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Supply Chain Game Executive Summary

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Submitted By tmduong
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Date: | December 2, 2014 | To: | VP of Operations of Supply Chain Management, Jacobs Industries | From: | Supply Chain Game Group: frontrow | Subject: | Executive Summary for Jacobs Industries |

Introduction Business Situation Jacobs Industries is faced with a difficult challenge in the development of an efficient and profitable supply chain strategy. Jacobs Industries produces an industrial chemical, more specifically a foam chemical, which can be used to produce very efficient thermal and acoustic insulators. Because of these insulator properties we have started to market to manufacturers of air conditioner retrofit kits, a highly variable demand market. In addition to the complexities associated with forecast and inventory planning, Jacob’s Industries is involved in a very competitive market. If Jacobs cannot meet certain orders or inventory levels to meet demand our potential customers can easily buy from competitors. To accommodate this competitive market Jacobs must develop a supply chain strategy that is efficient in production and delivery to reach this high level, seasonal and level demand. Many supply chain choices and assessments encompassed our key operational decisions. The first important supply chain decision involved the calculation of an appropriate reorder point (ROP) and Economic Order Quantity (EOQ) for all the regions including Calopeia, Sorange, Entworpe, Tyran, and Fardo. Secondly, our team needed to decide on which regions would serve target market in other regions. This decision also includes the determination of thetarget market priority service levels for each region. The third decision instilled by Jacobs Industries involves the implementation of transportation by truckload or mail. Although truck shipments are less expensive than mail shipments, truck shipments have much longer lead times. The fourth

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