What is the worst that can happen to ritz

Assignment Help Operation Management

Reference no: EM132695648

Starbucks barista or having the checkout clerk focus on you rather than talking over his shoulder to the clerk at the next counter. Moments of truth can occur when you order at McDonald's, get a haircut, or register for college courses. The operations manager's task is to identify moments of truth and design operations that meet or exceed the customer's expectations.

Answers on the activity/task shall be written on whole sheet/s of yellow paper and must be submitted not later than the agreed deadline. Late submissions will not be accepted and will result to a failing grade.

Ritz Products's materials manager, Tej Dhakar, must determine whether to make or buy a new semiconductor for the wrist TV that the firm is about to produce. One million units are expected to be produced over the life cycle. If the product is made, start-up and production costs of the make decision total P1 million, with a probability of 40% that the product will be satisfactory and a 60% probability that it will not. If the product is not satisfactory, the firm will have to re -evaluate the decision. If the decision is re-evaluated, the choice will be whether to spend another P1 million to redesign the semiconductor or to purchase. Likelihood of success the second time that the make decision is made is 90%. If the second make decision also fails, the firm must purchase. Regardless of when the purchase takes place, Dhakar's best judgment of cost is that Ritz will pay P.50 for each purchased semiconductor plus P1 million in vendor development cost. (Adapted from Haver J. Render B. & Munson C. (2017)0M. Swralnabdrty and Supply Chan, Management 12' Edition, p. 188)

Using the facts provided by the case, answer the following questions. Explain briefly and support your answers.

a. Assuming that Ritz must have the semiconductor (stopping or doing without is not a viable option), what is the best decision?
b. What criteria did you use to make this decision?
c. What is the worst that can happen to Ritz as a result of this particular decision?
d. What is the best that can happen?

Reference no: EM132695648

Questions Cloud

Comparison to traditional vpn management : How does software-defined networking affect the management of a VPN in comparison to traditional VPN management?

Why organizations striving to develop organizational culture : Why organizations are striving to develop organizational cultures that value diversity, and identify ways in which individuals and organizations can enhance.

How many times will it be necessary to write Fees Earned : Problem - In recording 400 fees earned on account during a single month, how many times will it be necessary to write Fees Earned

Data science and big data : While this weeks topic highlighted the uncertainty of Big Data, the author identified the following as areas for future research.

What is the worst that can happen to ritz : What is the worst that can happen to Ritz as a result of this particular decision and What is the best that can happen?

Indicate whether an account in the accounts receivable : Indicate whether an account in the accounts receivable or accounts payable subsidiary ledgers would be affected for each of the preceding transactions

Record these transactions in a purchases journal : Oct. 11. Purchased cleaning supplies for $235, on account, from General Supplies. Record these transactions in a purchases journal

Explain the two collective bargaining strategies : The employees at your organization have formed a union, and the bargaining process now begins. Write a case study in which you analyze the situation.

Record these transactions in a revenue journal : Dec. 5. Issued Invoice No. 302 to Butler Company for services provided on account, $5,000. Record these transactions in a revenue journal

User Account

All Pages