CH 8 LS OPMA

the time horizon for an aggregate operations plan ranges from ___ to ___ months

3,18

short range planning covers a period from one day to ___ months

6

The widespread scientific application of yield management began within what industry?

Airline

Which relevant costs are often the most difficult to measure?

Backordering costs

In the agriculture industry, migrant workers are commonly employed to pick crops ready for harvest. They are hired as needed and are laid off once the crops are picked. The realities of the industry make this approach necessary. Which production planning strategy best describes this approach?

Chase strategy

The essence of yield management is the ability to manage what?

Demand

From an operational perspective yield management is least effective under which of the following circumstances?

Demand is stable and close to capacity

Which of the following is not one of the "number of interesting issues that arise in yield management"

Designing yield management programs that cannot be imitated by a competitor

Firms facing cyclical demand fluctuations would be wise to introduce complementary products whose cycles are the same as their current products

F

It is NOT necessary for the operational plan to align with the business plan

F

Pricing for a service should primarily relate to the cost of providing the service and has little to do with capacity issues the service provider might face

F

The master production schedule is a crucial input into the aggregate operations plan

F

the cut and try approach will always identify the aggregate plan with the lowest overall cost

F

Under what type of demand is yield management most effective?

Highly variable

spoilage and obsolescence costs are considered what type of relevant cost?

Inventory holding costs

From an operational perspective yield management is most effective under which of the following circumstances?

Inventory is perishable

The aggregate operations plan details objectives for ________ and __________ over the intermediate term

Labor, production

Which of the following is a production planning strategy presented in the textbook?

Level

Major operations and supply planning activities can be grouped into categories based on the relevant time range of the activity. Into what time range category does sales and operations planning fit?

Medium-range planning

Which operations and supply processes are most greatly impacted by the sales and operations process?

Services, manufacturing, and logistics

What category of planning covers a period from a day to six months, with daily or weekly time increments?

Short-range planning

A rate fence is a logical justification for different prices for what is essentially the same service

T

Accurate medium-range planning increases the likelihood of operating within the limits of a budget.

T

Companies commonly use simply cut and try charting and graphic methods to develop aggregate plans

T

Costs incurred in hiring, training, and laying off personnel are considered relevant aggregate operations planning costs

T

Distribution and logistics is typically involved in sales and operations planning

T

In a services organization strategic capacity planning follows process planning

T

In services, once the aggregate staffing level is determined, the focus is on short-term workforce and customer scheduling

T

Order scheduling is the step in the aggregate operations planning process that immediately follows material requirements planning

T

The aggregate plan precedes the master schedule

T

Yield management is an important tool that can be used to shape demand patterns

T

Yield management is most effective when products can be sold in advance

T

sales and operations planning consists of a series of meetings

T

sales and operations planning occurs on a monthly cycle

T

From an operational perspective yield management is least effective under which of the following circumstances?

The product can be kept to be sold when demand is stronger

In an overview of the major operations planning activities in a typical logistics organization, which of the following activities most immediately follows aggregate sales and operations planning?

Vehicle capacity planning and loading

the aggregate operations plan is generally stated in __________ units rather than specifying _______ products

aggregate, particular

Which of the four costs relevant to aggregate production planning is the most difficult to accurately measure?

backordering costs

What actions would be possible in a level strategy plan?

building inventory during slow periods

yield management is the process of allocating which of the following to maximize profit?

capacity

external factors include external _________, raw material __________, market ________, and _______ conditions

capacity, availability, demand, economic

The main component of inventory holding costs is often the cost of ________ tied up in inventory

capital

subcontracting production is similar to a ______ strategy, but differs in that it doesn't use company employees to meet customer demand

chase

a production plan that varies the production rate by hiring and laying off employees is called a...

chase strategy

In conducting aggregate operations planning there are a number of required inputs. Which of the following are inputs considered external to the firm?

