Operations Management Test 1

Accounts Payable Cycle Time

Accounts Payable / Average Daily Cost of Sales

Accounts Receivable Days

Accounts Receivable / Average Daily Sales

Cash to Cash Cycle Time

Accounts Receivable Days + Average Days of Inventory - Accounts Payable Cycle Time

Front End of MPC System Framework:

Activities and systems for overall direction setting

Updating an old MPC system can include which of the following? Adding new modules or functionality Consideration of new decision criteria Removing unneeded/obsolete modules or functionality

All of the above

Which of the following is not a key decision when considering enterprise resource planning systems? Business complexity System costs and available resources Requirements of the firm's process

All of the above are key decisions

Average Daily Cost of Sales

Average Daily Sales * (% Cost of Sales)

Ending Inventory

Beginning Inventory - Sales Plan + Planned Production

Master production scheduling and resource planning are a part of which MPC phase?

Detailed planning

The Demand Management Process

Determines how a firm integrates information from customers into the MPC system.

Measurement and control are a part of which MPC phase?

Direction Setting Detailed Planning Execution

Sales and operation planning and demand management are a part of which MPC phase?

Direction setting

Which of the following is typically not a component of enterprise resource planning systems? E-mail management Finance Module Human resource module

E-mail management only

MPC is often a module in an ____________________

ERP System

Planned Production

Ending Inventory Target - Beginning Inventory + Sales Plan

In the MPC process, capacity decisions (equipment, facilities, suppliers, etc.) are most likely to occur in what time horizon?

Engine

Products that are part of a one-time production process (e.g. bridges or aircraft carriers) would most likely use which form of MPC?

Engineer to Order

In which environment is defining the customer order in terms of components ad options the key focus of demand management?

Engineer to order

The term ERP stands for ____________________.

Enterprise Resources Planning

Forecasts

Estimates of what might occur in the marketplace

Shop-floor systems are part of which MPC phase?

Execution

(T / F) Enterprise resource planning (ERP) systems coordinate multiple databases used to gather and maintain the firm's essential data.

False

Which of the following supply chain metrics is most useful for measuring customer satisfaction in a make to stock system? Fill rate by line item Order fulfillment lead time Inventory days of supply Asset turns

Fill rate by line item

In a make to stock environment, the most likely point where customer order decoupling would take place is....

Finished goods

Products that are part of a continuous production process would most likely use which form of MPC?

Flow

Demand management includes which of the following activities? Forecasting Product shipping Entering customer orders

Forecasting and entering customer orders

In the MPC process, detailed scheduling decisions are most likely to occur in what time horizon?

Front End

Master Production Scheduling (MPS) and Resource Planning are a part of which MPC phase?

Front End

MPC FLow Classification Schema:

continuous production - chemical plants, food, etc.

Demand Management Functions

- information gathering - communicating with customers - identifying all sources of demand

CPFR Steps

1. Review pas performance, assess reasons for differences between plan and actual 2. Create a collaborative forecast 3. Review specific plan for meeting expected demand 4. Commit to the order forecast and supply plan and agree on how exceptions will be handled

For a firm with average daily sales (Sd) of $200,000, current inventory (I) of $1,000,000, and cost of sales (CS) of 50%, what is the average days of inventory (Id)?

10 Days (I / Cd)

Independent Demand

Customer demand that is not directly influenced by the actions of the firm

MPC environment is defined by ____________________________________.

Customer order decoupling point (Alternatively, order penetration point)

Under make to stock, which of the following are examples of independent demand? Customer orders Shipping samples to the sales team Use of raw materials in production

Customer orders Shipping samples to the sales team

To support data analysis without burdening the operational enterprise resource planning system, many firms employ which of the following?

