Old Vs New Vehicle Models

CX5_850x400_black_mica_01
Recently my family and I have been looking into purchasing an affordable compact SUV. According to my dad, since the 2014 models are out now the 2013 models are most likely to drop in price. However, after I did some research online it is forecasted that the best time to purchase a car is during the winter when people are least likely to purchase a car therefore, causing a drop in the prices of vehicles. Regardless, we still pursued on purchasing a new vehicle. So we browsed online to see which vehicles were considered to be the top affordable compact SUV. I landed on the website the U.S. News Rankings and Reviews that listed the top 10 affordable compact SUVs of 2013. As a consumer, I personally focus more on the exterior appearance of the car before looking into the mechanical side of it. After looking through numerous vehicles, I finally set my eyes on the 2013 Mazda CX-5 which was ranked number 2 on the list. When I looked into the pros and cons of the vehicle I noticed that the engine on the 2013 model was lacking because it had a 2.0L engine which made it slightly under-powered as compared to the other compact SUV vehicles. Many consumer reviews that I have read have mentioned about the under-powered engine which made it a disadvantage. In class we learned about the use of the quality function deployment and based on the consumers wants the company will make the product accordingly. So when I looked into the 2014 model of the Mazda CX-5, I noticed that they changed their engine from a 2.0L to a 2.5L which is the standard engine on a Compact SUV. Therefore, Mazda has identified the customer’s wants and has made the adjustments onto the 2014 model. However, now that the 2014 model has came out the complaint from consumers is that the 5.8 inch touch panel screen is too small compared to other cars that has a 6-8 inch screen. I believe that the 2015 model of the Mazda CX-5 will have a larger screen panel in response to the consumers demand. As we have learned in class, as time progresses the company makes slight advancements and additions into each of the models and not all at once. First it is due to the consumers demand and second to keep the consumers wanting the most recent and updated technology. Therefore, allowing the company to generate a profit and to continue adding on to the existing product line.

Do you think companies leave out some specs or features on the product just so they can put it into the next model they come out with in order to generate profit in an existing product line?

Sources:
http://usnews.rankingsandreviews.com/cars-trucks/Mazda_CX-5/

http://www.caranddriver.com/news/2014-mazda-cx-5-photos-and-info-news

Forecasting in the Restaurant Industry, How Are Restaurants Keeping Up?

Forecasting is being used across the nation in order to find out what new foods and technologies are going to be used within the restaurant industry.  Since we are so attached to our technology, trends have changed drastically.

The reports are showing that about half of the consumers interested in eating out are looking at menus online in order to see if the restaurant is up to their standards.  Thus, making it possibly harder for restaurants to bring in new customers if their menu is not up to par.  This is especially important because ‘”the typical American palate is now much more sophisticated than 10 to 20 years ago.”’

Because of this forecasting in restaurants is now not only for how many customers are coming in, but the newest trends in food.  And restaurants are having some difficulties getting customers to come and sit down at their establishment because about seventy percent is now coming from take out and food trucks out of convenience.  Since seventy percent of the industry’s traffic is coming from off site many restaurants and food vendors have conformed to using food trucks that drive around neighborhood to neighborhood. However, the city of Chicago passed an ordinance that does not allow food to be prepared on the actual trucks.  This means that the vendors would either need a physical restaurant or at least access to a certified kitchen.  Due to this ordinance these vendors will have to either invest more money to continue or get out of the food truck industry.

In order to keep up with these constant changes in the restaurant industry technology is being more relied upon in the actual establishments to encourage guests to come sit down and eat.  For example, at a Chili’s restaurant you will find a tablet on the table where you can play games, watch move previews, and pay your bill.  However, it is being said that more restaurants will participate by having iPads, in which, you can look at the menu and see more detailed pictures and descriptions of the menu items.

Along with all of these trends, many consumers are now more conscious than ever about where there food actually comes from.  People are looking for sustainability especially in large cities where there are many neighborhoods that are considered food deserts.  Restaurants are recognizing this and most of the newly opened establishments really take pride in offering sustainable food that has come directly from local farms.  And other restaurants are changing their menus in order to be friendlier to locally grown ingredients.

