OM 300 - Exam 1
What are four examples of companies that have globalized?
1. Boeing - they are competitive bc both its sales and supply chain are world wide 2. Italy's Benetton - moves inventory to stores around the world faster than its competition 3. Sony - purchases components from a supply chain that extends to Thailand, Malaysia, and other places around the world for assembly of its electronic products 4. Volvo - a Swedish company, was purchased by a Chinese company, Geely, but Volvo assembles cars in Sweden, Belgium and China (Video examples = Texas Instruments, Caterpillar, and Otis Elevator) PUT ON SHEET
What are the 10 strategic OM decisions?
1. Design of goods and services 2. Managing quality and statistical process control 3. Process and capacity strategies 4. Location strategies 5. Layout strategies 6. Human resources, job design and work measurement 7. Supply chain management 8. Inventory management 9. Scheduling 10. Maintenance PUT ON SHEET
What are the seven steps in forecasting?
1. Determine the use of the forecast 2. Select the items to be forecasted 3. Determine the time horizon of the forecast 4. Select the forecasting model(s) 5. Gather the data 6. Make the forecast 7. Validate and implement results PUT ON SHEET
How do companies achieve competitive advantage?
1. Differentiation - better or different 2. Cost leadership - cheaper 3. Response - rapid response PUT ON SHEET
How do companies go about developing strategies?
1. Identify key success factors (KSF) 2. Understand core competencies 3. Build and staff the organization 4. Integrate OM with other activities PUT ON SHEET
What are the six reasons why companies chose to expand globally?
1. Improve the supply chain 2. Reduce costs and exchange rate risks 3. Improve operations 4. Understand markets 5. Improve products 6. Attract and retain global talent PUT ON SHEET
What are the stages of the product lifestyle?
1. Introduction 2. Growth 3. Maturity 4. Decline PUT DETAILS ON SHEET
What are the four qualitive forecasting approaches?
1. Jury of executive opinion 2. Delphi method 3. Sales force composite 4. Market survey PUT ON SHEET
What are the three essential functions of an organization?
1. Marketing 2. Finance/Accounting 3. Production/Operations
What are the five quantitative approaches?
1. Naive approach 2. Moving averages 3. Exponential smoothing 4. Trend projection 5. Linear regression PUT ON SHEET
What three factors affect productivity?
1. Quality 2. External elements 3. Precise units PUT ON SHEET
What three types of unusual challenges do forecasting in the service sector present?
1. Special need for short-term records 2. Needs differ greatly as function of industry and product 3. Holidays, other calendar events, and unusual events PUT ON SHEET
What are the four components of a time-series forecast?
1. Trend - upward or downward movement, includes changes in income, population, age, or cultural views 2. Seasonality - repeats itself after a period of days, weeks, months or quarters 3. Cycles - occur every several years, major importance in short-term business analysis and planning, may be affected by political events or international turmoil 4. Random variation - blips in data caused by chance and unusual situations, no pattern so cannot be predicted PUT ON SHEET
What is medium-range forecasting?
3 months to 3 years sales and production planning, budgeting comprehensive issues and support management decisions PUT ON SHEET
What is long-range forecasting?
3+ years new product planning, facility location, capital expenditures, and research and development PUT ON SHEET
What is computer-integrated manufacturing?
Backward to engineering and inventory control Forward into warehousing and shipping Can also include financial and customer service areas Reducing the distinction between low-volume/high-variety, and high-volume/low-variety production
Understand the special considerations for services process design.
Better interactions are accommodated in the process design leads to a more efficient process Find the right combination of cost and customer interaction PUT ON SHEET
What are flexible manufacturing systems?
Computer controls both the workstation and the material handling equipment Enhance flexibility and reduced waste Can economically produce low volume but high variety Reduced changeover time and increased utilization Stringent communication requirement between components
What is process focus?
