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OM in the News: The Intelligent Tire and “Last Mile” Delivery

June 21, 2021

Alongside the tire jack and the air pump, consider the algorithm as a tool for fixing flats, writes The Wall Street Journal (June 17, 2021). Goodyear Tire & Rubber and Bridgestone are rolling out new intelligent tire features that use sensors and artificial intelligence for vehicles delivering packages from e-commerce sites.

The technology is geared toward vehicles that specialize in last-mile delivery, which refers to the final step in getting packages from a distribution center to the customer. The market for last-mile delivery has picked up as online shopping has soared during the coronavirus pandemic. The volume of parcels is expected to grow to 200 billion in 2025, up from an estimated 100 billion in 2019,

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Goodyear’s new technology is called SightLine and includes a sensor and proprietary machine-learning algorithms that can predict flat tires or other issues days ahead of time, by measuring tire wear, pressure, road-surface conditions and many other factors. Sightline’s sensor tracks dozens of measurements such as tire wear, inflation and road-surface conditions and a battery that detects temperature, pressure, acceleration and vibration.

The surge of last-mile deliveries means that a lot of vehicles are on the road, stopping and going, hitting curbs, causing damage to the tires, causing breakdowns and congestion. Last-mile delivery vehicles can go through four sets of tires a year, which is highly inefficient from a cost and sustainability perspective.

Vehicles using Goodyear’s intelligent tires can shorten the stopping distance lost by wear and tear on a tire by about 30%. Helping detect tire-related problems before they happen can lead to fewer breakdowns, less traffic congestion and increased safety for last-mile delivery drivers. Tire manufacturers are also investing more heavily in the field of telematics, which refers to the use of technology to collect and monitor data relating to a vehicle or parts of a vehicle.

Classroom discussion questions:

  1. How can this tire impact the logistics of a firm?
  2. Why is the “last mile” so important in the supply chain?

OM in the News: The Bullwhip Flares Again

June 18, 2021

Even though global supply chains are regaining their footing as the Covid-19 pandemic begins to ease, many businesses are about to be knocked off their feet again, reports The Wall Street Journal (June 14, 2021). Uncertainty surrounding the demand predictions needed to drive supply-chain decisions increased markedly during the past 15 months as the ripple effects of the pandemic disrupted supply-and-demand patterns. Toilet paper shelves were empty in most stores as demand spiked 700%, and the construction and travel industries ground to a halt.

Now, pent-up demand, relief checks and vaccinations are spurring spikes in consumer spending, triggering shortages of many products that were overabundant a year ago. From lumber to semiconductors, markets are experiencing price run-ups and stockouts, stoking inflation fears.

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The result is that many companies want to kick manufacturing into high gear, replenishing inventory on expectations that today’s surging demand will continue. Firms should follow a “make more” strategy with caution, however, lest they become victims of the bullwhip effect, our topic in Supplement 11 (p. 473-75).

Bullwhip describes how companies typically respond to a spike in demand by ordering more products than required to hedge against potential continued growing demand and to avoid stockouts. This demand distortion is then passed along and amplified at each stage of the supply chain, with orders to suppliers furthest away from the point of sale far removed from the realistic views of consumer demand.

Bullwhip can lead to the rapid expansion of manufacturing capacity, including accelerated procurement of supplies, labor, warehouse space and transportation for finished goods, often at a cost premium. But just as the initial information reporting demand spikes takes time to reach upstream suppliers and manufacturers, so too does information about stabilizing demand. By the time companies reach peak capacity, demand may have stabilized at lower levels, leaving firms with excessive inventory.

The risk of overbuilding is highest in industries that may see demand surge as society reopens, such as tourism, dining and entertainment. Data indicate that consumer spending is already shifting away from “lockdown” spending on things such as home entertainment, workout and home-office equipment, and food-delivery services.

Classroom discussion questions:

  1. Explain the bullwhip effect in layman’s terms.
  2. Name several items that were impacted by bullwhip during or after the pandemic.

