This case study focuses on the operations strategies of Home-Style Cookies baking company. First, carefully read the following information about this organization.
The company is located in a small town in New York State. The bakery is run by two brothers, employs fewer than 200 people (mainly blue-collar workers), and the atmosphere is informal.
The company’s only product is soft cookies, of which it makes over 50 varieties. Larger companies, such as Nabisco, Sunshine, and Keebler, have traditionally produced biscuit cookies, where most of the water has been baked out, resulting in crisp cookies. The cookies have no additives or preservatives. The high quality of the cookies has enabled the company to develop a strong market niche for its product.
The cookies are sold in convenience stores and supermarkets throughout New York, Connecticut, and New Jersey. The company markets its cookies as “good food”- no additives or preservatives – which appeals to a health-conscious segment of the market. Many customers are over 45 years-of-age, and prefer a cookie that is soft and not too sweet. Parents with young children also buy the cookies.
The company has two continuous band ovens that it uses to bake the cookies. The production process is called a batch processing system. It begins as soon as management gets orders from distributors. These orders are used to schedule production. At the start of each shift, a list of the cookies to be made that day is delivered to the person in charge of mixing. That person checks a master list, which indicates the ingredients needed for each type of cookie, and enters that information into the computer. The computer then determines the amount of each ingredient needed, according to the quantity of cookies ordered, and relays that information to storage silos located outside the plant where the main ingredients (flour, sugar, and cake flour) are stored. The ingredients are automatically sent to giant mixing machines where the ingredients are combined with proper amounts of eggs, water, and flavorings. After the ingredients have been mixed, the batter is poured into a cutting machine where it is cut into individual cookies. The cookies are then dropped onto a conveyor belt and transported through one of two ovens. Filled cookies, such as apple, date, and raspberry, require an additional step for filling and folding.
The non-filled cookies are cut on a diagonal, rather than round. The diagonal-cut cookies require less space than straight-cut cookies, and the result is a higher level of productivity. In addition, the company recently increased the length of each oven by 25 feet, which also increased the rate of production. As the cookies emerge from the ovens, they are fed onto spiral cooling racks 20 feet high and 3 feet wide. As the cookies come off the cooling racks, workers place the cookies into boxes manually, removing any broken or deformed cookies in the process. The boxes are then wrapped, sealed, and labeled automatically.
Most cookies are loaded immediately onto trucks and shipped to distributors. A small percentage is stored temporarily in the company’s warehouse, but they must be shipped shortly because of their limited shelf life. Other inventory includes individual cookie boxes, shipping boxes, labels, and cellophane for wrapping. Labels are reordered frequently, in small batches, because FDA label requirements are subject to change, and the company does not want to get stuck with labels it can’t use. The bulk silos are refilled two or three times a week, depending on how quickly supplies are used.
Cookies are baked in a sequence that minimizes downtime for cleaning. For instance, light-colored cookies (e.g., chocolate chip) are baked before dark-colored cookies (e.g., fudge), and oatmeal cookies are baked before oatmeal raisin cookies. This permits the company to avoid having to clean the processing equipment every time a different type of cookie is produced.
The bakery prides itself on the quality of its cookies. A Quality Control Inspector samples cookies randomly, as they come off the line to assure that their taste and consistency are satisfactory, and that they have been baked to the proper degree. Also, workers on the line are responsible for removing defective cookies when they spot them. The company has also installed an X-ray machine on the line that can detect small bits of metal filings that may have gotten into cookies during the production process. The use of automatic equipment for transporting raw materials and mixing batter has made it easier to maintain a sterile process.
The bakery is run very efficiently and has minimal amounts of scrap. For example, if a batch is mixed improperly, it is sold for dog food. Broken cookies are used in the oatmeal cookies. These practices reduce the cost of ingredients and save on waste disposal costs. The company also uses heat reclamation: The heat that escapes from the two ovens is captured and used to boil the water that supplies the heat to the building. Also, the use of automation in the mixing process has resulted in a reduction in waste compared with the manual methods used previously.
Ideas for new products come from customers, employees, and observations of competitors’ products. New ideas are first examined to determine whether the cookies can be made with existing equipment. If so, a sample run is made to determine the cost and time requirements. If the results are satisfactory, marketing tests are conducted to see if there is a demand for the product.
There are a number of areas of potential improvement at the bakery. One possibility would be to automate packing the cookies into boxes. Although labor costs are not high, automating the process might save some money and increase efficiency. So far, the owners have resisted making this change because they feel an obligation to the community to employ the 30 women, who now do the boxing manually. Another possible improvement would be to use suppliers who are located closer to the plant. That would reduce delivery lead times and transportation costs, but the owners are not convinced that local suppliers could provide the same level of quality. Other opportunities have been proposed in recent years, but the owners rejected them because they feared that the quality of the product might suffer.
Then, through a case analysis, compare or contrast the Home-Style Cookies baking company with the Yamazaki Baking Co., Ltd. Use the following article: [Attached] (2012). Bread & Rolls Industry Profile: Japan, 1-32. You will find Yamazaki Baking Co., Ltd. on page 24.
A case study is a short description of a real business situation. Analyzing case studies gives you the opportunity to apply those concepts to real business problems. Cases are generally written for several types of analysis. Usually, there is not a “right or wrong” answer. Rather, cases provide a vehicle for you to demonstrate your understanding and ability to apply course concepts. You must use appropriate sources (properly cited) to support your position. Check your analysis by assessing how well it demonstrates your subject knowledge. If your answer relies on your impressions of the topic prior to taking this course, it is likely that the analysis is not your best effort. Simply answering the questions which are part of the case is not enough; consider the questions to be clues to the important concepts and facts. You are strongly encouraged to use the following outline, so that your analysis is organized appropriately:
Identify both the key issues and the underlying issues. In identifying the issues, you should be able to connect them to the business principles which apply to this situation.
Discuss the facts which affect these issues. The case may have too much information. In your discussion, you should filter the information and discuss those facts which are pertinent to the issues identified above.
Discuss your tentative solution to the problem and how you would implement your solution. What actions would you propose to correct the situation, based on the knowledge you have gained in this course? Be sure to support your recommendation by citing references in the text and in the supplementary readings. You should also draw on other references such as business periodicals and relevant journals. Remember that an ANALYSIS is more than simply a SUMMARY of the Case Study.
Discuss follow-up and contingency plans. How will the organization know that your proposed solution is working? What should they do if it does not work?
It may be helpful for you to “role-play” this assignment. Your presentation should cover the points listed above. By “role-playing” the situation, using the questions at the end of the case as hints, and by using this guide, you should be able to develop an action-oriented analysis with a recommended course of action.
Your case analysis should be 2-3 pages in length, not including the title and reference pages. Include at least two articles/materials (not including your course textbook) to support your analysis. All citations should be in APA 6th edition format. Double space your paper, use Times New Roman, 12-point font, with one inch margins. Be concise and present your materials in a clear manner. Include any calculations, spreadsheets, etc. that help to support your analysis of the case.