BUS3500 Operations Management_Case Study 3 Technical and Economic Information 1. The plant runs 5 days each week, and currently is running to lines with no overtime. Each line requires al people to run For planning purposes, the lines are run for 75 hours cach normal shift. Employees, though, are paid for hours' work. It is possible to run up to 2 hours of overtime each day, but it must be scheduled for a week time. and all the lines mostrovertime when it is scheduled Workers are paid $20.00h during a regular shift and 330.00/hour on over time. The standard production rate for each line 450 cases/bout 2. The marketing forecast for demand is as follow 1-2.000.02-22000-2.500.04-2650 and QI coext year) 2.300. These numbers are in 1.000 cases. Each um represents a 1 week forecast 1. Management has instructed manufacturing to maintain a two-week safety stock supply of polding inventory in the warehouses. The twoweck supply should be based on future expected sales. The following an ending inventory target levels to comply with the safety stock requirement for each quarter 01-13 02-385 04-08 04-13 Imentory carrying cost is estimated by accounting to be $1.00 per care per year. This means that if a case of pudding is held in inventory for an entire year, the con to carry that case inventory is $100 face is carried for only one week, the cost is $1.00/52 or 50.01923. The cost is proportional to the time carried in inventory. There are 200.000 cases in inventory at the beginning of this is 200 cases in the 1.000 case units that the forecast is given in sa stock out occurs the item is backordered and shipped at a later date. The cost when a bochonder eccurs is $2,40 per cute due to the woodwill and the high con of emergency shipping The human resource group estimates that it costs $5,000 to hire and train a new production employee. It com $1,000 to lay off a production worker 2. Make the following assomption in your cont calculations . Inventory costs are based on inventory in excess of the safety stock requirement. Backorder costs are incurred on the negative deviation from the planned safety stock requirement, even though planned inventory may be positive. Overtime must be used over an entire quarter and should be based on hours per day over that time Questions 1. Prepare an regte plan for the coming year, suming that the sales forecast is perfect Use the spreadsheet "Bradford Manufacturing" in the spreadsheet, an area has been designated for your pregate plan solution Supply the number of packaging lines to run and the number of overtime hours for each quarter. You will need to set up the cost calculations in the spreadsheet You may want to try using the Excel Solver to find a low cost solution. Remember that your final solution needs an integer number of lines and an integer number of overtime hours for cach quarter. (Solutions that require 8.9134 lines and 1.256 hours of overtime are not feasible.) It is important that your spreadshort calculations are set up so that any values in the number of lines and evertine hours nows evaluates correctly. Your speedsheet will be evaluated based on this 2. Find a solution to the problem that goes beyond just minimering cost. Prepare a short writeup that describes the procen you went through to find your solution and that justifies why you think it is a good chain