Question

16.       For the following two scenarios, describe whether the implied demand uncertainty would increase, decrease or stay the same? Explain the reason why.

1. A company introducing five new products to the market at the same time. (5 points)

(ii)       A company planning to enhance its service level from 90% to 95%. (5 points)

17. Where would you locate the following companies on the responsiveness-efficiency spectrum (fill in the blanks with the words “efficient” or “responsive”)

1. An automotive company that opens up a car assembly plant in a country with large car market. _________________ (4 points)
2. A factory with excess capacity. ________________ (4 points)

(iii)      A company that uses rail transportation system to ship its finished products. _______________ (4 points)

Answer 1

16.

1. The demand uncertainty would increase if the company chooses to introduce the five new products at a time, as some of the products might cannibanlise their co products.

2.Enhancing service level from 90% to 95% would only affect the risk of stockout, not the uncertainlty of demand.

17.

1. The company is responsive to the market demand by setting up a new assembly unit.

2, The company with excess capacity is more likely to be responsive to the demand.

3. The company which uses rail transportation is more efficient as it saves cost and time by doing so, increasing the effciency of operations.