Case Study The Morrison Company

Business School
Management & Marketing Department

Case Study - The Morrison Company
Course Name: Operations & Supply Chain Instructors: Dr. Muhammad Tayyab
Management
Course Code: OM 513-01 Academic Year: 2023, 1st term 231
Due date: October 17, 2023
Group# 3
Student’s Name: Student’s ID
Abdulrahman Alsuhaibani 200741570
Motlaq Alotaibi 201345430
Omar Alzubaidy 201347950
Hani Alharbi 201468160
Mariam Almansour 202202640
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I. Major Facts (5 points)
(State here the major facts as you see them)
II. Major Problem(s) (10 points)

State here the operations problems as you see it. There may be more than one major problem.
III. Questions (85%)

1- Conduct capacity and utilization analysis (using the data provided to you in the spreadsheets)
and provide your own interpretation of Morrison’s production capacity utilization by answering
the following: (30 points)
a. Calculate their monthly utilization rates (for each month)?
b. What is there utilization for standard and customized products?
c. What do you think is the real problem causing under and over utilization?
d. Based on their compounded annual growth (CAGR), do they have enough capacity for
the future?
2- Explain the production processes for the various product lines at Morrison Company
by including details for the following: (30 points)
a) Schematically map the flow of their production process.
b) Use a table (see Exhibit 1 below) to summarize the two major types of products that they
produce and the different characteristics of each product line.
c) Use a table (see Exhibit 2 below) to rank the competitive priorities of each product line:
i. Low cost,
ii. Performance (i.e., reliability, features),
iii. Flexibility (i.e., customization, volume),
iv. Time, Quality (i.e., consistent quality or top quality),
v. Innovation/customization.
d) What production process are they currently using for each product type? (Job, small-batch,
large-batch, line, or continues.)
e) If products have different characteristics and competitive priorities, they should be using
different production processes. Discuss the match between the product characteristics and the
production processes used in Morrison Company. If there is a mismatch then explain it and fix it
for them later in your recommendations.
3- What recommendations would you offer Shauna Breen about how to address those issues she
is facing? Be specific about any policies or organizational changes you propose, especially
regarding the products they should be focusing on. (25 points)
Hint: Standard and Customized products cannot be mixed in the same production process
The company's manufacturing and operating processes exhibit significant flaws, indicating the
need for a redesign of production and supply chain management, given the issues with the
production line and inventory management, there are two main recommendations to consider.
First recommendation is the product focus where many retail products were customized to order.
On the other hand, pharmaceutical products were stocked. Additionally, only a specific set of
standard products within the retail line performed well. Moreover, the retail product line was
contributing nearly 33% of the total revenue while pharmaceutical product line was contributing
nearly 67% back in 2010. Therefore, it would be more beneficial for the operation to prioritize
the less complex products that generate higher profits. For instance, shifting focus towards the
pharmaceutical product line could be a valuable strategy due to its higher profit margins
compared to the retail product line. As for the retail products, it might be more advantageous to
concentrate on the best-selling standard items or limit the options for customers to choose
"certain combinations of non-standard features" to minimize total processing times in the retail
line. This imposes effective communication between the sales department and the manufacturing
department to achieve the desired outcome.
The second recommendation is related to inventory management where the occurrence of stock
outs identified during parts picking has a significant adverse impact for the company. However, it
can be resolved by maintaining accurate inventory records, adjusting inventory policies or supply
chain management practices. For instance, since the production schedule is determined daily, it is
necessary to check the stock levels daily to prevent stock outs. It would be even more beneficial
to upload the latest stock information to a resource planning system. Alternatively, implementing
a modular design approach could be a viable solution to better meet market demand and reduce
manufacturing costs. This would also help alleviate stress on the assembly line and its workers.
Proper execution of Material Requirement Planning (MRP) is essential, and it should be
effectively communicated to all employees and staff members. This preparation requires the
involvement and commitment of all parties.
Exhibit 1: Product characteristics
Exhibit 2: Competitive priorities of each product type
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Business School

Management & Marketing Department

II. Major Problem(s) (10 points)

III. Questions (85%)

Exhibit 1: Product characteristics

Exhibit 2: Competitive priorities of each product type

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