The Vikings Division Harvard Case Solution & Analysis

The Vikings Division Case Solution

Introduction

The Vikings Division is the subsidiary of JJJ Enterprises and this division is producing five different nutritional products and ancillary equipment. Each product is composed of 4 by products. Demand for each product is different fluctuating in each week with respect to its nature.

There years ago it was the only company dealing in nutritional products soon after the expiration of its patent there are many competitors operating in this market. It is expected that demand of each product is different and a mix of both seasonal and steady demand according to the nature of each product.

It is expected that company is selling these products through different distributors and wholesalers Company has bad reputation with respect to meeting the demand of customers as company operating management department is not working efficiently. Company is facing the problem of high work in process time, poor utilization of machine and other operational issues that lead to customer dissatisfaction which results in lower in back orders and financial losses.

Ms. Jasmine Enterprise

It is expected that if the company will follow sane operational methodologies then it will be out from the market within short time as profit margin of the company is decreasing continuously. Therefore in order to deal with this problem company hires Ms. Jasmine Enterprises as Ms. Enterprise is expert in scientific management of the production facility.
It is expected that Ms. Enterprise will help the company in establishing the appropriate forecasting model, planning the suitable production model and in scheduling of each product which are discussed below in detail.

Forecasting

Currently the company is facing the problem of wrong production quantities as demand of the products is changing each week with respect to the nature of each product. Company is facing this problem is currently the management of the company is not following any forecasting models in order to determine the future demand of its products.

One of the primary goals of the Ms. Enterprise is to establish a suitable forecasting model for the company so that it could overcome the problem of manufacturing of wrongly estimated quantities. It is expected that by establishing a suitable model of forecasting company could meet the required customers demand within a given time frame.

In order to provide appropriate forecasting model Ms. Enterprise should considered following factors while performing forecasting activities. Previous business performance is the excellent predictor of the future needs; therefore the current and past trends should be analyzed while performing forecasting techniques.

Sometimes current data is not sufficient as the market is more volatile and market conditions are changing continuously, therefore Ms. Enterprise should analyzed market trends while performing forecasting techniques.

Moreover it would help the company by predicting the future demand which helps the company to design its resources and production levels according to the future demand and it will also help the company from over production. It is expected that by determining production levels and producing required number of Units Company could save its cost on that incurs on extra units and it could reduce its holding cost which could increase the profit margin of the company.

Ms. Enterprise could use several forecasting models in order to determine appropriate future demand of the products of the company. It is expected that Ms. Enterprise don not have data about seasonal index and alpha which could provide weight of the demand of the products of the company. Therefore it would be inappropriate to apply exponential smoothing model in order to forecast the demand of the products of the company.

The first forecasting technique which Ms. Enterprise could proposed to the management of the company is the simple method through which demand of the 11th week could be forecasted by taking the demand of the 10th week of each product. It is expected that following this method forecast for next 10 weeks would be equal to the number of units of 10th week which are 140 units for product 1, 170 units for product 2, 87 units for product 3, 47 units for product 4 and 42 units for product 5.........................

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