OM in the News: Inside the Amazon Warehouse

June 15, 2021
“In his drive to create the world’s most efficient company, Jeff Bezos discovered what he thought was another inefficiency worth eliminating: hourly employees who spent years working for the same company,” reports The New York Times (June 15, 2021) in a very critical analysis of Amazon operations. Longtime employees expected to receive raises. They also became less enthusiastic about the work. Bezos came to believe that an entrenched blue-collar work force represented “a march to mediocrity.”

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In response, Amazon encouraged employee turnover. After 3 years on the job, hourly workers no longer received automatic raises, and the company offered bonuses to people who quit. It also offered limited upward mobility for hourly workers, preferring to hire managers from the outside. It worked. Turnover at Amazon is much higher than at many other companies — with an annual rate of 150% for warehouse workers, which means that the number who leave the company over a full year is larger than the level of total warehouse employment. The churn is so high that it’s visible in the government’s statistics on turnover in the entire warehouse industry: When Amazon opens a new fulfillment center, local turnover surges.

At Amazon, workers sometimes find out about a new shift only the day before, scrambling their family routine. When workers want to get in touch with human resources by phone, they must navigate an automated process that can resemble an airline customer-service department during a storm. Employees are constantly tracked and evaluated based on their amount of T.O.T., or time off task. One employee who had earned consistent praise was fired for a single bad shift.

As Bezos prepares to step down as CEO, he says he wants to change Amazon’s workplace culture, stating “We are going to be Earth’s best employer.” Still, it is not at all clear that Amazon will change its basic approach to blue-collar work. The constant churning of workers has helped keep efficiency high and wages fairly low. Profits have soared, and the company is on pace to overtake Walmart as the nation’s largest private employer. Bezos has become one of the world’s richest people. People want to believe that being a generous employer is crucial to being a successful company. But that isn’t always true.

Classroom discussion questions:
1. Evaluate Amazon’s warehouse employee strategy.
2, In Chapter 2, we we provide 3 strategies for competitive advantage. Which does Amazon employ?

OM in the News: Trapping Plastic Waste

June 11, 2021

What do old televisions, street signs, motorbike helmets, windsurf boards, and Christmas trees have in common, asks CNN (June 10, 2021)? They were all caught floating down Amsterdam’s Westerdok canal — by a curtain of bubbles. “The Bubble Barrier” was developed as a simple way to stop plastic pollution flowing from waterways into the ocean. An air compressor sends air through a perforated tube running diagonally across the bottom of the canal, creating a stream of bubbles that traps waste and guides it to a catchment system. It traps 86% of the trash that would otherwise flow to the River IJssel and further on to the North Sea. The idea is to catch plastic without having a physical barrier like a net or boom blocking the river, which could disrupt aquatic life or interfere with shipping.

Up to 80% of ocean plastic is thought to come from rivers and coastlines. Much of the plastic in Amsterdam’s Westerdok canal comes from trash bags that local residents leave outside their homes. If the bags tear, wind and rain can carry trash into the canal.

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Globally, 11 million metric tons of plastic waste flows into the oceans every year, where it can suffocate and entangle some aquatic species. Plastic debris less than five millimeters in length, known as microplastics, can also affect marine life. Often mistaken for food, microplastics are ingested and have been found in zooplankton, fish, invertebrates and mammalian digestive systems.

The albatross chick shown in the photo above is being fed pieces of plastics by its parents, which mistake the waste for food. Seabirds which ingest plastic waste are smaller, lighter, and suffer from a litany of health problems. Plastic waste kills about 1 million seabirds every year. The second photo shows an Hawaiian monk seal chewing on a plastic bottle.

Classroom discussion questions:

  1. How is plastic waste an issue for operations managers?
  2. What are companies doing to minimize plastic usage and waste?

