CASE

The EGAD Bottling Company has decided to introduce a new line of premium bottled water that will include several “designer” flavors. Marketing manager Georgianna Mercer is predicting an upturn in
demand based on the new offerings and the increased public aware-ness of the health benefits of drinking more water. She has prepared aggregate forecasts for the next six months, as shown in the
following table (quantities are in tankloads):
Month May Jun Jul Aug Sept Oct Total
Forecast 50 60 70 90 80 70 420
Production manager Mark Mercer (no relation to Georgianna) has devel-oped the following information. (Costs are in thousands of dollars.)
Regular production cost Regular production capacity Overtime production cost Subcontracting cost Holding cost
$1 per tankload 60 tankloads $1.6 per tankload $1.8 per tankload $2 per tankload per month
Backordering cost Beginning inventory
Backlogs are not allowed 0 tankloads

Among the strategies being considered are the following: 1. Level production supplemented by up to 10 tankloads a month from overtime. 2. A combination of overtime, inventory, and subcontracting.
Regular production should be the same each month. 3. Using overtime for up to 15 tankloads a month, along with inventory to handle variations. Regular production should be the same each month.
Questions 1. The objective is to choose the plan that has the lowest cast. Which plan would you recommend? 2. Presumably, information about the new line has been shared with supply chain partners.
Explain what information should be shared with various partners, and why sharing that information is important.
15. A foreman has determined processing times at a work center for a set of jobs and now wants to sequence them. Given the information shown, do the following: a. Determine the processing sequence
using (1) FCFS, (2) SPT, (3) EDD, and (4) CR. For each sequence, compute the average job tardiness, the average flow time, and the average number of jobs at the work center. The list is in FCFS
order. b. Using the results of your calculations in part a, show that the ratio of average flow time and the average number of jobs measures are equivalent for all four sequencing rules. c.
Determine the processing sequence that would result using the S/O rule.
Job Job Time (days) Due Date Operations Remaining a 4.5 10 3 b 6.0 17 4 c 5.2 12 3 d 1.6 27 5 e 2.8 18 3 f 3.3 19 1