Canadian Sand in LA Highrises

Canadian Sand in LA Highrises

Article Title: Why Builders of Big L.A. Projects Are Making Concrete with Gravel and Sand Shipped from Canada

Author of Article: J. R. Koren

Date of article: November 4, 2017

Source URL: http://www.latimes.com/business/la-fi-canadian-gravel-20171104-htmlstory.html

For construction projects in the Los Angeles area, it is now cheaper to import the gravel and sand – known as aggregate – from Canada than to ship it from local quarries.

The aggregate travels one mile on conveyor belts from a quarry in Vancouver Island to a floating terminal on the coast. Ships then carry the materials 1,450 miles away to the Port of Long Beach. The materials are transported to a terminal on a conveyor belt. From there, they will be loaded into trucks to reach the construction sites.

The transportation cost is $16 compared to the $22.75 it would cost to truck a ton of materials from a local quarry to downtown L.A. These lower transportation costs, better quality of materials, and local residents’ reluctance to have quarry-related work and traffic nearby have contributed to increasing imports despite an abundant domestic supply.

Discussion Questions
1. Why is it cheaper to import the aggregate from Canada?

Guidance: Discuss the lower Continue reading

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The Skinny on Airline Seats

The Skinny on Airline Seats

Article Title: Air Travelers Resisting the ‘Incredible Shrinking Airline Seat’

Author of Article: M. C. White

Date of article: November 6, 2017

Source URL: https://www.nytimes.com/2017/11/06/business/airline-seat.html

This New York Times article illustrates the clash among marketing, finance, and operations strategies in the airline industry.

On one side, marketing departments and consumer advocate groups insist on preserving existing leg room standards.  On the other, revenue management departments push for efficiency-oriented plane redesigns that squeeze more seats into an airplane.

Slimmer seat designs can offer passengers more room. However, they also provide the opportunity to add one or two extra rows without compromising existing leg room.

Discussion Questions
1. What are the advantages and disadvantages of including more seats in an airplane?

Guidance: Discussion may focus on unit costs, revenues, number of planes needed, fuel costs, flight attendants’ morale, passengers’ expectations, and/or potential litigation.

2. Do you think the House of Quality framework was used to design the slimmer seats? Can the seats be improved further?

Guidance:  There is evidence the HOQ framework partially guided the design of the seats. The slimmer seat design features conform to customers’ requests for more room, fewer hard points, and better Continue reading

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Saline bags, stat!

Saline bags, stat!

Article Title: U.S. Hospitals Face a Shortage of This Most Basic Necessity

Author of Article: R. Langreth and C. Koons

Date of article: November 14, 2017

Source URL: https://www.bloomberg.com/news/articles/2017-11-14/this-simple-lifesaving-liquid-is-suddenly-in-short-supply

This BusinessWeek article describes the shortage of small saline-solution bags for hospitals across the country.

A limited number of suppliers, quality problems, legal probes into possible price-fixing, and the destruction of factories by Hurricane Maria have contributed to a dangerously short supply of the bags which are used to administer hundreds of different medicines. Inventory levels of many essential drugs are also very low, making it difficult to respond to sudden disasters.

To cope with these problems, hospitals are trying to change the drug delivery system from injectables to alternatives. However, this process is complicated because it involves a redesign of the workflows.

Discussion Questions
1. When there is uncertainty in lead times, organizations carry higher levels of safety stock. Is it an option here?

Guidance: Discuss the limited supply of bags in the country and the perishability of injectable drugs. Both make it impossible to order large quantities and keep high levels of safety stock. Moreover, “hoarding” drugs in short supply compounds the problem. Discuss the Continue reading

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