Ok

Five Assumptions

1. Demand rate is constant and known with certainty. 2. No constraints are placed on the size of each lot. 3. The only two relevant costs are the inventory holding cost and the fixed cost per lot for ordering or setup. 4. Decisions for one item can be made independently of decisions for other items. 5. The lead time is constant and known with certainty.

Materials Requirement Planning (MRP)

A computer-based operations management system that uses sales forecasts to make sure that needed parts and materials are available at the right time and place.

Bill of Resources

A record of a service firm's parent-component relationships and all of the materials, equipment time, staff, and other resources associated with them, including usage quantities.

Mixed Strategy

A strategy that considers the full range of supply options

Level Strategy

A strategy that keeps the workforce constant, but varies its utilization via overtime, under time, and vacation planning to match the demand forecast

Which method of forecasting uses contextual knowledge gained through on the job experience?

A. Judgement

Component

An item that goes through one or more operations to be transformed into or become part of one or more parents

Which method of inventory keeps track by performing inventory counts constantly, or on a frequent and regular basis, instead of once per year or once per quarter?

Cycle

Forecasting permits businesses to:

D. All of the Above

Inventory is:

D. All of the above

New Product Development Process

Design, Analysis, Development, Full Launch

The method to ensuring the lowest aggregate inventory cost (holding and ordering costs) is:

EOQ

Chase Strategy

Hiring and laying off workers to match demand forecast over time

Four Types of Forecasting

Judgement, casual, time-series, trend projection using regression

An estimate of time between placing an order and receiving the item is:

Lead Time

Levels in Operations Planning and Scheduling

Level 1: Sales and Operations Planning Level 2: Resource Planning Level 3: Scheduling

Inventory cannot be eliminated, it can only be:

Managed

In order to keep aggregate inventory and costs at a minimum, purchasers should attempt to:

Order as little and as late as possible

In terms of goods sold, what are the three types of inventories?

Raw Materials, Work in Process, Finished Goods

What is Naive forecasting?

The forecast for the next period equals the demand for the current period

ABC Analysis is a process of dividing SKU's into classes, according to their dollar usage, so that managers can focus on items that have the highest dollar value.

True

Using a linear regression helps to prevent making decision based on a false trend.

True

While items are in transit, they are still considered to be part of the shipper's inventory even if the recipient has yet to pay for them.

True

Enterprise Process

a company wide process that cuts across functional areas, business units, geographical regions, and product lines

Parent

a product that is manufactured from one or more components

Cycle inventory

average amount of inventory a business needs to meet customer demand between orders

Measure of Performance

did the product perform

Bullwhip Effect

erratic shifts in orders up and down the supply chain

Periodic Review System

fixed interval reorder system or periodic reorder system

Measure of Effectiveness

how well did the product achieve the desired end state

Anticipation Inventory

inventory used to absorb uneven rates of demand or supply, keeps extra stock on hand

Resource Planning

process that takes sales and operation plans; processes information in the way of time standards, routing, and other information on how services or products are produced; and then plans the input requirements

Pipeline Inventory

products that are in the company's shipping chain that have yet to reach their ultimate destination.

Safety Stock Inventory

surplus inventory that a company holds to protect against uncertainties in demand, lead time, and supply changes

Continuous Review System

system designed to track the remaining inventory of a SKU each time a withdrawal is made to determine whether it is time to reorder

Economic Order Quantity

the lot size that minimizes total annual inventory holding and ordering costs

Dependent Demand

the need for any one item is a direct result of the need for some other item, usually an item of which it is a part

Supply Chain Risk Management

the practice of managing the risk of any factor or event that can materially disrupt a supply chain

Operations Planning and Scheduling

the process of balancing supply with demand

Exponential Soothing

weighted moving average that calculates the average of a time series by implicitly giving recent demands more weight than earlier demands

ABC anaylsis

what type of inventory to keep and how much