Operations Management

ISL 223E FUNDAMENTALS OF PRODUCTION MANAGEMENT CASE STUDY 2[1] repayable go out: 17. 10. 2011 until at 17.00 to Room B408[2] NorSal TRONDHEIM NorSal Trondheim operates a salmon serveing initiation where fish are purchased from local sources on the North Sea, touch on at the facility, and sold to customers for distribution. The dispose manager, Inger Hansen, is contemplating a plant modernization to upgrade the technology in the plant. While the plant performs rise up enough now, modernizing equipment would permit the plant to increase capacity per hour, which is particularly advantageous because the manufactory has enough demand to cover the surplus capacity. Currently, the plant operates vanadium days a week, two breaks of 30 workers per shift. The workers are stipendiary $10 per hour. Adding a third shift is not mathematical because the plant is cleaned during the third shift. The firm is contemplating a plant modernization to upgrade lively e quipment, which should increase the plants widening spot lowering susceptibility follows. exploitation the current equipment, or so 1.500 pounds of salmon can be impact apiece hour, while the impertinently plant would be sufficient to processed each hour, while the new plant would be able to process 2.000 pounds per hour.

The updated equipment is made by the same producer as the existing equipment, and the new equipment quickly. For this reason, costs to train effect are fictive to be negligible. The production manager, Bjorn Pedersen, is skeptical rough undergoing the plant modernization. The fourth-year equipment, he argues, is already paid for, and new equipment would cost $10.000 per week. This cost is comprised of! both principal and interest, and includes manufacturer evocation of the equipment. The controller, Maret Karlsen, cautions that all decisions relate to costs should be included in the analysis and that because the energy consumption would be different, this must as well as be accounted for in the decision. Energy costs are soon $10 per unit,...If you want to get a full essay, revision it on our website: OrderEssay.net

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