Do you typically go out to eat at an actual restaurant or do you find yourself getting take out?

How do you feel about restaurants using more sustainably grown ingredients?

Would you rather go to a restaurant that uses technology such as iPads or tablets for the tables or just a simple mom and pop’s?

http://www.npr.org/blogs/thesalt/2013/01/03/168536679/hold-that-mini-burger-restaurants-forecast-food-for-2013

http://www.wbez.org/blogs/louisa-chu/2013-01/rip-food-trucks-top-5-trends-2013-plus-one-wish-104644

More Money & Less Features, Does Not Make Sense!

More Money & Less Features, Does Not Make Sense!

 

Any flight feels long because time wasted in traveling is just time wasted. Airlines are trying to figure out how to cut time and provide the best service. According to American Airlines and cutting time in placing the carry on baggage is too much trouble. They believe that due to the small compartments over the seat, there is typically not enough space and trying to accommodate carry on space has created many delays. The article says that the carry on spaces are always over booked due to people bringing a lot of access luggage. American Airline thinks by allowing only a small baggage like a purse that can be places under the seat is the way to do and people can check in everything else.

 

They are trying to do quality control for the time of luggage delays. Even though it only eliminates 2 minutes of the delay time, they think it will add up in the long run. In addition, there are cost savings because the luggage industry has created revenue in billions. I do not think this is a good strategy. The airline prices are continuously increasing due to the gas price and they are taking out amenities. I know when I travel I like doing it on Southwest because it’s cheap and allows luggage, other airlines  are more expensive and we have to pay additional for baggage. Even though it will eliminate some time in the flight, but that can be made up in other ways, such as boarding early. I think many people only carry a small luggage for a small distance and retrieving it in the luggage area would increase the traveler’s time. Also the issue to luggage getting lost is a big deal people have their carry on as their safety net and taking that away is a big deal.

 

Before American Airline makes this huge transition and purchasing, new aircraft they should construct many surveys to determine is this is worth it. Travelers want to get from point A to point B in as little hassle as possible and I believe this is just creating an unnecessary hassle. The airline will need to employ more people to put the baggage away and there is a change of loss baggage just to eliminate a 2 minute deplays. They should invest in creating a flow chart and figuring out where the problem is and eliminating or supplementing that feature. Quality control is improving quality overall not just making one area better and adding on problems in other areas.

 

What do you think are eliminating carry on luggage a good thing for American Airline to have? What would you prefer as a traveler?

 

http://www.businessweek.com/articles/2013-05-17/american-airlines-doesnt-want-your-bags-in-the-cabin#r=hpt-lst

 

Olympus Reduces their Camera Lineup

As technology continues to advance, companies that are built around tech-based products are being forced to alter their tactics to avoid growing deficits in the market. Olympus is currently facing such difficulty with regards to their cheaper line of cameras. The fact of the matter is that cameras are now becoming mainstay secondary functions in phones, tablets, and the like. These devices such as smartphones are often offering more quality and pixels than the competing cameras Olympus offers on the lower side of the price spectrum. It doesn’t help Olympus’ case that something like a smartphones offers the ability to quickly share pictures rather than the more lengthy process of a typical compact camera.

As a result Olympus is reducing their product strategy by cutting the low cost option. Something like a camera is considered to be in the mature stage of the product lifecycle, and the standardized camera can already be found on existing devices. Accordingly Olympus will be placing more emphasis on higher-end models and reducing their product line. Their new objective is attempting to focus more on the differentiation that expensive lenses offer to consumers. Interestingly enough is that while lenses can be unique in their mechanics, they’re still standardized to be used for a variety of cameras. This means Olympus can put their effort into an already reliable camera design and construct more lenses around that which can be used interchangeably. Modular design is a simple way for companies to provide variety for consumers while cutting production costs.

