...Kristen’s Cookie Company You and your roommate are preparing to start Kristen’s Cookie Company in your on‐campus apartment. The company will provide fresh cookies to starving students late at night. You need to evaluate the preliminary design for the company’s production process to figure out many variables, including what prices to charge, whether you will be able to make profit and how many orders to accept. Business Concept Your idea is to bake fresh cookies to order, using any combination of ingredients that the buyer wants. The cookies will be ready for pickup at your apartment within an hour. Several factors will set you apart from competing products such as store‐bought cookies. First, your cookies will be completely fresh. You will not bake any cookies before receiving the order; therefore, the buyer will be getting cookies that are literally hot out of the oven. Second, you will have a variety of ingredients available to add to the basic dough, including chocolate chips, M&M’s, chopped health bars, coconut, walnuts and raisins. Buyer will telephone in their orders and specify which of these ingredients they want in their cookies. You gurantee completely fresh cookies. In short, you will have the freshest, most exotic cookies anywhere, available right on campus. The production process Baking cookies is simple: mix all the ingredients in a food processor; ...
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...Kristen's Cookie Company Kristen's Cookie Company is a good example where the success or failure of the company depends directly on the process planning adopted by the company, i.e., the company can maximize its productivity by utilizing its resources effectively. One major aspect of process analysis is to identify the major bottlenecks in the process and trying to mitigate their effects with least possible level of costs and resources. The following flowchart shows the overall process adopted by the company: (Exhibit 1) Filling a rush order: Process Resource(s) Process Time Cumulative Time Consumed Taking Order E-mail 0 minutes 0 minutes Washing and Mixing Self 6 minutes 6 minutes Filling Tray Self 2 minutes 8 minutes Preparing Oven Roommate 1 minute 9 minutes Baking Oven 9 minutes 18 minutes Removing the tray Roommate 0 minutes 18 minutes Cooling None 5 minutes 23 minutes Packaging & Collecting Money Roommate 3 minutes 26 minutes Thus, it requires minimum 26 minutes to fill a rush order. Production Capacity (4 hours): Since the resources required for the different processes are not common everywhere, there can be two orders (of one dozen each, for simplicity) being processed simultaneously. Thus, it would not require twice as much time for the second order (of one dozen) to be completed as it requires for the first one (of one dozen). This can be attributed to the fact that one can get the tray ready for the second order while the first one is in the oven...
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...Case Report: Kristen’s Cookie Company Question 1 How long will it take to fulfill a rush order? | Gantt Chart for Kristen's Cookie Case | | | | | | | | | | | | | To fulfill the rush order it is still necessary to go through all parts of the process illustrated on the process flow diagram of the cookie-making process (it can be found on the last page). As there are no processes that can be done in a parallel way, every stage follows the other. Calculating the time needed for each step it can be concluded that the order can’t be prepared less than in 26 minutes. Question 2 How many orders can you fill in a night, assuming you are open 4 hours each night? We already know from the first question, the first dozen can be fulfilled in 26 minutes. Lets have a look, on the fastest possible way to prepare the second and all the following dozens. I can start preparing the 2nd order as soon as I start heating the oven (the chart visually demonstrates it): According to the chart it takes 26 minutes to fill the first order and 10 minutes more to fill each following order. From here we have: Operating time = 4*60 = 240 minutes The formula for counting the amount of orders that are able to be produced can be seen as: 16+10n <= 240 where n is the numbers of orders. From this equation we get, that n(max) = 22 dozen. So during 4 hours in a night one can prepare 22 dozen of cookies in 236 minutes. Question 3 How much of your own and your roommate’s valuable...
