isds 3115

Prior to embarking on supply chain design, operations managers must first consider

"Make-or-buy" and outsourcing decisions

An employee produces 15 parts during a shift in which he made $90. What is the labor content of the product?

$6

In the office relationship chart, which rating reflects the highest importance for two departments' closeness to each others?

A

A system that triggers ordering on a uniform time bases is called:

A fixed-period system

Which of the following is NOT a type of "waiting cost"

Answer: Adding an additional server True: -A customer leaving a line because it was too long -A customer not returning because the line was too long -Idle employees awaiting machine repaires

A response strategy requires suppliers be selected based primarily on:

Capacity, Speed, and flexibility

Which of the following could reduce distribution risk?

Careful selection, monitoring, and effective contrasts with penalties.

Which of the following organizations used its geographic information system to create a demographic profile of what a typically successful neighborhood for its location looks like- mostly in terms of income and ages?

Carvel Ice Cream

Which of the following aggregate planning strategies is a capacity option?

Changing inventory levels

Concerning relationships with suppliers, which of the following combinations is critical to the success of JIT?

Close relationships with trust

What provides feedback to the capacity plan, master production schedule, and production plan so planning can be kept valid at all times?

Close-loop MRP system

What is a supply chain designed to optimize both forward and reverse flows?

Closed-loop supply chain

What is a successful technique used by companies such as Ingall Ship Building Corporation to avoid some of the difficult problems producing items in fixed-position layouts?

Complete as much of the project as possible offsite

Which of the following is an example of a finite arrival population?

Copy machines in a copying shop that break down

when making a location decision at the region/community level, which of these would be considered?

Cost and availability of utilities

The cost to produce the goods or services sold for a given period is referred to as:

Cost of goods sold

What are the two most important cost considerations in queuing problems>

Cost of providing service and cost of waiting time

Which of the following reduces product handling, inventory, and facility costs, but requires both (1) tight and (2) accurate inbound product information?

Cross-docking

Which of the following statements is true regarding cross-sourcing?

Cross-sourcing uses one supplier for a component and a second supplier for another component, where each supplier acts as a backup for the other.

JIT has an internal focus while lean production begins with an external focus on:

Customers

What process uses warehousing to add value to a product through component modification, repair, labeling, and packaging?

Customizing

A bank office with 5 tellers, each with a separate line of customers, exhibits the characteristics of a multiphase queuing system.

False

A focused work center is well suited to the production of a large family of products requiring similar processing, even if their demands are not very stable.

False

Product-oriented layouts tend to have high levels of work-in-process inventories

False

The study of waiting lines calculates the cost of providing good service but does not value the cost of customers' waiting time.

False

The supply chain management opportunity called postponement involves delaying deliveries to avoid accumulation of inventory at the customers site.

False

When the assumptions of the M/M/1, M/M/S, M/D/1, and limited-population queuing models do not hold true, there are NO other approaches available to us

False

Which organization has developed principles and standards to be used as guidelines for ethical behavior?

Institute for Supply Management

What is the act of breaking up an order and running part of it ahead of schedule?

Lot splitting

Which of the following is characteristic of lean operations?

Low space requirements

Which negotiation strategy bases price on a published, auction, or index price?

Market-based price model

In process-oriented and fixed-position layouts, it is important to minimize the cost of:

Material handling

The main objective of retail layout is to:

Maximize profitability per square foot of floor space

The main goal of retail layout it:

Maximizing profitability per square foot of floor space.

The objective of aggregate planning is usually to:

Meet forecast demand while minimizing cost over the planning period.

Where is the "superhub" for FedEx located?

Memphis, Tennessee

The transportation model, when applied to location analysis:

Minimizes total production and transportation costs

The objective of aggregate planning is to meet demand while ______ over the planning period.

Minimizing cost

Which statement is characteristic of mixed strategy for aggregate planning?

Mixed plans seek a minimum cost via a combination of eight planning options.

Policies based on ABC analysis might include investing:

More in supplier development for A items

A concert hall, employing both ticket takers and ushers to seat patrons, behaves typically as which one the following?

Multi-server, multiphase system

Most bank teller services are operated with what kind of system?

Multiple-server, single-phase

An airline ticket counter, with several agents for one line of customers, is an example of which of the following?

Multiple-server, single-phase system

Why is Northern Mexico used as a cluster for electronics firms?

NAFTA

Which distribution most frequently describes the service time in queuing theory?