It should be noted that it’s not just Olympus that is suffering in the market. Canon, arguably one of the most well-known brands, had a 34% decline in net profit according to the article. The same surge of profit loss can likely be said for any company doing business with stand-alone cameras. Canon to me seems like a company that focuses heavily on their expensive cameras and lenses, and yet they’re still suffering from such losses.

I’ve never known much about Olympus as their cameras always seemed to be low-rated when it came to their offerings for compact cameras. The article I read, however, really surprised me. Their biggest business isn’t even cameras, it’s medical equipment. I looked on their website and they offer a variety of devices for endoscopy, ultrasound, and so on. One could easily imagine that medical equipment is on the rise now more than ever before when considering the aging population.

Do you think it would be more beneficial for Olympus to completely cut all their camera offerings, and focus on their more profitable sectors (e.g. medical equipment)? Is there still a place for cheaper cameras amidst the evolving smartphone market? Could Olympus possibly offer anything for their expensive lenses/cameras that would cripple strong contenders like Canon?

Sources
http://blogs.wsj.com/digits/2013/05/16/olympus-to-drop-cheap-point-and-shoot-cameras/
http://www.olympusamerica.com/index.asp

Mercedes’ Management pulling in Wealthy Chinese again

After Daimler’s CEO Dieter Zetsche sat in the Mercedes S-Class, he realized it would not recline as far as a seat in an airplane did, and therefore not give the same amount of comfort that the wealthy individuals that would buy this car are accustomed to. This was especially an issue in China where the car-owner sits in the back a lot of the time as they have chauffeurs. Zetsche had his designers recline to 43.5 degrees to make it more comfortable and luxurious and therefore more appealing to the wealthy Chinese. When the backseat reclines, the front seat automatically moves forward a bit to give more legroom, and the seats even have a massage feature for ultimate comfort.

Mercedes Revamps the S-Class to Lure China's Wealthy Buyers

To be able to realize that this is necessary is very impressive forecasting while also looking at the past sales and realizing that something is wrong. For the CEO to go out and try the features of the Mercedes S-Class and help come up with solutions shows the dedication he has to the company, and shows good management as well. It is rare that you hear that a chief executive officer figures out the issue a company has and makes it a point to fix it.

Chinese buyers account for more than half of all the sales of the S-Class, which makes improving the sales even more important. With Mercedes operating profit margin down in comparison to BMW and Audi, it is important that the sales of the S-Class are improving again because the profit margin is 25% for these cars. Zetsche was also smart

in realizing that innovating and improving this car is important to the bottom line of making more money, as it is the most profitable.

China is a huge market as the sales of luxury cars are projected to go up 12 percent annually up through the year 2020. Clearly the operations management of Mercedes is of highest quality, because being able to put together all of the factors I have talked about and realizing that perfecting the S-Class is essential is rather impressive.

A Mercedes S-Class can cost as much as 486,000 dollars in China due to very heavy import levies. Due to the halo effect, Mercedes is able to generally charge more for its other cars as well. Mercedes sold about 20,000 more of their luxury cars than BMW and a little over 40,000 more than Audi’s luxury car, so clearly Mercedes is the best at perceiving an image of luxury and highest of quality. With this fact in mind, Mercedes’ management needs to realize that they need to improve the sales of their other cars to become the most profitable company in overall again in comparison to their biggest rivals of BMW and Audi.

What do you think Mercedes can do to improve their sales and become the most profitable company again? Are you impressed by the improved S-Class moves?

Can You Have Your Cake and Eat It Too

As I’m lounging on the sofa in the family room watching my husband decorate the cakes that he baked for both our moms on Mother’s Day, thoughts about how he plans the whole process are running through my head. While my husband wasn’t enthused about the interruption, I was busy asking him multiple questions regarding how to forecast future demand, how to manage quality and quantity, and finally what inventory method is used by businesses that produce wedding cakes.

