Supply Chain

Consulting
Group Assignment 4

Group 3 Details
FT161011
FT162010
FT163034
FT164052
FT162061
FT161108

Akhil Dwivedi
Alwin James
Jibin P Rajan
Nishant Raj
Pallavi Dwivedi
Rishi Puttoo

Q 1) Using the sample data given in Exhibit 10, make a

recommendation for how many units of each style Wally
Obermeyer should order during the initial phase of production.
Assume that all ten styles in the sample problem are made in
Hong Kong, and that Obermeyers initial production commitment
must be at least 10,000 units. (Ignore price differences among
styles & minimum order quantities in your initial analysis.). If a
minimum order quantity were imposed on the production, how
would you go about deciding production quantities?
Wally had estimated that the forecast accuracy was the highest for those
styles that the Buying committee had the highest level of agreement. He
found that the Standard Deviation of the Buying Committee for a style
was twice the actual demand for the style. Therefore he manipulated the
equation accordingly.
We assume that the data is normally distributed. Now if we take into the
equation for standard normal distribution is - k, where is the average
value and is the standard deviation. Now value of k is generally 0, 1, 2,
3 and so on, showing the level of standard deviation. Now for k = 1, 68%
of the data will lie between , for k = 2, 95% of the data will lie in
between 2. Now we test for value of k does the total production sum
up to around 10000.
Case1: When k=0

Individual Forecasts
Carol
Wen
yn
Greg dy
Tom

Laur
a

Gail

Pri
ce
$11
0

900

1,000

Isis

$99

700

Entice

$80

Assault

$90
$12
3
$17
3
$13
3

800
1,20
0
2,50
0

Style

Teri
Electra
Stephan
ie
Seduce
d

$73

800
2,50
0
600
4,60
0

1,600
1,900
900
1,900
900
4,300

900
1,00
0
1,50
0
2,70
0
1,00
0
1,90
0
1,00
0
3,90
0

1,300

800

1,600

950

1,550

950
2,80
0

2,450
1,100
2,800
1,100
4,000

950
1,80
0
950
4,30
0

Avera
ge
Forec
ast
()
Wall
y
1,20
0
1,20
0
1,35
0
2,80
0
1,85
0
2,00
0
2,12
5
3,00
0

Standa
rd
Deviati
on ()

2x
Std.
Deviati
on

Prod.
units
k=0

1,017

194

388

1017

1,042

323

646

1042

1,358

248

496

1358

2,525

340

680

2525

1,100

381

762

1100

2,150

404

807

2150

1,113

524

1,048

1113

4,017

556

1,113

4017

Anita
Daphne
Totals

$93
$14
8

4,40
0
1,70
0
20,0
00

3,300
3,500
20,00
0

3,50
0
2,60
0
20,0
00

1,500
2,600
20,00
0

4,20
0
2,30
0
20,0
00

2,87
5
1,60
0
20,0
00

3,296

1,047

2,094

3296

2,383

697

1,394

2383

20,000

20001

Since the number of units produced is greater than 10000, we cannot accept it.

Case1: When k=1

Individual Forecasts
Carol
Wen
yn
Greg dy
Tom

Laur
a

Gail

Pri
ce
$11
0

900

1,000

Isis

$99

700

Entice

$80

Assault

$90
$12
3
$17
3
$13
3

800
1,20
0
2,50
0

Style

Teri
Electra
Stephan
ie
Seduce
d
Anita
Daphne

$73
$93
$14
8

Totals

800
2,50
0
600
4,60
0
4,40
0
1,70
0
20,0
00

1,600
1,900
900
1,900
900
4,300
3,300
3,500
20,00
0

900
1,00
0
1,50
0
2,70
0
1,00
0
1,90
0
1,00
0
3,90
0
3,50
0
2,60
0
20,0
00

1,300

800

1,600

950

1,550

950
2,80
0

2,450
1,100
2,800
1,100
4,000
1,500
2,600
20,00
0

950
1,80
0
950
4,30
0
4,20
0
2,30
0
20,0
00

Avera
ge
Forec
ast
()
Wall
y
1,20
0
1,20
0
1,35
0
2,80
0
1,85
0
2,00
0
2,12
5
3,00
0
2,87
5
1,60
0
20,0
00

Standa
rd
Deviati
on ()

2x
Std.
Deviati
on

Prod.
units
k=1

1,017

194

388

629

1,042

323

646

396

1,358

248

496

862

2,525

340

680

1845

1,100

381

762

338

2,150

404

807

1343

1,113

524

1,048

65

4,017

556

1,113

2904

3,296

1,047

2,094

1202

2,383

697

1,394

989
10573

20,000

Since the number of units is close to 10000, it is acceptable.