Negative exponential

The advantage of having many potential suppliers is their willingness to:

Offer lower prices in the short term

Because problems with fixed-position layouts are so difficult to solve well onsite, operations managers:

Often complete as much of the project as possible offsite

What sends a lot to two different machines for the same operation?

Operations splitting

What is transferring a firm's activities that have traditionally been internal to external suppliers?

Outsourcing

What is a lot-sizing technique that orders the quantity needed during a predetermined time between orders?

POQ

Which of the following tools means tracing upward in the BOM from the component to the parent item?

Pegging

Three common measures of supply chain performance are:

Percentage invested in inventory, inventory turnover, and weeks of supply.

Which of the following industries has the highest supply chain cost as a percentage of sales?

Petroleum

Which distribution most frequently describes the arrival rate in queuing theory?

Poisson

Governmental attitudes toward issues such as private property, intellectual property, zoning, pollution, and employment stability may change over time. What is the term associated with this phenomenon?

Political risk

Hewlett-Packard withholds customization of its laser printers as long as possible.

Postponement

What is the practice of keeping a product generic as long as possible before customization?

Postponement

With regard to the cost-based price model negotiation strategy, which of the following is true?

Prices are based upon supplier costs

Which of the following statements regarding a pull system is TRUE?

Problems become more obvious.

Which of the following approaches is also called a "job shop"?

Process-oriented layout

A bill of materials for a menu item in a restaurant is also called a:

Product specification

In MRP, the number of units projected to be available at the beginning of each time period refers to:

Projected on hand

Workspace can inspire informal and productive encounters if it balances three physical and social aspects:

Proximity, privacy, and permission

Which of the following is generally found in most lean environments?

Pull Systems

What is a concept that results in material being produced only when requested and moved to where it is needed just as it is needed?

Pull system

Which of the following mitigation tactics could reduce economic risk?

Purchasing contracts that address price fluctuations

Industries traditionally associated with revenue management operate in which quadrant of the Revenue Management Matrix?

Quadrant 2: Price tends to be variable; use tends to be predictable.

What is another name for a waiting line?

Queue

The body of knowledge about waiting lines is called:

Queuing theory

Three criteria for designing distribution networks to meet customer expectations are:

Rapid response, product choice, and service

Which of the following types of inventory describes inventory that has been purchased but not processed?

Raw material inventory

Work cells typically have:

Reduced investment in machinery and equipment

Which one of the following is a characteristic of a JIT partnership?

Removal of incoming inspection

A location decision for a tradition department store (e.g., Macy's) would tend to have what type of focus?

Revenue focus

Yield management is of interest to organizations having the characteristic of:

Segmentable demand

Which of the following terms describes the physical surroundings in which a service takes place, and how they affect customers and employees?

Servicescape

What is the cost to prepare a machine or process for production?

Setup cost

Job assignments are a focused issue in which of the following?

Short-range plans

Aggregate planning is concerned with determining the quantity and timing of production in the:

Short-term

Which one of the following is NOT a characteristic of a Model B or M/M/S system?

Single server

A McDonald's single-lane drive- through that has one window for making the payment and a second window for receiving the food behaves most like which of the following?

Single- server, multiphase system

What is a system for ordering items that have little or no value at the end of a sales period?

Single-period inventory model

The objective of inventory management is to:

Strike a balance between inventory investment and customer service

Dependence on an external source of supply is found in which of the following aggregate planning strategies?

Subcontracting

In the service sector, which of the following aggregate planning strategies might direct your client to a competitor?

Subcontracting

Which of the following aggregate planning options is NOT associated with manipulation of product or service demand?

Subcontracting

Which of the following is the first stage of supplier selection?

Supplier evaluation

A copy center has five machines that serve many customers throughout the day. The waiting-line system for copy service has an infinite population, while the waiting-line system for copier maintenance has a finite population.

TRUE

Which one of the following statements is TRUE about the kanban system?

The customer workstation signals to the supplier workstation when production is needed.

What is the major difference in focus between a location decision in the service sector vs. the manufacturing sector?

The focus in service is on revenue maximization, while the focus in manufacturing is on cost minimization.

What makes aggregate planning particularly complex in the airline industry?

The large number of dependent sites

A grocery store is attempting to implement a kanban system. Which of the following would not be an application of kanban?

The meat department stocking up on turkeys before Thanksgiving.

Which of the following is a requirement to be able to compute expected monetary value?

The probability of each state of nature is known

Which of the following statements is TRUE about the MRP plan when using lot-for-lot ordering?

The quantity of gross requirements for a child item is equal to the quantity of planned order release(s) multiplied by the number of child items used in the parent assembly.