Forecasting is a critical aspect of the business to effectively manage overhead costs, ingredient inventories and most importantly, volume projections to meet demand while maintaining a profitable business. To achieve desired profitability, the business should deliver a wide variety of designs at competitive prices.

In class, I had learned about five quantitative forecasting methods. The simplest method to forecast how many wedding cakes will be produced next month is looking back at the last month’s production quantity. Another forecasting model is using the moving averages forecast method. This method uses an average of the most recent periods of data to predict of how many wedding cakes need to be produced next period. For example, the bakery may use a 3-month moving average by adding the last 3-month production of wedding cakes and dividing by 3 months. However, to use this method, we would assume that the market for wedding cake demands is quite stable.

Next important aspect for a Wedding Cake business is how to efficiently manage the quantity and quality of the cakes. Higher quality of ingredients used during production will lead to a better reputation for the business and create higher customer satisfaction, leading to repeat customers. Moreover, business would save ingredient costs by purchasing larger volumes.

This reminded me of what I had recently learned in my class about product focus. Some bakery businesses focus on producing high volumes and low variety. For example, one business can focus on a niche market and produce only wedding cakes that will deliver a high volume but limited designs. But such a business will need to be highly completive in the market in order to be successful. On the other hand, another bakery might produce low volume of cakes, but cater to a much broader customer base such as birthdays, graduations, anniversaries, Bar Mitzvahs, etc.

Managing inventory of raw ingredients as well as finished goods is another critical aspect that has to be closely managed. The perishable nature of the products makes it very important to effectively manage inventory of seasonal products, while maintaining stocks for rush orders. Also, inventory management is crucial in maintaining business profitability by reducing waste of both raw ingredients and expired finished products.

Although I learned a great deal regarding the wedding cake industry from my husband, I”m still left with a few questions: What is the best way to forecast wedding cakes? What process strategies should be used by bakeries? Would it be more profitable to use process focus or mass customization strategy?

http://smallbusiness.chron.com/examples-management-strategies-cake-bakery-business-12208.html

What else is hidden in Google’s Arsenal?

What else is hidden in Google’s Arsenal?

Whenever Google comes out with a new application, product, or service quality is an after-thought. Google is in the process of coming out with something and entering a risky market that could hurt the high quality image Google Portrays. This new “thing” is upgrading its Google Play that launched last year. This wasn’t doing as well as anticipated so they are in the process of revamping it. Android hackers dug deep into Google’s servers to find this out which, is an interesting way of having a competitive advantage. Anyway, this market is extremely competitive and bumpy. A lot is needed to compete when there are only so many games to sign. Additionally, signing to right or wrong game could mean a tarnished image. This new revamp is intended to offer some new features that other companies haven’t yet added.  Social Integration, In-Game Chatting, and Cloud Capabilities are just some of the new additions that will hopefully put them above their competitors and bring a better and higher quality image to their brand. The Social Integration aspect will grant users the ability to use their Google+ profile compare performances on leader boards. Next, In-Game Chatting will build on the social capabilities and users will have the ability “to chirp your friend’s terrible performance.” The last addition are Cloud Capabilities. This will be where the management of quality comes in. Google Play Games will sync all saved data on servers the same way calendars, contact information, and mail is stored. The games, supposedly, won’t take up precious hard drive room; however, relying 100% on the Google servers may put too much responsibility in the hands of the company. If Google doesn’t capitalize on this opportunity and execute it some quality issues will definitely arise.

My Opinion

Google is taking the right actions to get ahead of its competition. I don’t think these changes are outlandish because innovation is what makes money now a days. Also, this won’t hurt Google’s quality and credibility because consumers don’t expect much out of mobile device games so the sky is the limit. Any upgrade or innovational addition will just bring more users into the scene and make it an even more profitable market. Google’s market share within this realm of entertainment will grow.

Questions

  1. Will this new version of Google Play be too risky and tarnish Google’s accolades in quality?
  2. What else could Google do to make this “less risky”?
  3. What can Android do?
  4. Are Google’s new additions attainable or impossible?
  5. How does this effect quality in the market or with Google?

http://news.yahoo.com/expect-googles-mobile-game-hub-214655725.html

Is The “Dreamliner” Still a Dream?

