Course SCM 2160 – Supply Chain and Operations Management
Winter Term 2013
Section A01 M/W at 8:30 a.m. in Room ___ Drake Centre
Section A03 Tu/Th at 4:00 p.m. in Room ___ Drake Centre
Glenn Ismond
Office Hours: 11:00 to 2:00 p.m. on Monday/Wednesday
Office: ___ Drake Centre
E-mail Address:
gismond@mymts.net
Telephone: 474 - ____
INTRODUCTION
Operations Management concerns the management of the transformation of inputs into outputs.
An Operations Manager is principally concerned with the design, planning, direction, and control
of facilities, processes, and activities required to transform material, labour, capital, energy, and
skills into goods and services, henceforth called products.
COURSE OBJECTIVES
The major objective of this course is to introduce you to the fundamental concepts of Operations
Management from a general management perspective.
Our discussions will include references to some broader issues facing businesses in the
21st Century, namely ethics and corporate social responsibility. You will have opportunities to
enhance your skills in critical thinking, quantitative analysis, communication (written and
spoken), teamwork and leadership.
At the conclusion of this course, you should appreciate that Operations Management is
primarily a management discipline that is strategically important for survival in todays very
competitive environment.
COURSE MATERIAL
1. Jacobs, F, Robert, Chase, Richard B., and Balakrishnan, Jaydeep (2010). Operations and Supply
Chain Management: The Core, Canadian Edition, Toronto, McGraw-Hill Ryerson.
package of cases
2. Package of Cases and readings, mainly from the Harvard Business School or the Richard Ivey
School of Business in the Bookstore. Be sure to purchase the Ismond A01/A03 package.
3. Class Hand-outs
METHODS OF INSTRUCTION
Case Studies The primary method of instruction will be the analysis and discussion of case
studies. This requires active student participation.
Each of the teaching case studies for this course represents an Operations Management
situation in which a decision must be made in light of a number of tradeoffs and alternatives.
Class time on “Case Days” will be devoted to discussing the situation, the managerial and
technical implications of various options, and the action to be taken to implement the preferred
options. There is no one right answer to a case, but there are definitely approaches that address
the issues and recognize the tradeoffs involved. Thus, the lack of a single correct answer does not
imply that all suggestions are equally valid.
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Other Methods While discussing cases will be the most common method of instruction, other
activities will be employed from time to time. Examples include but are not limited to: the
discussion of textbook material, hand-out articles, exercises, and student presentations.
PERFORMANCE EVALUATION
Class Participation .................... 30%
Mini-Tests (two at 10 marks each) 20%
In-class Exercises ...................... 15%
Formal Group Presentation ........ 10%
Final Examination ...................... 25%
Total ....... 100%
Participation Participation is very important. I expect you to be prepared for each and every
class discussion, so that you can be an active participant in advancing the learning of the class.
Participation means making a useful contribution in a fair number of classes during the term. On
any given day, I may call upon you without any notice, AND you can indicate your willingness to
join the discussion by raising your hand. On those certain rare occasions when you may not be
prepared to participate in the discussion PLEASE let me know by voice-mail or E-mail, so that
neither you nor I are embarrassed in class. I will simply expect you to make your contribution in
other discussion sessions.
I define a useful contribution as any contribution that pushes the understanding of the
class forward. You could argue your point of view during a case discussion, ask a relevant
question, suggest an alternative viewpoint, and/or redirect our attention to another topic which
had not been adequately covered.
You do not have to be a top participant in every class, nor do you have to have the “right
answer” when you do participate. Do not be afraid to speak up simply because you think your
ideas might be challenged; this is the place for such challenges so long as they are made politely.
Please focus on what was said, and do not attack the speaker. The Participation Grade is meant to
be a stimulant to discussion, not a deterrent.
