Management case study
See the Instruction below, Complete question 1-3, I will provide more if indeed.
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>Simulate
(or Fn F9) to generate new sets of random numbers
No. Workers: No. Workers: No. Workers: No. Workers: No. Workers: No. Workers: InBox Potential Move InBox Potential Move InBox Potential Move InBox Potential Move InBox Potential Move InBox Potential 0 0 0 0 0 0 0 0 0 12 0 0 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 2
0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 5
0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0
0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 2
0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 33 5
0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 18 9
0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 28 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 0 0 3 0 0 21 0 0 24 0 0 12 0 0 12 0 0 24 0 0 723 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Stickley Adhesives I Case Study Page 1
BOSTON METROPOLITAN COLLEGE
DEPARTMENT OF ADMINISTRATIVE SCIENCES
STICKLEY ADHESIVES I1
Pasquale “Cocoa” Martinez began reviewing his Operations Management course notes in preparation for Company Background
In the early 1910’s, Gerald Stickley and his cousin (Dean Happ) began experimenting with making glue The severe drought of the 1930’s and the subsequent economic depression forced Gerald and his family The Stickley Adhesives division of Congisto A/S employs 6,000 people worldwide. They include about
1 This case was developed by John Maleyeff based on his work in service process capacity planning. All references to
Stickley Adhesives I Case Study Page 2
Applications Service Operations
Cocoa’s project concerns Stickley’s applications service. This service responds to requests from The service also includes recommendations regarding the equipment needed to achieve a high quality Recently, Congisto’s management became aware of complaints from both customers and Stickley’s staff Centralized Applications Service Offering
The new applications service system will centralize applications services operations while taking The service will be available 7 days per week; its process flow is shown in the Appendix. It is anticipated Every customer request will be received on a standard form originating from the company’s web site. Once prioritizing is completed, the request is sent to the scoping process. Like all other transitions, the IT
Stickley Adhesives I Case Study Page 3
ready at the next process on the following day. Based on past scoping requests, about 1 in 8 (12.5%) of After scoping, each request is sent to the experimenting process. This process will be done by engineers Finally, the last process in the applications service system is reporting. This process will take place at a The characteristics of each process including location, average completions per day and “fully loaded” Table 1: Process Characteristics
Process Location Worker (customers/day) Prioritizing Puerto Rico 12 125
Scoping: Scientist Wichita (U.S.) 3 400
Scoping: Technician Wichita (U.S.) 7 250
Experimenting Bangladesh 6 75
Analyzing w/o Rental Wichita (U.S.) 6 300
Analyzing w/Rental Wichita (U.S.) 2 350
Reporting Philippines 8 50
Service System Simulation
During earlier phases of the project, a consultant developed a Monte Carlo simulation of the proposed A video has been prepared by the consultant describing the use of the simulation in detail. It is
Stickley Adhesives I Case Study Page 4
APPENDIX
Applications Service Operations: Process Flow
Prioritizing
Scoping: Scientist Scoping: Technician
Experimenting
Reporting
Analysis w/ Rental Analysis w/o Rental
CUSTOMER REQUEST
REQUEST COMPLETED
12.5% 87.5%
50% 50%
Inputs only in yellow cells (Workers) – hit F
9
Stickley Adhesives: Applications Services Simulation
Prioritizing
Scoping: Scientist
Scoping: Technician
Experimenting
Analyzing w/o Rental
Analyzing w/Rental
Reporting
No. Workers:
Day No.
Demand
InBox
Potential
Move
Done
1
1
8
18
0
3
21
2
4
12
24
2
19
3
7
3 19
5
6
4
26
82
5
30
11
6
33
14
7
15
16
8
17
177
9
25
20
10
23
11
32
267
12
34
301
13
31
14 19
338
15 15
353
16 14
367
17 15
382
18 33
415
19 15
430
20 16
446
21 32
478
22
29
507
23 17
524
24 31
555
25
27
582
26 34
616
27 26
642
28
670
29 19
689
30 34
723
Totals
Averages
24.1
0.0
UNIVERSITY
his first big project at Stickley Adhesives. A recent graduate of Boston University’s Metropolitan College,
Cocoa had just been hired to be an operations analyst at a Stickley facility in Puerto Rico. Cocoa holds an
undergraduate degree in biology and a Master’s degree in applied business analytics. This project
requires him to analyze capacity requirements for a newly designed service system. Stickley’s customers
use this service when they are unsure of how to take advantage of Stickley’s extensive product line. This
“applications service” supplements product sales and is an important component of Stickley’s business
strategy. In fact, Cocoa’s work will be the last in a series of analyses on which a project team of scientists
and consultants has been working during the past year. When Cocoa asked why a relatively
inexperienced analyst should take on this role, he was told that the project’s budget did not include
money for a more experienced outside consultant and, in any case, the analysis should not be too
difficult.
for various bonding applications. Gerald, an enthusiastic science student finishing the 11th grade, had
just learned that the protein collagen was used to make glue. Living on a farm in Kansas, Gerald’s
interest was piqued because collagen, contained in connective animal tissues, was abundant on his
family’s farm. After Dean went off to college, Gerald continued to work on his experiments while
assisting with his farming chores. After graduation from high school, he continued to work full time on
the farm, while taking on an increasing number of responsibilities for both the operation of the farm and
the business of farming.
to abandon farming and move to the city of Wichita, Kansas. There, Gerald took a series of low paid jobs.