Finally, “after months of headaches brought on by its 787 Dreamliner jet, Boeing Company is now back on track and even speeding up the production rate of the new airliner.”

This is fantastic news for the Dreamliner program being that starting from January 16th until late April of this year, all of the Boeing 787s had been grounded due to some safety concerns with the plane’s lithium-ion battery system. The influential aerospace company has stated that they have since increased the jet production rate to seven airplanes per month at one of its factories in Everett, Washington, and claims that the Dreamliner program is set to reach a further increase to ten per month by the end of the year.

Before the grounding, Boeing had delivered fifty of the Dreamliner planes to eight different airlines worldwide, including United Airlines, which is the only U.S. carrier that operates 787s currently. Today the Dreamliner program has more than 800 unfulfilled orders to 58 customers worldwide. Hence, the immediate need for Boeing to fix the jet’s design flaws and production challenges they were facing. The Federal Aviation Administration grounded Boeing’s newest and most technologically advanced jetliner until the risk of battery fires was resolved. During the time of the grounding order, Boeing had not been allowed to deliver any new 787 Dreamliner’s but continued building them. The company had to seriously look at the jet program’s operations and reevaluate some of their critical decisions.

The final assembly of the Dreamliner’s takes place at the Everett facility, but the bulk of the jet’s large components come from numerous suppliers around the world so the time putting these planes together is influenced heavily on the getting the parts in quickly. “There are about 50 suppliers in California alone.” But the major production slowdown was due to Boeing having to redesign the 787’s battery system due to some overheating incidents that had occurred. One incident even resulted in a fire.

Although “Boeing will not say how much redesigning, testing, and retrofitting the battery system has cost the company,” officials have stated that the cost was absorbed into spending $705 million in research and development during Boeing’s first quarter. The three-month grounding period of the Dreamliner created a 2.5% downturn in revenue for the company, which came out to be around $18.9 billion. Despite all the production troubles Boeing has encountered recently, the company now firmly states it is back on track to deliver more than 60 of the planes during this year as originally planned. But the question is whether the Dreamliner will now stick in the pubic’s mind as a troubled aircraft?

In addition to the increased production of the Dreamliner jet, Boeing has also increased production of its 737 and 777 jets and is forecasting to deliver as many as 645 planes this year, making this a record for the company.

Which types of critical decisions did Boeing have to reevaluate? Do you think that the grounding of the Dreamliner will or has had any effect on the company or the plane’s reputation? Which types of forecasting methods do you think Boeing is using in regards to their production ability and what other factors does Boeing need to consider?

Article Reference: http://www.chicagotribune.com/business/breaking/la-fi-mo-boeing-787-production-rate-20130510,0,6024577.story

 

How Forecasting May Forever Change Hollywood

Is it possible to forecast how much money a movie will make just by reading a script?  Statistics professor and movie guru, Vinny Bruzzese says you can.

Mr. Bruzzese and his team have supposedly come up with an equation to forecast how much money a movie will make in the box office, just by reading the script. For only $20,000 his company, Worldwide Motion Picture Group, will read any movie scrip and will compare it to other narratives with comparable story lines, Facebook likes, and data taken from focus groups consisting of over 1,500 moviegoers. With this information, he can dissect any scrip or screenplay, and help directors see how much money their movie will (or will not) make.

Based on statistics and moviegoer opinions, Bruzzese reads a script, and uses data to determine if characters are likable, or should be changed. He uses corresponding data with certain celebrities to determine how many people will attend a movie just because that person is in the film. His recommendations usually come in a 30 page report, and include both minor and large corrections.  Mr. Bruzzese also said that he will not hesitate to inform a writer that the movie is crap, and characters need to be developed into something completely different in order to for the audience to be engaged enough to see the movie in theaters.

