Supply chain management - optimization problem - Coursework Example

), the second cash flow comes at the end of year two and gets an interest for one year (one thousand, one hundred ?), whereas the third cash flow happens at the end of year three and thus does not earn any interest (one thousand ?) (Leeman, 2010, 34). It is the value of cash or an asset at a given time or date in the future, which has a value that is equal to a particular amount of money presently (Leeman, 2010, 34). The Future Value can be calculated in two different ways as follows: For an asset that has a simple annual interest: Future Value = Original Investment multiplied by (1= (rate of interest* the total number of years)).

For an asset that has an interest that is compounded years, Future Value = Original Investment multiplied by [(1+rate of interest) ^ total number of years]. One has to account for inflation when planning for his or her retirement. The nominal interest rate is generally used; thus even though he or she might have several ? in the future; we find that the money will actually be worth less that the present million ? (Leeman, 2010, 34). For proof of the impacts of inflation take into consideration that one ?

in the year 1940 is presently worth about only 8.5 cents. How do you apply FV to a house purchase of ?245,000/7%Int/30 FV =  FV = ?245,000* (1.1)30 ? 4275103. . At one point, the company’s profits were decreasing because of the competence of its logistics management. The company over depended on the in-house manufacturing and distribution operations that were dysfunctional such as incompetent movement of goods along the chain of supply. These issues led to the chief executive Jim Maxmin choose to form a coalition with Federal Express BLS, which is the master of logistics (Leeman, 2010, 34).

FedEx utilizes their logistical ability to operate as the inventory and supply agent for various enterprises whose main proficiency is in manufacturing. This move will also benefit the Federal Express since neither of these companies could perform their function well and the alliance formed gave the better of the two worlds. There are a number of essential factors that supply chain alliances should have in order to be successful. This is since its control is not only associated with the management mechanism they employ.

The alliance partners should balance the control mechanism with trust building and the level of this trust largely depends on the alliance formed. Laura Ashley and Federal Express based their alliance mainly on trust with few elements of control in the official agreement. The agreement that Laura Ashley and BLS arrived at resulted to BLS taking over LA’s Newtown, distribution activities and Wales’s warehouse. Jim Maxmin initiated this process and handed the project over to the Global Operations Executive team for implementation.

This led to the reformation of the current procedures and writing down of new incorporated distribution system. LA had to withdraw from warehousing, handling of goods with distribution and handing this task to a third party. He felt that this procedure would take