Capacity Management at TIS Harvard Case Solution & Analysis

Capacity Management at TIS Case Solution

Decision Problem and Optimal Solution:

The problem for TIS is to determine how much quantity they should make in order to maximize the profits. The product A has high cost and it is high margin product, whereas B is a low cost and low margin product and the demand is more sensitive to price changes than the demand for Product A.

The profit for the products depends on the price of the products; the variable cost for the product A is 2.85 and 1.10 for the product B. Each product consumes manufacturing capacity of 0.86 and 0.60 respectively. If the price of Product A is $5, then the profit of Product A is $2.15. The profit for the Product B with the price of $2 is $0.9...................

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