Operations Management C215

The first unit of a product took 400 hours to complete. If an 80% learning curve is expected, how long will the 18th unit take to complete?

157.6 hours

A strategic plan provides direction and objectives for

2 to 10 years.

Six Sigma quality implies how many average defects per million?

3.4

What level of average inventory must be maintained on hand to provide 4 hours of production supply if the average material consumption rate is 12 units per hour?

48 units

If your firm has 5 employees and each employee can ship 10 computers a day, how many employees will you need to ship 300 computers, assuming a level production plan and a five day work week?

6

What process width is typically used when computing the process capability index Cp?

6σ

What is an action notice?

An output from the MRP system for action

Which of the following is a benefit of JIT?

Increased productivity

What processes are used to produce a variety of products with different processing requirements in lower volumes?

Intermittent

What type of operations focus on products in the early stage of the life cycle?

Intermittent

What are the stages of the product life cycle?

Introduction, growth, maturity, and decline

What measurement does a company use for its minimum inventory investment?

Inventory turnover

Which of the following is an advantage of using standard elemental times?

It eliminates workplace disruptions caused by making time studies.

What is fitness for use?

It evaluates how well the product performs for its intended use.

What is a capacity cushion?

It is an amount of capacity added to the needed capacity in order to provide greater flexibility.

What is a reason that services have lagged behind manufacturing in the use of statistical process control?

It is difficult to measure the quality of a service.

What does a Cp = 1 tell us?

It means that the process variability just meets specifications; the process is minimally capable.

Which of the following is TRUE about subcontracting?

It provides additional output capacity during periods of high demand.

Which is TRUE about JIT manufacturing?

It relies on a coordination system called kanban that withdraws parts from a previous work center and moves them to the next.

Which of the following statements is TRUE of material resource planning?

Its objective is to determine the quantity and timing of material requirements.

Which of the following is TRUE about JIT manufacturing?

JIT relies on a pull system. If products are not requested, they are not produced.

Which of the following techniques for determining order quantity entails ordering exactly what is needed?

Lot-for-lot

Which is TRUE about JIT manufacturing?

Low setup times in JIT mean that small lot sizes of products can be produced as needed and that production lead times will be shorter.

Hand tools, lubricants, and cleaning supplies are usually examples of what?

Maintenance, repair, and operating inventory

Which strategy produces products to customer specification after an order has been received?

Make-to-order

Which of the following is true about JIT implementation?

Managers develop reward systems for ideas and team cooperation.

What was a disadvantage of first-generation ERP systems?

Providing only a snapshot in time

Companies consider many factors in location analysis. Which of the following factors needs to be considered by companies trying to reduce transportation cost?

Proximity to suppliers

Which of the following is an example of common causes of variation?

Slight differences in machines

Which of the following is characteristic of a product layout as compared to a process layout?

Space requirements for inventory storage are lower.

When discussing the capacity of a facility, we need what two types of information?

The amount of available capacity and the effectiveness of capacity use

__________________ is the philosophy that seeks to improve quality by eliminating the causes of product defects.

Total quality management

What does average number of jobs in the system measure?

Work-in-process inventory

What is an advantage of a level production plan?

Workforce stability

An employee who will not help a customer because "it is not my job" violates the JIT belief of

a broad view of operations.

All ERP modules use

a common database.

Productivity is

a measurement of how well a company uses its resources.

Efficiency is

a measurement of performance relative to a standard.

ABC inventory classification is

a method for determining the level of control and frequency of review.

Projects have _______________ and consume _______________.

a specific time period; resources

The central belief of the JIT philosophy is

elimination of waste.

TQM is a complete philosophy that has to be

embraced with true belief.

ISO 14000 provides tools to identify and report on the adverse impacts of business, including systems and standards for promoting

environmental responsibility.

The purpose of the ISO 9000 is to

establish international quality standards.

JIT requires compact layouts and increased visibility so

everyone can see what everyone else is doing.

The capacity of a business can be changed by either __________ or __________ the amount of capacity.

expanding; reducing

Warranty claims, customer complaints, and costs of litigation are examples of __________ costs.

external failure

Scheduling is the _______ planning that occurs before the actual execution of the plan.

final

Independent demand is the demand for

finished products.

The indifference point tells us

at what quantity the total costs of the two alternatives (make it or buy it) are equal.

A control chart for ______________ is used to monitor characteristics that have discrete values and can be counted.

attributes

When developing an aggregate plan and using a level plan, the aggregate production rate is set equal to

average demand.