I judge Participation for each session on a scale of 0 to 4. A “0” indicates no contribution,
and you can earn a “0” by being silent or absent (more information on this topic later). I expect
you to attend every class, but being here is not the same thing as Participation. If your
contribution only consists of introducing case facts, it is probably worth a “1”. When you
combine miscellaneous case facts into new data or you begin to make inferences, you will
probably earn a “2”or a “3”. A “4” is an outstanding contribution, recognized by everyone
present.
Negative assessments of Participation will be made in the following instances (but are not
restricted to): repeatedly arriving late to class, poor attendance, failure to notify your instructor of
your absence and disruptive activities (associated with the use of electronic devices) during class.
At the end of the course, I will determine overall Participation by assigning grades to the best and
the least good participants, and scaling others accordingly. Note: This makes it possible for
everyone to do well in Participation.
Mini-tests. Mini-tests are multiple-choice tests, based on assigned study material. Each mini-test will
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be administered twice, first individually and then as a group exercise. It is important to master the
course content as soon as possible but scarce class time is best spent on other activities. Mini-tests are
used to help you "get ahead" with the course content so you will be able to make more informed
contributions to other class activities. The mini-test procedure is a good, well-developed and welltested method for doing this. The approach serves two purposes. First, it encourages you to be
prepared to do your fair share in upcoming sessions. Second, it should raise your group's level of
understanding of the assigned study material – beyond the level of any individual group member.
More detail about the mini-test requirements and procedures will be specified in a separate document.
Examination. The Final Examination will be designed to test your knowledge of the assigned
readings and text material. It will consist of various types of questions (e.g., case scenario / vignette,
essay style, short answer, multiple-choice, problems). The nature of the exam will be discussed in
class, as we approach exam time. The only electronic device allowed will be a basic calculator and the
only other material allowed will be an English-language dictionary. Any other items require your
instructor's permission well before the exam.
This course is not quantitatively oriented. Thus, the Final Examination will not emphasize problem
sets, mathematics, or quantitative techniques.. Nevertheless, you will be responsible for mastering a
limited set of quantitative approaches. In particular, examination topics may include quantitative
problems associated with (1) process analysis, capacity, and bottlenecks, (2) Statistical Process
Control, (3) Material Requirements Planning, and (4) project management / critical path analysis.
Also, please note the following statement from the University of Manitoba, Undergraduate Calendar,
Academic Schedule, Section 6:
April 12 – 26 is the Final Examination Period for most faculties and schools.
Students must remain available until all examination obligations have been fulfilled.
.
Other Information and Requirements
Attendance We start on time and I expect you to attend each and every session. If you cannot
attend, phone me or E-mail me in advance. You do not need to tell me why you are not attending;
I will simply expect your contribution on other days. An Attendance - Participation Register will
be maintained by the class. My phone has Voice Mail, so please use it.
Class Seating and Name Cards
Please choose a permanent seat at the beginning of next
class. I will also expect you to bring your name cards to each session. I need to learn your names
quickly, and these arrangements help me to do so.
Study Groups Today, you shall form a Study Group of six persons. Please submit a clearly
printed copy of the names to me. Please indicate where and when you propose to meet. This will
facilitate the “topping up” of Study Groups next class.
Anyone not in a Study Group by next class shall be assigned arbitrarily to a Study Group.
The purpose of these groups is to help you learn, by discussing each case with others.
Operations Visits For your class presentation at the end of the Term, your study group will be
expected to visit an operation in the Winnipeg area. Your Study Group will make all
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arrangements (including choosing the company and lining up contacts). At the conclusion of the
semester, your Study Group will make a formal presentation to the class. (10%)
Within the first two weeks of the Term, I will ask you to sign a Release and
Indemnification Form concerning these site visits. If you choose not to sign the Release and
Indemnification Form you will be assigned an individual campus-based Library Research Project
instead. You will make a formal presentation to the class concerning your Research Project in
order to earn the ten marks set aside for the Formal Class Presentations. Please note that
attending a tour is not a valid excuse for missing activities in/for other courses.