Case1: When k=2

Individual Forecasts
Carol
Wen
yn
Greg dy
Tom

Laur
a

Gail

Pri
ce
$11
0

900

1,000

Isis

$99

700

Entice

$80

Assault

$90
$12
3
$17
3

800
1,20
0
2,50
0

Style

Teri
Electra

800
2,50
0

1,600
1,900
900
1,900

900
1,00
0
1,50
0
2,70
0
1,00
0
1,90
0

1,300

800

1,600

950

1,550

950
2,80
0

2,450
1,100
2,800

950
1,80
0

Avera
ge
Forec
ast
()
Wall
y
1,20
0
1,20
0
1,35
0
2,80
0
1,85
0
2,00
0

Standa
rd
Deviati
on ()

2x
Std.
Deviati
on

Prod.
units
k=2

1,017

194

388

241

1,042

323

646

-250

1,358

248

496

366

2,525

340

680

1165

1,100

381

762

-424

2,150

404

807

536
3

Stephan
ie
Seduce
d

$13
3

Anita

$93
$14
8

Daphne

$73

Totals

600
4,60
0
4,40
0
1,70
0
20,0
00

900
4,300
3,300
3,500
20,00
0

1,00
0
3,90
0
3,50
0
2,60
0
20,0
00

1,100
4,000
1,500
2,600
20,00
0

950
4,30
0
4,20
0
2,30
0
20,0
00

2,12
5
3,00
0
2,87
5
1,60
0
20,0
00

1,113

524

1,048

-983

4,017

556

1,113

1791

3,296

1,047

2,094

-892

2,383

697

1,394

-405
1145

20,000

Since the number of units is less than 10000, it is unacceptable.

Using Solver and value of k is 1.06

Individual Forecasts
Carol
Wen
yn
Greg dy
Tom

Laur
a

Gail

Pri
ce
$11
0

900

1,000

Isis

$99

700

Entice

$80

Assault

$90
$12
3
$17
3
$13
3

800
1,20
0
2,50
0

Style

Teri
Electra
Stephan
ie
Seduce
d
Anita
Daphne
Totals

$73
$93
$14
8

800
2,50
0
600
4,60
0
4,40
0
1,70
0
20,0
00

1,600
1,900
900
1,900
900
4,300
3,300
3,500
20,00
0

900
1,00
0
1,50
0
2,70
0
1,00
0
1,90
0
1,00
0
3,90
0
3,50
0
2,60
0
20,0
00

1,300

800

1,600

950

1,550

950
2,80
0

2,450
1,100
2,800
1,100
4,000
1,500
2,600
20,00
0

950
1,80
0
950
4,30
0
4,20
0
2,30
0
20,0
00

Wall
y
1,20
0
1,20
0
1,35
0
2,80
0
1,85
0
2,00
0
2,12
5
3,00
0
2,87
5
1,60
0
20,0
00

Averag
e
Foreca
st ()

Standa
rd
Deviati
on ()

2x
Std.
Deviat
ion

1,017

194

388

1,042

323

646

1,358

248

496

2,525

340

680

1,100

381

762

2,150

404

807

1,113

524

1,048

4,017

556

1,113

3,296

1,047

2,094

2,383

697

1,394

Prod.
units
k=1.0
6
605.41
88
356.73
84
831.85
49
1803.6
72
291.68
84
1293.9
53
1.3063
22
2836.3
56
1074.7
34
904.27
77

20,000

10000

Assuming minimum order quantity is produced, the total production

units increases by 1150 units.

Individual Forecasts
Carol
Wen
yn
Greg dy
Tom

Laur
a

Gail

Pri
ce
$11
0

900

1,000

Isis

$99

700

Entice

$80

Assault

$90
$12
3
$17
3
$13
3

800
1,20
0
2,50
0

Style

Teri
Electra
Stephan
ie
Seduce
d
Anita
Daphne
Totals

$73
$93
$14
8

800
2,50
0
600
4,60
0
4,40
0
1,70
0
20,0
00

1,600
1,900
900
1,900
900
4,300
3,300
3,500
20,00
0

900
1,00
0
1,50
0
2,70
0
1,00
0
1,90
0
1,00
0
3,90
0
3,50
0
2,60
0
20,0
00

1,300

800

1,600

950

1,550

950
2,80
0

2,450
1,100
2,800
1,100
4,000
1,500
2,600
20,00
0

950
1,80
0
950
4,30
0
4,20
0
2,30
0
20,0
00

Wall
y
1,20
0
1,20
0
1,35
0
2,80
0
1,85
0
2,00
0
2,12
5
3,00
0
2,87
5
1,60
0
20,0
00

Averag
e
Foreca
st ()

Standa
rd
Deviati
on ()

2x
Std.
Deviat
ion

1,017

194

388

1,042

323

646

1,358

248

496

2,525

340

680

1,100

381

762

2,150

404

807

1,113

524

1,048

4,017

556

1,113

3,296

1,047

2,094

2,383

697

1,394

20,000

Produ
ction
units
k=1.0
6
605.41
88
600
831.85
49
1803.6
72
600
1293.9
53
600
2836.3
56
1074.7
34
904.27
77
11150.
27