ABC analysis is based upon the principle that:

There are usually a few critical items, and many items that are less critical

An example of an intangible cost, as it relates to location decisions, is the quality of education.

True

Design capacity is the theoretical maximum output of a system in a given period under ideal conditions

True

Expected output is sometimes referred to as rated capacity

True

In the analysis of queuing models, the Poisson distribution often describes arrival rates, while service times are often described by the negative exponential distribution.

True

One drawback of a product-oriented layout is that works stoppage at any one point ties up the whole operation.

True

One guideline for determining the arrangement and space allocation of a retail store is to place high-impulse and high-margin items in prominent locations

True

One reason for a firm locating near its competitors is the presence of a major resource it needs

True

Outsourcing is a form of specialization that allows the outsourcing firm to focus on its key to success factors.

True

Price changes are useful for matching the level of demand to the capacity of a facility

True

Service firms choose locations based, in part, on the revenue potential of a site

True

The most common tactic to arrange departments in a process-oriented layout is to minimize material handling costs

True

Unfavorable exchange rates can offset other savings in a location decision.

True

The bullwhip effect:

True: -Occurs because of distortions in information in the supply chain - occurs at orders are relayed from retailers to distributors to wholesalers to manufacturers -Increases the costs associated with inventory in the supply chain -results in increasing fluctuations at each of the step of the sequence

Which of the following is an element of inventory holding costs?

True: -housing costs -investment costs -material handling costs -pilferage, scrap, ad obsolecence

To provide better access and possibly reduce the number of workers needed, work cells may be designed in the shape of what letter of the alphabet?

U

If there is any distinction between JIT, TPS, and lean operations, it is that lean operations emphasize:

Understanding the customer

Which of these aggregate planning strategies is a capacity option?

Using part-time workers

A goods-producing location decision would likely emphasize the importance of which of the following?

Utility and labor costs

Which one of the following is not a benefit of JIT implementation?

Variability increase

What is developing the ability to produce goods or services previously purchased or actually buying a supplier or a distributor?

Vertical integration

Which of the following lot-sizing techniques is likely to prove the most complex to use?

Wagner-Whitin

"A special arrangement of machinery and equipment to focus on production of a single product or group of related product" describes what layout type?

Work cell

Which of the following arranges machinery and equipment to focus on production of a single product or group of related products?

Work-cell layout

Which value in an office relationship chart represents "Not desirable?"

X

What is an alternative name for revenue management?

Yield management

Which of these factors would be considered when making a location decision at the site level?

Zoning Regulations

Virtually every restaurant deals with its suppliers on:

a JIT basis

What directly results from disaggregation of an aggregate plan?

a master production schedule

Manufacturing cycle time is best defined as the:

time from raw materials receipt to finished product exit

When making a location decision at the country level, which of these would be considered?

Location of markets

Capacity decisions are most critical to which of the following?

Long-range plans

What is a long-term purchase commitment to a supplier for items that are to be delivered against short-term releases to ship?

-Blanket order

Supply chain managers outsource logistics to meet three goals:

1. Drive down inventory investment 2. Lower delivery costs 3. Improve delivery reliability and speed

A work system has five stations that have process times of 5, 9, 4, 9, and 8. What is the throughput time of the system?

35

A work system has five stations that have process times of 5, 9, 4, 9, and 8. What is the bottleneck time?

9

Which of the following statements is NOT true about a fixed-period system?

A fixed-period system is also called "continuous review" True: -The advantage of the fixed-period system is that there is no physical count of inventory items after an item is withdrawn. -A fixed-period system is appropriate when vendors make routine visits to customers to take fresh orders or when purchasers want to combine orders to save ordering and transportation costs -the disadvantage of the fixed-period system is that because there is no tally of inventory during the review period, there is the possibility of a stockout during this time.

A system that keeps track of each withdrawal or addition to inventory continuously is:

A perpetual inventory system

Which of the following statements about aggregate planning is TRUE?

A pure chase strategy allows lower inventories when compared to a pure level scheduling.

A supply chain ends with:

A satisfied customer

Which of the following best describes a gross material requirements plan?

A schedule that shows total demand for an item, and when it must be ordered from a supplier or when production must be started.

A system in which the customer receives service from only one station and then exits the system is which of the following?

A single-phase system

Which of the following is NOT a goal of JIT partnerships?

