CANON produces printers for sale in northern Europe in its Taiwan factory. Printers sold in different countries differ in terms of the power outlets as well as the language for the manuals. Currently, CANON assembles and packs printers for sale in individual countries. The distribution of weekly demand in different countries is normally distributed, with means and standard deviations as shown in the table below: Country Mean Weekly Demand Standard Deviation Germany 3,000 2,000 Norway 4,000 2,200 Denmark 2,000 1,400 3(a). Initially, it is assumed that demand in different countries is independent. Given that the lead time from the Taiwan factory is eight (8) weeks, how much safety inventory does CANON require in northern Europe if it targets a CSL of 95 percent? HINT: For the disaggregated option, just show sample calculations for one country (e.g., Germany), then organize the results for the remaining countries in a table or amend the table above. 3(b). CANON recently decided to build a central Distribution Center (DC) in northern Europe. It will now ship base printers (without power supply) to the DC. When an order is received, the DC will assemble power supplies, add manuals, and ship the printers to the appropriate country. The base printers are still to be manufactured in Taiwan with a lead time of 8 weeks. How

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

ChapterC: Cases

Section: Chapter Questions

Problem 5.1SC: Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing...

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CANON produces printers for sale in northern Europe in its Taiwan factory. Printers sold in different countries differ in terms of the power outlets as well as the language for the manuals. Currently, CANON assembles and packs printers for sale in individual countries. The distribution of weekly demand in different countries is normally distributed, with means and standard deviations as shown in the table below:

Country	Mean Weekly Demand	Standard Deviation
Germany	3,000	2,000
Norway	4,000	2,200
Denmark	2,000	1,400

3(a). Initially, it is assumed that demand in different countries is independent. Given that the lead time from the Taiwan factory is eight (8) weeks, how much safety inventory does CANON require in northern Europe if it targets a CSL of 95 percent? HINT: For the disaggregated option, just show sample calculations for one country (e.g., Germany), then organize the results for the remaining countries in a table or amend the table above.

3(b). CANON recently decided to build a central Distribution Center (DC) in northern Europe. It will now ship base printers (without power supply) to the DC. When an order is received, the DC will assemble power supplies, add manuals, and ship the printers to the appropriate country. The base printers are still to be manufactured in Taiwan with a lead time of 8 weeks. How much savings of safety inventory can CANON expect as a result?

Features Features Normal distribution is characterized by two parameters, mean (µ) and standard deviation (σ). When graphed, the mean represents the center of the bell curve and the graph is perfectly symmetric about the center. The mean, median, and mode are all equal for a normal distribution. The standard deviation measures the data's spread from the center. The higher the standard deviation, the more the data is spread out and the flatter the bell curve looks. Variance is another commonly used measure of the spread of the distribution and is equal to the square of the standard deviation.

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