Capacity planning decisions are a three-step process; what are the three steps?

(1) identify capacity requirements, (2) develop capacity alternatives, and (3) evaluate capacity alternatives

Which of the following scheduling techniques determines the earliest possible completion time for a job?

Forward scheduling

Which of the following is a disadvantage of group incentive systems?

Free-riders

_________ sharing emphasizes the costs of outputs rather than profit levels.

Gain

What is the process of creating clusters of products based on similar processing requirements?

Group technology layouts

Which of the following is TRUE with regard to implementing SPC?

How often to inspect depends on product cost and product volume.

Which of the following are the steps in the product design process?

Idea development, product screening, preliminary design & testing, and final design

What does the textbook define as the three MOST critical factors in successful partnering?

Impact, intimacy, vision

Which of the following is an intangible benefit of ERP?

Improved visibility of corporate data

Shifting demand is a proactive marketing approach in aggregate planning that involves

leveling demand fluctuations with incentives for consumers.

JIT believes in developing __________ relationships with suppliers.

long-term

In bottleneck scheduling, it is better to balance the ________ instead of the ________.

process; flow

Intermittent operations are designed to focus on

producing lower volumes of products with differing characteristics.

The goal of determining the output rate is to design a ______________ _____________ that can produce the desired number of units with the ______________ amount of work centers and a/an ______________ of workload.

product layout; least; balance

Building a bridge over the Mississippi River for a new highway uses a _______ process.

project

An advantage of using probabilistic time estimates is the ability to predict the probability of

project completion dates.

The notion that the root cause of quality problems needs to be identified is

quality at the source.

The critical chain approach is based on

the theory of constraints.

A ____________ supplier is a direct supplier to the manufacturer.

tier one

If a worker's performance is below average, the worker may need

to be retrained.

When implementing supply chain management a company must _________ to inform continuous improvement.

track performance

In companies trying to increase speed, one strategy is to eliminate

unnecessary activities.

A control chart for ______________ is used to monitor characteristics that can be measured and have a continuous scale.

variables

The Six Sigma approach is organized around what plan?

Define, Measure, Analyze, Improve, Control

What is a layout that can be easily modified to meet changing demand?

Flexible layout

When customer demand changes daily, what is a strategy to meet demand?

Floating workers

What is the PFD job-based allowance factor if PFD = 12%?

1.12

Which of the following values for performance rating factor would be for an above-average work pace?

1.4

What is a process layout?

A layout that groups resources based on similar processes or functions.

_________ is a grouping of physical, sensual and psychological benefits that are purchased together as part of the service.

A service package

What is the process of randomly inspecting a certain number of items from a lot or batch in order to decide whether to accept or reject the entire branch?

Acceptance sampling

What makes acceptance sampling different from statistical process control?

Acceptance sampling is done before or after the process.

What is Reverse engineering?

Acquiring a competitor's product and studying its design features

What do you call it when you delay delivery to the customer until the item becomes available?

Back order

In the critical chain approach where are time buffers added?

Before bottlenecks in the critical path

In an office layout what is a benefit of proper layout planning?

Building good working relationships

How can services improve quality through JIT?

Building quality into the process

How can both the just-in-time (JIT) and EOQ inventory theories effectively be reconciled?

By considering the setup cost as a variable instead of a parameter.

What is a bottleneck caused by inefficient usage?

Capacity-constrained resource

What are assignable causes of variation?

Causes that can be identified and eliminated

What type of aggregate plan sets labor and equipment capacity to satisfy demand each period?

Chase

_______________ MRP is an MRP system that includes production planning, master production scheduling, and capacity requirements planning.

Closed-loop

What are the two causes of variation?

Common and assignable

_____________ is a series of guidelines to follow in order to produce a product easily and profitably.

Design for manufacture

Which one of these refers to reducing the number of parts and features of the product whenever possible?

Design simplification

What refers to the use of common and interchangeable parts?

Design standardization

Which of the following is a role of management in JIT?

Develop an incentive system.

Alternatives to capacity requirements fall into which of the following categories?

Do nothing; expand large now; expand small now, with option to add later.

Evaluating an aggregate plan in terms of inventory levels is using which perspective?

Cost

What is the reduction of completion time for a project?

Crashing

Managers take on more of a supportive function in the JIT environment. Aside from being a coach and motivator, assisting with teamwork and problem solving, what is the MOST important thing managers can do for employees to help facilitate implementing JIT?

Create cultural change

What are the three areas for Inventory objectives?