A. Removal of unnecessary activities B. Removal of in-transit inventory C. Obtain improved quality and reliability D. Removal of in-plan inventory E. ALL OF THE ABOVE ARE GOALS OF JIT PARTNERSHIPS

What is a report showing the resource requirements in a work center for all work currently assigned there as well as all planned and expected orders?

Load report

Of the four approaches to capacity expansion, the approach that "straddles" demand:

A. Uses incremental expansion B. Works best when demand is not growing but is stable C. At some times leads demand, and at other times lags D. Uses one-step expansion E. Choices A and C are both correct

The "A" on an office relationship chart means:

Absolutely necessary

A fixed-position layout:

Addresses the layout requirements of large, bulky, projects such as ships and buildings.

Which of the following occurs first within a production planning system?

Aggregate planning

The book Aerotropolis describes cities that develop around which of the following?

Airports

Revenue (or yield) management is best described as:

Allocation of scarce resources to customers at prices that will maximize revenue.

ABC analysis divides an organization's on-hand inventory into three classes based upon:

Annual dollar volume

Which of the following statements is NOT true?

Answer: A closed-loop supply chain is a designed to only reverse flows True: -A closed-loop supply chain prepares for returns prior to product introduction -"Closed-loop supply chain" is sometimes used as a synonym for "reverse logistics" -Reverse logistics involves the processes of sending returned products back up the supply chain for resale, repair, reuse, remanufacture, recycling, or disposal

Which of the following is NOT one of the features that an S&OP process needs to generate a useful aggregate plan?

Answer: A forecast of demand for a reasonable long-term planning period in aggregate terms. True: A. a model that combines forecasts and costs B. a method to determine the relevant costs C. A logical unit for measuring sales and output

The requirements of work cells do NOT include

Answer: A high level of training and a low level of flexibility True: -Being self-contained, with its own equipment and resources -Testing at each station in the cell -Identification of families of products

Which of the following would NOT be produced or offered using a fixed-position layout?

Answer: A hospital emergency room True: -A ship -A highway -A hospital operating room

Which of the following statements is NOT true regarding aggregate plans?

Answer: Aggregate plans use information regarding individual products rather than product lines. True: A. An aggregate plan is the output of S&OP B. For service organizations, an aggregate schedule ties strategic goals to workforce schedules C. An aggregate plan often examines a 3- to 18-month time horizon

Which of the following mitigation tactics is NOT designed to reduce the risk of information loss or distortion?

Answer: Alternate sourcing True: -Secure IT systems -Redundant databases -Training supply chain partners on the proper interpretations and use of information

Which of the following statements is NOT true?

Answer: An increased sales effort may help a firm reach its profit goals more easily than would effective cost cutting.

Which of the following is NOT one of the tasks of random stocking systems?

Answer: Assigning certain items or classes of items to particular warehouse areas so that the total distance traveled within the warehouse is maximized. True: -Maintaining accurate records of existing inventory and its locations -Maintaining a list of "open" locations - Sequencing items to minimize the travel time required to "pick" orders.

Which of the following is NOT a capacity option of aggregate planning?

Answer: Back ordering during high-demand periods True: A. Varying production rates through overtime or idle time B. Subcontracting C. Changing inventory levels

Which of the following statements is NOT true regarding channel assembly?

Answer: Channel assembly sends individual components, modules, and finished products, to the distributor. True: -Channel assembly represents one way to implement postponement -Channel assembly postpones final assembly of a product so the distribution channel can assemble it -Channel assembly treats distributors more as manufacturing partners than as distributors

Which of the following would likely result in a LEAST amount of inventory?

Answer: Chase strategy Likely: A. Mixed strategy B. Inventory levels are unaffected by the aggregate plan C. Level strategy

Which of the following statements regarding "proximity" in the location decision is FALSE?

Answer: Clustering among fast food chains occurs because they need to be near their labor supply True: -Service organizations find that proximity to market is the most critical primary location factor -Perishability of raw materials is a good reason for manufacturers to locate near the supplier, not the customer -Reduction in bulk is a good reason for a manufacturer to locate near the supplier

Which of the following activities does NOT need to be virtually eliminated for a lean organization?

Answer: Cross-training True: -Inventory -Material handling -Inspection

Which of the following statements about DRP is NOT true?

Answer: DRP pushes inventory through the system True: A. DRP stands for "distribution resource planning" B. DRP procedures and logic are analogous to MRP C. Lead times are considered in DRP

Which of the following statements is NOT generally an implication stemming from an increase in the number of facilities?

