Capacity Utilization and Richard B Chase
Applichem- The Transportation Problem
Webster University
Abstract
Applichem is a Chicago based manufacturer of the specialty chemicals formulated as solutions to specific customer’s problems. It developed a chemical called Release-ease in 1952 to help in formulating a plastic molding compound which released easily from metal molds. Release-ease was a patented product and has brought Applichem steady revenues. They have multiple plants around the world to support their business. Applichem has done little research on production processes. Any process changes that have been implemented have been done so by plant managers.
Recently Applichem has been faced with the difficult problem of allocating to its customers the capacity of its manufacturing plants (Jacobs & Richard B Chase). “Differences in technology used in the plants and local raw material and labor costs create significant differences in the costs to produce Release-ease in the various regions. Additional constraints include management’s hesitance to increase capacity at the plants, along with varied costs of shipping products around the globe.” (Jacobs & Richard B Chase). As a result, profit decreases due to poor management of Applichem’s overall operations.
Applichem-The Transportation Problem Applichem was founded in Chicago before World War II as a specialty chemical manufacturing company (Hammond & Pisano, 1993). Before its research department developed a broader product, Applichem produced products specific to customer needs. In 1952, Applichem developed Release-ease, a specialty product. A customer requested the company to develop a plastic molding compound that would release easily from metal molds. “Applichem had held the patent for Release-ease through 1982. Applichem had done little focused research on the Release-ease product or process after about 1953. What product or process changes had been made were insighted and implemented by
Webster University
Abstract
Applichem is a Chicago based manufacturer of the specialty chemicals formulated as solutions to specific customer’s problems. It developed a chemical called Release-ease in 1952 to help in formulating a plastic molding compound which released easily from metal molds. Release-ease was a patented product and has brought Applichem steady revenues. They have multiple plants around the world to support their business. Applichem has done little research on production processes. Any process changes that have been implemented have been done so by plant managers.
Recently Applichem has been faced with the difficult problem of allocating to its customers the capacity of its manufacturing plants (Jacobs & Richard B Chase). “Differences in technology used in the plants and local raw material and labor costs create significant differences in the costs to produce Release-ease in the various regions. Additional constraints include management’s hesitance to increase capacity at the plants, along with varied costs of shipping products around the globe.” (Jacobs & Richard B Chase). As a result, profit decreases due to poor management of Applichem’s overall operations.
Applichem-The Transportation Problem Applichem was founded in Chicago before World War II as a specialty chemical manufacturing company (Hammond & Pisano, 1993). Before its research department developed a broader product, Applichem produced products specific to customer needs. In 1952, Applichem developed Release-ease, a specialty product. A customer requested the company to develop a plastic molding compound that would release easily from metal molds. “Applichem had held the patent for Release-ease through 1982. Applichem had done little focused research on the Release-ease product or process after about 1953. What product or process changes had been made were insighted and implemented by
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