De La Salle University - Dasmarias

BUSINESS OPERATIONS MANAGEMENT

CASE STUDY: ENERGY CRISIS IN CALIFORNIA

An Activity Paper
College of Business Administration and Accountancy
Business Management Department
De La Salle University Dasmarias
City of Dasmarias, Cavite, Philippines

In Partial Fulfillment for the Requirements in

MGNT427 Strategic Operations Management

Mr. Carlo Antonio C. Magno

Course Adviser

Geronga, Daniel Jake

Iral, Katherine
Lucena, Kalvin Kier
Mactal, Lovely
Melanes, Dianne May
Mendoza, Mika
Perez, Hazelle Angela
Group Members

August 22, 2015

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BUSINESS OPERATIONS MANAGEMENT
Statement of the Problem
Based on the case study, economic growth in California was particularly
strong during the 1990's boom economy, and rapidly expanding firms started to
need more energy, which caused an increase in demand. With this, the California
state did not bother to help increase supply. Therefore, an energy shortage
problem occurred. There was a mismatch between supply and demand and the
situation was called as a classic aggregate planning problem.
Objectives
The group has considered this set of objectives in order to come up with
appropriate courses of action that will potentially help resolve the existing
problem of California sheds Light on regulation:

Impose strategy how to improve computer technology.

Find the supplier who will be manage and maintained the power
source needed.

Find and search the new machinery high performance.

Improve the utilities and manpower for monitoring the usage.

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BUSINESS OPERATIONS MANAGEMENT
Area of Consideration
Strengths:

California has enough monetary budgets.

The demand of the electricity consumption is high because of economic

growth of California.

Weaknesses:

Energy shortage.

Electricity power cannot be stored as inventory.

Electricity must be generated for immediate use.

Lack forecasting.

Opportunities:

Adding more power plants to increase electricity supply.

Encouraging conservation to people.

Signing long-term contracts with other providers.

Threats:

De La Salle University - Dasmarias

BUSINESS OPERATIONS MANAGEMENT

Low electricity supply, High demands

Expensive electricity pricing (Especially during peak periods)

Buying surplus electricity from other areas are only allowed on short-term
spot markets.

Outsourcing supplies to other countries are too expensive.

Additional power plants are a long process to address the current issue.

Convincing people to save energy is hard to advocate especially now a

days.

Alternative Courses of Action

Below are the alternative actions that the group has come up to lessen the power
shortage in California:

Conduct annual or daily maintenance work during summer months or

during peak hours

Establish their own Solar Energy panel

Have a long term contract to other energy suppliers

Maximize production during out of peak house (1:00pm - 5:00pm)

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BUSINESS OPERATIONS MANAGEMENT

Regularly provide preventive maintenance to all machinery and equipment

or Switch off unused equipment

Use natural daylight as possible or switch off lights where natural daylight
occurs, apply reflecting coating to old roofs

Use compact fluorescent lamp because it uses one quarter of the energy

Encourage staff to use stairs instead of elevators if they are not carrying
loads.

Change or improve computer technologies whereby computer memory

would be able to produce a particular type of memory at lower cost.

Recommendation
Based on our group research, here are some recommendations that might
serve as a solution to the problem:

Since California has enough monetary budgets, their government should

funds for a new and higher volume storage Power Plants. This thing
improves the storage and energy for the Californias crisis,

California government should proposed LED (Bulb, Lamp, & etc.) for the
everyday use of consumers, mostly those big establishment such as

De La Salle University - Dasmarias

BUSINESS OPERATIONS MANAGEMENT
malls, restaurants, clubs etc.; using LEDs lessen the consume of
electricity and also lessens expenses.

California should separate the electric consumption of street lights, future

comes a new innovative street lights which is lights depends on lights, this
so called solar lights which conserves energy from sunlight in daytime
and lighten up the streets in nighttime.