Answer: Decreased total logistics cost True: -Quicker response -Increased facility costs -Increased customer satifaction

In service business with highly variable demand, the general approach to aggregate scheduling does NOT involve:

Answer: Depleting inventory during slack periods. Does involve: A. Using labor to accommodate most of the changes in demand B. Depleting inventory during peak periods C. Building very modest levels of inventory during slack periods

Which of the following statements is NOt true regarding ERP?

Answer: ERP promises slow, but accurate, information. True: A. The objective of an ERP system is to coordinate a firm's whole business B. ERP usually provides financial and human resource management information C. ERP allows companies to share a common database and business practices throughout the enterprise.

Which of the following is NOT of Taiichi Ohno's seven wastes?

Answer: Energy True: A. Queues B. Transportation C. Motion

which of the following is not a characteristic of Model C or M/D/1 system?

Answer: Exponential service time pattern True: -Single server -Single phase -Poison arrival rate pattern -Unlimited population size

Which of the following statements is NOT true?

Answer: Finding the optimal number of facilities represents a critical and static decision True: -An effective supplier management program and an effective distribution management program may make the difference between supply chain success and failure -Top-notch supply chain performance requires good downstream management, just as it does good upstream management -Packaging and logistics are important distribution decisions, because the manufacturer is usually held responsible for breakages and serviceability

Successful techniques to control the cost of labor in service firms do NOT include

Answer: Flexibility in rate of output or hours of work to meet changing supply. Do Include: A. Flexibility of individual worker skills that permits reallocation of available labor. B. An on-call labor resource that can be added or deleted to meet unexpected demand. C. Accurate scheduling of labor-hours to assure quick response to customer demand.

Which of the following statements is NOT true?

Answer: For any product, some components of that product are independent demand items True: A. Less inventory frees up capital and floor space for other uses B. For any product for which a schedule can be established, dependent techniques should be used C. Demand for items is dependent when the relationship between the items can be determined.

A single-period inventory model is NOT applicable for:

Answer: Furniture True: -Seasonal goods -Milk -Newspapers

Which of the following statements is NOT one of the response strategy decisions?

Answer: Gather and communicate market research data True: -Use buffer sticks to ensure speedy supply -fast transportation -low setup time

Globalization of the location decision is the result of all EXCEPT which of the following?

Answer: Higher quality of labor overseas True: -Market economics -High differences in labor costs -Ease of capital flow between countries -More rapid, reliable travel and shipping

Which of the following is NOT one of the principles for standard work practice at Toyota?

Answer: Improvements in the system must be made in accordance with the "scientific method," at the highest possible level in the organization. True: -Work is completely specified as to content, sequence, timing and outcome -Internal and external customer-supplier connections are direct, specifying personnel, methods, timing and quantity. -Product and service flows are to be simple and direct.

Which of the following attributes is NOT for lean operations?

Answer: Increase space requirements True: -Use JIT techniques to eliminate virtually all inventory -Develop partnerships with suppliers -Build systems that help employees produce a perfect product every time.

Which of the following is NOT one of the benefits accrued from a centralized purchasing function?

Answer: Increase the duplication of tasks True: -Maintain professional control over the purchasing process -Leverage purchase volume for better pricing -Devote more resources to the supplier selection and negotiation process

Which of the following is NOT one of the benefits in MRP?

Answer: Increased inventory levels Benefits: A. Better response to customer orders as the result of improved adherence to schedules B. Improved utilization of facilities and labor C. Faster response to market changes

Which of the following is NOT a feature of Toyota's new Japanese plant?

Answer: Instead of perching car chassis on raised platforms, they dangle from overhead conveyors. True: -The assembly line uses quiet friction rollers with fewer moving parts, requiring less maintenance than conventional lines and reducing worker fatigue. -Retooling permits faster changeovers, allowing for shorter product runs of components, supporting level scheduling. -The assembly line has cars sitting side-by-side, rather than bumper-to-bumper.

Which of the following does NOT belong to ordering costs?

Answer: Interest payment True: -Clerical support -Order processing -Cost of supplies

Which of the following statements is NOT true regarding the planning process?

Answer: Job scheduling is made as part of intermediate plans True: A. Short-range plans are usually for less than 3 months B. Short-range plans are the responsibility of operations personnel C. Long-range plans require policies and strategies related to issues such as capacity and capital investment, facility location, new products and processes, and supply chain development.

Which of the following is NOT helpful for retail layout?

Answer: Keep end-aisle locations empty to facilitate traffic flow. True: -Locate the high-draw items around the periphery of the store -Use prominent locations for high-impulse and high-margin items -Distribute what are known in the trade as "power items" to both sides of an aisle

Which of the following is NOT one of the assumptions of fixed-period systems?