Facilities are organized around specific activities or processes, includes general purpose equipment and skilled personnel High degree of product flexibility Typically high costs and low equipment utilization Product flows may vary considerably making planning and scheduling a challenge Low volume, high variety, intermittent processes Many inputs > Many departments and routings > Many different outputs PUT ON SHEET
What is product focus?
Facilities are organized by product with long, continuous production runs that enable efficient processes with less skilled labor High volume but low variety of products high fixed cost but low variable cost High volume, low variety, continuous process Few inputs > Output variations in size, shape PUT ON SHEET
What is repetitive focus?
Facilities often organized as assembly lines Characterized by modules with parts and assemblies made previously Modules may be combined for many output options Less flexibility than process-focused facilities but more efficient Raw materials and module inputs > Modules combined for many outputs PUT ON SHEET
What is the difference between goods and services?
Goods are tangible and services are intangible
How does forecasting affect human resources, capacity planning and the supply chain?
Human resources - hiring, training, and laying off workers all depend on anticipated demand Capacity planning - when capacity is inadequate, the resulting shortages can lead to loss of customers are market share Supply chain - good supplier relations and the ensuing advantages in product innovation, cost, and speed to market depend on forecasts PUT ON SHEET
What are automatic identification systems and radio frequency identification?
Improved data acquisition Reduced data entry errors Increased speed Increased scope of process and automation
How is forecast error measured and compared across multiple forecasts?
MAPE (Mean Absolute Percentage Error)
What are advantages and disadvantages to outsourcing?
PUT ON SHEET
What are vision systems?
Particular aid to inspection Consistently accurate Never bored Modest cost Superior to individuals performing the same tasks
What are robots?
Perform monotonous or dangerous tasks Perform tasks requiring significant strength or endurance Generally enhanced consistency and accuracy
How is productivity used in the service sector?
Productivity is hard in the service sector bc service in intangible. It is hard to measure and different people have different opinions/expectations.
What is mass customization?
Rapid, low-cost production of goods and services to satisfy increasingly unique customer desires Combines the flexibility of a process focus with the efficiency of a product focus Tightly controlled inventory management High volume, high variety PUT ALL ON SHEET
What is process control?
Real-time monitoring and control of processes Sensors collect data Devices read data on periodic basis Measurements translated into digital signals then sent to a computer Computer programs analyze the data Resulting output may take numerous forms
How do we select the best forecasting technique?
Select the lowest forecast model that gives you the lowest forecast error according to: Mean Absolute Deviation (MAD) or Mean Squared Error (MSE)
How do you do seasonal index in excel?
Step 1: =AVERAGE(periods or years) Step 2: Drag that down to all the rest of the months/periods Step 3: Find the overall average by =AVERAGE(of the avgs above) Step 4: Find seasonal index by =AVG(period or yrs) / AVG (overall) Step 5: Find demand w/o seasonality by taking =Annual demand in problem / number of periods Step 6: Find FC by =Seasonal index * Demand w/o seasonality PUT ON SHEET (look at what you wrote in ur binder)
How do you find Mean Absolute Deviation in excel?
Step 1: Actual Demand - Forecasted Demand Step 2: =ABS(number calculated above) Step 3: =AVERAGE(all of the absolute values)
How do you find Mean Squared Error in excel?
Step 1: Actual Demand - Forecasted Demand Step 2: Square the number above for each Step 3: =AVERAGE(all of the squared values)
What types of decisions do Operation Managers make?
The Base: People, Product Process The Place: Location, Layout The Stuff: Quality Management, Inventory Management, Supply Chain Management The Face: Scheduling, Maintenance PUT ON SHEET
True or False: Never outsource your core competencies.