Customer service, cost-efficient operations, and minimum inventory investment

What is an advantage of an appointment system?

Customer wait time reduction

What is the term for the maximum amount of time each workstation has to complete its assigned task?

Cycle time

Which phase in the project life cycle involves carrying out the activities that make up the project?

Execution

Which of the following typically represents the beginning of a supply chain?

External suppliers

Which of the following is the scheduling technique that uses a prioritized list of jobs?

Finite loading

Which of the following scheduling techniques tends to break down over the long term?

Finite loading

Which of the following techniques loads jobs up to a predetermined capacity level?

Finite loading

What is the approach to job design that involves an increase in responsibility for work planning and/or inspection?

Job enrichment

What factor in globalization has encouraged suppliers and manufacturers to locate near each other?

Just-in-time manufacturing

Which of the following is a common cause for TQM failure?

Lack of top management support

What are two of the most critical factors for successful ERP implementation?

Leadership and top management commitment

What type of aggregate plan maintains a constant workforce and produces the same amount of product in each time period?

Level

What is an advantage of a chase aggregate plan?

Minimizing finished goods holding costs

The theory of constraints is an extension of ____________, a technique that makes ____________ the basis for scheduling and capacity planning.

OPT; bottlenecks

What is the common term for a process of developing a long-term relationship with a supplier based on mutual trust, shared vision, shared information, and shared risks?

Partnering

Who coined the saying "quality is free"?

Philip Crosby

Which of the following are reasons why crossdocking implementations fail?

Poor facility layout, The wrong products are selected for crossdocking, Noncompliance by all supply chain members, Internal informations systems are not integrated, Insufficient volume of activity.

________________ is one of the key trade-offs in office layouts.

Privacy versus proximity

Which of the following represents three separate team approaches to job design?

Problem-solving, special-purpose, and self-directed

What are the types of layouts?

Process, product, hybrid, and fixed position

Which of the following is TRUE with regard to quality inspection?

Processes that do not change frequently do not need to be inspected often.

A company with a pure continuous processing system is MOST likely to use which layout type?

Product

Hybrid layouts combine characteristics of which two types of layouts?

Product and process

What is a make-to-stock strategy?

Products are produced for immediate delivery.

What does PERT mean?

Program evaluation and review technique

Which of the following choices of process types shows the degree of product standardization from lowest to highest?

Project, batch, line, continuous

Companies consider many factors in location analysis. Which of the following factors needs to be considered by companies trying to recruit high-caliber employees?

Quality-of-life issues

What do we call purchased items or extracted materials that will be transformed into components or products?

Raw materials inventory

What is one advantage of undertime?

Reducing need to release and rehire workers

What type of operations focus on products in the late stage of the life cycle?

Repetitive

Which of the following are examples of traditional measures of supply chain performance?

Revenue growth, market share, ROI

What is the term for inspecting a random sample of an output from a process and determining if it produces products within a predetermined range?

Statistical process control

What service design is used to develop a production-line approach to a service?

Substitute technology for people

Which of the following is considered to be a key element of JIT supplier relationships?

Suppliers located near the customer

The __________ is an effort to standardize measurement of supply chain performance.

Supply Chain Operations Reference (SCOR)

Which of the following is a benefit of globalization?

Taking advantage of foreign markets

Which of the following is used in determining the order quantity in the periodic review system?

Target inventory level

In a periodic review inventory system, how many units are ordered?

Target inventory level - on-hand balance

Which of the following is TRUE about storage areas of equal size in warehouse layouts?

The goal is to locate the departments with the highest number of trips closest to the dock.

Your firm starts the week with 5 employees and each employee can ship 10 computers a day. At the end of the week you need to ship 300 computers. Daily demand fluctuates and you are using a chase aggregate plan. What is the impact on your employees?

The number of employees will vary over the week.

Which of the following is an issue that complicates quality control in service organizations?

The presence of the customer during service delivery.

What happens when a plot of data falls outside preset control limits?

The process is out of control.

Which of the following is a reason that capacity and location decisions are usually made simultaneously?

The size of a new facility may affect its location.

What does job flow time measure?

The time a job spends in the shop before it is finished

What is the result if a bottleneck resource is idle?

The time is lost forever.

Which of the following is TRUE about ALDEP and CRAFT?

These are names of software packages used in layout planning.

What is one reason that companies fail to gain the benefits of JIT?

They do not implement the culture necessary.

How much can companies expect to spend on consultants versus what they spend on the ERP system?

Three times as much

What is the purpose of periodic counting?