OM in the News: The Murderous Wind Turbines

June 9, 2021

We don’t see many power-generating wind turbines here in Florida, but they were ubiquitous as we vacationed out West a few weeks ago. The turbines and solar energy (more common in Florida) are cited as the future of clean energy and sustainability–our topic in Supplement 5 of your OM text.

wind turbines

But the wind turbines—some with 200-foot blades spinning up to 180 mph—are estimated to kill as many as 500,000 birds a year through accidental collisions, according to The Wall Street Journal (June 6, 2021). Wildlife researchers in 2013 estimated that the Energy Department’s 2008 wind-power target would push bird deaths to about 1.4 million annually. That figure hasn’t been updated to reflect the Biden administration’s plans to expand offshore wind farms.

Federal law has led to penalties for two wind farms.  Duke Energy agreed to spend $600,000 a year on a compliance plan, on top of $1 million in penalties, aimed at preventing bird deaths at several wind-turbine projects in Wyoming, where 14 golden eagles and 149 other protected birds had been killed. Also in Wyoming, PacifiCorp was fined $2.5 million for bird deaths.

Wind turbines, however, are far from the biggest hazard to birds; nearly 600 million birds die each year from crashing into windows. Both the National Wildlife Federation and the Audubon Society support the expansion of wind power on grounds that greenhouse gas emissions and climate change pose a far bigger threat to birds than turbines. Wind-turbine companies use several methods to deter bird deaths, including noisy devices that birds want to avoid, as well as locating the turbines in areas away from common flight paths.

One promising new technology dubbed IdentiFlight involves sky-scanning robots that use artificial intelligence and alert the company to stop the blades from spinning as birds approach. Duke Energy installed the IdentiFlight technology in 2015, after the bird-death fine, at a 110-turbine wind farm in Wyoming and it reduced eagle deaths by 82%.

Classroom discussion questions:

  1. Do the benefits outweigh the negatives of wind turbines?
  2. How does this relate to the triple bottom line (see page 195)?

Guest Post: Changing the Supply Chain

June 7, 2021

HowardWeiss2 Our Guest Post comes from Prof. Howard Weiss, who recently retired from Temple University.

Ghana, the second-largest producer of cocoa beans, currently ships the beans out of the county for production into chocolate. This means that Ghana receives less than 2% of the profits on chocolate. According to Financial Times (June 3, 2021), in order to reduce the poverty level in Ghana, the country’s president has set his country the challenge of producing chocolate bars on a commercial scale.

The Supply Chain Management chapter in your Heizer/Render/Munson textbook (Ch. 11) defines vertical integration as “developing the ability to produce goods or services previously purchased and cites an example of “Apple deciding to manufacture its own semi-conductors.” In the case of Ghana, the president is proposing the backwards integration for the entire industry, not just a single company. This would develop more income than a strategy of raising prices.

Chapter 11 also notes that “Backward integration may be particularly dangerous” and in the case of Ghana there are several challenges to producing its own chocolate bars. Ghana will need to import milk powder, develop packaging facilities and face issues related to energy because more energy will be required in Ghana than say, Switzerland, to keep the chocolate from melting and energy is more expensive and less reliable in Ghana. In addition, it is further away from markets so transportation costs will be high.

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In spite of the challenges, the change has already begun with Fairafric, a German-Ghanian company, building a $10 million plant in Ghana. Fairafric demonstrates Corporate Social Responsibility, as defined in Supplement 5 of your textbook, “By not only sourcing the cocoa in Ghana but by producing the chocolate from bean to (wrapped) bar in Ghana”.

 

Classroom Discussion Questions

1. For what other resources in Africa might it be profitable and socially responsible to modify the supply chain?

2. What are the major benefits that will accrue to Ghanians from more profits staying in Ghana?

OM in the News: Your Long Wait for Packages

June 3, 2021

Global supply chains are buckling, driving up prices, creating shortages and frustrating consumers. If at any point in the past 7 months you looked out to sea from the LA-Long Beach container port complex, the largest in the U.S., you would see the problem: up to 40 container ships anchored, with nowhere to go. There’s no space in the clogged ports. To put it another way, you’re looking at as many as 100,000 containers—holding everything from running shoes and home electronics to frozen seafood and furniture—waiting to be unloaded and then shipped to factories, stores and homes across the country.