True
What is the supply chain?
a global network of organizations and activities that supplies a firm with goods and services
What is a consumer market survey?
ask the customer; disadvantage is that it may be optimistic bc consumers may say one thing and actually do another PUT ON SHEET
What is the naive approach?
assumes demand in next period is the same as demand in most recent period sometimes cost effective and efficient can be a good starting point very easy and simple
What is automated storage and retrieval systems?
automated placement and withdrawal of parts and products Reduced errors and labor Particularly useful in inventory and test areas of manufacturing firms Used in high dollar volume areas, like NYC
What are automated guided vehicles?
electronically guided and controlled carts used for movement of products and/or individuals amazon is pushing these
What is a sales force composite?
estimates from individual salespersons are reviewed for reasonableness, then aggregated; disadvantage is that it tends be overly optimistic PUT ON SHEET
How do you quantitively rate outsourcing providers?
factor-rating method, assign points to each provider and then importance weights to each of the factors
What are trend projections?
fitting a trend line to historical data points to project into the medium to long-range can be found using the least-squares technique y = a + bx where a = intercept, b = slope, x = forecast yr in the problem IN EXCEL: Use =SLOPE(y,x) and =INTERCEPT(y,x)
What is process mapping?
flowchart with time added on the horizontal axis and allows users to identify and eliminate waste such as extra steps, duplication, and delay PUT ON SHEET
What is service blueprinting?
focuses on the customer and the provider's interaction with the customer PUT ON SHEET
What is the exponential smoothing method?
form of weighted moving average weights decline exponentially and most recent data is weighted the most require smoothing constant (a) ranges from 0 to 1 subjectively chosen involves little record keeping of past data IN EXCEL: Last period's forecast + a (Last period's actual demand - Last period's forecast)
For factor rating, use the _______ score. For assessing risk, use the ________ score.
highest lowest PUT ON SHEET
What is machine technology?
increased precision, productivity, and flexibility reduced environmental impact additive manufacturing produces products by adding material, not removing it supports innovative product design, minimal custom tooling required, minimal assembly time, low inventory, and reduced time to market
Choose high values of alpha when the underlying average is what?
likely to change PUT ON SHEET
What is globalization?
means customers, talent, and supplier are worldwide
What is a strategy?
organization's action plan to achieve the mission
What is a mission statement?
organization's purpose as to what it will contribute to society
What is the Delphi method?
panel of experts, queried iteratively; disadvantage is timeliness and based on opinions PUT ON SHEET
What is a jury of executive opinion?
pool opinions of high-level experts, sometimes augmented by statistical methods; relatively quick but has "group think" disadvantage PUT ON SHEET
What is forecasting?
process of predicting a future event
What are flow charts?
schematic or drawing of the movement of material, product, or people PUTONSHEET
What is the moving averages method?
series of arithmetic means used for little or no trends often used for smoothing IN EXCEL: use =AVERAGE
What is time-series forecasting?
set of evenly spaced numerical data that is obtained by observing response variables at regular time periods; based only on past values
Choose low values of alpha when the underlying average is what?
stable PUT ON SHEET
What is value-stream mapping?
takes an expanded look at where value is added, extends the analysis back to the supplier PUT ON SHEET
What is productivity?
the ratio of outputs (goods and services) divided by the inputs (resources such as labor and capital) [Ratio of outputs / inputs]
What is operations management?
the set of activities that creates value in the form of goods and services by transforming inputs into outputs
What is outsourcing?
transferring activities that have traditionally been internal to external suppliers
What is short-range forecasting?
up to 1 year, generally less than 3 months purchasing, job scheduling, workforce levels, job assignments, production levels more accurate than long term PUT ON SHEET
What is associative forecasting?
used when changes in one or more independent variables can be used to predict the changes in the dependent variables most common technique is linear regression y = a + bx where a = intercept, b = slope, x = whatever is given in the problem IN EXCEL: Use =SLOPE(y,x) and =INTERCEPT(y,x)
What is the weighted moving average method?
used when some trend might be present older data is usually less important weight based on experience and intuition IN EXCEL: use =SUMPRODUCT(demand, weights) / SUM(weights)
