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Solution Manual for Introduction to Materials Management, 9th Edition by Stephen N. Chapman
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Solution Manual for Introduction to Materials Management, 9th Edition by Stephen N. Chapman
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Sure, I can help with that! For a 5000-word introduction to *Introduction to Materials Management, 9th Edition* by Stephen N. Chapman, you might want to focus on the following key areas:1. **Overview of the Textbook**: Summarize what the textbook covers,including its purpose, scope, and key themes. Highlight the author's credentials and the book's relevance in the field of materials management.2. **Importance of Materials Management**: Discuss the role and importance of materials management in supply chain and
operations management. Explain how effective materials management contributes to overall organizational efficiency and profitability.3. **Key Concepts and Topics**: Outline the major concepts and topics presented in the book. This might include inventory
management, procurement, logistics, supply chain coordination, and technology's role in materials management.4. **Structure and Organization**: Describe how the book is structured. Mention how the chapters are organized and how they build upon each other to
provide a comprehensive understanding of materials management.5. **Updates and New Features**: Since this is the 9th edition, discuss any new updates or features that have been added. This might include new case studies, updated data, or recent trends in materials
management.6. **Practical Applications**: Provide examples of how the concepts in the book are applied in real-world scenarios. This can include industry-specific applications or case studies.7. **Conclusion**: Summarize the key takeaways from the book and its
significance to students and professionals in the field of materials management.Here's a rough outline to help you get started:### Introduction- **Purpose of the Book** - Overview of materials management - Relevance to students and professionals### Importance of
Materials Management- **Role in Supply Chain Management** - Efficiency and cost-effectiveness - Impact on organizational performance### Key Concepts and Topics- **Inventory Management** - Techniques and strategies- **Procurement** - Processes and
best practices- **Logistics** - Transportation and warehousing- **Technology** - Role of IT in materials management### Structure and Organization- **Chapter Breakdown** - Overview of each chapter - How chapters interconnect### Updates and New
Features in the 9th Edition- **New Content** - Recent trends and data- **Enhanced Features** - Additional case studies or exercises### Practical Applications- **Real-World Examples** - Industry applications - Case studies and their relevance### Conclusion-
**Summary of Key Points** - Importance of materials management - Contributions of the textbookFeel free to expand or adjust these sections based on what you find most relevant. If you need more detailed content on any specific section, let me know!
Solution Manual for
Introduction to Materials Management, 9th Edition by Stephen N. Chapman
Chapter 1-17
INTRODUCTION TO MATERIALS MANAGEMENT
CHAPTER 1: INTRODUCTION TO MATERIALS MANAGEMENT
ANSWERS TO PROBLEMS
1.1 Sales 100% 100%
Cost of manufacturing 60% 55%
Other costs
85% 90%
Profit (percent of Sales) 30% 30%
10% 15%
Therefore a 10% reduction in the cost of manufacturing would produce a 50% increase in
profit.
1.2 Profit = Sales – (direct costs + overhead)
0.15 = Sales – (0.60 Sales + 0.30)
0.45
Sales = = 1.125 = 112.5%
0.4
To increase profits from 10% to 15% takes a 12.5% increase in sales but only a 5%
decrease in costs. Good materials management can have a direct impact on profit. Note
the cost of overhead has been left unchanged in this problem.
a. Weekly cost of goods sold = $16,000,000 = $320,000
1.3
50
Value of 8 weeks‘ WIP = 8 $320,000 = $2,560,000
b. Value of 6 weeks‘ WIP = 5 $320,000 = $1,600,000
Reduction in WIP = $960,000
$30,000,000
1.4 a. Weekly cost of goods sold = = $600,000
50
, Value of 12 weeks‘ WIP = 10 $600,000 = $6,000,000
b. Value of 5 weeks‘ WIP = 5 $600,000 = $3,000,000
Reduction in WIP = $3,000,000
Annual saving = 20% $3,000,000 = $600,000
1.5 Using $1 million as the units:
As a % of sales
Sales $20.0
100%
Direct material $6.4 32%
Direct labor 6.6 33%
Overhead 6 19 30% 95%
Profit $1 5%
a. From the above we can say: (in millions or M$)
Sales = direct material + direct labor + overhead + profit (needs to be 2M$)
= .32(sales) + .32(sales) + .33(sales) + 6 M$+ 2.0 M$
.35 (Sales) = 8 M$
Sales = 22.86 M$ = 22.86 $1,000,000 = $22,860,000
Therefore, there must be a $2.86 million increase in sales.
b. To increase profit by $1,000,000 there must be a $1,000,000 reduction in cost.