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Schedule - Winter Term 2013 Classes on Monday and Wednesday
Introduction
7 January
Introduction to Course - Administrivia
9 January
Discussion: How to Prepare for a Case Discussion
14 January
Discussion: What is Operations and Supply Chain Management?
Capacity and Process Flow
16 January
Case: Process Fundamentals & Case: Capacity Analysis: Sample Problem
18 January
Course Revision Period Ends
21 January
Mini-Test One
23 January
Case: National Cranberry Cooperative (Abridged)
28 January
Discussion: Synchronous Operations
Quality Management
30 January
Discussion: What is Quality? & What do the Quality Tools do?
4 February Exercise: Quality Tools
6 February
Case: Deutsche Allgemeinversicherung
11 February Case: Cranston Nissan
Planning and Control
13 February Case: MacPherson Refrigeration Limited
No classes February 18 – 22 Mid-Term Break
25 February Exercise: Master Production Schedule
27 February Mini-Test Two
4 March
Case: Illustrious Corporation
6 March
Discussion: Toyota Production System / Lean (JIT) Operations
11 March
Case: McLeod Motors
Supply Chain Management
13 March
Case: The ITC e-Choupal Initiative
18 March
Case: Zara: IT for Fast Fashion
20 March
Voluntary Withdrawal Deadline for Term Two Courses
Project Management
20 March
Discussion: Project Management and an Exercise
25 March
Case: IDEO Product Development
Operations Strategy
27 March
Discussion: What is Operations and Supply Strategy?
1 April
Case: Microlite S.A.: The Pan-Orient Decision
3 March
Case: Chaircraft Corporation
Group Presentations of your Second Site Visit
3 April Formal Group Presentations
8 April Formal Group Presentations
10 April Formal Group Presentations with the Course Evaluation (during last 20 minutes)
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DAILY ASSIGNMENTS For each class discussion, you have been assigned some “Questions
for Consideration” found on Pages Six to Eleven. These questions are for guidance only, to help
you focus on certain aspects of a particular case/reading. As a minimum, you should be prepared
to address each question in class.
Each Case Discussion will normally follow a sequence of:
1. Situation Analysis/Issues
2. Criteria
3. Alternatives (note the “s”)
4. Mathematical Analysis (“number crunching”) 5. Discussion (argument) 6. Decision
7. Plan of Action (include Immediate, Short-term, and Long-term Plans)
8. Executive Summary (Decision, Costs, Benefits, and Implementation Hurdles/Concerns)
Suggestion: Put yourself in the position of the Decision-Maker. The real issue is what should be
done to resolve the current situation? Your decision should be the logical product of a thorough
Analysis and a logical Discussion.
In Chronological Order, the cases/readings to be discussed this term are:
How to Prepare for a Case Discussion
Reading: None.
Questions for Consideration:
1. What is the total annual cost for each supplier?
2. What additional criteria should be considered before a decision can be made?
3. As the decision-maker, what do you propose to do? Why is it the best course of action?
What is Operations and Supply Chain Management?
Reading: Jacobs et al., Chapter One.
Questions for Consideration:
1. What is Operations Management? How does it differ from the other functional areas
(Marketing, Finance)? How does it apply in the Service Sector?
2. What are the differences between Manufacturing and Service Organizations?
3. What types of decisions must be made by Operations Managers?
4. What are some of the recent changes and current challenges in Operations Management?
5. What changes have there been in Operations in the past century or so? What might we expect
to see in the future?
6. What are the important concepts concerning product design?
7. What messages are inherent in the Service-System Design Matrix?
8. What messages are inherent in the Product-Process Matrix?
9. How has technology impacted Manufacturing? Services?
Process Fundamentals and Capacity Analysis: Sample Questions
Reading: Jacobs et al., Chapter Four.
Questions for Consideration:
1. Study the case materials thoroughly and make certain that you understand the concepts,
examples, and terminology.
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2. Be prepared to explain the concepts to the class, or apply the concepts to similar material given
to you in class, i.e., an in-class exercise.
