Production Information:

Mr$.$ Ralph has provided you a table that shows all of the tasks involved in manufacturing a table in his facility:

Task Task Time $($minutes$)$ Description Task That Must Precede

A $4$ Loading of composite sheets from raw materials storage to production area $-$

B $12$ Cutting composite parts A

C $18$ Sanding of composite parts B

D $12$ Assembly of back rest C

E $12$ Assembly of legs C

F $12$ Assembly of seat C

G $6$ Attaching legs to seat E$,$ F

H $4$ Attaching company nameplate $($logo$)$ to backrest D

I $6$ Attaching backrest to seat$/$legs G$,$ H

J $5$ Final quality inspection I

K $4$ Transporting chair to finished goods storage J

$*$The facility operates $20$ days a month and for $10$ hours per day.

Precedence Diagram:

Cycle Time Required to Meet Forecasted Demand:

# of Workstations$/$Employees Required and Tasks Assigned to Each:

Overall Predicted Utilization $($next $12$ months$)$:

Capacity Management:

Mr$.$ Ralph is considering some different expansion options for $2024$:

Option $1-$ Small expansion of production and storage facilities

Option $2-$ Large expansion of production and storage facilities

Option $3-$ Keep production and storage facilities as$-$is

He is fairly confident in the long$-$term market research that his sales team has conducted which determined there are $3$ possible scenarios for the level of demand. The estimates are that there is a $20\%$ chance that demand will be low, a $40\%$ chance that demand will be medium, and a $40\%$ chance that demand will be high.

The small expansion would cost $$5$ million to build. If demand is low, he expects to receive an additional $$3$ million in discounted revenues $($present value of future revenues$)$ with the new facility. If demand is medium, he expects an additional $$6$ million. If demand is high, he expects an additional $$6$ million with the small facility.

The large expansion would cost $$8$ million to build. If demand is low, he expects to receive an additional $$3$ million in discounted revenues $($present value of future revenues$)$ with the new facility. If demand is medium, he expects an additional $$6$ million. If demand is high, he expects an additional $$12$ million with the large facility.

There is also a new government program that the Ontario Government is launching in $2024$ to support the expansion of Ontario businesses through grants. Mr$.$ Ralph believes that the large expansion could qualify for this program and that if Ontario Leisure Chairs applied for the grant there is a $50\%$ chance their application would be successful. They would not know if the application is successful until after the facility is built but the grant is worth $$2$ million.

Construct a decision tree to help Mr$.$ Ralph make a decision and include it in your final recommendation in the report.