Therefore, direct material must be reduced by $1,000,000. It therefore takes 2.86 times
the sales dollars to obtain the profit that would be realized in material reductions.
c. As for b. Direct labor would have to be reduced by $1,000,000.
Sure, I can help with that! For a 5000-word introduction to *Introduction to Materials Management, 9th Edition* by Stephen N. Chapman, you might want to focus on the following key areas:1. **Overview of the Textbook**: Summarize what the textbook covers,
including its purpose, scope, and key themes. Highlight the author's credentials and the book's relevance in the field of materials management.2. **Importance of Materials Management**: Discuss the role and importance of materials management in supply chain and
operations management. Explain how effective materials management contributes to overall organizational efficiency and profitability.3. **Key Concepts and Topics**: Outline the major concepts and topics presented in the book. This might include inventory
management, procurement, logistics, supply chain coordination, and technology's role in materials management.4. **Structure and Organization**: Describe how the book is structured. Mention how the chapters are organized and how they build upon each other to
provide a comprehensive understanding of materials management.5. **Updates and New Features**: Since this is the 9th edition, discuss any new updates or features that have been added. This might include new case studies, updated data, or recent trends in materials
management.6. **Practical Applications**: Provide examples of how the concepts in the book are applied in real-world scenarios. This can include industry-specific applications or case studies.7. **Conclusion**: Summarize the key takeaways from the book and its
significance to students and professionals in the field of materials management.Here's a rough outline to help you get started:### Introduction- **Purpose of the Book** - Overview of materials management - Relevance to students and professionals### Importance of
Materials Management- **Role in Supply Chain Management** - Efficiency and cost-effectiveness - Impact on organizational performance### Key Concepts and Topics- **Inventory Management** - Techniques and strategies- **Procurement** - Processes and
best practices- **Logistics** - Transportation and warehousing- **Technology** - Role of IT in materials management### Structure and Organization- **Chapter Breakdown** - Overview of each chapter - How chapters interconnect### Updates and New
Features in the 9th Edition- **New Content** - Recent trends and data- **Enhanced Features** - Additional case studies or exercises### Practical Applications- **Real-World Examples** - Industry applications - Case studies and their relevance### Conclusion-
**Summary of Key Points** - Importance of materials management - Contributions of the textbookFeel free to expand or adjust these sections based on what you find most relevant. If you need more detailed content on any specific section, let me know!
CASE STUDY 1.1 TEACHING NOTES
Fran’s Flowers
Fran‘s Flowers is a good case to use early in a course of study, because it illustrates two
important areas (service design and operations strategy) in a case format that is completely
qualitative, and therefore less threatening to some student as they make their first entrance into
materials management. It can also be used to start students thinking about the quantitative aspects
of materials management, both from a data gathering and data analysis aspect, as one of the direct
case questions (#2) asks students to consider the data collection needs as well as how they would
suggest using this data. This presents a good opportunity (usually at the conclusion of the primary
analysis) to have an open, ―brainstorming‖ discussion. This can be used not only to start student
thinking about quantitative analysis, but can be used as an ―icebreaker‖ to allow student to feel
comfortable about open class discussions.
The Problem
Fran clearly stated that she intended to focus on the specialty make-to-order flower arrangements.
, Clearly in such a business the major operational focus should be on artistic capability, flexibility,
design, and close communication with the customer. The volume would be fairly small, but the
margin on each order would be fairly large. The order-winning aspects of such a business would
clearly be availability, design, and flexibility.