To satisfy auditors that inventory records match on-hand values

Which of the following are special cases of process layout?

Warehouse and office layouts

What does customer service mean in inventory management?

Whether or not a product is available

When monitoring the progress of a project, it is important to focus on

activities on the critical path.

Actions that consume resources and/or time are project

activities.

A company's __________ plan is a statement of the resources available to the operations group during the next 6 to 18 months.

aggregate

The first step to implementing a strategic, integrated supply chain is to

analyze your current supply chain.

Costs of quality inspections, testing, auditing, and test equipment are examples of _____________ costs.

appraisal

Compared to large facilities, focused factories

are more flexible.

According to Dr. Taguchi's view of quality,

as conformance values move away from the target, loss increases as a quadratic function.

In JIT, the role of production worker is to

be actively engaged.

Economies of scale occur when a company is operating

below its best operating level and increases its output.

When an employee isn't present until they are needed, they are on

call.

A chart used in TQM that identifies potential causes of particular quality problems is called a

cause-and-effect diagram.

One common definition of quality is __________, which focuses on measuring how well the product or service meets targets and tolerances determined by its designers.

conformance to specifications

Compared to past robotic systems, the new generation of intelligent assembly robots

cost less.

Just-in-time relies on ___________ worker skills, meaning the ability of workers to perform many different tasks on many different machines.

cross functional

Quality is defined by the

customer.

When designing a service concept, the service package should target the wants of

customers.

Layout planning is

deciding on the best physical arrangement of all resources that consume space within a facility.

Shortage costs are incurred when

demand exceeds supply.

Sales and operations planning enables

disciplined and formalized communications.

Studies mentioned in the text have shown that workers that are in close proximity to each other are more likely to

have greater understanding, tolerance, and trust for one another.

Capacity requirements planning enables the company to evaluate

how well it is using its critical work centers.

After the aggregate plan is developed, it needs to be evaluated in terms of cost, customer service, operations, and

human resources.

A benefit of the single information source of ERP is that it

improves organizational information flow.

External pressures that can drive a company to implement a strategic, integrated supply chain include

increased global competitors, or industry consolidation reducing the number of surviving companies in the industry, major technological changes withint the industry, a switch to e-commerce (including e-purchasing and e-sourcing)

Capacity decisions at the strategic level include

investment in new facilities and equipment.

A purchase order

is a legal document committing a company to buy goods and providing details of the purchase.

The cost of defect correction

is less costly the earlier defects are found.

If a delay in an activity will delay completion of the whole project, the activity

is on the critical path.

You may be able to speed up completion of a project by

making additional resources available

Project managers employ change control boards to

manage changes to the project.

The ease with which the product can be made is its

manufacturability

A market constraint happens when

market demand is less than production capacity.

Time-based compensation systems are used when

measuring output per employee is not applicable.

The approach that details the tasks of a job and how to do them is

methods analysis.

Services offered by warehouses can improve customer service by

moving goods closer to the customer.

The use of __________ in service operations helps improve quality and customer responsiveness.

multifunctional workers

For every scheduled receipt in an MRP table, there is also in the organization a(n)

order that has been placed but not yet been received.

Work measurement is a process for evaluating employee

performance.

A disadvantage of globalization is

political risks for countries with unstable governments.

Vertical integration decisions are a better strategic decision for

repetitive operations.

A(n) ___________ is a form used to inform purchasing that an item or a material needs to be purchased.

requisition request

Three basic elements work together to complete a JIT system: just-in-time manufacturing, total quality management, and

respect for people.

Holding costs have three components: capital, storage, and

risk costs.

Companies use _________ to determine whether a proposed ERP is feasible.

rough-cut capacity planning

According to JIT, workers should perform

routine preventive maintenance activities.

In the critical chain approach, because project activities are uncertain, _________ is added.

safety time.

When companies face high seasonal demand, an alternative to full-time employees is

seasonal employees.

For a delayed service or backlog scheduling technique, new customers are

served in the order they arrive.

Ordering costs are fixed costs for placing an order with a supplier or

setup costs for in-house production.

In evaluating your new production plan, cost comparisons are

simple if you are comparing similar ending positions.

The challenge for service operations is _____ their production ________ demand.

synchronizing; with

The two motivations for ERP implementation are

technological and operational.

Throughput time is

the average amount of time a product takes to move through the system.

As safety stock increases,

the customer service level increases and inventory investment increases.

Companies that have attained the benefits of TQM have developed a process to identify

the meaning of customer-defined quality.