National Cranberry Cooperative (Abridged)
Reading: Jacobs et al., Chapter Five and Six..
Questions for Consideration:
1. Prepare a detailed flow diagram showing how "process fruit" is processed at RP1. Be sure to
distinguish between wet and dry berries.
2. Identify the capacities at each stage of the process. Please do your analysis in barrels and barrels per
hour. (Note: bbls. = barrels)
3. What are the current bottlenecks and how might they change?
4. As Mel O'Brien, what facilities changes, if any, would you propose for RP1 for the 1981 season?
What influences your decision?
5. How would you implement your plan?
Synchronous Operations
Reading: Chapters 13, 14, and 15 of Goldratt, E. M. & Cox, J. 1992. The Goal: A Process of
Ongoing Improvement, 2nd Revised Edition. Great Barrington, MA: North River Press.
Questions for Consideration:
1. What are the analogies between the Boy Scout Hike and a typical manufacturing plant?
2. What does Alex realize about statistical fluctuations and dependent events? How does this
assist him to better understand his plant?
3. What does Alex learn about a “balanced plant”? How does this help him at work?
4. What other lessons did Alex learn while on the hike? How will these lessons help him to
become a better manager?
5. What performance measures are appropriate at the operational level? Explain.
6. Explain the “drum, buffer, rope” method of control.
Note: In the Goldratt material, throughput refers to throughput rate (which we have been calling
capacity or output rate), NOT throughput time (which we have been calling manufacturing lead
time).
What is Quality?
Reading: Jacobs et al., Chapter Seven.
Questions for Consideration:
1. Who are recognized as “Quality Gurus”? What did each guru contribute to our understanding
of Quality?
2. How is Quality defined in terms of - goods? - services?
3. What are the four categories that comprise the cost of quality?
4. What is Total Quality Management? What are the major elements of such a program?
5. What does ISO Certification entail? What is the rationale behind such a program?
6. What are the eight basic quality control tools? What purpose does each tool perform?
7. How can you tell if a process is out of control?
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What do the Quality Tools do?
Reading: Study Jacobs et al., Chapter Seven.
Instructions:
Be prepared to discuss and/or do in-class exercises based on the assigned reading.
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Deutsche Allgemeinversicherung
Additional Reading: Study Jacobs et al., Chapter Seven.
Questions for Consideration:
1. Why is DAV using Statistical Process Control (SPC)? What are the primary challenges in
applying SPC to a service industry compared with manufacturing?
2. If you were to explain (in about thirty minutes) the concept of a p-chart to, say, a group of bank
tellers who have little background in SPC, how would you do it?
3. How large should each sample be for the experiment described by Schoss and Kluck?
4. The first twelve weeks of the data in Exhibit 4 represent the diagnostic period for the Policy
Extension Group. What are the 3-sigma control limits for the process? In which of the
subsequent weeks is the process out of control (if any)?
5. As Annette Kluck, what are your specific implementation plans? How do you intend to begin
improving the performance of the operation?
Cranston Nissan
Additional Reading: Study Jacobs et al., Chapter Seven.
Questions for Consideration:
Answer the following questions from the perspective of TQM.
1. Categorize the quality problems in this case.
2. 'V/hat are the probable causes of so many mishaps?
3. Prepare a cause-and-effect chart for "failure to remedy repair problem to customer satisfaction.'
4.a) What specific actions should Jackson take immediately?
b) What should some of his longer-term goals be?
MacPherson Refrigeration Limited
Additional Reading: Study Jacobs et al., Chapter 12.
Questions for Consideration:
1. What are the relevant tradeoffs at MacPherson?
2. Construct an aggregate plan better than the ones shown in the case.
3. What criteria and assumptions did you use?
4. How flexible is your plan?
5. How would your plan change if MacPherson produced to order rather than to stock?
6. What effect does the timing of peaks have?
7. What effect would additional periods have?
Note: Before constructing your aggregate plan, please ensure that you adjust the data in the case
according to any instructions handed out for your section. For your convenience, a spreadsheet will
be made available to help with your trial-and-error aggregate planning attempts. You are not
required to use the spreadsheet. It just makes life easier.