U.S. ports are severely stressed, a problem that won’t disappear with the pandemic, writes The Wall Street Journal (June 3, 2021). Not one U.S. port was represented in the top 50 container ports globally in productivity performance. Why? The answer comes down to a complicated transportation market. Capacity is deployed according to shifting company and investor calculus, a complex system of handoffs between land and sea that has long resisted coordination.

There are no solutions in sight. In Asia, ships are worked 24/7, or 168 hours a week, compared with 16 hours a day, or only 112 hours a week, at LA-Long Beach. Terminal gates used by truckers to deliver and receive seaborne containers operate only 88 hours a week, vs. 168 in Asia. For larger ships, it takes 24 seconds on average to move a container at the Chinese ports, vs. 48 seconds at LA That leaves the port system chronically vulnerable to unanticipated volume surges.

Global Supply Chains Pressures

Longshore labor relations also hinder improvements in productivity. A decades-long history of toxic labor-management relation has led to huge cost increases that discourage operators from expanding work hours, limit their ability to automate terminals, and end in avoidable delays during contract negotiations. And there is no sign that this labor-management paradigm will change with the new pro-union presidency.

Classroom discussion questions:

  1. Why does productivity lack at US ports?
  2. What can the US do to unclog ports?

Guest Post: Online vs. Face-to-Face OM in Fall

May 31, 2021

Our Guest Post today comes from Dr. Lynn A. Fish, who is Professor of Management in the School of Business at Canisius College

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The pandemic has led higher education to use online education more. It’s important for instructors to understand and develop student expectations for our classes and modes of teaching. With the change to online classes, do instructors and students have the same perceptions of online versus face-to-face education?

Forthcoming research completed at an AACSB Jesuit, Catholic University with a strong focus on teaching face-to-face classes revealed that during the pandemic with instruction mainly online, instructors and students still prefer face-to face instruction on most individual factors (specific to the student or instructor) and program factors (decisions that the instructor makes in developing the course) studied.

However, the instructor and business student perspectives differ on many factors. In general, both groups are more positive toward face-to-face education. Contrastingly, instructors and students who have not experienced online were very homogenous in their perspectives on all factors. In post-pandemic education, as instructors we need to address student expectations versus our own and use online components that may complement our classrooms in ways that we may not have understood prior to the pandemic. For example, in my operations management classes during the pandemic, over 80% of students rated the MyOMLab homework experience positively. Students are interested in keeping the pandemic instructor-developed video lectures available for review. However, they are frustrated with online testing and wish to return to traditional pencil-and-paper.

Future course offering will adjust accordingly to meet their expectations. However, not all institutions are the same and the key is to understand and manage these expectations at your institution after the pandemic. As instructors, it’s important to define and meet student perceptions as we enter the post-pandemic education world.

OM in the News: Food Supply Chain Problems

May 26, 2021

Americans are returning to restaurants and bars as Covid-19 restrictions come down, adding new strains in food supply chains, reports The Wall Street Journal (May 22-23, 2021).

Distributors are facing shortages of everyday products like chicken parts, as well as difficulty in finding workers and surging transportation costs as companies effectively try to reverse the big changes in food services that came as coronavirus lockdowns spread across the U.S. last year.

restaurant

“The start up has been, in many ways, as difficult as the shutdown…Everybody is trying to turn it on immediately and the capacity might not be there,” says an industry CEO. Shortages of raw materials are leading to erratic deliveries of items that usually arrive on predictable schedules. That disrupts entire supply chains.