Answer: Lead times are variable True: -Lean times are known -The only relevant costs are the ordering and holding cost -Items are independent of one another

Which of the following is NOT identified in the text as one of the 8 major determinants of volume and revenue for the service firm?

Answer: Level of advertising expenditures True: -Competition in the area -Quality of management -Operating policies of the firm

Which of the following is NOT a type of inventory?

Answer: MRP True: -Work-in-process -Finished goods -Raw material

Which of the following is NOT true about MRP limitations?

Answer: MRP does not tell you that a job needs to be completed on a certain week or day. True: A. MRP does not do detailed scheduling B. MRP is considered an infinite scheduling technique C. MRP is an excellent took for product-focused and repetitive facilities, but it has limitations in process (make-to-order) environments.

Which of the following statements is NOT true about MRP?

Answer: MRP is an independent demand technique used in a production environment. True: A. MRP provides a clean structure for dependent demand B. MRP has evolved as the basis for Enterprise Resource Planning C. MRP uses a bill-of-material, inventory, expected receipts, and a master production schedule to determine material requirements.

Which of the following statements is NOT true regarding location decisions?

Answer: Once management is committed to a specific location, many costs become relatively easy to reduce. True: -Location often has the power to make or break a company's business strategy -Location decisions to support a low-cost strategy require particularly careful consideration -Location decisions are important because location has a major impact on the overall risk and profit of the company.

Which of the following does NOT belong to holding costs?

Answer: Ordering processing True: -Insurance on inventory -Pilferage, scrap, and obsolescence -Storage costs

To obtain flexibility in layout, managers may implement all EXCEPT which of the following tactics?

Answer: Place workstations far apart True: -Use small equipment -Cross train workers -Keep investments low

When determining the optimal number of facilities, logistics-related costs do NOT usually include which of the following costs?

Answer: Purchasing True: -Transportation -Inventory -Facility

Which of the following allocates display space and responds to customer behavior?

Answer: Retail layout True: -Office layout -Product-oriented layout -Warehouse layout

Which of the following statements is NOT true about S&OP?

Answer: S&OP is also called an aggregate plan True: A. When the resources appear to be substantially at odds with the market expectations, S&OP provides advanced warning to top management. B. S&OP is used to determine which plans are feasible in the coming months and which are not. C. S&OP is typically done by cross-functional teams that align competing constraints.

The 5S's developed by the Japanese do NOT include:

Answer: Safety Do include: -Sort/segregate -Simplify/straighten -Standardize

Which of the following is NOT one of the techniques that Disney uses to try to keep visitors happy while waiting in line?

Answer: Serves drinks True: -Entertains people while they wait -Makes lines appear to be constantly moving forward -Posts signs telling visitors how many minutes until they reach each ride

For organizations that have perishable inventory, which of the following characteristics would NOT make yield management of interest?

Answer: Service or product cannot be sold in advance of consumption Would: A. low variable costs and high fixed costs B. Fluctuating demand C. Relatively fixed capacity

Which of the following is NOT true about reverse logistics as compared to forward logistics?

Answer: Speed is often very important True: -Pricing is dependent on many factors -Forecasting is more uncertain -Distribution costs are less directly visible

Which of the following is NOT one of the three seating sections that McDonald's is creating in its redesigned restaurants?

Answer: The "family" zone True: -The "grab and go" zone -The "flexible" zone -The "linger" zone

Which of the following statements is NOT true about DRP?

Answer: The DRP procedure starts with the forecast at the supplier level True: A. Effective use of DRP requires an integrated information system to rapidly convey planned order releases from one level to the next. B. The goal of a DRP system is small and frequent replenishment within the bounds of economical ordering and shipping. C. When dependent techniques are used in the supply chain, they are called distribution resource planning (DRP).

Which of the following statements is NOT true about the EOQ?

Answer: The EOQ is preferable when dependent demand exists True: A. The EOQ can be used as a lot-sizing technique for MRP systems B. The EOQ is a statistical technique using averages, whereas the MRP procedure assumes known demand reflected in a master production schedule. C. The EOQ can be a reasonable lot-sizing technique when demand is relatively constant and independent.

Which of the following statements is NOT true regarding the bullwhip effect?