competitor behavior and economic conditions

The aggregate operations plan may be derived from the __________ plan

corporate

In conducting aggregate operations planning there are a number of required inputs. which of the following are considered inputs internal to the firm?

current physical capacity and current workforce

yield management is defined as the process of allocating the right type of capacity to the right type of ________ at the right price and _______ to maximize profit

customer, time

aggregation on the demand side is done by groups of _____________

customers

Which of the following methods discussed in the text requires generating several alternative aggregate plans?

cut and try

As a key customer service activity, ___________ and ____________ needs to know how changes to the production schedule may impact shipped quantities to the customer

distribution, logistics

in a service organization, sort-term scheduling focuses on

employees

basic production costs consist of _________ and _______ costs incurred in producing a given product type in a given time period

fixed, variable

when product shortages occur, loss of ________ and ________ _______ are incurred along with ________ costs

goodwill, sales revenue, expediting

Yield management is most effective when fixed costs are _______ and variable costs are ________

high, low

Yield management is most effective when demand is ________ variable

highly

which of the following are internal factors that influence a production plan?

inventory levels

unused inventory that is carried over from the previous period is called?

inventory on hand

basic production costs consist mainly of charges related to

labor

in production planning, a _______ strategy is executed by maintaining a stable workforce and producing output at a constant rate

level

designing the logistics activities that deliver products to the customer is a ______-_______ planning activity

long-range

designing the manufacturing and service processes that produce the products of the firm is a ______-______ planning activity

long-range

which of the following is not an operations and supply chain task performed in an intermediate-term plan?

make vs buy assessment

if an organization is using overtime, hiring/firing employees, and subcontracting to modify production plans, it is likely developing which type of production strategy?

mixed

the main purpose of an aggregate plan is to specify the:

optimal combination of production rate, workforce level and inventory on hand

training workers and managers on how to handle frequent _____ changes is an important part of operating a yield management system

price

which of the following activities precedes aggregate sales and operations planning

process planning

on the supply side of the business, aggregate planning is done by

product families

hiring, training and laying off personnel are costs associated with changed in the _________ rate

production

the number of units completed per unit of time is called the ____________

production

in a stable workforce - variable work hours plan, one varies the _________ rate by varying the number of __________ worked through flexible schedules and overtime

production, hours

short-term operations and supply chain tasks are focused mostly on scheduling _________ and shipment _________

production, orders

when an organization consistently uses a single variable only to modify production plans, such as hiring/firing, building/depleting inv, it is likely deploying a ________ strategy

pure

a means of justifying a price difference to customers (such as first-class airline seats) is known as a...

rate fence

by simulating various master production schedules and calculating corresponding capacity, labor and equipment requirements, one is developing a..

rough cut aggregate plan

a ______-____ aggregate plan may be further modified by mathematical methods to develop a lower cost plan

rough-cut

What process gives senior management a better handle on the meeting customer demand over a 3 to 18 month time horizon?

sales and operations planning

the planning process that helps firms provide better customer service, lower inventory, shorter lead times, and stabilized production rates is known as ________ and ________ planning

sales, operations

Yield management is most effective when demand can be ________ by customer

segmented

benefits of the sales and operations planning process are better customer ________, stabilized ________ rates, & lower ___________

service, production, inventory

The aggregate operations plan may be developed by ___________ a number of master production schedules to choose the best option

simulating

which of the following is considered a "pure" production planning strategy?

stable workforce, variable work hours

when a manufacturer uses a _____________strategy there is a risk of losing control of the schedule and/or quality

subcontracting

An external factor that influences a production plan is

subcontractor capacity

a common approach to developing an aggregate operations plan is from

the corporate annual plan

Yield management allocated capacity according to _______, type of __________, and type of _________

time, customer, capacity

the number of workers needed to meet production requirements is called

workforce level

Which of the following activities follows aggregate sales and operations planning?

workforce scheduling

one means of making demand more predictable is ________ management

yield