The food sector is seeing a version of the bullwhip effect (as discussed in Supp. 11 of your Heizer/Render/Munson OM text), where companies that have pulled back their operations seek to rapidly scale up on signs of improving demand, leaving suppliers scrambling to keep up. Food suppliers allocated more capacity to retail customers like grocery chains during the pandemic leaving distributors short of some products as restaurants and institutional food-service operations open back up.

Demand has changed too. Restaurants that remained open slimmed down their menus during the pandemic and shifted from fresh ingredients for salad bars and buffets to using more prepackaged foods for takeout and delivery operations. Restaurants, hotels and institutional food-service operations are coping with big price swings on staple ingredients and erratic availability. The cost of pepperoni jumped 60% over the past five weeks while flour and tofu are out of stock about half the time for some restaurants.

The lack of available workers may be the biggest strain on the sector since the impact cascades from the production facilities to trucking to distribution centers.

Classroom discussion questions:

  1. Explain the impact of the bullwhip effect on the food supply chain.
  2. What can restaurants do overcome the shortages?

OM in the News: Awash in Hand Sanitizer

May 24, 2021

In Supplement 7, Capacity and Constraint Management, we ask “What are the strategies for when demand exceeds capacity? When capacity exceeds demand?” The past year saw the hand sanitizer industry whipsawed from desperate shortages to massive excesses.

Now Piggly Wiggly stores in Alabama and Georgia, are offering 4-for-1 specials on sanitizers after sales nearly halted. They tried selling the disinfectants for half-price and discounted them at 75% to no avail. Lucky Supermarket in Millbrae, Calif., is offering free bottles of hand sanitizer with any $10 purchase. Supermarkets are on a mission to get rid of hand sanitizers. Once nearly impossible to find, America is awash in it.

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Consumers rushed to buy sanitizers when the pandemic took hold, writes The Wall Street Journal (May 21, 2021). The surging demand resulted in shortages and purchase limits at retailers. Hoping to fill their shelves, supermarkets bought inventory from overseas and turned to other businesses—including distilleries—that switched their production to make sanitizers for the first time. Manufacturers expanded capacity, at times overpaying for components like pumps.

Now, supermarkets are sitting on pallets of them. Covid-19 cases are declining. Health officials now say that the virus is airborne and that the disinfectants aren’t as effective as masks and distancing. Sales of hand sanitizers are down 80% from a year ago. Weekly sales hit as high as $52 million in July. Average unit prices are $2.10, about 40% lower than a year ago.  Prices on the Liquidation.com marketplace have fallen to 2 to 3 cents on the dollar, a 90% decline in resale prices over 6 months

Among those struggling with the current glut: distilleries that jumped into the sanitizer business when brands couldn’t keep up with demand last year. Adirondack Distilling, which makes whiskey, vodka and gin, still has between 10,000 and 20,000 sanitizers that the company made in stock. In Oregon, Crater Lake Spirits is giving away leftover sanitizers after it produced roughly 60,000 gallons of disinfectants for hospitals and hotels last summer.

Classroom discussion questions:

  1. What are the OM choices when demand exceeded capacity?
  2. What are the options now that capacity exceeds demand for sanitizers?

OM in the News: Tyson Blames the Chickens

May 21, 2021

There’s simply not enough chicken to go around as US demand for the meat surges, reports the New York Post (May 12, 2021) Underperforming roosters that aren’t producing as many chicks as expected are partly to blame for the shortage, according to Tyson Foods. The Arkansas-based company, one of the world’s largest poultry producers, says that it’s struggling to ramp up chicken supply because the new roosters it’s been using for fertilizing eggs and breeding new chicks simply aren’t hitting expectations.

“We’re changing out one type of male that, quite frankly, we made a bad decision on,” says the company president. Breeding companies provide hens and roosters to chicken producers like Tyson, which then breed the birds and hatch their eggs to produce poultry. Tyson owns one of the major breeding companies in the US.

