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Golf-Sport: Managing Operations Golf-Sport is a small-sized company that produces high-quality components for people who build their own golf clubs...

Golf-Sport: Managing Operations

Golf-Sport is a small-sized company that produces

high-quality components for people who build their

own golf clubs and prebuilt sets of clubs. There are

five components—steel shafts, graphite shafts, forged

iron heads, metal wood heads, and metal wood heads

with titanium inserts—made in three plants—Chandler,

Glendale, and Tucson—in the Golf-Sport system.

Each plant can produce any of the components,

although each plant has a different set of individual

constraints and unit costs. These constraints cover labor

and packaging machine time (the machine is used

by all components); the specific values for each component-

plant combination are given in Tables 1-3.

Note that even though the components are identical in

the three plants, different production processes are

used, and therefore the products use different amounts

of resources in different plants.

Besides component sales, the company takes the

components and manufactures sets of golf clubs. Each

set requires 13 shafts, 10 iron heads, and 3 wood

Day t

Battery storage

end of day t -1

Battery storage

end of day t

Electrical usage in day t

Electrical energy from sun in day t

FIGURE 1

Daily Energy Flow

C A S E 3 Golf-Sport: Managing Operations 1353

TAB L E 1

Product-Resource Constraints: Chandler

Resources

Labor Packing Advertising

Products (Minutes/Unit) (Minutes/Unit) ($/Unit)

Steel shafts 1 4 1.0

Graphite shafts 1.5 4 1.5

Forged iron heads 1.5 5 1.1

Metal wood heads 3 6 1.5

Titanium insert heads 4 6 1.9

Monthly availability 12,000 20,000

TAB L E 2

Product-Resource Constraints: Glendale

Resources

Labor Packing Advertising

Products (Minutes/Unit) (Minutes/Unit) ($/Unit)

Steel shafts 3.5 7 1.1

Graphite shafts 3.5 7 1.1

Forged iron heads 4.5 8 1.1

Metal wood heads 4.5 9 1.2

Titanium insert heads 5.0 7 1.9

Monthly availability 15,000 40,000 —

(minutes)

TAB L E 3

Product-Resource Constraints: Tucson

Resources

Labor Packing Advertising

Products (Minutes/Unit) (Minutes/Unit) ($/Unit)

Steel shafts 3 7.5 1.3

Graphite shafts 3.5 7.5 1.3

Forged iron heads 4 8.5 1.3

Metal wood heads 4.5 9.5 1.3

Titanium insert heads 5.5 8.0 1.9

Monthly availability 22,000 35,000 —

(minutes)

1354 A P P E N D I X 2 Cases

heads. All of the shafts in a set must be the same type

(steel or graphite), and all of the wood heads must be

the same type (metal or metal with inserts). Assembly

times for the sets at each plant are shown in Table 4.

Each plant of Golf-Sport has a retail outlet to sell

components and sets, and the specific plant is the only

supplier for its retail outlet. The minimum and maximum

amounts of demand for each plant-product pair

are given in Table 5. Note that, although the minimums

must be satisfied, you do not need to satisfy demand

up to the maximum amount.

This planning problem is for two months. The costs

in Table 6 increase by 12% for the second month, and

production times are stationary. Inventory costs are

based on end-of-period inventory for each product set

and cost out at 8% of the cost values in Table 6. Table

7 lists the revenue generated by each product. Initially,

there is no inventory.

The corporation controls the capital available for

expenses; the cash requirements for each product are

given in the last column of Tables 1-3. There is a total

of $20,000 available for advertising for the entire

system during each month, and any money not spent

in a month is not available the next month. The corporation

also controls graphite. Each shaft requires 4

ounces of graphite; a total of 1,000 pounds is available

for each of the two months.

Your job is to determine a recommendation for the

company. A recommendation must include a plan for

production and sales. In addition, you should also address

the following sensitivity-analysis issues in your recommendation:

If you could get more graphite or advertising cash,

how much would you like, how would you use it,

and what would you be willing to pay?

At what site(s) would you like to add extra packing

machine hours, assembly hours, and/or extra

labor hours? How much would you be willing to

pay per hour and how many extra hours would you

like?

Marketing is trying to get Golf-Sport to consider

an advertising program that promises a 50% increase

in their maximum demand. Can we handle

this with the current system or do we need more

resources? How much more is the production going

to cost if we take on the additional demand?

TAB L E 4

Time Total Time Available

Plant (Minutes per set) (Minutes)

Chandler 65 5,500

Glendale 60 5,000

Tucson 65 6,000

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