HW Solutions - Chapter 1 #2, 3, 4, 6 Homework #1 Solution...

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Chapter 1 #2, 3, 4, 6 Homework #1 Solution Question 2 a. 1. Marketing company that handles all the market research, telemarketing, and mass mailing to solicit customers. 2. Mortgage brokers that will take the applications of the new customers. 3. Credit report agency that provides report of evaluates credit reports of the customer. 4. Mortgage brokers would prepared and submit loan document to a bank. 5. Bank extends the mortgage loans. 6. Mortgage brokers distribute the loan to the individual. b. Market company – solicit more customers, with minimum cost Mortgage brokers –maximize sales commissions Bank – make low risk and high return loans Credit report agency – providing relevant and accurate information c. Similar to product supply chain, service chain is to provide value added services at the right time, at right location and in a form that satisfy customer’s requirements while minimizing total costs. Different from the product chain, which has flow of information, physical products, and wealth, service chain does not have the flow of physical products. In many cases, service chain is primary flow of information and wealth. Due to the absent of physical products, transportation, inventory cost are not major costs in the service chain. Without inventory, the service chain needs to be even more efficient on matching supply and demand. Finally, in a service chain, in order to understand customers and their needs, information becomes very valuable. Thus there is a price for obtaining information. In the example above, banks would need to pay the credit report agency for the additional information about the customers. Question 3 Many supply chains evolve over time. Here are some examples: - Software supply chain When the product first introduced, the price is very high. It might be distribute through direct sales to the users. Over time, there might be standardization, so product can be package and sell in stores as out-of-box solution. As newer version and enhancements becomes available, software might be distributed through the web. There also might be partnership with other software companies, and then the product would be packaged and distributed as a suite along with other products. - Memory chip supply chain When a new memory chip is introduced, price is high, yield is low, and production capacity is tight, and the availability of the product is important. Consequently, production is usually done at plants close to markets, and the management
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focuses on increasing yield, reducing the number of production disruptions, and fully utilizing capacity. When the product matures, however, its price drops and demand is stabilized for a period of time, so minimizing production cost moves to center stage. To reduce costs, production may be outsourced to overseas foundries, where labor and materials are much cheaper . Question 4
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This note was uploaded on 05/08/2011 for the course IEOR 153 taught by Professor Staff during the Spring '08 term at University of California, Berkeley.

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HW Solutions - Chapter 1 #2, 3, 4, 6 Homework #1 Solution...

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