Chapter 2- Solved Problems

Problem 1
An inventor is seeking a manufacturer to contract for the purpose of outsourcing
production of a new medical device. As a medical device, quality, particularly reliability
quality, is of paramount importance. However, as a potentially life saving device that is
relatively new to the market and without competitors, cost and flexibility are relatively
unimportant. Based on the relative weights and performance of two suppliers given
below; which supplier should the inventor choose?

Performance
Importance Supplier 1 Supplier 2
Performance Quality 4 2 3
Conformance Quality 4 3 3
Reliability Quality 5 2 5
Delivery Reliability 3 4 2
Delivery Speed 2 5 2
Cost 2 4 2
Mix Flexibility 1 5 1
Volume Flexibility 2 2 3
Changeover Flexibility 3 3 5

Answer Problem 1

Performance Value Index

Importance Supplier 1 Supplier 2 Supplier 1 Supplier 2
Performance
Quality 4 2 3 8 12
Conformance
Quality 4 3 3 12 12
Reliability Quality 5 2 5 10 25
Delivery Reliability 3 4 2 12 6
Delivery Speed 2 5 2 10 4
Cost 2 4 2 8 4
Mix Flexibility 1 5 1 5 1
Volume Flexibility 2 2 3 4 6
Changeover
Flexibility 3 3 5 9 15
Total 78 85
 Problem 2
A new supplier has entered the medical device market. Having just entered the industry,
this new supplier has tremendous capabilities with regard to quality, but insufficient
economies of scale to drive down cost. Based on the relative performance of this new
supplier given below, which supplier should the inventor choose?

Performance Quality 5
Conformance Quality 5
Reliability Quality 5
Delivery Reliability 2
Delivery Speed 2
Cost 2
Mix Flexibility 2
Volume Flexibility 2
Changeover Flexibility 2

Answer Problem 2

Performance Value Index

Importance Supplier 1 Supplier 2 Supplier 3 Supplier 1 Supplier 2 Supplier 3
Performance
Quality 4 2 3 5 8 12 20
Conformance
Quality 4 3 3 5 12 12 20
Reliability Quality 5 2 5 5 10 25 25
Delivery Reliability 3 4 2 2 12 6 6
Delivery Speed 2 5 2 2 10 4 4
Cost 2 4 2 2 8 4 4
Mix Flexibility 1 5 1 2 5 1 2
Volume Flexibility 2 2 3 2 4 6 4
Changeover
Flexibility 3 3 5 2 9 15 6
Total 78 85 91
Problem 3
A consumer is selecting from two laser printers for his home office. One of the printers is
from a well-known competitor in the computer printer industry (HB), the other is from a
new Chinese entry in the US market (LX). Based on the importance and performance
figures given below, which printer should be purchased for the home office?

Performance
Importance HB LX
Product Features 4 2 4
Reliability 4 1 5
Brand name 1 5 1
Aesthetics 3 4 2
Availability 3 5 3
Cost 2 4 2

Answer Problem 3

Performance Value Index

Importance HB LX HB LX
Product Features 4 2 4 8 16
Reliability 4 1 5 4 20
Brand name 1 5 1 5 1
Aesthetics 3 4 2 12 6
Availability 3 5 3 15 9
Cost 2 4 2 8 4
Total 52 56