Op Management Final

Silo Mentality

failing to see the big picture, and acting only in regard to a single department within the firm, or single firm within the supply chain

bullwhip effect

occurs when distorted product-demand information ripples from one partner to the next throughout the supply chain

Lean thinking

operating philosophy

Inventory cost reduction results in

profit increase, but only if stockout costs are avoided

Types of inventories

raw materials, work-in-process, and finished goods

Service Level

the percentage of time the firm wants to be in stock

Logistics

the process of planning, implementing, and controlling the efficient, effective flow and storage of goods, services, and related information from point of origin to point of consumption for the purpose of conforming to customer requirements

Order lead time

the time from order receipt to arrival of the order

Lean layouts tend to...

use more visibility than traditional layouts

What percentage of Fortune 500 companies use Six Sigma?

50%

Customer lifetime value value is used to segment customer based upon their:

Both current and future profitability

Managing customer flows effectively leads to

Both enhanced customer satisfaction and firm competetiveness

Strategic fit requires the alignment of product design with:

Both external and internal fit

Which of the following is the most likely result of a process that limits the output of a system?

Bottleneck

Cross-functional teams would be associated with which of Deming's 14 Points for Management?

Break down barriers between departments

A tool used to determine the frequencies of specific problems is referred to as what?

Check Sheet

A new development in the product development and commercialization process is to design new products concurrently or sequentially?

Concurrently

A firm makes what type of plans to accommodate unforeseen changes and forecast errors?

Contingency

A bank emailing monthly statements to a customer would be an example of which type of information flow?

Corporate

Core competencies are primarily used to:

Create competitive advantage

Which of the following is most likely an example of a job shop?

Custom furniture manufacturer

Focus of lean thinking in the services sector

Customer needs

CRM refers to which concept?

Customer relationship management

An airline that divides its customers into VIP, Preferred, and Regular customer sets is practicing what principle?

Customer segmentation

Demand patterns that occur every several years and are influenced by macroeconomic and political factors

Cyclical

T or F: The primary benefit for companies to engage in global sourcing is to procure better quality products.

False

T/f: Differential pricing is viewed as intrinsically fair by customers

False

T/f: Forecast quality is likely to only impact inventory levels of finished goods, raw materials, and components

False

T/f: In CPFR, trading patterns should exercise caution and be reluctant to share information

False

T/f: Integrating lean into the culture of an organization causes unnecessary confusion and lean should be left to the production areas

False

T/f: Lean and sustainability are two concepts that do not go together well

False

T/f: Quantitative forecasts are based on opinions and intuition

False

T/f: Using customers as servers is referred to as yield management

False

T/f: a box of cereal on a grocery store shelf is an example of a work-in-process

False

T/f: the bullwhip effect is used in the meat packing industry to differentiate between beef and pork

False

True/ false: lean systems are largely static and unchanging

False

Supply chain flexibility is _____ than/ as in the past.

Greater

Negative consequences resulting from holding substantial amounts of finished goods for delivery any time that a customer demand is experienced

High carrying costs

Make-to-Stock processes are characterized by all of the following except:

High degree of customization available

An assembly line is characterized by which of the following?

High volume, limited flexibility

For products with similar investments, managers usually will choose to invest in the product with the _________ IRR?

Highest

An organization's strategy is not primarily designed to consider which of the following?

How the organization makes decisions on a day-to-day basis.

The use of too much service capacity can result in...

Idle servers and high labor costs

Six Sigma focuses on?

Improving quality

Successfully implementing lean can potentially result in

Increased productivity, reduced inventory levels, increased customer satisfaction

Holding too little inventory does what to the risk of a stockout?

Increases

Spend Categories

Internal assessment of purchases, the purchases are commonly divided into these categories

Which process is best suited for a company offering customtized products?

Job Shop

A signigicant roadblock to the implementation of lean practices in an organization can be the lack of a?

Lean culture

The reduction of waste, along with continuous improvement, and the synchronization of material flow within the organization and between supply chain trading partners are characteristics of which operations management development.

