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1. A consultant has been brought in to a manufacturing plant to help apply Six Sigma principles. Her first task is to work on the production of rubber balls. The upper and lower spec limits are 21 and 19 cm, respectively.

A. The consultant takes ten samples of size five and computes the the mean of the sample means to be 19.89 cm and the standard deviation of the process to be 0.7. Is this process capable of meeting the specifications? Why or why not? What would you do bring the process under control?

B. If the mean is set to 20cm, what should be the standard deviation of the process to achieve 3 sigma quality, 4 sigma quality and 6 sigma quality?

1. A. Thinking of a university as a production facility that prepares students for the job market, draw a supply chain for this process. Identify the upstream and downstream processes that need to be managed. What information flows back and forth in the supply chain? How would you measure the performance of this supply chain?

B. The following data are pulled from a recent Walsh Manufacturing annual report.

Assets

Raw material inventory $120,000

Work-in-process inventory $50,000

Finished goods inventory $300,000

Property, plant & equipment $500,000

Other assets $200,000

Total assets $1,170,000

Condensed Income Statement

Revenue $2,000,000

Cost of goods sold $600,000

Other expenses $1,000,000

Net income $400,000

Calculate: (a) Percent invested in inventory, (b) Inventory turnover, and (c) Weeks of supply.