Master Production Schedule Exercise
Additional Reading: Jacobs et al, Chapter Fourteen.
Instructions:
Be prepared to discuss and/or do in-class exercises based on the assigned reading.
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Illustrious Corporation
Reading: Jacobs et al, Chapter Fourteen.
Questions for Consideration:
1. What is the difference between dependent demand and independent demand?
2. As Nancy Barfield, prepare the operating plan for the next ten weeks. Fill in the forms
provided in the Reserve materials, and use the lot-for-lot ordering rule.
3. What problems did you discover? What course of action do you recommend? Why?
4. What is “closed-loop MRP”? What is required to “close the loop”?
5. Could MRP have been useful in any of the companies that we have discussed?
Toyota Production System / Lean (JIT) Operations
Reading: Jacobs et al., Chapter Ten
Questions for Consideration:
1. Prepare for a discussion about the Toyota Production System (often called just-in-time production,
lean operations, etc).
2. Which aspects of this system are "Japanese" and which could be applied in other industrial settings?
That is, what is so Japanese about Japanese approaches to manufacturing?
3. What explains the success the Japanese have had with their approaches to production?
4. How is the notion of waste used in the Toyota Production System?
McLeod Motors Ltd.
Reading: Jacobs et al., Chapter Ten
Questions for Consideration:
1. What are some examples of specific form/function inventory combinations at McLeod
Motors?
2. Prepare a process flow of the BN-88-55 production process. Identify where Work-in-Process
(WIP) inventory exists in the system.
3. Why might the WIP inventory level at McLeod Motors have increased? What was the
previous level of WIP inventory? What is the lowest possible level of WIP inventory?
4. As Sue Reynolds, what action would you recommend to John Ingram?
The ITC e-Choupal Initiative
Additional Reading: Study Jacobs et al., Chapter Eight. If you have time, you might check the
ITC website [www.itcibd.com].
Questions for Consideration:
1. What was ITC's motivation for creating the e-Choupal?
2. What were the old and new physical flows and information flows in the channel?
3. What principles did ITC employ as it built the newly-fashioned supply chain?
4. What barriers did ITC face in embarking on this project?
5. As Mr. Sivakumar, how do you plan to proceed to develop this platform for the future?
Zara: IT for Fast Fashion
Additional Reading: Read Jacobs et al., Chapter Eight. If you have time, you might check the
Zara website [www.zara.com].
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Questions for Consideration:
1. As Mr. Salgado, what will you do concerning the issue of upgrading the POS terminals? Will
you upgrade to a modern operating system? Should the POS applications be rewritten to
include any additional functionality? If so, what functionality?
2. In your opinion, what are the most important aspects of Zara's approach to information
technology? Are these approaches applicable and appropriate anywhere? If not, where would
they not work well?
3. What benefits does Inditex/Zara get from its IT infrastructure? How difficult would it be for a
competitor to acquire these same benefits?
4. What current or potential weaknesses do you see in Zara's IT infrastructure and IT strategy?
Project Management and an Exercise
Additional Reading: Study Jacobs et al., Chapter Three.
Questions for Consideration:
1. Be prepared to discuss the Critical Path Method (C.P.M.) and the Program Review and
Evaluation Technique (P.E.R.T.).
2. Be ready to complete some in-class exercises based on these topics.
IDEO Product Development
Additional Reading: Study Jacobs et al., Chapter Three, and read Thomke, Enlightened
Experimentation: The New Imperative for Innovation (case package). If you have time, you might
check the IDEO website [www.ideo.com].