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...Homework #1: Kristen’s Cookie Company Case 1 6+2+1+9+5+2+1 = 26 mins Resources Activities where needed Time required per unit of work Number of each resource Capacity Kristen Wash and Mix Dish up to trays 6 min 2 min 1 7.5 dozen/hr Bowl Wash and Mix 6 min 1 10 dozen/hr Trays Dish up to trays 2 min Infinite Infinite dozens/hr Roommate Load & Set Timer Packing Payment 1 min 2 min 1 min 1 15 dozen/hr Oven Load & Set Timer Baking 1 min 9 min 1 6 dozen/hr Empty space Cooling 5 min Infinite Infinite dozens/hr The oven is the bottleneck resource. Its capacity is 6 dozen cookies per hour. Because the process’s hourly capacity is 6 dozen, the process’s cycle time is 10 min. Therefore the maximum number of dozens that the process can produce can be given with the help of the following formula: 16 + 10x = 240 x = 22.4 The maximum number of dozens that the process can produce in four hours is 22. 16 + 10x = 60 x = 4.4 λ = 4.4 dozen/hr W = flow time = 26 min = 26/60 hr L = λ W = 1.91 Case 2 Resources Activities where needed Time required per unit of work Number of each resource Capacity Kristen Wash and Mix Dish up to trays 6 min 4 min 1 6 orders/hr Bowl Wash and Mix 6 min 1 10 orders/hr Trays Dish up to trays 4 min Infinite Infinite orders/hr Roommate Load & Set Timer Packing Payment 2 min 4 min 1 min 1 8.57 orders/hr Oven Load & Set Timer Baking 2 min 18 min 1 3 orders/hr Empty space Cooling...
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...2 minutes to spoon the cookie dough onto a tray, a dozen per tray; 10 minutes to put the cookie into the one tray capacity oven, set the timer, and bake the cookies; 5 minutes to take the cookies out of the oven and let them cool; 2 minutes per dozen to take the cookies off the tray and carefully pack them into a box; and 1 minute to accept payment for the order. The overall process takes 19 minutes per dozen and a constant 8 minutes for every order under four dozen cookies because of each order under four dozen will always take 2 minutes to receive and accept payment for the order and 6 minutes to mix ingredients up three dozen cookies worth. So for a rush order of two dozen it will take 46 minutes and a rush order of three dozen will take 65 minutes. 2. How many orders can you fill in a night, assuming you are open four hours each night? Assuming all orders are only one dozen, we could fill 24 orders in a night because the bottleneck resource of the process, which determines the capacity of the whole process, is the baking in the oven. Baking takes 10 minutes giving it the lowest capacity of all the steps and the capacity of the whole process, 6 dozen cookies per hour thus 24 dozen cookies each four-hour night. The capacity for the other steps are 60 dozen per hour to receive, read, print, and send reply to the customer order; 10 dozen per hour to place all the ingredients of the order into a mixing bowl; 30 dozen per hour to spoon the cookie dough onto a tray; 12 dozen...
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...Kristen’s cookie company pre-case report DSC335 1. Draw a flow chart of the cookie-making process 2. How long will it take to fill a rush order of 1-dozen cookie? It will take 26 minutes to fill a rush order of 1-dozen cookie. (I revise my chart to 4 cycle orders) 3. What is the cycle time? How many orders can you fill in a night (4-hour period)? Does your answer depend on the size of the order, 1-dozen, 2-dozen, or 3-dozen? 1-dozen orders: The cycle time is 10 minutes. The first order of 1-dozen cookies will take 26 minutes, and each 10 minutes for another 1-dozen cookie order. (4*60-26)/10=21.4 plus the first order, we can make 22 orders of 1-dozen cookie fill in a night. 2-dozen orders: The cycle time is 20 minutes. The first order of 2-dozen cookies will take 36 minutes, and each 20 minutes for another 2-dozen cookie order. (4*60-36)/20=10.2 and plus the first order, we can make 11 orders of 2-dozen cookie fill in a night. 3-dozen orders: The cycle time is 30 minutes. The first order of 3-dozen cookies will take 46 minutes, and each 30 minutes for another 3-dozen cookie order. (4*60-46)/30=6.47 and plus the first order, we can make 7 orders of 3-dozen cookie fill in a night. 4. What is the difference in labor (both you and your roommate’s time) per dozen among 1-dozen, 2-dozen, and 3-dozen orders? 1-dozen orders: Me: Wash and Mixing 6 minutes + fill the tray 2 minutes = 8 minutes +my roommate: Setting timer and putting in the oven 1 minute...
