Data Tech, Inc - Operations Management 515 Essay

981 WordsJan 27, 20134 Pages
Data Tech, Inc. – Assignment 4 Operations Management (515) This paper will determine whether Jeff should give greater priority immediately and analyze with the decision tree analysis. Determine whether Jeff should give greater priority to a smaller facility with possibility of expansion or more into a larger facility immediately. In my opinion I believe that Jeff should determine which alternative Jeff should provide greater priority instantly, the various factors will be analyzed through the decision tree analysis. Looking at his situation and calculation below seem like larger facility would be more profitable. Another thought Jeff should consider is choose between whether to take facility with excess capacity or one with the potential for expansion. Below my calculation shows larger facility is more profitable: Jeff should give greater priority immediately; various factors will be analyzed through the decision tree analysis. Jeff would have to choose between whether to take facility with excess capacity or one with the potential for expansion. At decision point one above, if he takes the location with excess capacity, the expected value of this decision will be: he has to do some analysis, market research and look at all the factors which will impact the business and what is convenient for his customer as well. Market research and look at all the factors which will impact the business and what is convenient for his customer as well. Below my calculation shows larger facility is more profitable. EV excess Small Facility Expansion = | 0.7 (800,000) + 0.3 (500,000) | = | 560,000 + 150,000 | | $710,000.00 | If he takes the location with potential for expansion, then the expected value of this decision will be: EV Potential Larger Facility Expansion = | 0.7 (100,00) + 0.3 (600,000) |

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