decentralized versus a centralized inventory system as it ultimately relates to the amount of safety stock (extra inventory over and above mean demand) held in the system. Focus on one specic part: SurgeArrester. The lead time for this part from manufactung to warehouses is one week. Suppose that the CEO of ElectroWorks requires a 99% customer service level. This means that the probability of satisfying customer demand during the lead time is 0.99. Assume that lead time demands for the Milwaukee warehouse, Chicago warehouse, and centralized warehouse are Normally distributed with the following means ,1; and standard deviations 0': X = Milwaukee warehouse ,ux = 415 units ax = 48 units Y = Chicago warehouse W = 2639 units 0'}! = 272 units Correlation between X and Y 9 = 0.52 X + Y = centralized warehouse ,uXer = 3104 units ax\"; = 299.78 units (Use decimal notation. Use Table A. Round your answer to the nearest integer.) For a 99% service level, how much safety stock of the SurgeArrester part does the Milwaukee warehouse need to hold? For a 99% service level, how much safety stock of the SurgeArrester part does the Chicago warehouse need to hold? For a 99% service level, how much safety stock of the SurgeArrester part does the centralized warehouse need to hold? safety stock: units
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
