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Coffee Maker Supreme Case marking key (F07)

Coffee Maker Supreme Case marking key (F07) - Coffee Maker...

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Coffee Maker Supreme Marked By: __________________________________________________ Student Name ________________________________ (Print) Student # ____________________________________ # marks marks assigned Comments Introduction MAX 5 type of business / industry - private coffee machine manufacturer, good demand, multinational 2 Well established, operating for 3 generations 2 In 2000, introduced new product features/designs 2 global sourcing, product line rationalized, use 2 plants only 2 replaced 100% inspection with random checks, change in quality process 2 Other 2 Problem Statement MAX 5 Product quality has decreased 3 Unfavourable operating variances 3 Inspections reduced 2 Minor issues (symptoms) 1 Declining profit, Analysis MAX 35 Variances Sale variance $2.3F 3 materials variance $2.1U 3 manufacturing overhead $16.7U 3 Operating Income $18.8M U 3 Cost of Quality Decline in customer satisfaction with product 2 Decline in product quality 85% to 61.5%, Durability, Value 2 Cost of Quality increased to $10M from $6.1M 2 BUT higher customer satisfaction with product features (88.6% vs. 53.8%) 2 4 Costs of quality 3 3
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