M/s Bajaj Auto Ltd. (BAL), a large scooter manufacturing company in North India
ID: 378624 • Letter: M
Question
M/s Bajaj Auto Ltd. (BAL), a large scooter manufacturing company in North India makes a family of scooters and motorcycles. For this example, we consider two models of scooters, Regular and Sports. The Regular model is essentially a family vehicle, with extra-large seats for pillion riders, and extra leg space in the front for carrying items like 40 litre water drum, grocery cartons, shopping bags or even a cooking gas cylinder. The model appeals to those who use the scooter for evening or weekly shopping with family. The engine of this model is optimised to give good mileage at lower speeds. The sports model is based on sleek design that has less space in front and pillion. This model has a high torque engine that gives burst speed for zipping through city traffic and is ideal for those who will use the scooter for daily commute to office.
The company dispatches the scooters to a network of dealers, spread all over the country. For this example, we consider three dealers Zone wise, Zone 1, Zone 2 and Zone 3. The sales persons visit each dealer and collect the Request for Delivery for the next week. Exhibit I shows the dealer demand for the coming week. Dispatch trucks arrive every evening at the company finished goods area for loading the daily production and carry the dispatch to the dealers by next morning. The dispatch of Saturday evening is available at the dealer for Monday morning. The dealers will not have storage space to accept more than this quantity, however shortfall in supply will be accepted as it is with a loss of goodwill (no carry forward of demand).
Exhibit I: Dealer demand for next week
Dealer
Model
Mon
Tue
Wed
Thu
Fri
Sat
Sun
Zone 1
Regular
300
200
200
150
200
400
0
Zone 1
Sports
200
100
100
100
150
250
0
Zone 2
Regular
400
200
200
300
400
500
0
Zone 2
Sports
500
300
300
300
300
400
0
Zone 3
Regular
300
300
200
150
200
300
0
Zone 3
Sports
300
300
100
100
150
250
0
Total (4900)
Regular
1000
700
600
600
800
1200
0
Total (4200)
Sports
1000
700
500
500
600
900
0
BAL hires trucks from third party logistics providers to carry out the dispatch from the factory to the dealers. A variety of trucks are available, for this example we consider two types of trucks, Normal and Jumbo. We assume that there is unlimited availability of both these trucks. The capacity of trucks is flexible and use of special fixtures allows a variety of loading patterns within each truck. For this example, we consider four loading patterns for each truck as shown in Exhibit II.
Exhibit II: Truck loading patterns (number of scooters in each pattern)
Truck
Model
Pattern_1
Pattern_2
Pattern_3
Pattern_4
Normal
Regular
20
12
6
0
Sports
0
5
10
15
Jumbo
Regular
30
18
9
0
Sports
0
10
15
25
The cost of hiring each truck depends on location of dealer as shown in Exhibit III.
Exhibit III: Hiring Cost per trip (in Rupees) for each truck
Truck
Zone 1
Zone 2
Zone 3
Normal
20,000
24,000
18,000
Jumbo
30,000
35,000
24,000
The estimated cost of loss in goodwill for short supply at each dealer is shown in Exhibit IV.
Exhibit IV: Cost (in Rupees) for each vehicle shortage at dealer
Model
Zone 1
Zone 2
Zone 3
Regular
1,000
1,800
1,500
Sports
1,200
2,000
1,800
Find the optimal dispatch plan that minimises the total cost of transport and goodwill loss.
Dealer
Model
Mon
Tue
Wed
Thu
Fri
Sat
Sun
Zone 1
Regular
300
200
200
150
200
400
0
Zone 1
Sports
200
100
100
100
150
250
0
Zone 2
Regular
400
200
200
300
400
500
0
Zone 2
Sports
500
300
300
300
300
400
0
Zone 3
Regular
300
300
200
150
200
300
0
Zone 3
Sports
300
300
100
100
150
250
0
Total (4900)
Regular
1000
700
600
600
800
1200
0
Total (4200)
Sports
1000
700
500
500
600
900
0
Explanation / Answer
Two variable is said to be directly related if both the variable moves in the same direction. In other words if one variable is increasing then another variable also increase and vice-versa.
As can be seen in the data set 1, both variable J and K are increasing. And J and K individually are increasing by the same amount. It means both are moving in the same direction. Therefore J and K are directly related.
As can be seen in the data set 2, both variable L and M are increasing. And L and M individually are increasing by the same amount. It means both are moving in the same direction. Therefore L and M are directly related.
As can be seen in the data set 3, Variable N is decreasing by the same amount while variable P are increasing by the same amount. It means both are moving in opposite direction. Therefore N and P are not directly related.
As can be seen in the data set 4, Variable R is decreasing by the same amount while variable T are increasing by the same amount. It means both are moving in opposite direction. Therefore R and T are not directly related.
As can be seen in the data set 5, both variable U and V are increasing. And U and V individually are increasing by the same amount. It means both are moving in the same direction. Therefore L and M are directly related.
It means data set of 1, 2, and 5 are directly related.
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