Obermeyer
I will identify how many units of each style I should make during the initial phase, the outcome of producing the same articles in China as opposed to Hong Kong and the operational improvements that will assist Sport Obermeyer to improve performance. Key assumptions It is anticipated that a two years lead time of planning and production activity must take place prior to the actual sale of products to consumers. Workers in Hong Kong work about 50% faster than their Chinese counterparts. They are more highly skilled and typically trained in a broader range of tasks. In China, lead times are longer and more labour is required per unit, however, the cost of production is much lower due to lower wages and proximity to raw materials. Hong Kong is more expensive relative to both of these concerns, but can produce much quicker and with fewer workers. Statement of Issue(s) Ski wear product is a short-life cycle over a single selling season encompassing high demand uncertainty, limited to non-existent background data for forecasting, poor lead times with both companies imposing minimum production quantities. Before I joined the company, the management style was a more intuitive one that was heavily informed by extensive industry experience rather than formal data-gathering and analytical techniques. But now, with the competition sales increasing rapidly (about 23% of the adult ski-jacket market), I have to forecast the appropriate commitment for the first half of Obermeyers’ projected demand for the next season. The most critical task I am facing now on November 1992 is what Sport Obermeyer faces every year, which is committing to specific production quantities for each ski wear item the company would offer in the coming year’s line.