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...Case Study: Kristen’s Cookie Company Key questions to answer before you launch the business: 1) How long will it take you to fill a rush order? If we consider that one order is a dozen, the flow time is 26 minutes for the first order. 2) How many orders can you fill in a night, assuming you are open four hours each night? (4 hours = 240 minutes) If we consider that one order is a dozen, it will take me: * For the first order: 26 minutes * For the second order: 20 minutes (excluding backing and mixing because 6 min can be for 3 dozens) * For the third order: 20 minutes → So, it will take 66 minutes for 3 orders. → (240 / 66)* 3 = 10 orders/ night. 3) How much of your own and your roommate’s valuable time will it take to fill each order? If we assume that we will work 4 hours (240 minutes) each night, and it takes us on average 22 minutes (26+20+20 /3) to produce a dozen. (Considering that one order is a dozen.) 4) Because your baking trays can hold exactly one dozen cookies, you produce and sell cookies by the dozen. Should you give any discount for people who order two dozen cookies, three dozen cookies, or more? If so, how much? Will it take you any longer to fill a two-dozen cookie than a one-dozen cookie order? Because producing a second and a third dozen cookies will take less time than producing the first dozen cookies (excluding the washing and mixing steps), we can give a discount for people ordering two or three dozens...
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...For the exclusive use of S. Zhang, 2015. 9-686-093 REV: JULY 13, 2006 ROGER BOHN 1 Kristen's Cookie Company (A1) You and your roommate are preparing to launch Kristen’s Cookie Company in your on-campus apartment. The company will provide fresh cookies to hungry students late at night. You need to evaluate the preliminary design for the company’s production process in order to make key policy decisions, including what prices to charge, what equipment to order and how many orders to accept, and to determine whether the business can be profitable. Illustration by Jane Simon Business Concept Your idea is to bake fresh cookies to order, using any combination of ingredients that the buyer wants. The cookies will be ready for pickup at your apartment within an hour. Several factors will set you apart from competing products such as store-bought cookies. First, your cookies will be completely fresh. You will not bake any cookies before receiving the order; therefore, the buyer will be getting cookies that are literally hot out of the oven. Second, like many Boston-based area ice-cream shops, you will have a variety of ingredients available to add to the basic dough, including chocolate chips, M&M’s, chopped Heath bars, coconut, walnuts, and raisins. Buyers will telephone in their orders and specify which of these ingredients they want in their cookies. You will guarantee completely fresh cookies. In short, you will have the freshest, most exotic cookies...
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...3. Flow Rate Analysis • Evaluating flow-rate through a complex process • Notions of “capacity”, “bottlenecks” and “utilization” • Improving flow-rate (capacity) of a system Case: Kristen’s cookie company 1 Course Roadmap Operations Management Strategic View Process View Process Flow Metrics Flow Rate 2 Recap Basics Steps of Process Flow Analysis 1. Define the process 2. Draw the process flow diagram 3. Determine the basic process flow metrics: flow rate, flow time, inventory Little’s Law I=RxT 3 Kristen’s Cookie Co. • Process Flow Diagram 4 Kristen’s Cookie Co. Q1. How long will it take you to fill a rush order? 5 Kristen’s Cookie Co. Q2. How many orders can you fill in a night, assuming you are open four hours each night? Assume each order is for 1 dozen cookies. Assume that you have 1 tray. 6 Kristen’s Cookie Co. Q2. How many orders can you fill in a night, assuming you are open four hours each night? Assume each order is for 1 dozen cookies. Assume that you have sufficient number of trays. 7 Definition Capacity of a resource It is the maximum possible flow rate through a resource on average What is capacity of each resource in KCC? 8 Definition Bottleneck Bottleneck is the resource with limiting constraint on the system. Capacity of a process It is the maximum possible flow rate through the process. = Capacity of the Bottleneck resource Now Calculate the Capacity of KCC? 9 Bottleneck...