Lean thinking

A batch process requires ________ flexibility versus a job shop.

Less

The use of too little service capacity can result in...

Long customer wait times and lost sales

A process via which a specialty product is made based upon customer specifications would most likely be a __________ process.

Make-to-Order

Which of the following is not a basic operations management activity?

Marketing

What does MRP stand for?

Material requirements planning

In Six Sigma, what is the abbreviation of opportunities for a defect to occur

OFD

The administrative costs associated with purchasing items

Order cost

Production on a limited basis to determine if production equipment can reliably manufacturer the product at full scale is referred to as:

Pilot manufacturing

A diagram showing the sequence of steps involved in a process is a:

Process flowchart

The process of making decisions about the characteristics, features, and performance of a company's goods and services refers to?

Product design

Poor forecasting and production planning can negatively impact all of the following *except*: Customer relationships, product reliability, sales, profitability

Product reliability

Lean systems a.k.a

Pull system

The actual cost of items bought from a supplier

Purchase cost

A firm launching a new product for which historical data does not exist would likely use which type of forecasting technique?

Qualitative

Formal Request for Pricing, Services and Plans

RFP

Unexpected events that may lead to demand

Random variation

What type of inventory is wheat and other ingredients used to make bread considered?

Raw material

Potential benefits of better forecasting

Reduced stockouts, smoother production plans, and reduced costs

The simple moving forecasting technique is...

Relatively easy to use

Example of process automation

Self-service checkouts

Quality philosophy that drives a firm to lower prices, higher quality, and fast responses

Six Sigma

Carrying too little inventory can lead to

Stockouts, plant shut downs, and dissatisfied customers

In a typical supply chain, goods flow in which of the following manners?

Supplier - Manufacturer - Distributor - Retailer - Consumer

Purchase Spend

The amount of money that a firm spends on goods and services

"Managing the relationships among people within an organization and between customers and the company's customer service reps in order to improve the bottom line" is the definition of which concept?

The customer relationship process

Which of the following definitions is most closely associated with "operations management"?

The effective planning, organizing, and controlling of the value-creating activities of the firm

T or F: ISO 9000 is the standard most often associated with quality management

True

T or F: TCO (total cost of ownership) is a relatively common approach used to compare competing price quotes

True

T/f: A multiple server "snake line" style queuing system is more efficient than a system with separate queue lines

True

T/f: Anticipation inventories allows demand to be met during periods of expected high demands

True

T/f: Capacity sharing refers to finding uses for underutilized capactiy

True

T/f: Customer employee interaction takes place at customer contact points

True

T/f: Cycle inventories are created when a firm purchases or produces a quantity large enough to last until the next purchase or production period

True

T/f: Demand management is broadly defined as the process that balances customer requirements with supply chain capabilities

True

T/f: Economic order quantity (EOC) derives the order cost that will minimize the sum of the annual inventory holding cost and annual order cost

True

T/f: Field personnel might be able to generate good forecasts because they are close to their customers and markets

True

T/f: Independent demand refers to the external demand for a firm's finished products

True

T/f: Kanbans are used to control the flow of inventory through the facility

True

T/f: Many lean efforts begin with the implementation of the Five S's

True

T/f: Part-time employees offer companies greater capacity flexibility

True

T/f: SMED stands for single-minute exchange of die

True

T/f: The jury of executive opinion approach is beneficial because of the collective knowledge of the executives

True

T/f: The line of visibility separates a customer contact point from points where customer contact does not take place

True

T/f: When developing a sales forecast, sales force personnel might be inclined to submit lower sales forecasts in order to achieve sales targets and receive greater bonuses

True

T/f:Inventory that is used to satisfy unforeseen demand is referred to as safety stock

True

True or False: One objective of supply chain management is to maintain an uninterrupted glow of goods and services to the organization at desired customer service levels

True

True/ false: the elimination of non-value adding activity is the key focus of lean waste reduction

True

True/False: A batch process is found in organizations where moderate customization and higher volume are required by customers

True

True/False: A process is a method for getting work done.

