Operation Research

Operation Research

Unit II: Case Study

Shipper Company is established in the 1960s and firstly specialized in the aerospace business through developing and producing the Echo weather satellites - artificial bodies launched into space in order to monitor the weather and climate of the Earth. In recent times, the firm had split into three divisions: the Electrical Products Division, the Materials Division, and the Advanced Products Division. That led to the increasing noticeably in sales and profitability of the company for the period from 2002 to 2006 except for the revenue earned in 2005.

Accordingly, in April 2007, James Wallace, general manager of the Advanced Products Division (hereinafter referred as to “APD”) at Shipper and his team had revised the business of the division. In former times, the APD was expert in producing aerostats which most of the revenue on selling to communications enterprises, the U.S government and foreign countries contributed significantly to the company’s whole profit. Along with aerostats, the APD also designed and manufactured a diversity of other unique items ordered by various clients. Generally speaking, the APD was familiar with making specialty products in low volume according to customer orders. Thereupon Wallace decided to amend business strategy which focus on satisfying different customers and manufacturing common parts in higher volume as well as reducing cost yet still improving quality. This revise in business strategy need inter-departmental coordination such as product designing, manufacturing, marketing, operating……to effectively compete in the new environment.

1. Firstly, the objective of the new production strategy is to cut down on the APD dependence on short-term clients, specialty products or projects and concurrently bringing on stream new goods with greater-volume continuous production. It might require expanding