So far, Mr. Bruzzese has reviewed over 100 scripts in Hollywood, including “Oz the Great and Powerful,” which earned $484.8 million in the box office. His services also include reviewing scripts for TV shows and Broadway productions. Although his price may be high, Hollywood directors seem to be interested in his operation, and many have found it to be incredibly useful. However, he clearly states to each screenwriter that he will not be held responsible if the movie flops, and his equation is not correct. As we learned, forecasting is rarely 100% correct, and is used as more of a guideline than an indicator of fact.

But what are the implications of using statistical forecasting on an art form like movie making?  Some people are not as excited about the idea. One movie critic wrote, “It’s the enemy of creativity, nothing more than an attempt to mimic that which has worked before. It can only result in an increasingly bland homogenization, a pell-mell rush for the middle of the road” (Ol Parker).

So do you think forecasting of new moves will inhibit creativity in scriptwriters? Do you think Hollywood directors should only focus on their movies making the most amount of money? Will Hollywood movies just become cookie cutters of the previous ones before them? Or do you believe an equation made for forecasting movie success help make new movies better?

________________

Source: http://www.nytimes.com/2013/05/06/business/media/solving-equation-of-a-hit-film-script-with-data.html?pagewanted=1&_r=1&smid=fb-share&adxnnlx=1368414010-4e41KEMI8B67C1EjLSjPvg

Is College a Scam?

 

 

We live in a country where the student debt is the second largest debt after mortgages. U.S is one of the nations where the education cost is outrageous and almost impossible to cover without taking any loans.  The cost is so high, because it is purposely set up that way. Students are being offered loan programs, which allow the schools to increase the tuition each year. The higher the tuition, the better the school’s reputation – and we all know it. According to the article the “average student loan balance for a 25-year-old is $20,326.” For most of the young adults, it takes until middle age to pay off the student loans. But is it all worth it? A huge number of students have difficulties finding a job after graduation or are being terminated after a short period of time. Bennett looked at the 3500 colleges and universities in the U.S and calculated the return on investment. The results were a bit shocking. Only 150 institutions had a positive return. The top 10 (ranked by Bennett) are listed below:

 

  1. Harvey Mudd College
  2. California Institute of Technology
  3. Massachusetts Institute of Technology (MIT)
  4. Stanford University
  5. Princeton University
  6. Harvard University
  7. Dartmouth College
  8. Duke University
  9. University of Pennsylvania
  10. University of Notre Dame

Bennett said “college is worth it if you get into a top tier university like Stanford, or study an in-demand field like nuclear engineering at even a lower tier school.” Not everyone can afford to go to Stanford.

I somewhat agree with Bennett’s point of view, since the top companies only retain talent from the ivy league schools. Some organizations will not consider inviting you for an interview, if you didn’t go to a top university. I believe everyone deserves a chance, and school should not be the only factor that impacts your future. However, we live in a society where the “brand name” matters the most. Universities compete with each other by establishing a good reputation. In result, students pick the schools that will guarantee a job in the future. The vicious circle closes. In order to create some equilibrium, universities that are less expensive should implement a breakthrough improvement. As we learned in class, innovation and creative thinking is crucial. Also, such schools should use the benchmarking method. By researching the industry and following the footsteps of the successful colleges it will lead to a superior performance. It will give them a chance to become more popular, and hopefully, a positive return on investment ratio for the students. I think more students are willing to go to a more affordable college, where the future outcome is bright.

Unfortunately, this is not the case. As I mentioned before, the more you pay for your tuition the higher chances of getting a job. The question remains – is this fair?

Links where I found the article and the pictures used for this blog:

http://finance.yahoo.com/blogs/daily-ticker/only-150-3500-u-colleges-worth-investment-former-132020890.html?vp=1

http://www.mynextcollege.com/college-life/the-student-loan-scam/

http://www.sfexaminer.com/files/blog_images/graduationhats.jpg

http://www.blackenterprise.com/career/10-highest-paying-college-degrees-for-african-americans/attachment/grad-cap-money-620×480/