Plastic Innovations - Case Material - Essay Example

Plastic Innovations Case Material The strategy has been to keep producing plastic items that support evolving applications. Plastic innovation has really evolved to cater for the needs of users. The plastic innovation was initially engineered to produce toys, automotive components. Early 1980s the use of small moulding machineries assisted to provide household items. However, as the market broadens company had to shift to larger machines. Advances into fresh areas of functions have been more and more recurrent and consequential. Manufacturing and processing technology have sophisticated tremendously. A stable attention to a new strategy and a very professional innovative staff allow strategy to reach a great qualitative point and to obtain great paybacks in the sector. The operations have supported the innovation strategy enormously by inventions of new technologies and machines. The strategy has changed from production of consumer durable items, toys and component of automotive used in industries to spatulas, pasta strainers, hand whisks and others. This has been enhanced due to change in machines from small plastic moulding machines to 24 large injection-moulding machines. Early 1980s small moulding machines were used for toys and automotive components. This later expanded to enhance production of household items. The market change in 2002 from industrial commodities to household; facilitated strategy enhancement to a greater height. This later facilitated change in expertize as seen in 2006 when a new marketing manager was hired. The Focus and Concept brands were initiated due to the change in management of marketing director. It also changed the market targets and enhanced profit margin. 2. The market is competitive and thus requires new innovations and ideas to keep up with stiff competition. Similarly, operation to keep up with demands and quality must keep on changing its requirements. Markets do change as consumers frequently change their aspects of the environment. Likewise, operational requirements must change to meet or challenge environment change. As markets demands get sophisticated, so do operational requirements do. Markets and operations requirements differ in the sense that larger markets mean more and more profit but, operational costs go higher as markets expanded. Operation requires experts to implement the desired result or objections of company. Similarly, markets require qualified team to achieve desired results. The demand for an idea or concept choice is less predictable that leads to unpredictable changes in schedules and large distraction in the production plan. Frequently longer operation times due to non-optimal changes require a respond to unexpected demand or an impromptu promotion. Markets requirements in directly affect the operations within the firm. Markets range compels operation team to consistently produce quality products. The planning of the project team is affected by the operations requirements and markets target. The difference from the two must be closely monitored in order for a company to achieve the goals. Operations requirement is monitored by the management to check cost incurred, however, markets is a sales team work to ensure the gap is ridged significantly. These disparities also give a planning team hectic time in convincing involved parties. 3. Forecasting is a planning device that assists management in its efforts to cope with the insecurity of the future, depending mainly on facts from the earlier period and present and analysis of tendencies. Forecasting begins with some assumptions based on the organization’s experience, acquaintance, and judgment. For the table given the following forecasting methods are chosen per focus data. Focus: cream bucket, quantitative method is chosen. Quantitative forecasting model are utilized to approximate future demands as a utility of past data; suitable when past data are obtainable. The method is more often than not applied to short-intermediate vary decisions. Examples of these methods are: last period order, simple and weighted moving mean (N-Period), multiplicative seasonal indexes, simple exponential smoothing. When enough statistics exist, quantitative methods are predictable to be more accurate. It is not often clear how much information is enough. This is considered in regards of the source, relevance, amount, reliability, variability, and validity of the data. The above factors prompted the choice of forecasting method for the chosen focus one (Armstrong, 2001, Pg 1-2). Focus: Clear 30litres storage box, naïve forecasting method is chosen. Naive methods regularly give ample results, and they are generally inexpensive. Thus, extrapolation modes may be suitable for short-term inventory-control anticipates of goods with long histories of steady demand. They are less effectual in circumstances where there are considerable changes. Any business is concern on reducing costs that is why choice of the method applied must be inclined with that objective. Use uncomplicated methods unless a tough case can be reserved for complexity. One of the most lasting and practical conclusions from the study on forecasting is that uncomplicated methods are usually as correct as complex methods. Focus: rain forest green spatula, Causal / econometric forecasting methods is suitable. Seasonality is a factor in marketing and projections. This is method that would apply to the chosen focus. Any commodity which is subjected to weather pattern is seasonal. 4. Also using your demand forecast and assuming demand for rain forest green spatula’s is normally distributed with a standard deviation is 32, what is the reorder level if the lead time is two weeks. For all calculations, show your workings (100 words, 30% mark) For calculating the economic order size we use the following parameters. Total annual cost = annual purchase cost + annual ordering cost + annual holding cost TC = DC + (D/Q)*S + (Q/2)*H, where: D = Demand (annual) TC = Total annual cost Q = Quantity to be ordered C = Cost per unit R = Reorder point S = Setup charge or cost of making an order L = Lead time; in days H = Annual holding and storage rate per unit of regular inventory. H = IC, where I refer to the percent carrying cost. Basic EOQ and Reorder Point Formula Quantity to Order (EOQ) EOQ = Square Root of ((2*D*S)/H) Reorder Point = R = d * L Where, D = Demand (annual) H = Annual holding and storeroom cost per unit of typical inventory d = is the mean daily demand, constant S = Setup cost or cost of placing an order L = Lead time (in days) Bibliography ARMSTRONG J.S. (2001), Selecting Forecasting Method University of Pennsylvania , armstrong@wharton.upenn.edu retrieved on 14th April 2013 from http://repository.upenn.edu/cgi/viewcontent.cgi?article=1181&context=marketing_papers Read More