Business Decision Making Final
Deborah Barnett
QNT/275
09/28/2015
Tracy Sipma

Business Decision Making Final
The company that our team decided to use was the Honeywell Company, which is an aerospace division for global aftermarket services. This division repairs jet engines and other parts and processes around 1000 orders per week.
The problem that we have found with this company is that it has what is called a “Hold Shelf”. This is where orders, products and information is stored or removed from the process. It causes a problem in the inventory and can be very costly. It also causes problems in variation. When these items get placed on the hold shelf then they are considered to be out of the inventory.
In order to try and solve the problem we need to consider why these things are happening and what needs to be done to prevent it from happening again. First, we need to find out who is responsible for putting the orders on hold and not putting them back into the inventory. Then we need to find out the reason they are being put on hold. When items get cancelled someone should be responsible for seeing that it gets put back into the inventory instead of put on a shelf and left out of the inventory. Someone else could be looking to order that particular item and if it is not in inventory and sitting on a shelf then the company would be losing money. The sales would increase and the cost would decrease.
Last week the data was broke down and we looked at the amount of time that the orders were placed on hold in the five categories: Communication with the Customer, Quality Review, Engineering Review, Systematical Errors, and Pricing Review. We determined that the orders that were on the hold shelf waiting for the customers’ communication was there the longest. The company needs to focus on improving the communications between the customers and the leaders of the company. The leaders need to allocate the resources that are needed to improve the process and be able to figure out what will benefit the company more.
If we break down the totals for each category then the totals will range from 8 to 58. Take the total orders(186) and do a sample size by using the square root rule of thumb. The sample size would be 13.6, and it would need to be rounded to the next nearest number, which would be 14. Take the data and use the =RANDBETWEEN function that can be found in the Excel spreadsheet and it will give you the random and equal figure. Then we validated the sample. In comparing the averages the sample of 14 does not represent the means of the data set.
If we look at the number of days on hold and the cost of the order we can calculate the actual cost of the order and subtract the average cost to be able to figure out the added cost of the orders that are on hold. Let’s look at the table with the data that was formulated:

If we continue to formulate the table for all the orders then we will have a full table of data to work with. It can be put in a scatter chart and that will help us to display the days on hold and the added cost. If the data is completely organized then it will show the relationship between the days on hold and the cost.

The graph above shows the breakdown of the Days on Hold vs The Percent above Cost.
By looking at the graph, it is visible that the days on hold and the added cost show that it demonstrates leadership and the potential cost can reduce the days that the orders will be on hold and will not only cover the cost of the much needed resources but it will address the issues at hand and reduce the overall cost of the production and also increase the sale of productivity.