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11.8 Cases and Problems

Learning on the Web (AACSB)

How to Build a BMW

How’d you like to own a BMW? How about a Z4 two-seat roadster for touring town and country? Or maybe an X5 SAV—a sports activity vehicle with the body of a high-performance car and the soul of a sports car? We can’t help you finance a BMW, but we can show you how they’re made. Go to http://www.bmwusfactory.com/Manufacturing.aspx?id=162 to link to the BMW Web site for a virtual tour of the company’s South Carolina plant.

Start by clicking on the car of your choice—the X5 SAV or the Z4 Roadster—and then on the blocks on the “Timeline,” where you can see each step in the production of your car. Before going any further, answer the following questions:

  1. What are the steps in the production of the car?
  2. What type of production process is used to make it?

Once you’ve answered these questions, continue your tour by going to the “Main Navigation” button in the upper-left corner of the screen. Click on the third block to learn about BMW’s operational efficiencies and on the fourth block to learn about its quality-control procedures. Now, answer these two questions:

  1. What technology does BMW use in the design and production of its vehicles?
  2. What procedures does the company follow to ensure the production of high-quality vehicles?

Career Opportunities

Wanted: Problem Solvers and Creative Thinkers

If you had a time machine plus a craving for a great hamburger, you could return to the early 1950s and swing by Dick and Mac McDonald’s burger stand in San Bernardino, California. Take a break from eating and watch the people in the kitchen. You’ll see an early application of operations management in the burger industry. Dick and Mac, in an effort to sell more burgers in less time, redesigned their kitchen to use assembly-line procedures. As the number of happy customers grew, word spread about their speedy system, and their business thrived. Curiously, it wasn’t Dick and Mac who made McDonald’s what it is today, but rather a traveling milkshake-mixer salesman named Ray Kroc. He visited the hamburger stand to learn how they could sell twenty thousand shakes a year. When he saw their operations and the lines of people walking away with bags filled with burgers, fries, and shakes, he knew he had a winner. In cooperation with the McDonald brothers, he started selling franchises around the country, and the rest is history.

So, what does this story have to do with a career in operations management? If you’re a problem solver like Dick and Mac (who discovered a way to make burgers faster and cheaper) or a creative thinker like Ray Kroc (who recognized the value in an assembly-line burger production system), then a career in operations management might be for you. The field is broad and offers a variety of opportunities. To get a flavor of the choices available, go to http://www.wetfeet.com/Careers-and-Industries/Careers/Operations.aspx to link to the WetFeet Web site and review the dozen or so operations management positions listed. Provide a brief description of each position. Indicate how interesting you find each position by rating it using a five-point scale (with 1 being uninteresting and 5 being very interesting). Based on your assessment, pick the position you find most interesting and the one you find least interesting. Explain why you made your selections.

Ethics Angle (AACSB)

In many ways, Eastman Kodak (a multinational manufacturer and distributor of photographic equipment and supplies) is a model corporate citizen. Fortune magazine has ranked it as one of the country’s most admired companies, applauding it in particular for its treatment of minorities and women. Its community-affairs programs and contributions have also received praise, but Eastman Kodak remains weak in one important aspect of corporate responsibility: it has consistently received low scores on environmental practices. Recently, for example, the watchdog group Scorecard rated Eastman Kodak’s Rochester, New York, facility as the third-worst emitter of airborne carcinogens in the United States. Other reports have criticized the company for dumping cancer-causing chemicals into the nation’s waters.

Go to http://www.kodak.com/US/en/corp/HSE/homepage.jhtml?pd-path=2879/7196 to link to the Eastman Kodak Web site and read its own assessment of its environmental practices. Then answer the following questions:

  • Based on the information provided on its Web site, how favorable do you feel about Eastman Kodak’s environmental practices?
  • In what ways is the company responding to criticisms of its environmental practices and improving them?
  • Do the statements on the Web site mesh with the criticism that the company has received? If not, what accounts for the differences?

Team-Building Skills (AACSB)

Growing Accustomed to Your Fit

Instead of going to the store to try on several pairs of jeans that may or may not fit, wouldn’t it be easier to go online and order a pair of perfect-fitting jeans? Lands’ End has made this kind of shopping possible through mass-customization techniques and some sophisticated technology.

To gain some firsthand experience at shopping for mass-customized goods, have each member of your team go to http://www.landsend.com/custom to link to the Lands’ End Web site. Each team member should go through the process of customizing a pair of jeans but stop right before placing an order (unless you’re actually in the market for a pair of mass-customized jeans). After everyone has gone through the process, get together and write a report in which the team explains exactly what’s entailed by online mass customization and details the process at Lands’ End. Be sure to say which things impressed you and which didn’t. Explain why Lands’ End developed this means of marketing products and, finally, offer some suggestions on how the process could be improved.

The Global View (AACSB)

What’s the State of Homeland Job Security?

Over the past several decades, more and more U.S. manufacturers began outsourcing production to such low-wage countries as Mexico and China. The number of U.S. manufacturing jobs dwindled, and the United States became more of a service economy. People who were directly affected were understandably unhappy about this turn of events, but most people in this country didn’t feel threatened. At least, not until service jobs also started going to countries that, like India, have large populations of well-educated, English-speaking professionals. Today, more technology-oriented jobs, including those in programming and Internet communications, are being outsourced to countries with lower wage rates. And tech workers aren’t alone: the jobs of accountants, analysts, bankers, medical technicians, paralegals, insurance adjusters, and even customer-service representatives have become candidates for overseas outsourcing.

Many U.S. workers are concerned about job security (though the likelihood of a particular individual’s losing a job to an overseas worker is still fairly low). The issues are more complex than merely deciding where U.S. employers should be mailing paychecks, and politicians, economists, business executives, and the general public differ about the causes and consequences of foreign outsourcing. Some people think it’s a threat to American quality of life, while others actually think that it’s a good thing.

Spend some time researching trends in outsourcing. Formulate some opinions, and then answer the following questions:

  1. About what percentage of U.S. jobs have left the country in the last five years? What percentage will probably leave in the next five years?
  2. What kinds of jobs are being outsourced, and where are they going? What kinds of jobs can’t be outsourced?
  3. How does global outsourcing help U.S. businesses? How does it hinder them?
  4. How has the trend in outsourcing manufacturing and service operations to foreign countries helped average Americans? How has it harmed them?
  5. Does overseas outsourcing help or hurt the U.S. economy? In what ways?