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The company switched to the new kind of rooster because it improved the quality of meat. The hatching crisis hit Tyson in January, after it introduced the rooster that’s now getting the boot. (It has moved back to the roosters it previously used).

The company discovered that eggs fertilized by this specific type of rooster hatch less often, limiting the company’s supply just as nationwide demand for chicken is sky high. While working to replace the rooster by the fall, but there could be a lingering supply hit that carries over into next year. The breeding problem could be responsible for as much as half of Tyson’s problems meeting demand for its chicken.

There are other factors also holding back chicken supply. The winter storm that slammed Texas earlier this year as well as “worker absenteeism” and a surge in demand are also hurting supply. 

Classroom discussion questions:

  1. Why is this an OM issue?
  2. What mistakes did Tyson make?

OM in the News: Amazon and Injuries

May 18, 2021

Amazon recorded 5.6 injuries per 100 workers in 2019, the last full year of data, compared with the 4.8 rate nationally for the warehousing sector. So the firm, after years of criticism over worker safety at its depots, is establishing a program focused on improving the health and wellness of its hourly warehouse staffers, reports The Wall Street Journal (May 18, 2021).

The new program, called WorkingWell, aims to better educate employees on how to avoid workplace injuries and improve mental health on the job. The firm began testing parts of the program 2 years ago and plans to expand it to 1,000 facilities by the end of the year. Amazon said it aims to cut recordable incidents in half by 2025.

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Amazon, which employs about 950,000 people in the U.S., says it is acting because of the frequency of workplace injuries in the warehousing industry and because the coronavirus pandemic has heightened the awareness of healthcare needs. It is particularly concerned about musculoskeletal disorders, known as MSDs, which account for 40% of its work-related injuries.

Under the WorkingWell program, warehouse employees gather on a rotating basis near their work stations to watch videos about injury prevention, including how to lift items properly. Employees also are given hourly prompts at their stations that guide them through 30-60 second stretching and breathing exercises.

The company also is installing kiosks where employees can watch videos that show guided meditations and calming scenes and sounds. New wellness zones provide dedicated spaces for workers to stretch or meditate. The company also is developing staffing schedules that rotate employees among jobs that use different muscle groups to reduce repetitive-stress injuries. Amazon’s program does not include a significant reduction in the rate at which employees are expected to work. That pace has been a source of worker complaints. Employees, for example, are expected to take about 300 items off shelves each hour.

Experts say introducing educational tools in workplaces is often not enough to substantially reduce injuries, and that measures that provide mechanical lifts or reconfigure how a workplace is organized have a bigger impact.

Classroom discussion questions:

  1. Comment on Amazon’s new program.
  2. What else can the firm do to improve worker safety?

Teaching Tip: Online OM

May 16, 2021

As an OM instructor, you teach complex concepts. And you’re maintaining situational awareness of a classroom of dozens, if not hundreds, of students. (As of last year, you’re trying to do all of this through a tiny Zoom screen). That’s a lot to handle. Teaching OM class synchronously means you carry an extraneous load including the following:

  • Remembering students’ names and calling patterns
  • Reading online chat windows
  • Keeping track of time
  • Maintaining eye contact and body language

The key is to focus on what’s intrinsically valuable, writes the Harvard Business School Faculty Lounge (May 11, 2021). Here are some tips for how to do that:

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 Before Class
  • Create a teaching plan with an adequate level of detail. Give yourself as much structure as you need to feel comfortable, knowing there’s something you can refer to if you do get sidetracked
  • Develop and sort call lists ahead of time. Come to class with a general sense of which students you’re going to call on.
  • Clear your workspace of distraction. Even small distractions can really affect your ability to pay attention.
    • Ensure a clock is visible; Have a pen and notepad ready; Eliminate background noise; Fix sightline distractions, such as a computer light
  • Block 15–30 minutes before class. Take this time to review your teaching plan, remember where you are in the syllabus, and just generally focus on the class ahead of you.
 During Class
  • Ask clear, concise questions. If your students aren’t clear on what you’re asking, then you will end up expending time on the confusion rather than on the topic.
  • Encourage follow-up questions. Challenge and build on student comments, and have your students do the same.
  • Accept cognitive “gifts”—unprompted, unexpected insights from students that help tie together the lesson.
  • Acknowledge when you’re feeling overloaded. There will be times when your working memory runs out and you need to stop and process.. For example, say, “I want to put you in groups. I just need a minute to think about how to structure them productively.

