The project constitutes of a scheduling and planning game. You will be the operations managers of a small manufacturing company. During the course of the remaining class meetings, each class meeting corresponds to a planning cycle in the company. Before each class meeting, you need to prepare at least a one cycles production plan that remains frozen$.$ When I provide you with the actual demand data and new orders for the different types of products, you will then prepare profit$-$and$-$loss $($P&L$)$ statement for that cycle. 

 

Companys background

The company you are taking over manufactures cell phones. There are three different types of cell phones: Consumer, commercial, and special$-$order cell phones. The consumer cell phones are the ones you manufacture and sell to end users in the open market. These have a fairly stable demand that is depicted in Table $1.$ Commercial cell phones are the ones you manufacture for a telecommunication company. The orders for these phones are taken in the form of blanket orders, i$.$e$.$ they place an order for a certain amount for four months at a time. The special$-$order cell phones are the ones that you manufacture for special orders; these may be for private companies or governmental institutions. The special order phones are further divided into three types: Top$-$of$-$the$-$line, medium, or regular.

You currently own two machine centers that are operated by several employees. The machine centers can be operated $24$ hours per day, $8$ hours per shift, for $20$ days each month, for a maximum of $960$ hours each month.

Cost Figures

The following table summarizes the cost figures and manufacturing times for the different types of cell phones.

Time to manufacture $($minutes$)$ Raw material cost $($$$)$ Selling Price $($$$)$

Consumer $1560112$

Commercial $125095$

Top$-$of$-$the$-$line $20100180$

Medium $1890160$

Regular $1580145$

A machine center needs to be setup for each type of cell phone manufactured. It takes $20$ hours to setup the machine to make consumer phones, $20$ hours to make commercial phones, and $30$ hours to make any of the three types of special$-$order phones. The employees get paid $120$ $ per hour $(2$ $ per minute$)$ for regular time $($first shift$)$ and $150$ $ per hour for overtime $(2\mathrm{.}5$ $ per hour$),$ and assume that substitutes are always available if overtime is needed.

IV$.$ Demand

The consumer cell phones are the ones you manufacture to stock. You can sell these types of phones on the market up to the amount demanded. However, if you do not have enough to meet demand, you can sell as much as you have without incurring any back$-$order costs. These have a fairly stable demand, about $1000$ units per month. Demand for the last $6$ months is depicted in the following table.

Month Demand

$11200$

$2850$

$3950$

$41050$

$51150$

$6800$

The commercial cell phones are manufactured according to contract with a telecommunications company. The orders are placed for three months at a time. You have currently signed a contract for $1000$ units for each of the next $3$ months. It is very important to fulfill these orders. Marketing also tells you that if you decide not to accept one of this companys blanket orders, you will lose their business. Any unit that is not shipped on time costs you $20$ $

The special order phones, on the other hand, are on order basis. You have the freedom to accept or reject special$-$orders, but once you have accepted an order, you are liable to fulfill it$.$ Any unit that is not shipped on time costs you $40$ $ In addition to that, if you choose to keep a unit of any type of phone in inventory, it costs $5$ $ for each period. $-$ Question: Data Analysis for : Cost $($ breakeven point for number of units$),$ capacity $,$ demand $($ forecasting $,$ trends $)$