True

True/False: An organization's strategic plan addresses the organization intends to achieve its mission.

True

True/False: Another name for environmental product impacts known as life cycle assessments is cradle-to-grave analysis.

True

True/False: Business Process Reengineering is the fundamental rethinking and redesign of a process to achieve dramatic improvements in efficiency and effectiveness.

True

True/False: Customer Relationship Management (CRM) is managing the firm's customer base so they remain satisfied and continue to purchase goods and services.

True

True/False: Customer segmentation refers to a firm grouping its customers within its customer database.

True

True/False: Firms compete using three competitive directions: cost, quality, and customer service.

True

True/False: In many industries, more than 40% of revenues are generated from products introduced during the previous year.

True

True/False: Mass customization processes is a hybrid process, combining several aspects of the job process and the assembly line process

True

True/False: Operations strategies are a set of decisions with the operations function to support the mission and strategy of the frim.

True

True/False: Production processes are matched to the product by considering the desired production volume and the variety of goods/services that customer desire.

True

True/False: Quality Function Development (QFD) begins with identifying, listening to, and surveying customers.

True

True/False: Supply Chain Management is the integration of key business processes concerning the flow of materials from raw material suppliers to the final customer.

True

Kanban

Used to signal a need for items from an upstream manufacturing cell

Pricing policies/ promotions

Utilizing pricing changes to alter demand

Strategic-alliance-based approach to controlling inventory and reducing costs

VMI

Costs that would contribute to inventory carrying cost

Warehouse rent, Shrinkage costs, and Handling costs

Lean systems

Waste elimination

What type of inventory is bread being baked?

Work-in-process

Five-S

a common approach to waste reduction

Kaizen

A Japanese term for continuous improvement

Example of Employee scheduling

A restaurant using more servers on busy evenings

Example of a customer contact point

A ticket window at a theater

Meeting forecasted demand while minimizing costs and maximizing customer service over a series of planning periods

Aggregate Planning

5 modes of transportation

Air, Rail, Truck, Water, Pipeline Carriers

Employee cross-training

Allowing employees to seamlessly move from an idle process to a busy process

Example of yield/ revenue management

An airline that overbooks seats on its aircraft

Dell's computer production process is most closely associated with which type of process?

Assemble-to-Order

All of the following are leading to shortened product life cycles except?

Decreased competition

Lean thinking with a firm's suppliers involves

Delivery of smaller quantities, more frequent deliveries, and delivery to point of use

A quantitative forecasting technique that relies on group convergence

Delphi method

Forecasted demand and customer requirements with supply chain capabilities are part of this supply chain process.

Demand management

Queuing analysis can likely be used to do...

Determine customer waiting times, determine the number of customers waiting in queue, and assist in capacity decisions

Lean Warehousing

Eliminate non-value-added steps and waste in storage process

What does ERP stand for?

Enterprise resource planning

A customer paying a bill through a bank's online systems would be an example of which type of information flow?

Environmental

Most accurately describes the concept of forecasting

Estimate future demand

Waste

Excess inventories, scrap losses, rejects, and rework

Over-forecasting likely leads to

Excessive hiring

Capacity sharing

The matching of service capacity to customer demand to minimize customer waiting

Work flow

The movement or transfer of work from the customer through the organization

Risk Pooling

The relationship between the number of warehouses, system inventories and customer service

Business process integration refers to which of the following?

The sharing and coordination of key processes between companies in a supply chain.

Yield/ revenue management

The use of overbooking, allocating capacity among customer segments, and differential pricing

A philosophy that suggests that a system is only as good as its weakest part is the:

Theory of Constraints

What is the x-axis on a Ghatt Chart?

Time

A philosophy that encompasses a collection of processes that seek to improve quality continuously to please customers, reduce costs, and ultimately create a competitive advantage for the firm is referred to as:

Total Quality Management (TQM)

What type of inventory function is oil that is on an oil tanker that is in transit to a customer?

Transportation

Successfully managing inventories can positively impacts

customer service, competitiveness, and cost