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Wolverine Manufacturing Case

The company Wolverine Manufacturing produces engine bearings and has a disagreement with its unionized workforce over funding for the hourly employees' retirement plan. The union wants an additional $1.5 million contributed over 20 years. Wolverine will work with the union to establish the retirement fund using bonds from three approved companies. The objective is to determine how much Wolverine needs to invest and which bonds to purchase to meet the union's demand while minimizing costs, according to the labor agreement. Linear programming will be used to solve this case by modeling the feasible regions and constraints in a spreadsheet application.

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Himanshu Kansal
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976 views2 pages

Wolverine Manufacturing Case

The company Wolverine Manufacturing produces engine bearings and has a disagreement with its unionized workforce over funding for the hourly employees' retirement plan. The union wants an additional $1.5 million contributed over 20 years. Wolverine will work with the union to establish the retirement fund using bonds from three approved companies. The objective is to determine how much Wolverine needs to invest and which bonds to purchase to meet the union's demand while minimizing costs, according to the labor agreement. Linear programming will be used to solve this case by modeling the feasible regions and constraints in a spreadsheet application.

Uploaded by

Himanshu Kansal
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Executive Summary

Wolverine Manufacturing is a company that produces engine bearings for the automotive
industry. Kelly Jones works as an Financial Analyst for this company. There is a disagreement
between the Wolverine Manufacturing Company and its unionized workforce regarding the
funding of Wolverine retirement plan for its hourly employees. According to the union, the
company has not been contributing enough money to this fund to cover the benefits it will need
to pay the retiring employees. The union wants the company to contribute approximately $1.5
million in additional money to this fund over the next 20 years. So, the company had decided to
work out a new labor agreement with the labor union. The Wolverine CFO and the union s
chief negotiator has agreed that AAA-rated bonds issued by three different companies may be
used to establish this fund (Ragsdale, 2015). The companies are named AC&C, IBN and
MicroHard. All three companies have different provisions for the bonds.
The main objective of this study is to determine how much money the company would have to
invest and which bonds the company should buy in order to meet the labor unions demand. This
must be achieved keeping in mind both the stipulations in the agreement, selecting one of them
for minimizing the money the company has to invest.
In order to solve the Wolverine Retirement Fund case, we will be using Linear Programming.
Since, this case includes many variables, visualizing or graphing the feasible regions can be a
daunting task. Therefore, we will be using different mathematical techniques built into a
spreadsheet package in a way that makes solving this LP problem a fairly simple task. The main
challenge is to formulate the LP problem correctly and implementing the formulation to the
computer application accuraterly.

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