Answer: The bullwhip effect occurs as occurs as order are relayed from retails, to distributions, to wholesalers, to manufacturers, with fluctuations decreasing at each step in the sequence. True: -Bullwhip fluctuations in the supply chain increase the costs associated with inventory, transportation, shipping and receiving. -Bullwhip fluctuations in supply chain decrease customer service and profitability. -Inaccurate information results in distortions and fluctuations, causing what is known as the bullwhip effect.

Which of the following is NOT one of McDonald's "seven major innovations"?

Answer: The happy meal True: -Breakfast menus -Drive-through windows -Play areas -Self-service kiosks

Which of the following statements is NOT true regarding the master production schedule?

Answer: The master production schedule is a sales forecast True: A. The master production schedule provides input to material requirements planning system B. The master production schedule is a result of disaggregation C. The master production schedule is a time table that specifies what is to be made and when

Which of the following is NOT one of the four predictive variables in La Quinta Inn's regression model that predicts motel selection behavior and success of a site?

Answer: The number of hotel rooms in the vicinity True: -The state population per inn -The location of nearby colleges -Median income levels

Which of the following is NOT one of the reasons that the techniques for addressing fixed-position layout are complicated?

Answer: The volume of materials needed is constant True: -Different items become critical as the project develops -At different stages of projects, different materials are needed -There is limited space at virtually all sites

Which of the following is NOT true regarding layout decisions?

Answer: To obtain flexibility in layout, operations managers could keel investments high. True: -An effective layout can help an organization achieve a strategy that supports differentiation, low cost, or response. -Layout designs need to be viewed as dynamic because of our increasingly short-life-cycle and mass customized world. -Layout is one of the key decisions that determines the long-run efficiency of operations.

Which of the following statements is NOT one of the differentiation strategy decisions?

Answer: Use buffer stocks to ensure speedy supply True: -Modular design to aid product differentiation -Gather and communicate market research data -Minimize inventory to avoid product obsolescence

Which of the following is NOT a demand option of aggregate planning?

Answer: Using part-time workers True: A. Counterseasonal product and service mixing B. Back ordering during high-demand periods C. influencing demand

Which of the following is NOT one of the 5 elements for each city that geographic information systems used to analyze location decision factors?

Answers: Rivers, mountains, lakes, and forests True: -Transportation options -Residential areas -Cultural and entertainment centers

A waiting line, or queuing, system has three parts, which are:

Arrivals or inputs, queue discipline or the waiting line itself, and the service facility

Enterprise resource planning (ERP):

Automates and integrates the majority of business processes.

The common measures of a queuing system's performance include:

Average time each customer spends in the system, probability that the service system will be idle, and average time each customer spends in the queue.

Cross-docking

Avoids placing the materials or supplies in storage by processing them as they are received for shipment.

Which of these is among the demand options for aggregate planning?

Back-ordering during high-demand periods.

Customers who _______ refuse to join the waiting line because it is too long to suit their needs of interests.

Balk

What is a list of quantities of components, ingredients, and materials required to make a product?

Bill-of-material

Disaggregation:

Breaks the aggregate plan into greater detail.

What is a time-phase stock-replenishment plan for all levels of the supply chain?

DRP

As the level of service increases, the cost of waiting time:

Decreases

The objective of layout strategy is to:

Develop an effective and efficient layout that will meet the firm's competitive requirements.

In manufacturing, excess capacity can be used to:

Do more setups, shorten production runs, and drive down inventory costs.

What is an information system for identifying and planning the enterprise-wide resources needed to take, make, ship, and account for customer orders?

ERP

What is an information system for identifying and planning the enterprize-wide resources needed to take, make, ship, and account for customer orders?

ERP

Supply chain management systems in the grocery industry that tie sales to buying, to inventory, to logistics, and to production are called:

Efficient consumer response

Inventory control models assume that demand for an item is:

Either independent of or dependent on the demand for other items

What does EMV stand for?

Expected monetary value

Which of the following is the best example of the proximity rule that, for service firms, proximity to market is the most important location factor?

Few people will travel out-of-state for a haircut

The objective of warehouse layout is to:

Find the optimum trade-off between handling costs and costs associated with warehouse space

Which of the following moves production to a large work cell that remains part of the present facility?

Focused work center

The advantage of having few suppliers is to:

Form a long-term relationship

A rice mill in south louisiana purchases the trucking firm that transports packaged rice to distributors. This is an example of which of the following?

Forward integration

What is a system that stores and displays information that can be linked to a geographic location?

GIS

An organization whose capacity is on that portion of the average unit cost curve that falls as output rises:

Has a facility that is below optimum operating level and should build a larger facility.