Finally, learn to let go of perfection. Have empathy for yourself. Just do the best you can with where you are in the moment.

Guest Post: Size and Natural Hazard Risk

May 12, 2021

Prof. Howard Weiss shares his insights with us monthly. Dr. Weiss recently retired from Temple U.

Scrub Daddy Inc., the maker of smiley-faced scouring pads featured on ABC’s Shark Tank reality show, is moving into a recently acquired South Jersey office-and warehouse building from its current home in Delaware County.

As mentioned in Figure 8.1 of your Heizer/Render/Munson textbook, one location factor is the size of the site. Size has become more important than it previously was because employees need to maintain a safe distance from each other due to COVID-19. In the case of Scrub Daddy, the size of their new facility is large enough to accommodate the 65 employees who currently are located in three facilities in a different suburb of Philadelphia.

Another factor that may, in general, be important is risk assessment based on natural hazards as opposed to the political risks listed in the figure.  The Federal Emergency Management Agency (FEMA) has prepared the National Risk Index (NRI) which identifies risks by county based on the following 18 natural hazards: Avalanche, Coastal Flooding, Cold Wave, Drought, Earthquake, Hail, Heat Wave, Hurricane, Ice Storm, Landslide, Lightning, Riverine Flooding, Strong Wind, Tornado, Tsunami, Volcanic Activity, Wildfire, and Winter Weather

FEMA (https://www.fema.gov/flood-maps/products-tools/national-risk-index) essentially performed a Factor Rating on these 18 factors for each county in the U.S. For each factor, the county scores were scaled from 0 to 100. FEMA assigned equal weights to each of the 18 factors and simply computed the sum of the 18 hazard scores for each county.

Classroom Discussion Questions

  1. What are the advantages and disadvantages of consolidating all of your employees in one location?
  2. Does using equal weights on the 18 factors make sense for individual organizations?

OM in the News: Inside the Race to Power Electric Vehicles

May 9, 2021

Atop a long-dormant volcano in northern Nevada, workers are preparing to start blasting and digging out a giant pit that will serve as the first new large-scale lithium mine in the U.S. in more than a decade — a new domestic supply of an essential ingredient in electric car batteries and renewable energy. The mine, on federal lands, could help address the near total reliance on foreign sources of lithium.

But the project, known as Lithium Americas, has drawn protests from a Native American tribe, ranchers and environmental groups because it is expected to use billions of gallons of precious ground water, potentially contaminating some of it for 300 years, while leaving behind a giant mound of waste

lithium mines

The fight over the Nevada mine is emblematic of a fundamental tension surfacing around the world: Electric cars and renewable energy may not be as green as they appear, writes The New York Times (May 7, 2021). Production of raw materials like lithium, cobalt and nickel that are essential to these technologies are often ruinous to land, water, wildlife and people. In addition to Nevada, businesses have proposed lithium production sites in California, Oregon, Tennessee, Arkansas and North Carolina.

Traditional mining is one of the dirtiest businesses out there. Its environmental toll has often been overlooked in part because there is a race underway among the U.S., China, Europe and other major powers. Echoing past contests and wars over gold and oil, governments are fighting for supremacy over minerals that could help countries achieve economic and technological dominance for decades to come.

“Our new clean-energy demands could be creating greater harm, even though its intention is to do good,” says the head of a group that vets mines for carmakers.

Classroom discussion questions:

  1. Why is this an OM issue?
  2. What is China’s strategy regarding “rare earths” such as lithium?