Managing Functional Products

The decisions a typical company in ME needs to make include procurement of components, assembly of these components to configure products, distribution of products to markets in the EE, and shipment of products to the markets in ME. As explained earher the uncertainty on the procurement side will be significant, and there will be some uncertainty in demand, though not large. Note that retailers in ME may overcome the supply uncertainties (in EE) by using the EE facihties only 

To elaborate the business model, consider a simple case where a company produces and sells a single product entirely in EE. Assume that the per unit cost of manufacturing the product (including procurement of components) and shipping it to the market is c, and unit sales price is p. The company needs to decide how many units to produce and ship (0, given that there is a huge uncertainty in the supply of components (5) and some uncertainty in demand (D). We may capture the supply uncertainty by denoting the actual delivery from suppliers for an order of Q as yg, where y is a random variable between 0 and 1. It is clear that the manufacturer s expected sales will equal the minimum of supply and demand, expressed as Ey Eo Min yQ,D). As the manufacturer only pays for the amount supplied, yg, his expected profit will be p Ey Ep Min yQ,D) — cEy yQ. He will choose order quantity g to maximize his expected profit. Note that the expression for optimal value of the order quantity is independent of the probability distribution functions of D and y, the actual value will be specific to these distributions (Rekik et al. 2010). 

Example. Consider a company that faces four possible values of demand (discrete) 200, 400, 600, and 800 and three possible values of y 0.2. 0.5, and 0.8. It can be verified that for an order size of 900, the possible values of realized sales quantities, corresponding to the values of demand and y, will be as shown in Fig. 7.4. 

Assuming unit sales price of 20, expected revenue will be 5,578. As the company only pays for the quantities actually delivered, we compute the procurement cost based on expected number of units delivered, which will be (180)(0.5) + (450)(0.3) + (720)(0.2) = 366. Assuming a unit purchase price of 4 the expected cost of purchase will be = 1,476. Thus, for an order quantity of 900 units, the company s profit will be 5,578 —1,476 = 4,102. The company can do similar computations with different order sizes Q, and select the value that maximizes its profit. 

In many cases it may not be easy to determine the distribution function of y, whereas, the distribution of available supply S, like demand, may be easier to determine (5 is independent of Q). If this is the case, the company would need to investigate two supply scenarios (S Q and S Q) and two demand scenarios (D Q and D Q) generating four supply chain scenarios, shown in Fig. 7.5. For each of the four scenarios, the unit profits and the likelihood of the scenarios are listed, from which the expected profit can be determined. It is assumed that if S Q, 

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In addition, it should be stressed that all these functional products and their various chemistries are merely tools to be employed in the operational management and maintenance of boilers and BW surfaces. To maximize the potential benefits available, these BW treatment programs must be utilized in the most suitable way, which in turn requires ... 

Van Trijp, J.C.M. and Steenkamp, J.E.B.M., Consumer-oriented new product development principles and practice, in Innovation of Food Production Systems, Jongen, W.M.E. and Meulenberg, M.T.G., Eds., Wageningen Pers, Wageningen, 1998, 37. Luning, P.A. and Marcehs, W. 1., A food quality management functions model. Trends Food Sci. Technol., 18, 159, 2007. 

In general, the larger corporations respond to TSCA demands much as they would to any other demand presented to them. There have been additional resources added the additional costs will be expressed in the cost of products and services provided by the corporation. With smaller companies, the general result has been to add the TSCA burdens to existing personnel, particularly in technical/research and development functions. The final result in these smaller companies may be less innovation and productivity. In the smallest companies, the burdens have fallen on the few managers whose time in general management functions is reduced. Less productivity may be the result here. 

Another product area appeared in the 1980s called building automation systems (BAS). These systems included historical data, trend logging and fire and security functions in addition to conventional energy management functions. 

Since the operation is in an arctic environment, achieving the above objectives presents particular problems and would be difficult and Inefficient using the more conventional approaches. Therefore, as part of the original facilities a "supervisory control and data acquisition" (SCADA) system was Installed in the VfOA. The operational philosophy is one where, by means of the SCADA system, the functions necessary for reservoir management and production control could be monitored and controlled from a central location called the Main Operations Center [Pg.57]

In R D, whether a work group is structured according to function, product or business area, it will need to have somebody acting as its leader. In the management line... 

There is a clear overlap between the functions of MRP 11/ERP systems and MES systems. Indeed, many MRP 11/ERP functions are moving toward the plant floor, bridging the gap between business and production systems. Some modern process control systems are starting to offer interfaces "upwards" to MRP 11/ERP (e.g., enhanced batch management functionality). Meanwhile, major MRP 11/ERP system suppliers are including MES features in their product range, typically as separate modules that are closely integrated with the... 

In the downstream processing, conversion, and consumption sectors, some product becomes waste, and this is referred to as product wastes" to avoid confusion with production wastes. Recycling of product wastes is acquiring greater importance and is becoming a further waste-management function in the chemical industry. 

Since vendors began releasing RDBMS (relational database management system) products in the 1970s, the processing model in which various business data are divided into distributed databases and are accessed via network has been widely adopted. Client/server systems are composed of the various functional elements associated with data processing. 

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