Data warehouse

Key Areas of Influence on MPC System Design

Degree of Supply Chain Integration Customer roles and expectations Needs of management

Demand Management Activities Include:

Demand determination Converting customer orders into delivery promises Balancing supply with demand

Dependent Demand

Demand that is driven by the plans and activities of the firm

Average Days of Inventory

Inventory / Average Daily Cost of Sales

Which of the following supply chain metrics is most useful for measuring the firm's management of inventory levels? Fill rate by line item Order fulfillment lead time Inventory days of supply Asset turns

Inventory days of supply

In the MPC process, capacity decisions (equipment, facilities, suppliers, etc.) are most likely to occur in which time horizon?

Long

Back End of MPC System Framework:

MPC execution systems

Which of the following supply chain metrics is most useful for measuring customer satisfaction in a make to order system? Fill rate by line item Order fulfillment lead time Inventory days of supply Asset turns

Order fulfillment lead time

Demand management is the firm's connection to which of the following entities? Suppliers Employees Marketplace Sales and operations planning

Marketplace

Manufacturing planning and control includes which of the following activities? Material Management Product Marketing Coordinating Suppliers

Material Management Coordinating Suppliers

Purchasing, vendor evaluation, and invoice management are typically covered in which module of an enterprise resource planning system?

Materials management

Overall Market Data

Needed for sales and operations planning

Average Daily Sales

Net Revenue / Number of Sales

The MPC Systems trend is towards ____________

On-line data access and systems, replacing inventory with speedier information exchange

Which of the following are aspects of enterprise resource planning systems? Multifunctional - able to provide data concerning many parts of the firm Modular - able to combine selected components into a single system Independent - each functional area has its own system and data and maintains control of that system and data

Only modular and independent

Key Point of Short Term Support Activities

People working on the right things

Number of Employees

Planned Production / (Employee Productivity x Working Days)

Capacity leveling, material requirements planning, and bill of materials processing are typically covered in which module of an enterprise resource planning system?

Production planning and control

Products that are part of a one-time production process would most likely use which form of MPC?

Project

Ending Inventory Target

Sales Plan / Working Days x Target Days

Which of the following MPC components is primarily responsible for coordinating the planning efforts of marketing, finance, operations, and human resources?

Sales and operations planning

Sources of demand that are part of demand management include all of the following except Customer orders Service parts Scrap products Promotional inventory

Scrap products

In the MPC process, detailed scheduling decisions are most likely to occur in which time horizon?

Short

Plans

Specify how the firm will respond to these forecasts

In an engineer to order environment, the most likely point where customer order decoupling would take place is...

Suppliers

Enterprise resource planning systems perform which of the following tasks? Support decisions Make decisions Evaluate decisions

Support decisions

Engine MPC System Framework:

Systems for detailed material and capacity planning

Which of the following actions would be likely to increase the cash-to-cycle time for a firm? •Increasing the cost, but not the price, of the product •Taking advantage of "early pay" discounts with suppliers •Revaluing inventory to reflect reductions in purchasing prices

Taking advantage of early pay discounts with suppliers

The customer order decoupling point is best defined as...

The point in the supply chain where demand changes from dependent to independent

Customer Order Decoupling Point

The point where demand changes from independent to dependent

The "functional silo" problem refers to

The tendency for decisions to be made without considering

Detailed Product Mix

Used for master production scheduling and customer order promising

Under make to stock, which of the following are examples of dependent demand? Customer orders Unfinished goods stock to build preloaded store displays Raw material usage

Using goods stock to build preloaded store displays and raw material usage

In an assemble to order environment, the most likely point where customer order decoupling would take place is...

Work in process parts and components

MPC Repetitive Classification Schema

longer production cycles - automobiles

MPC MRP Classification Schema

management of complicated parts product - airplanes

Manufacturing Planning and Control System (MPC)

provides information and support, which enables managers to efficiently direct the flow of material, manage the utilization of people and equipment, and respond to customer requirements by utilizing the capacity of suppliers, internal facilities, and, in some cases, customers.

The fundamental issue issue is matching supply and demand in terms of both _______________________.

volume and product mix

MPC Just-In-Time Classification Schema

shorter production cycles - TVs, personal computers

Project Classification Schema

unique, long duration - ships