SOAL UJIAN AKHIR SEMESTER MM UNAIR

CLASS : MANAJEMEN OPERASI DAN PROSES

TAKE HOME EXAM :

Ujian : Selasa tanggal 16 Juni 2020

Dikumpulkan : Hari Sabtu, tanggal 20 Juni 2020

Email : wjrrumaji@gmail.com

1. North and Star management team were busy evaluating the performance at OlahStuff.com over
the previous year. Demand had grown by 80 percent. However, could clearly see that costs would
grow faster than revenues if demand continued to grow and the supply chain network was not
redesigned. The idea was very well received in the market-place, demand grew rapidly and by the
end of 2019, the company had sales of $0.8 million. In June 2019, the company leased part of a
warehouse in the outskirts of St. Louis to manage the large amount product being sold. Suppliers
sent their product to warehouse. Customers order were packed and shipped by UPS from there.
As demand grew, the company leased more space within the warehouse. Management divided
the USA into six customer zones for planning purposes. Demand from each customer was shown
in Table 1.below. Fixed and variable costs are shown in Table 2.
Table 1. Regional demand on 2019

Zone Demand Zone Demand

Table 2. Fixed and variable costs of Potential warehouses

Small warehouse Large warehouse

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 Table 3. UPS charges per shipment (Four units)

The company need more warehouse space to cope with the anticipated growth. One option was
to lease more warehouse space in St.Louis itself. Other options included leasing warehouses all
over the country. Leasing a warehouse involved fixed costs based on size of the warehouse and
variable costs that varied with the quantity shipped through the warehouse. Small warehouses
could handle a flow of up to 2 million units per year, whereas large warehouses could handle a
flow of up to 4 million unit per year. The current warehouse in St. Louis was small. The company
charged a flat fee USD 3 per shipment sent to a customer. An average customer order contained
four units. The charges were based on both origin and destination. Management estimated that
inbound transportation cost for shipments from suppliers were likely to remain unchanged, no
matter what warehouse configuration was selected.

Your task is :
What supply chain network configuration do you recommend for the
company?.

2. FOODGRADE is one the quintessential icons in the country for food industry. It has 14 food-
processing facilities in 12 states, employs more than 20,000 associates, partners with 7,500
independent farm families and produces about 2.7 billion pounds of chicken and turkey annually.
Its operating subsidiaries provide quality products and service to retail, food service, and
agriculture customers. Though best known as a poultry company, it is a major producer of
agricultural products. The company purchases grain from more than 5,000 local farmers to supply
its feed mills and market grain internationally. It also owns a fleet barges, leased rail cars, and
deep-water port to export grain and agricultural products around the world.

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FOODGRADE is a vertically integrated company. The entire supply chain starts from breeding eggs,
hatching chicks, manufacturing processing, packaging, warehousing and distribution. This gives
the company total control of quality. The company maintains quality control through its
distribution network, including its own truck fleet, distribution and replenishment centers and
dedicated cold storage and export facilities. It has its own breed of chicken to supply eggs to
hatcheries. The vision of year 2021 is to increase sales volume to USD20 billion from its current
level of USD 2.7 billion.

The questions are :

a. Compare the poultry industry’s vertical supply chain model with Dell’s direct model that

outsources most of its operations. Is this the best operations management / supply chain

model for both industries? Why or why not ?

b. Analyze the entire production lead time, starting from eggs. How does lead-time affect

production planning ? are there any risks and bottlenecks ?

c. Examine SWOT of the company. What new operational ideas and changes would you

recommend to the management to realize its vision 2021 ?

Use the reference below :

a. www.thepoultrysite.com
b. www.perdue.com
c. www.manugistics.com/envision2005/speakers.html.
d. www.news.mywebpal.com/partners/963/public/news640284.html