He supplemented his meager income with sales of glue products. Once the economic situation improved,
sales of “Stickley Glue” increased, and eventually Gerald opened a small factory to make glue products.
Over the years, glue production transitioned from the use of animal products to synthetics and, in 1975,
the name of the company was changed to Stickley Adhesives. Gerald Stickley died in 1978 and the
company was sold to an international corporation, Congisto A/S. Congisto has maintained the brand
name Stickley Adhesives, due to its excellent reputation for high quality products that can be used for a
multitude of bonding applications.
900 scientists, engineers, and technicians who are devoted to the development of new adhesive products
and the support of customers using existing products. Because the majority of Stickley’s customers are
not familiar with the science of adhesives, Stickley offers numerous support services. These support
services include troubleshooting, equipment rental, and applications consultation, which are considered
by Stickley management to be a key source of competitive advantage. It is the reason why Stickley can
charge a premium for its products. Although its headquarters remains in Wichita, Stickley’s design,
manufacturing, and support functions are located at various U.S. and international locations. It has
customers located in the America’s, Europe, and Asia.
people and organizations are fictional. © 2018 All rights reserved.
customers who wish to know the best adhesive product to use for a specific application, and the
recommended application characteristics. These characteristics could include the amount, the
recommended cure time, the holding (or clamping) pressure, and other factors that affect the quality of
the resulting bond. Examples include bonding requirements for products such as medical (e.g., syringes),
personal (e.g., cosmetics), acoustics (e.g., speakers), and automotive (e.g., engine hoses). Often, the
materials used or the conditions under which the bond must hold are unusual or extreme. For example, a
manufacturer may wish to bond a rubber hose to a specialized metal alloy in an automobile engine with
extreme temperature variations, excessive vibrations, and oily or dirty conditions.
result. Both standardized equipment (such as dispensing setups and ultraviolet curing systems) and
customized equipment may be needed by customers. Customers who do not own their own equipment
may rent or purchase the equipment from Stickley (they usually start by renting the equipment with an
option to purchase later). Currently, the applications service is decentralized, with each region
performing its own analyses for regional customers. Each region charges customers for the service in
different ways, in some cases offering the service free of charge for some important customers. In every
region, the system makes extensive use of scientists, engineers, and technicians to study each application,
run experiments, analyze experimental results, and report results to customers.
regarding the operation of the applications service. A Lean Six Sigma project found that the number of
“reapplications” (i.e., requests concerning applications that had already been evaluated but did not
succeed) had increased substantially. The root causes were found to include many inconsistences in the
operation of the applications service across the global landscape. Many of these inconsistencies did not
appear to be especially new. However, requests have become more complex and expectations of
Stickley’s customers have increased as the service has become more popular. Finally, Stickley’s technical
staff complained of having multiple job responsibilities with conflicting incentives. As a result, the
decision was made to centralize the operation of the applications service.
advantage of scale economies and low labor costs when sensible. It will use new information technology
(IT) systems that will allow for the transmittal of information over great distances. At the time of Cocoa’s
involvement, the system design is complete and the anticipated operational challenges have been
addressed. The only remaining questions concern its capacity requirements and the revenue model
(whose determination will be made by corporate finance after Cocoa’s analysis).
that an average of 24 customer requests will be received on a daily basis, and that the number of requests
per day will vary. Analysis of worldwide demand data indicated that there would be no differences in
the average demand across days of the week. Daily demand is expected to vary from 14 to 34 requests,
uniformly distributed across this range.
The first process, prioritizing, consists of an expert evaluation. It determines if the request represents a
project that should be handled by a scientist or a technician. Prioritizing will take place in Puerto Rico
(down the hallway from Cocoa’s office). On average, each worker can prioritize an average of 12 requests
per day, but the actual number of requests each day varies depending on their complexities.
system will process transactions at the end of each day. Hence, the output from each process will be
requests need to be handled by scientists, with the remainder handled by a technician. On average, a
scientist can scope an average of 3 requests per day and a technician can scope an average of 7 requests
per day. Again, the actual number of requests per day will vary. Scoping will be performed at the U.S.
headquarters in Wichita.
located on a Stickley subsidiary located in Bangladesh (at a facility known to have the best quality results
in the decentralized system). Here, each worker can complete an average of 6 requests per day. After the
experiments are complete, requests are sent for analysis. The analyzing process is performed at the R&D
facility in Wichita. About half of these requests require equipment rental (which requires design of the
equipment system and price determination), and workers performing these analyses can complete an
average of 2 requests per day. The remaining half do not require equipment rental, and workers
performing these analyses can complete an average of 6 requests per day.
Stickley subsidiary located in the Philippines. Workers at this facility can complete an average of 8
customer requests per day. As with the other processes, the actual number of requests completed will
vary by day.
labor costs per day are shown in Table 1 (fully loaded labor costs include allocations for benefits and
other overhead expenses).
Average Capacity per
Labor Cost per
Worker ($/day)
system. Cocoa is told that he should make use of this simulation. He is informed that the simulation is
accurate, and no changes will be necessary to its internal logic. It simulates 30 days of operation based on
the structure and parameters described above. Users must enter the number of workers assigned to each
process. Each “iteration” of the simulation will mimic 30 days of operations. By running the simulation
repeatedly, users can observe the variation in throughput (completed requests at the end of 30 days) and
other process characteristics.
recommended that Cocoa watch the video before answering the analysis questions posed to him.