Homework answers / question archive / HazMat Shipping Company You are the assistant to the manager of the southeastern region of the HazMat Shipping Company

HazMat Shipping Company You are the assistant to the manager of the southeastern region of the HazMat Shipping Company

Operations Management

Share With

---

HazMat Shipping Company

You are the assistant to the manager of the southeastern region of the HazMat Shipping Company.  Your boss is in the process of negotiating a contract with a new customer: Southern Chemicals, Inc.  The contract is to remove waste from the customer’s six plants and drop it at one of three designated waste disposal sites located in the Southwest.  While your company is used to transporting hazardous chemicals, this is the first time you will be involved in shipping hazardous wastes.  This will impose new restrictions on your drivers in terms of circuitous routes (many towns will not let you bring hazardous wastes into their town limits) and longer transport times (EPA restrictions limit the speed at which a truck carrying hazardous wastes can travel).  The estimated costs of shipping (already including the new limitations) a barrel of waste from each plant to each disposal site is given in Table 1:

 

	Waste Disposal Sites
Plants	Whitewater	Los Canos	Duras
Kingsport	$12	15	17
Danville	14	9	10
Macon	13	20	11
Selma	17	16	19
Columbus	7	14	12
Allentown	22	16	18

Table 1: Shipping Costs from Plants to Disposal Sites

 

The contract would require HazMat to make at least weekly pickups at each plant.  The amounts of hazardous waste generated by each plant, each week, is shown in table 2:

 

Plants	Waste/week
Kingsport	35 bbl
Danville	26 bbl
Macon	42 bbl
Selma	53 bbl
Columbus	29 bbl
Allentown	38 bbl

Table 2: Hazardous Waste Generated

 

The treatment capacities of the disposal sites are 65 barrels (bbl) at Whitewater, 80 barrels at Los Canos, and 105 barrels at Duras.  As a note, your trucks are all the same size and can carry the same number of barrels – so the number of barrels per truck is not relevant for this problem. 

 

Besides simply shipping directly from the plants to the disposal sites, HazMat could take shipments from one plant to another, using the plants as intermediate shipping points.  This would allow the company to send only full truckloads across the country.  There would be no additional cost to HazMat because Southern Chemicals has agreed to be responsible for all local handling of the waste at both the plants and the disposal sites.  The only drawback is the unknown cost of a backlash from the environmental groups who might protest the shipping in of hazardous wastes to the plants.  The cost of shipping (in dollars per barrel) between plants is shown in Table 3 below:

 

	Kingsport	Danville	Macon	Selma	Columbus	Allentown
Kingsport	--	6	4	9	7	8
Danville	6	--	11	10	12	7
Macon	5	11	--	3	7	15
Selma	9	10	3	--	3	16
Columbus	7	12	7	3	--	14
Allentown	8	7	15	16	14	--

Table 3: Shipping Costs between Plants

 

A third option: using the disposal sites themselves as intermediate shipping points.  The idea here is to get the hazardous wastes to the processing plants as quickly as possible, and then move them around at your leisure (again, moving only full truckloads between the processing sites).  Do not make any changes to this solution – just solve it once.

 

There might be unknown costs associated with this option, as the EPA is stringent about the removal of hazardous wastes from the disposal plants.  The cost of shipping ($/bbl) between the disposal sites is given in Table 4:

 

	Whitewater	Los Canos	Duras
Whitewater	--	2	1
Los Canos	2	--	3
Duras	1	3	--

Table 4: Shipping Costs between Disposal Sites

 

You will submit a one-page summary for this case, but you must choose between the first two options (plant-to-site or plant-to-plant) I presented in the video, not the third option (site-to-site)..

OMGT 3223 One-Page Summary Instructions for

Test 3 – Transportation Case

 

In the recorded session, I presented two different solutions to a hazardous waste shipping problem, along with a little bit of background on the problem setting.  One solution was simply shipping from the plants to the processing sites.  The other was using the plants as transshipment points (shipping from one plant to another plant and then to the processing sites).  For both approaches, you have the initial optimal solution and a second solution that costs more but is simpler.  You must listen to that recording (there are no lecture notes) and then decide for yourself which one of the solutions you would recommend and why.  You must consider more than simply costs – there are advantages and disadvantages to shipping through the plants (fuller truckloads means fewer trucks on the road, but transporting into plants might create a risk.  Which is riskier, shipping on interstates at high speeds or shipping through a city?).  You must decide which solution carries less risk.  Once you have done that, you must write up your recommendation in a one-page summary, single-spaced.  The margins of the paper can be no less than one inch all the way around.  The typeface may be no less than 10 point, and you must use a normal typeface (Times New Roman, or something like that).  Grammar and spelling will be graded.  The outline for what you must write follows:

 

Begin by telling me which of the two solutions (plant-to-site or plant-to-plant) you choose, saying simply “I recommend we use ____ shipping.”  You should not include the quotation marks and fill in the “_______” with the solution (plant-to-site or plant-to-plant) you recommend.

 

Start a new paragraph and explain why your preferred solution is better.  This must include more than simply total costs.  Consider and talk about all the factors that would be involved in managing this company while doing this task.  In this paragraph, you must provide some data as part of the comparisons.

 

In the final paragraph, summarize what you didn’t like about the solution you did not choose.  This is not going into as much detail as simply explaining what it is that made up your mind.  Remember that a one-page summary should be written so that whoever reads it could argue your point and sound smart.  To write a one-page summary, start by writing a two+ page summary, including everything you want to say.  Then go back and start editing and deleting until you get it down to one page.

 

As for grading I will take off points for misspellings, misuse of words and poor grammar (noun/verb agreement, undefined pronouns, and misuse of punctuation, to list only a few possibilities).  Think of this as a professional document, one you are handing to your boss.  I do not read rough drafts, but I will answer questions if you have them.

 

If there is any part of this that is not clear to you, let me know.

 

Ken MacLeod