UNIVERSITY OF KWAZULU-NATAL: PIETERMARITZBURG SCHOOL OF MANAGEMENT

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1 1 INFORMATION & INSTRUCTIONS: DURATION: THREE (3) HOURS TOTAL MARKS: 100 INTERNAL EXAMINER : EXTERNAL EXAMINER: MR MP POULTER MRS MJ NAUDE NB: STUDENTS ARE REQUESTED IN THEIR OWN INTERESTS TO WRITE LEGIBLY AND IN INK. ANSWER SECTION A (COMPULSORY) AND THREE (3) QUESTIONS FROM SECTION B. ENSURE YOUR STUDENT NUMBER APPEARS ON EACH ANSWER SHEET IN THE SPACE PROVIDED. THIS EXAMINATION PAPER CONSISTS OF 5 PAGES. PLEASE ENSURE THAT YOU HAVE THEM ALL.

2 2 SECTION A (COMPULSORY) (40 MARKS) READ THE CASE STUDY AND ANSWER THE QUESTION THAT FOLLOW: Case Study: WHEELS FOR AFRICA The Wheels for Africa Company (WFA) manufactures a range of bicycles on a 5 days per week, 2 shifts per day system [2 x 8 hour shifts: 07h00 to 15h00 & 15h00 to 23h00]. The range of cycles is very large and production is batch-type for components, with flow (line production) for assembly. All models follow basically the same route through the factory with varying lot sizes. The annual demand for each type is also highly variable, ranging from a production run of just a few hours per year at one extreme to the African Flyer, demand for which is about 1/3 of all production. WFA has a fine reputation in the industry and with retailers for making good quality bicycles. However WFA are receiving complaints from the larger retailers about late deliveries. This has resulted in lost sales. Expansion Plans As a result of growing sales, it is proposed that an extension to the existing factory should be built; this extension will house a production facility dedicated solely to the African Flyer- a durable and competitively priced mountain bike. Operations Planning and Control (OPC) At Wheels for Africa, OPC has considerable difficulties in forecasting when batches will be completed, since manufacturing throughput times vary widely even for similar batch sizes for the same cycle type. Inventory is considered to be high especially raw materials and work-in-process. There are only a few bicycles in finished goods inventory but this is due to the factory having to catch up with orders. A major problem is that stock-outs of raw materials and components required for the different models are occurring more frequently. In addition, frequent, unexpected machine breakdowns make the situation far worse. These problems are causing increasing friction between Operations and Marketing and need to be resolved urgently.

3 3 Maintenance The Maintenance Department feels that it can never win at Wheels for Africa. At one extreme, there are many occasions when there is equipment is waiting to be repaired and not enough repair men to tackle them; at the other extreme, there are so few machines needing repairing that the repair men are idle. Names of individuals and companies contained in this case study are fictional. Any resemblance to actual individuals or companies is purely coincidental. M P Poulter c/o UKZN, Pietermaritzburg, South Africa Question 1 COMPULSORY You have been called in as an operations management consultant to assist Wheels for Africa to improve their operation and to assist in planning for their new extension. Prepare a report for WFA which would include the following: 1.1 Identify the causes of problems of Operations Planning and Control and suggest possible solutions that might help to solve them. 1.2 Indicate what operational evaluations and decisions need to be taken before work starts on the new extension. 1.3 Suggest other improvements that could be carried out e.g. Maintenance.

4 4 SECTION B - ESSAYS (60 MARKS) ANSWER THREE QUESTIONS FROM SECTION B (20 MARKS EACH) QUESTION 2 Outline the performance objectives (key criteria) of operations management and explain how they impact on the operation of an organization. QUESTION 3 You have been asked to prepare a section in a training manual for Marketing/Sales personnel in your organisation outlining and describing the different types of processes (process types) which they are likely to encounter in their visits to potential customers. Your answer must include examples in both the manufacturing and service sectors. QUESTION 4 Quality is a concept that can be applied to both the manufacturers of products such as Toyota cars and McDonald hamburgers as well as service/utility organisations such as Eskom and Telkom. Outline the concept of Total Quality Management (TQM) and discuss its importance and impact on organisational performance. QUESTION 5 Just-in-Time (JIT) principles have been very well described in relation to high volume repetitive manufacturing as an operations control technique (kanban) and as a philosophy (the elimination of waste, etc.). Discuss the foundations of JIT and outline its importance in both manufacturing and service organizations.

5 5 QUESTION 6 From a systems perspective, consider a product of your choice manufactured in South Africa or the SADC region and its supply chain. Outline and briefly discuss the impact of major influences, developments, trends, events of the wider or macro- environment on your chosen supply chain. In addition, briefly outline and discuss major influences of the immediate (or task) environment that are likely to impact on your chosen product. It is suggested that a diagram or map could be used to illustrate and enhance your answer. --ooooooo--