?Case Study of Time-Critical Management Essay

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Based on the EMV done supra, the optimal determination scheme based on the cost entirely is to acquire the constituent from ARC solution and transport it via Land path.

See the computations attached in Memo 1 to pull the decision in the above analysis

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Sensitivity Analysis
Resale of new push reverser.
Sing the ‘Y’ as the figure of old ages after which we are able to sell the freshly purchased Thrust Reverser ( Node B ) . As seen from Memo 2, the optimal determination scheme remains the same every bit long as ‘Y’ is equal or more than 2 old ages.

Probability of whether BCS constituent is fit or non
See the chance that the BCS constituent will suit is ‘p’ and so the chance that BCS constituent will non suit is ( 1-p ) As seen from computation done from Memo 3, The optimal determination scheme remains the same every bit long as P & lt ; 51.7 % . Since its reference that the chance that BCS constituent tantrums is 35 % to 50 % , the optimal determination remains the same.

Based on the sensitiveness analysis done supra, our optimal determination scheme doesn’t alteration unless the variables take unreasonable values.

However this optimal determination scheme is calculated based on cost entirely, If we consider the repute loss along with gross for the Latin Airlines, so transporting the ARS solution constituent by land has a 20 % opportunity of detaining the aircraft by 3 more yearss taking to important loss in repute of the Airlines.

Whereas transporting the ARS solution constituent by Air doesn’t have such of widening the hold and is 100 % safe manner of conveyance.

Sing the difference in the cost between reassigning ARS solution constituent by Air and by Land, the cost difference is merely $ 7659, which is really negligible.

So after sing the loss in gross along with repute for the Latin air hoses, we suggest that the Optimum determination scheme will be to acquire the constituent from ARC solution and transport it via Air path.

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