OPNS 430, 71
Summer Quarter 2007
CRU Computer Rentals
Due: June 27, 2007
Hima (Bindu) Batchu
JoAnna Thomas (Bowen)
The decision to launch a sales drive this year can lead to financial growth for the company. CRU must look at their overall operations to insure the company can meet the sales demands from the sales drive initiative. Their current computer rental operation is a long process that consists of many buffers. It is imperative that CRU focus on the computer rental return to computer availability for ...view middle of the document...
This will reduce inventory and therefore increase units available for rent.
• CRU should also maintain a stock of highly used replacement parts so the computers requiring those parts can be turned around quickly.
• CRU should set up an information sharing system with its suppliers in order to increase turnaround time for those computers.
• Combine duties of Pre-configuration and Re-configuration tech. This will reduce overhead cost and effectively utilize resources.
• Since it costs $150 to repair each computer plus labor, set a limit on the maximum age computer that can be repaired (e.g. repairing a 2.5 year old computer does not make sense since it’s book value is about $167 at that point).
o Redeploy some of these technicians to address the backlog to pre-configure computers that are not defective.
Currently CRU has many of their computers trapped as inventory and not out at the clients generating revenue. With the increased demand and throughput, keeping inventory levels constant will result in reduced flow times as seen in Figure C in Appendix A. This will create a more efficient process by accelerating the turnaround time for the computers and hence increase profitability.
• Inventory: Computers currently in storage will instead be available for rent, leading more rental revenue for CRU.
• Time: There will be less wait time for repair parts. Also, customers require timely (just in time) rental units and the reduced processing...