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Review the Scenario. Your process team has two deliverables due shortly, each for a different client in a different industry but with the same fundamental objective of analyzing the current manufacturing or service operation and recommending changes. The first client, Samson Seating, manufactures front seats for several major car manufacturers while the second is Midland Hospital's Diagnostic Medicine unit. Specifically,

1. Samson Seating manufactures leather seating that consists of various components such as frames, electrical parts (heating and comfort features), padding, and leather sewing (final assembly). Each of these components is developed at separate locations, and the final assembly is done at the main plant.

2. Determine if Samson and Midland use batch or continuous flow processes in their manufacturing. Should they modify significantly? Support your answer by providing examples based on the scenario, the addenda mentioned above, and any additional research.

3. Determine if JIT or kanban principles can apply to either Samson or Midland and justify your answer.

II. Prepare to discuss, with a salesman, of the most recent developments in Inventory Management, including JIT, MRP, ERP, and Lean operations. Her motive is to sell a SOA (Supply Chain Opportunity Assessment) to the division and to follow that up with a new software package implementation.
In preparation for that meeting, you ask your staff to participate in a brainstorming meeting.

JIT Inventory The president of Penman Corporation, John Burton, has asked you, the company’s controller, to advise him on whether Penman should develop a just-in-time (JIT) inventory system. Your research concludes that there is a high cost associated with inventory storage facilities; that inventories use a large portion of the company’s cash flow; and that because of the nature of the inventory, there is a significant amount of shrinkage. Research also shows that neither of Penman’s two competitors uses a JIT inventory system. Most of Penman’s employees are trained to do only one job and belong to a local union. The union is strong and, in the past, has opposed major production changes. The union believes major changes will result in the loss of union employees’ jobs. Your research indicates that Penman’s major production item (a fairly new product in the market) should continue to have strong sales growth.


1. Using the information provided, advise John Burton to either continue the present system or work to develop a JIT inventory system.

2. Assume John decides to develop an inventory management system. He plans to evaluate the system after one year. List at least four possible performance measures John could use to evaluate the effectiveness of the system. Describe what information these measures would provide John.

Plus Bonus Q&A.

2. Midland Hospital’s Diagnostic Medicine unit is primarily responsible for processing patients' blood work. Patients are directed to one or more collection offices, where blood is drawn, and then the blood is sent to various other departments depending on the test.

Your task is to develop a high level analysis of both clients' manufacturing processes as a preliminary report that will subsequently be delivered to the client. In this report, include the following:
1. Contrast and compare manufacturing and service operations and identify which to apply to Samson and Midland

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