Questions for Consideration:
1. How would you characterize IDEO's process, organization, culture, and management?
2. As Dennis Boyle, what advice would you give to David Kelley and why? That is, should IDEO
accept the Visor project as is (on a dramatically reduced schedule)? Should they try to persuade
Handspring's management to change its aggressive launch schedule? Or, should they simply
decline the project? Please consider both the IDEO and Handspring perspectives.
What is Operations and Supply Strategy?
Reading: Jacobs et al., Chapter Two pp. 26-47.
“The Concept of Operations Strategy (Overview),” Chapter One from Hayes, R. H., Pisano, G.
P., and Upton, D. M., 1996, Strategic Operations: Competing through Capabilities, New York:
The Free Press.
Questions for Consideration:
1. What is Operations Strategy?
2. What are the competitive priorities? Why are trade-offs considered?
3. What are the differences between order-qualifiers and - winners? How has time changed this?
4. What are the various roles the operations function can play with respect to corporate strategy?
What role should it play?
5. What do Hayes et al. Say about the notion of fit? Of focus? Of “one best way” to organize
and manage operations?
Microlite S.A.: The Pan-Orient Decision
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Reading: None.
Questions for Consideration:
1. As Luis Pinto, what is your analysis of the capacity situation?
2. What concerns do you have about the competitive environment?
3. What alternatives are available to you? What are the financial implications of each
alternative?
4. As Luis Pinto, what do you plan to do? Why is this course of action the most appropriate?
5. What is your Plan of Action for adding capacity at the Jaboata Plant? Be specific with respect
to actions to be taken, the timing of these actions, the specific people involved, and so on.
What difficulties do you anticipate? What would you do about them? What overall results do
you expect?
Note: We will NOT be discussing how to finance projects in light of Brazilian debt, inflation, etc.
Use American dollars for all cost calculations, and assume that if an alternative makes sense,
the financing will be obtained to implement it.
Chaircraft Corporation
Reading: None.
Questions for Consideration:
1. Identify the flows of material through the organization.
2. What are the company’s current inventory policies?
3. Identify the flows of information through the organization.
4. What are the major issues facing Chaircraft Corporation?
5. As Mr. Johnson, what are your plans to overcome the major operations problems? Be specific
with respect to actions to be taken, the timing of these actions, the people involved in performing
these actions. What difficulties do you anticipate?
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Schedule – Tuesday / Thursday Winter Term 2013
Introduction
8 January
Introduction to Course - Administrivia
10 January
Discussion: How to Prepare for a Case Discussion
15 January
Discussion: What is Operations and Supply Chain Management?
Capacity and Process Flow
17 January
Case: Process Fundamentals & Case: Capacity Analysis: Sample Problem
18 January
Course Revision Period Ends
22 January
Mini-Test One
24 January
Case: National Cranberry Cooperative (Abridged)
29 January
Discussion: Synchronous Operations
Quality Management
31 January
Discussion: What is Quality? & What do the Quality Tools do?
5 February Exercise: Quality Tools
7 February
Case: Deutsche Allgemeinversicherung
12 February Case: Cranston Nissan
Planning and Control
14 February Case: MacPherson Refrigeration Limited
No classes February 18 – 22 Mid-Term Break
26 February Exercise: Master Production Schedule
28 February Mini-Test Two
5 March
Case: Illustrious Corporation
7 March
Discussion: Just-In-Time Manufacturing
12 March
Case: McLeod Motors
Supply Chain Management
14 March
Case: The ITC e-Choupal Initiative
19 March
Case: Zara: IT for Fast Fashion
20 March
Voluntary Withdrawal Deadline for Term Two Courses
Project Management
21 March
Discussion: Project Management and an Exercise
26 March
Case: IDEO Product Development
Operations Strategy
28 March
Discussion: What is Operations Strategy?
2 April
Case: Microlite S.A.: The Pan-Orient Decision
4 April
Case: Chaircraft Corporation
Group Presentations of your Second Site Visit
9 April Formal Group Presentations
11 April
Formal Group Presentations
10 April Formal Group Presentations with the Course Evaluation (during last 20 minutes)
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