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A dairy plant in Gujarat that cannot keep up in summer
You run the case. Read the prompt, answer questions from the notes below, and share data only when the candidate asks for it or gets stuck. Score at the end.
Case timer
00:00
1. Read the prompt aloud
Read it slowly, then pause. Let the candidate ask questions before they structure.
A dairy in Gujarat, India bottles flavoured milk. In summer, shops want 5,500 bottles an hour, and the plant runs 16 hours a day. Each bottle earns INR 6 of contribution (price minus the costs that move with each bottle). The steps, machines and rates are in the table with this case. The plant manager wants to buy a faster filling machine. What should the dairy do? (The dairy is fictional and the figures are illustrative.)
The prompt refers to Exhibit 1. After reading it, say: "Open Exhibit 1 now."
2. Answers to clarifying questions
This case has no scripted clarifying answers. Answer from the prompt, and say "assume what you think is reasonable" if the prompt does not cover it.
3. A model structure
Compare the candidate's structure with this one. A different split can be just as good if it is clean and fits the problem.
- Output = the lower of demand and the slowest step; the value of a fix = extra bottles x contribution
- Capacity of each step = machines x rate
- Key: Output today and the shortfall against demand
- What the shortfall costs a day
- Options: fix the slowest step, then check the next one
Exhibit 1
The prompt uses this exhibit, so the candidate opens it right after you read the prompt ("Show exhibit 1" on their screen).
| Step | Machines or packing stations | Bottles per hour, each | Step capacity per hour |
|---|---|---|---|
| Fill | 2 | 3,000 | 6,000 |
| Cap | 1 | 7,000 | 7,000 |
| Label | 1 | 4,500 | 4,500 |
| Pack into crates | 3 | 1,800 | 5,400 |
So-what
Labelling, at 4,500 bottles an hour, is the slowest step, so the whole line makes 4,500 an hour however fast the fillers run.
4. The working, step by step
Each step shows how a strong candidate works it out. Share a new fact from it only when the candidate asks or is stuck, and let them do the math: the result in the dark box is what they should reach.
Step 1: Filling capacity
What a strong candidate does: Two fillers at 3,000 bottles an hour each.
Fill capacity (bottles per hour): 2 × 3,000 = 6,000
Step 2: Packing capacity
What a strong candidate does: Three packing stations at 1,800 bottles an hour each.
Pack capacity (bottles per hour): 3 × 1,800 = 5,400
Step 3: Output today
What a strong candidate does: Output is the lowest of demand and the four step capacities. Labelling is the bottleneck.
Output (bottles per hour): min(5,500; 6,000; 7,000; 4,500; 5,400) = 4,500
Step 4: Shortfall
What a strong candidate does: Shops want 5,500 an hour and the line makes 4,500.
Bottles short each hour: 5,500 - 4,500 = 1,000
Step 5: What the shortfall costs
What a strong candidate does: 1,000 bottles an hour, for 16 hours, at INR 6 each.
Contribution lost a day (INR): 1,000 × 16 × 6 = 96,000
Step 6: The faster filler
What a strong candidate does: Even if filling doubled to 12,000 an hour, labelling still allows only 4,500. The filler adds nothing.
Output with a faster filler (bottles per hour): min(5,500; 12,000; 7,000; 4,500; 5,400) = 4,500
Step 7: A second labeller
What a strong candidate does: Labelling doubles to 9,000. Now packing, at 5,400, is the slowest step.
Output with two labellers (bottles per hour): min(5,500; 6,000; 7,000; 9,000; 5,400) = 5,400
Step 8: The real gain
What a strong candidate does: The gain is 900 bottles an hour, not 1,000, because packing becomes the limit.
Extra contribution a day (INR): (5,400 - 4,500) × 16 × 6 = 86,400
Step 9: Payback
What a strong candidate does: A second labeller costs INR 25 lakh (2,500,000). Divide by the daily gain.
Payback (summer days): 2,500,000 ÷ 86,400 = 28.94
Step 10: Then fix packing cheaply
What a strong candidate does: A fourth packing station takes packing to 7,200 an hour, so output reaches demand.
Output with four packing stations (bottles per hour): min(5,500; 6,000; 7,000; 9,000; 4 × 1,800) = 5,500
The recommendation to listen for
At the end, say: "The CEO walks in. What is your recommendation?"
Do not buy the faster filler: labelling is the bottleneck, so a faster filler adds no output at all. Buy a second labeller instead. It lifts output from 4,500 to 5,400 bottles an hour and earns about INR 86,400 a day, so its INR 25 lakh cost pays back in about 29 summer days. Then add a fourth packing station for the peak season, which closes the last 100 bottles an hour of the gap. The risk is that summer demand is shorter or weaker than planned; check how many days a year demand stays above 4,500 an hour before buying.
Risks a strong answer names: Demand above 4,500 an hour may last only a few weeks; A second labeller needs floor space and an operator on every shift.
Score the candidate
Score each criterion from 1 to 5. A 2 or a 4 sits between the descriptions.
Total
0 out of 25
Score all five criteria to see the band and the feedback template.