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...Case Three: Kristen’s Cookie Company Kate Johnson INTRODUCTION For many students on a college campus, late nights are as common as group projects and comprehensive tests. During these late nights, snacks can help keep a student focused. Kristen’s Cookie Company (KCC), hopes to capitalize on this fact by providing these students with customizable (perceived quality), high quality, freshly made cookies (aesthetic quality) with a quick delivery time (serviceability) in close proximity to the students (serviceability). Ordinarily, students can get cookies in many venues—including grocery stores, restaurants, and bakeries—that are premade for reasonable prices; but these venues may be closed late at night, or are too far from the campus to fit into a student’s busy schedule. For this reason, many students may be receptive to the convenience and fast delivery time of KCC. Additionally, the easy online ordering process will benefit the company as it continues to grow. KCC is positioned to be successful if it can continue to effectively deliver on all of its order winners. COOKIE PRODUCTION The production process for making the cookies is shown in the process flow diagram in Exhibit 1. Since the time to preheat the oven is omitted from this case, the total processing time for the first batch of one dozen cookies is 26 minutes. If a mistake is made on one of the batches of cookies, it will set KCC back by a minimum of 25 minutes. When the first batch is put into the oven...
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...Case Report: Kristen's Cookie company 1. It takes 26 minutes to complete a rush order, that is, the addition of the time it takes to complete each step: 6 (wash and mix) + 2 (spoon) + 10 (load and bake) + 5 (unload and cool) + 2 (pack) + 1 (pay) = 26. Process flow diagram of the cookie-making process: Me Mixer Me Spoon and tray Roommate Oven and tray Oven and tray INPUT OUTPUT Roommate Oven and tray Tray Roommate Roommate Remarks: Since it does not consume any time, the first step, that is to take an order, is here ignored. Inventory is not kept at any time as the cookie dough is continuously being processed by the dozen to fit the bottleneck's capacity and only produce fresh cookies according to placed orders. 2. We assume the following: The minimum amount of cookies per order is one dozen cookies (the case states that the process produces “cookies by the dozen”). There are at least two trays and spoons, as the case mentions “cookie trays” and “spoons” Since the amount of time necessary to unload the oven is considered “negligeable”, it can be done during the same minute used to load the next batch. In this view, the first order takes 26 minutes but each following batch only requires an additional 10 minutes (see Gantt chart 1 attached). Capacity of resources (dozen cookies per hour): | Me | Roommate | Mixer (1) | Trays (2) | Spoons (2) | Oven (1) | Cycle time | 8mns/unit | 4mns/unit...
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...Running Head: KRISTEN’S COOKIE COMPANY 1 Kristen’s Cookie Company: An Effective Production Process ABSTRACT This paper will explore the Kristen’s Cookies business concept and evaluate if the company current status is profitability. We will review the ability to take orders, pricing the product, developing policies. Kristen’s Cookie Company is a business idea thought up by two roommates who are trying to tap into a market which caters to starving college students in the late night hours. The proposed idea is to offer freshly baked made-to-order cookies late at night for students within an hour. Although, the concept is good, the purpose of this analysis is to determine the components that can make or break this company’s success. The ultimate goal of the company is to comprise a price that is affordable, yet profitable to the two owners. The key points that need to be evaluated would be the production process along with fees for the services, will they be able to profit based of the cost put into the business, ordering capacity based off the equipment currently owned and times of operations, the amount materials that should be in the inventory, and man-power. The students already own key equipment like the mixers, cookie pans that hold a dozen cookies, and the oven, so no investment is needed in this area. Expenses like electricity are covered by the landlord, so this is another item not necessary for the operational budget to start. The input to consider...