Sure, I can help with that! For a 5000-word introduction to *Introduction to Materials Management, 9th Edition* by Stephen N. Chapman, you might want to focus on the following key areas:1. **Overview of the Textbook**: Summarize what the textbook covers,
including its purpose, scope, and key themes. Highlight the author's credentials and the book's relevance in the field of materials management.2. **Importance of Materials Management**: Discuss the role and importance of materials management in supply chain and
operations management. Explain how effective materials management contributes to overall organizational efficiency and profitability.3. **Key Concepts and Topics**: Outline the major concepts and topics presented in the book. This might include inventory
management, procurement, logistics, supply chain coordination, and technology's role in materials management.4. **Structure and Organization**: Describe how the book is structured. Mention how the chapters are organized and how they build upon each other to
provide a comprehensive understanding of materials management.5. **Updates and New Features**: Since this is the 9th edition, discuss any new updates or features that have been added. This might include new case studies, updated data, or recent trends in materials
management.6. **Practical Applications**: Provide examples of how the concepts in the book are applied in real-world scenarios. This can include industry-specific applications or case studies.7. **Conclusion**: Summarize the key takeaways from the book and its
significance to students and professionals in the field of materials management.Here's a rough outline to help you get started:### Introduction- **Purpose of the Book** - Overview of materials management - Relevance to students and professionals### Importance of
Materials Management- **Role in Supply Chain Management** - Efficiency and cost-effectiveness - Impact on organizational performance### Key Concepts and Topics- **Inventory Management** - Techniques and strategies- **Procurement** - Processes and
best practices- **Logistics** - Transportation and warehousing- **Technology** - Role of IT in materials management### Structure and Organization- **Chapter Breakdown** - Overview of each chapter - How chapters interconnect### Updates and New
Features in the 9th Edition- **New Content** - Recent trends and data- **Enhanced Features** - Additional case studies or exercises### Practical Applications- **Real-World Examples** - Industry applications - Case studies and their relevance### Conclusion-
**Summary of Key Points** - Importance of materials management - Contributions of the textbookFeel free to expand or adjust these sections based on what you find most relevant. If you need more detailed content oic section, let me know!
Once those characteristics have been developed, a discussion of the importance of location can be
initiated. In the make-to-order business location could be expected to be insignificant, as the case
indicates when it discusses how Fran and Miguel usually visit the clients to obtain the order,
rather than the other way. In such a situation it really doesn‘t matter where she locates as long as
she has space to store the flowers and make the arrangements.
Some student will immediately jump on the now-obvious mistake that Fran made. She selected a
location in a highly visible strip mall. In such a location it should be expected that people will
walk in a flower shop with the idea of making spot purchases of flowers. In other words, she
selected a location without considering the strategic impacts. It might have worked out without a
problem if she would have just turned away the customers wanting the spot purchases, but the
financial benefits of such an apparently easy sale was too appealing.
As soon as Fran started accommodating those walk-in customers, she had evolved into two
separate businesses with two separate operational strategy models. The walk-in business was, of
course, a make-to-stock business with all the typical characteristics of such a business. The
contrasts are summarized on the following table. Such a table can be easily developed during the
class discussion to enable all students to clearly see the contrast in the service businesses:
Make-to-order Make-to-stock
Price Not sensitive Sensitive—order winner
Location Not sensitive Critical
Design Order winner Standardized
Skill level Very high Fairly low
Volume Very low Higher
Variety of design Each one different More standard
Operational focus Close customer contact Standardized, low-cost
Inventory Can order as needed High—standard
arrangements
Not only has she gotten herself into a dual business situation (of which she originally had no
interest in and has minimal managerial skills to run), but now customers in the make-to-stock
business are trying to force her to move even more away from her core. The consideration to have
the shop open longer, open a second location, and become part of a national delivery service will
pull her away from her central business focus even more.
Approaches
, There are really three basic approaches that appear to make sense, although some students will
come up with logical variations on these three:
Do nothing—This is always an alternative, and is frequently the least desirable one for a number
of reasons. It would continue the problems outlined in the case and quite likely cause erosion of
her business, as it appears she cannot give proper attention to either business under the current
circumstances.
