Using Regression Analysis to Forecast Olympic Medals

Posted on by

FEBRUARY 12, 2014

olympicsHow many medals will the U.S. walk away with at this year’s Winter Olympics? What about perennial runner-up China? Two brothers, writes Fast Company (Feb. 7, 2014), have the answers. Since the 2010 Winter games, the two collected more than 30 datasets and ran regression after regression until they found a model that accurately matched the past two Winter Olympics.  According to Tim and Dan Graettingers’ model, the U.S. will walk away once more with the most overall medals, though it won’t come close to last Olympic’s record-setting 37 individual awards.  China, which only won 11 medals in the last Winter Games, is set to double its haul.

For the final model, the Graettingers found that only four variables consistently predicted a country’s medal count in the Olympics (with an R-squared of .585):

Geographic area – Their best guess is that it may reflect the nation’s population and/or the genetic diversity within the nation and/or the presence of mountain ranges on which to ski and snowboard.  Also, it does separate the relatively larger nations of the world from the many small (geographically and population-wise) island nations in the Caribbean and the Pacific.

GDP per capita –  It seems to confirm the hunch that nations whose people are affluent can afford to spend time pursuing excellence in sports, while poorer nations cannot.

Value of Exports – This measure of a nation’s total economic power seems to complement per capita GDP.

Latitude of Nation’s Capital –  The further your country is from the equator, the more snow and ice you’ll have – and the more medals you’ll win at sports contested on snow and ice. (We can think of Oslo, Stockholm, or Helsinki).

By the way, no nation from Africa, South America, or the Middle East has ever won a medal at the Winter Olympic Games.  No nation from the Caribbean has either, despite the worthy efforts of the Jamaican bobsled team!

This post provided courtesy of Jay and Barry’s OM Blog at www.heizerrenderom.wordpress.com. Professors Jay Heizer and Barry Render are authors of Operations Management , the world’s top selling textbook in its field, published by Pearson.

Chipotle’s Operations Strategy for Faster Service

Posted on by

FEBRUARY 10, 2014

chipotle-service

Lines snaking out the door at lunchtime have long been a bottleneck to growth at Chipotle, the burrito chain, writes Quartz.com  (Jan. 31, 2014).  But the fast-food firm managed to speed up service by 6 transactions per hour at peak times this past quarter by implementing what it calls the “four pillars of great throughput.” Here they are:

+“Expediters” That would be the extra person between the one who rolls your burrito and the one who rings up your order. Her job? Getting your drink, asking whether your order is for here or to go, and bagging your food.
+“Linebackers” The people who patrol the countertops, serving-ware, and bins of food, so the ones who are actually serving customers never turn their backs on them.
+“Mise en place” What in a regular restaurant means setting out ingredients and utensils ready for use means, in Chipotle’s case, zero tolerance for not having absolutely everything in place ahead of lunch and dinner rush hours.
+“Aces in their places” A commitment to having what each branch considers its top servers in the most important positions at peak times, so there are no trainees working at burrito rush hour.
Chipotle is also mulling incorporating a Starbucks-style mobile payment system (the chain already accepts online orders for pick-up), which the company is hopeful will help funnel customers in and out of its lines a bit faster. But the company is open to a number of other options, too, so long as they help speed up service.

This post provided courtesy of Jay and Barry’s OM Blog at www.heizerrenderom.wordpress.com. Professors Jay Heizer and Barry Render are authors of Operations Management , the world’s top selling textbook in its field, published by Pearson.

Harley-Davidson’s Manufacturing Strategy

Posted on by

FEBRUARY 5, 2014

harley2“Before the great recession, Harley-Davidson didn’t have to worry about counting the seconds,” writes The New York Times (Feb. 2, 2014). There was little competition for their core customers — “fat white guys,” as one employee called them. Harley charged a huge premium for its bikes, and its customers waited as long as 18 months to receive them. The union rep at Harley’s York plant said workers could assemble motorcycles at their own pace, music blaring. “We had 30% absenteeism every Monday and Friday,” added the plant manager. This all worked fine until the recession, when the company was close to collapse.

Many firms respond to global competition by breaking their unions, by moving to a right-to-work state (or out of the country), and by employing robots on the assembly line. But Harley has an “American blue-collar, working man” brand, and to get rid of its union or to make its motorcycles in Mexico would have been catastrophic. The company could only compete by redesigning the production system so that each worker created more value than they cost. So Harley tore down the existing plant and built a new one. Unlike most factories, the new plant has people everywhere. There are no robots on the main assembly line; instead, hundreds of workers, operating in teams of 5 or 6, manually build each motorcycle. There are around 1,200 different Harley configurations, and a new bike starts its way through the production line every 80 seconds. Virtually each one is unique.

Human beings can also solve thorny problems that lead to major inefficiencies. At Harley, there are 150 “problem solvers” whose entire job is to continuously monitor their small sections of the production line and search for better ways to make motorcycles. The average tenure of a line worker at the York plant is 18 years, and these workers are extremely devoted to the company. (“How many factory workers have the company logo tattooed on their arm?” asks the plant manager.) Costs have fallen by $100 million at the plant and quality has improved even more significantly. Customer demand is extremely high, especially now that people can get a bike within a few weeks.

This post provided courtesy of Jay and Barry’s OM Blog at www.heizerrenderom.wordpress.com. Professors Jay Heizer and Barry Render are authors of Operations Management , the world’s top selling textbook in its field, published by Pearson.