Description
Instructions:
- Students can work in groups of two or individually to complete the project.
- The students may use POM and/or Microsoft Excel to answer the questions.
- Submit only soft copy by Moodle.
- Please fill and attach the cover sheet before submission.
- Plagiarized projects will be given 0 marks.
- If the project is submitted late, marks will be deducted.
Project
Question 1:
Southwestern University (SWU), a large state college in Stephenville, Texas, 30 miles
southwest of the Dallas/Fort Worth metroplex, enrolls close to 20,000 students. In a typical
town–gown relationship, the school is a dominant force in the small city, with more
students during fall and spring than permanent residents. A longtime football powerhouse,
SWU is a member of the Big Eleven conference and is usually in the top 20 in college
football rankings. To bolster its chances of reaching the elusive and long-desired numberone ranking, in 2006, SWU hired the legendary Phil Flamm as its head coach. One of
Flamm’s demands on joining SWU had been a new stadium. With attendance increasing,
SWU administrators began to face the issue head-on. After 6 months of study, much
political arm wrestling, and some serious financial analysis, Dr. Joel Wisner, president of
Southwestern University, had reached a decision to expand the capacity at its on-campus
stadium. Adding thousands of seats, including dozens of luxury skyboxes, would not please
everyone. The influential Flamm had argued the need for a first-class stadium, one with
built-in dormitory rooms for his players and a palatial office appropriate for the coach of a
future NCAA champion team. But the decision was made, and everyone, including the
coach, would learn to live with it. The job now was to get construction going immediately
after the 2012 season ended. This would allow exactly 270 days until the 2013 season
opening game. The contractor, Hill Construction, owned by Bob Hill signed his contract.
Bob Hill looked at the tasks his engineers had outlined and looked President Wisner in the
eye. “I guarantee the team will be able to take the field on schedule next year,” he said with
a sense of confidence. “I sure hope so,” replied Wisner. “The contract penalty of $10,000
per day for running late is nothing compared to what Coach Flamm will do to you if our
opening game with Penn State is delayed or canceled.” Hill, sweating slightly, did not need
to respond. In football-crazy Texas, Hill Construction would be mud if the 270-day target
was missed. Back in his office, Hill again reviewed the data and noted that optimistic time
estimates can be used as crash times. He then gathered his foremen. “Folks, if we’re not
75% sure we’ll finish this stadium in less than 270 days, I want this project crashed! Give
me the cost figures for a target date of 250 days—also for 240 days. I want to be early, not
just on time!”
Activity
Description
A
Bonding, insurance, tax
structuring
B
Foundation, concrete
footings for boxes
C
Upgrading skybox
stadium seating
D
Upgrading walkways,
stairwells, elevators
E
Interior wiring, lathes
F
Inspection approvals
1
Time Estimates (Days)
Optimistic Most Pessimistic
Predecessor(s)
Likely
20
30
40
A
20
65
80
A
50
60
100
C
30
50
100
B
E
25
0.1
30
0.1
35
0.1
G
H
I
J
K
L
Plumbing
Painting
Hardware/AC/metal
workings
Tile/carpet/windows
Inspection
Final detail work/cleanup
D, F
G
H
25
10
20
30
20
25
35
30
60
H
J
I, K
8
0.1
20
10
0.1
25
12
0.1
60
Use Microsoft Excel and/or POM/QM to answer the following questions: (10 marks)
a) Develop a network (AON) drawing for Hill Construction and determine the critical path.
How long is the project expected to take?
b) Draw the Gantt chart for the project.
c) Calculate the mean time for all activities and project variance.
Question 2:
With the growth of Hard Rock cafe from one branch in London in 1971 to more than 150
restaurants in 53 countries today, came a demand for better forecasting. Hard Rock uses
long range forecasting in setting a capacity plan and intermediate term forecasting for
locking in contracts for leather goods and for such food items as beef, chicken, and fish.
Short term sales forecasts are conducted each month by café, and then accumulated for a
headquarters view.
The heart of the sales forecasting system is the point of sale system (POS) which captures
transaction data on nearly every person who walks through a café’s door. The sale of each
product represents one customer; the sales data are transmitted daily to the Orlando
corporate headquarters database. There, the financial team begins the forecast process.
They forecast monthly guest counts, retail sales, banquet sales and concert sales at each
cafe. The general managers of individual cafes tap into the same database to prepare a daily
forecast for their sites. A café manager pulls up prior years’ sales for that day, adding
information from the local Chamber of Commerce or tourist board on upcoming events
such as a major convention, sporting event, or concert in the city where the cafe is located.
The daily forecast is further broken into hourly sales, which drives employee scheduling.
And hourly forecast of $5500 in sales translates into 19 workstations, which are further
broken down into a specific number of wait staff, hosts, bartenders and kitchen staff.
Computerized scheduling software plugs in people based on their availability. Variances
between forecast and actual sales are then examined to see why errors occurred.
Hard Rock doesn’t limit its use of forecasting tools to sales. To evaluate managers and set
bonuses, a 3-year weighted moving average is applied to cafe sales. If cafe general
managers exceed their targets, a bonus is calculated. Todd Lindsey, at corporate
headquarters, applies weights of 40% to the most recent year’s sales, 40% to the year
before and 20% to sales 2 years ago in reaching his moving average.
An even more sophisticated application of statistics is found in Hard Rock’s menu
planning. Using multiple regression, managers can calculate the impact on demand of other
menu items if the price of one item is changed. For example, if the price of a cheeseburger
increases from $7.00 to $8.00, Hard Rock can predict the effect this will have on sales of
chicken sandwiches, beef sandwiches, and salads. Managers do the same analysis on menu
placement, with the center section driving higher sales volumes. When an item such as a
hamburger is moved off the center to one of the side flaps, the effect on related items, say
french fries, is determined.
2
Based on the above information, answer the following questions:
(10 marks)
a. Describe three different forecasting methods being used at Hard Rock.
b. At Hard Rock’s Moscow restaurant, the manager is trying to evaluate how a new
advertising campaign affects guest counts. Using data for the past ten months given below,
develop a least squares regression relationship and then forecast the expected guest count
when advertising is $65,000.
Hard Rock’s Moscow Café
Guest count
21,000
24,000
27,000
32,000
29,000
37,000
43,000
43,000
54,000
66,000
Month
1
2
3
4
5
6
7
8
9
10
Question
Project
Advertising ($)
14,000
17,000
25,000
25,000
35,000
35,000
45,000
50,000
60,000
60,000
CLOs
PLOs
2.2
S1, S2
/20
Instructions:
• Students can work in groups of two or individually to complete the project.
• The students may use POM and/or Microsoft Excel to answer the questions.
• Submit only soft copy by Moodle.
• Please fill and attach the cover sheet before submission.
• Plagiarized projects will be given 0 marks.
• If the project is submitted late, marks will be deducted.
Due Date: May 25, 2025
3
Thank you
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