As the level of service increases, the cost of providing service:

Increases

Which of the following plans are the job of the operations manager, working with other functional areas of the firm?

Intermediate plans

Excess bags of basic commodities such as flour and sugar that are stored in a restaurant's kitchen represent which of the following wastes?

Inventory

MRP:

Is a dependent demand technique used in production environments.

Airfreight:

Is a fast-growing mode of shipping

Trucking:

Is increasingly using computers to manage its operations

Which of the following is an advantage of ERP?

It creates commonality of databases

How has McDonald's driven seconds out of the production process to be able to produce made-to-order hamburgers in 45 seconds?

It reconfigured its kitchen layout

Which of the following statements regarding the production order quantity model is TRUE?

It relaxes the assumption that all the order quantity is received at one time

JIT makes quality cheaper because:

JIT prevents long runs of defects.

Services throughout the world use:

JIT, TPS, and Lean

The Japanese call the practice of stopping production when a defect occurs:

Jidoka

Which of the following organizations used its geographic information system to create an ideal customer profile or female homeowners with families?

Jo-Ann Stores

A hospital's layout most closely resembles which of the following?

Job shop

Which of the following words means continuous improvement in Japanese?

Kaizen

Which of the following strategies is part collaboration, part purchasing from few suppliers, and part vertical integration?

Keiretsu networks

What is the primary aggregate planning vehicle in service industries?

Labor

Which of the following approaches may use subcontracting to accommodate excess demand?

Lagging demand with incremental expansion

Which of the following pieces of information is NOT contained in a bill of material?

Lead times

Which of the following approaches makes new capacity a larger increase at the beginning of the period?

Leading demand with a one-step expansion

The most aggressive and risky approach to capacity planning is:

Leading demand with one-step expansion

Which of the following statements is true regarding lean sustainability?

Lean and sustainability both seek to maximize resource and economic efficiency

Which of the following is an example of ambient conditions?

Leather chairs at starbucks

How do pharmacies implement lean operations to ensure that customers will always receive their medications upon demand?

They develop community networks as backup systems

What is the primary reason why retailers tend to locate high-draw items around the periphery of the store?

This arrangement will help to maximize customer exposure to other items in the store

A lawnmower assembly plant uses a variety of nuts, bolts, screws, and other fasteners in its operation. Its supplier delivers these items directly to the point of use on the assembly line and ensures that there are always sufficient quantities of fasteners to maintain the production schedule.

This is an example of: Vendor-managed inventory

The do-it-yourselfer plucked a gallon can of base paint from the shelf of the local hardware store and handed it to Keith, the cheerful clerk at the paint counter. Their eyes met briefly and the do-it-yourselfer silently handed over sample 150c-1, Musical Mist, to the clerk. It was impractical to keep several gallons of every possible color on the shelves at the hardware store, so the paint manufacturer had created clever workaround. The workaround was a computer-based system that added predetermined quantities of pigments to a gallon can of base paint depending on the desired shade, in this case, Musical Mist. The Hardware store now needed to stock only the base pain. this machine, and a small supply of paint pigments in order to create the thousands of colors in its catalog.

This scenario is a prime example of: Postponement

Which of the following allows a segment of the master schedule to be designated as "not to be rescheduled?"

Time fence

What is one of the tools that is particularly useful in reducing system nervousness in an MRP system?

Time fences

The operations manager has two important tools available to deal with MRP system nervousness. Those tools are:

Time fences and pegging

In companies such as Intel, what is the PRIMARY motivation behind the trend of shrinking office space and lower cubicle walls for individuals?

To get people to work more in groups

One use of inventory is

To provide a hedge against inflation

Which of the following represents an unlimited queue?

Toll booth serving automobiles on an interstate

Aggregate planning would entail which of the following production aspects at BMW for a 12-month period?

Total number of cars to produce

Which of the following techniques might a service or retail organization use to make a location decision?

Traffic counts

Which of the following is true regarding the steps to reducing setup times?

a. The first step involves performing as much setup preparation as possible while the process/machine is operating. b. The cycle of steps is repeated until setup time is reduced to under a minute. c. Standardize tooling and standardize training are included in the same step. d. Improved material handling and move material closer are done before operator training. e. ALL OF THE ABOVE

What is a lot-sizing technique that generates exactly what was required to meet the plan?

lot-for-lot

Which of the following lot-sizing techniques results in the lowest holding cost?

lot-for-lot

Which of the following aggregate planning options attempts to manipulate product or service demand?

price cuts

In level scheduling, what is kept uniform from month to month?

production/workforce levels