Sure, I can help with that! For a 5000-word introduction to *Introduction to Materials Management, 9th Edition* by Stephen N. Chapman, you might want to focus on the following key areas:1. **Overview of the Textbook**: Summarize what the textbook covers,
including its purpose, scope, and key themes. Highlight the author's credentials and the book's relevance in the field of materials management.2. **Importance of Materials Management**: Discuss the role and importance of materials management in supply chain and
operations management. Explain how effective materials management contributes to overall organizational efficiency and profitability.3. **Key Concepts and Topics**: Outline the major concepts and topics presented in the book. This might include inventory
management, procurement, logistics, supply chain coordination, and technology's role in materials management.4. **Structure and Organization**: Describe how the book is structured. Mention how the chapters are organized and how they build upon each other to
provide a comprehensive understanding of materials management.5. **Updates and New Features**: Since this is the 9th edition, discuss any new updates or features that have been added. This might include new case studies, updated data, or recent trends in materials
management.6. **Practical Applications**: Provide examples of how the concepts in the book are applied in real-world scenarios. This can include industry-specific applications or case studies.7. **Conclusion**: Summarize the key takeaways from the book and its
significance to students and professionals in the field of materials management.Here's a rough outline to help you get started:### Introduction- **Purpose of the Book** - Overview of materials management - Relevance to students and professionals### Importance of
Materials Management- **Role in Supply Chain Management** - Efficiency and cost-effectiveness - Impact on organizational performance### Key Concepts and Topics- **Inventory Management** - Techniques and strategies- **Procurement** - Processes and
best practices- **Logistics** - Transportation and warehousing- **Technology** - Role of IT in materials management### Structure and Organization- **Chapter Breakdown** - Overview of each chapter - How chapters interconnect### Updates and New
Features in the 9th Edition- **New Content** - Recent trends and data- **Enhanced Features** - Additional case studies or exercises### Practical Applications- **Real-World Examples** - Industry applications - Case studies and their relevance### Conclusion-
**Summary of Key Points** - Importance of materials management - Contributions of the textbookFeel free to expand or adjust these sections based on what you find most relevant. If you need more detailed content on any specific section, let me know!
Expand the Make-to-Stock business—Given that she apparently has a good location, this business
could be attractive if run effectively. Fran, however, does not consider that business as the one
most attractive to her. She just prefers to use her design talents on the make-to-order. One method
to allow for effective expansion is to hire a full-time, experienced person to completely take over
the make-to-stock business. This person could be evaluated on a profit basis, but be given almost
free reign to expand the business in any direction that will prove profitable. Fran could then
concentrate her efforts on the make-to-stock, and it is highly likely that having both businesses be
successful, allowing for at least some synergistic effects as customer for one business would,
under the right circumstances, buy from Fran if they have a need for flowers for another purpose.
Eliminate the Make-to-Stock business—One potential problem with the expansion of the make-
to-stock business is the potential large amount of capital needed (this, in fact, should be one of the
data items students should mention for case question #2). Eliminating this business would allow
her to concentrate on her core business, with less need for capital. The largest problem with this is
the potential loss of profitability with the make-to-stock business, and she still has the location
issue. If she wants to maintain the present location, she should take steps to clearly identify the
nature of the business to possible walk-in customers. Given that the strip mall is popular,
however, the lease costs may be higher that she should have to pay given that location is not very
important to the make-to-order business. She might be better off financially to seek a location
with a lower cost. Location, again, is not critical in the make-to-order business.
Conclusion
Another opportunity for discussion is presented as students debate these options, or may, in fact,
create others. This discussion can be again used to bring in the data questions. You may wish to
ask the students the criteria they should use to make the final decision. Much of these criteria will
probably be dependent on gathering certain information.
You may or may not wish to spend much time on the implementation question. Such a discussion
tends to be less interesting to students and more ―mechanical‖ in nature, but if you wish to use the
case to have students think about the detailed design issues for a service business you may want
to spend some time with it.
This case was based on a real situation in a real flower shop. You may wish to inform the students
that the real ―Fran‖ decided to use her skills and desires to concentrate on the make-to-order
business, but the potential for the walk-in business was too attractive to eliminate, especially
given her location. She hired an experienced retail manager to manage the walk-in business as a
profit center. The manager was given permission to manage that business in any fashion they
wished, but part of their compensation was based on profit-sharing, giving the manager plenty of
incentive to make the store profitable. Fran and Miguel worked in the back room, but could serve
as advisors to the walk-in business as requested by the new manager. Fran and the new manager
would meet on a regular basis to discuss the overall business and look at flower needs, constantly
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