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...Kristen’s Cookie Company Case Study OPTM 6090 Spring 2014 Team 1 Executive Summary Kristen and her roommate have planned the Kristen’s Cookie Company (KCC) as a joint venture to create and operate a successful business operated in a college campus apartment, with potential to grow in the future. The core competency is providing made-to-order fresh cookies after standard business operating hours. There are several immediate decisions to address including scale of operation, business partner relationship, operation and production systems, as well as pricing, ordering, and delivery policies. Kristen and her partner must determine which of various alternatives presented will help them achieve operational optimization. After a careful analysis, it is recommended that Kristen that all orders be standardized to one dozen, with rush deliveries limited to the first batch of the night while using existing equipment available. Kristen should continue to maintain her working relationship with her roommate in order to run the business out of their apartment using one oven, one mixer and two baking trays. Problem Definition Kristen needs to decide how to optimize the cookie making process to achieve the best business practices. The partners must formulate rules for accepting and fulfilling orders that will address any of the system’s current insufficiencies. The business is small, with limited resources in finances, space, equipment and time. The primary constraint is...
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...Assignment 1 Operations Management I Kristen’s Cookie Company (A1) Total (50) Marks Weightage 10% Lead Questions for Assignment 1 1. How long will it take you to fill an order? (8) marks Operation | Time (mins) | Quunatiy (dozen) | Washing, Mixing etc | 6 | 3 | Spooning | 2 | 1 | Resetting & Baking | 10 | 1 | Cooling | 5 | 1 | Packing | 2 | 1 | Accepting Payment | 1 | - | For filling in a rush order Time taken = 6+2+10+5+2+1 = 26 mins 2. How many orders can you fill in a night, assuming you are open four hours each night? ( 7) marks Time for 1 dozen = 26 mins. Time for 2 dozen = 6+2+10+10+5+2+1 = 36 mins. Time for 3 dozen = 6+2+10+10+10+5+2+1 = 46 mins. Hence, eqn for time reqd = 16+10*n ; where n => no of dozen Therefore 4*60 = 16+10*n 224 = 10*n n = 22 dozen 3. How much of your own and your roommate’s valuable time will it take to fill each order? ( 5) marks My time spent = 6+2 = 8 mins. Roommate time spent = 1+3 = 4 mins. 4. Because your baking trays can hold exactly one dozen cookies, you will produce and sell cookies by the dozen. Should you give any discount for people who order two dozen cookies, three dozen cookies or more? If so, how much? Will it take you any longer to fill a two-dozen cookies order than one–dozen cookies order? ( 4) marks The two cost components in this business, that the team of Kristen and her roommate is...
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...Time, and More How do we quantitatively evaluate a process? – Capacity – Time – Other? ARES: – Charging Ahead to Push Electric Cars – Latest Starbucks Buzzword: ‘Lean’ Japanese Techniques 1 Amazon in 1990’s: Delivering Books 2 Amazon’s Potential Solutions What do customers want? Inventory – Large selection – Fast delivery – Low Price Eliminate the uncertainty Print on demand/eBook Transfer/Share the uncertainty How do we deal with uncertainty ? Or why is it so difficult to deliver books to customers on time and at a low cost? Transfer the inventory to a distributor 3 Potential Solutions: Transfer the inventory to the distributor Example: In the early days of Amazon.com the company did not keep any inventory of books. 4 Potential Solutions: Transfer the inventory to the distributor Amazon’s Order – The supplier Ingram kept the books for Amazon. – Once Amazon received an order, it was transmitted to Ingram. – Ingram would ship the book directly to the consumer. Amazon’s Post Order Process 5 Ingram’s Order Ingram’s Book Inventory Ingram’s Post Order Process 6 1 Potential Solutions: Transfer the inventory to the distributor ARES Changing Ahead to Push Electric Cars What are the advantages for such an arrangement for Amazon and Ingram? – Risk pooling (less inventory is needed) What are the disadvantages of this arrangement for Amazon and Ingram? – Allocation priority ...
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