Exam 3
Postcompletion Phase
"wrap-up" reassignment of project resources
DRP
A time-phased planning approach that uses planned orders at the point of demand to determine forecasted demand at the source level is:
downstream supply partners' requirements.
Forecasts in a company using a distribution requirements planning system are typically based on:
bill of material
If a manufacturer had no inventory of any kind but had orders for 10 finished units of their sole product, their buyer would know what parts to order if they were supplied with a:
the single card is the production card.
In a single-card kanban system:
the move card signals when a container of parts should move to the next process step.
In a two-card kanban system:
overproduction
Inflexible or unreliable processes cause organizations to produce goods before they are required; this is called:
advantages of MRP (ch12)
MRP is directly tied to the master production schedule and indicates the exact timing and quantity of orders for all components MRP allows managers to trace every order for lower-level items through all the levels of the BOM, up to the master production schedule MRP tells a firm and its suppliers precisely what needs to be made when
special considerations in MRP (ch12)
MRP requires organizational discipline and accurate information MRP must be able to accommodate uncertainty MRP nervousness
concept phase.
Project planners develop a broad definition of what the project is and what its scope will be during the:
restocking level (ch11)
R
defects.
Scrap or rework are examples of the lean waste recognized as:
unnecessary inventory.
The delivery lead time was highly variable as was the quality of the product being shipped. These two factors combined to contribute to the waste of:
factory
The factory produces product and ships it to the distributor. The distributor sends it to the wholesaler when they receive an order. The wholesaler ships the product to the retailer as the retailer requests replenishment. The customer visits the retailer's bricks and mortar store to purchase the product when they run out. Which of these supply chain members is most likely subjected to the greatest variability in customer demand?
For the system to work properly, demand rates must be relatively stable and interruptions must be minimized.
Which of the following statements regarding supply chain synchronization using kanbans is BEST?
with the first problem that surfaces as inventory is removed from the system
a company puts on their Lean thinking caps and decides to attack their own processes. Where should they begin their troubleshooting efforts
forecasted demand (ch12)
a company's best estimate of the demand in any period
master schedule (ch12)
a detailed planning process that tracks production output and matches this output to actual customer orders makes specific the overall resource levels established by S&OP states exactly when and in what quantities specific products will be made links production with specific customers orders, allowing the firm to tell the customer exactly when an order will be filled informs the operations manager what inventory or resources are still available to meet new demand
available to promise (ch12)
a field in the master schedule record that indicates the number of units that are available for sale each week, given those that have already been promised to customers
hedge inventory (ch11)
a form of inventory buildup to buffer against some event that may not happen
move card (ch13)
a kanban card that is used to indicate when a container of parts should be moved to the next process step
production card (ch13)
a kanban card that is used to indicate when another container of parts should be produced
bill of material (BOM)
a listing of all the subassemblies, intermediates, parts, and raw materials that go into a parent assembly showing the quantity of each required to make an assembly
network path (ch14)
a logically linked sequence of activities in a network diagram
lean six sigma (ch13)
a methodology that combines the organizational elements and tools of six sigma with lean's focus on waste reduction
critical-path method (ch14)
a network based technique in which there is a single time estimate for each activity
critical path (ch14)
a network path that has the longest, or is tied for the longest, linked sequence of activities
program evaluation and review technique (PERT) (ch14)
a network-based technique in which there are multiple time estimates for each activity
just-in-time (ch13)
a philosophy of manufacturing based on planned elimination of all waste and on continuous improvement of productivity. In a broad sense, it applies to all forms of manufacturing and to many service industries as well
lean (ch13)
a philosophy of production that emphasizes the minimization of the amount of all the resources (including time) used in the various activities of an enterprise. It involves identifying and eliminating non-value-adding activities in design, production, supply chain management, and dealing with customers can be applied to a wide range of production and service environments companies can and do use a wide range of planning and control techniques, not just kanban entirely consistent with business process improvement, quality improvement, and supplier management initiatives
material requirements planning (MRP)
a planning process that translates the master production schedule into planned orders for the actual parts and components needed to product the master schedule items managers dependent demand inventory which are inventory items whose demand levels are tied directly to the production of another item rough-cut capacity planning - a capacity planning technique that uses the master production schedule to monitor key resources requirements
kanban system (ch13) (pull system)
a production control approach that uses containers, cards, or visual cues to control the production and movement of goods through the supply chain
pull system (ch13)
a production system in which actual downstream demand sets off a chain of events that pulls material through the various process steps
planning and control (ch12)
a set of tactical and execution-level business activities that includes master scheduling, material requirements planning, and some form of production activity control and vendor order management
two-card kanban system (ch13)
a special form of the kanban system that uses one card to control production and another card to control movement of materials move card & production card
single-period inventory systems (ch11)
a system used when demand occurs in only a single point in time when excess inventory cannot be held in the future, firms must weigh the cost of being short against the cost of holding excess unit
project (ch14)
a temporary endeavor undertaken to create a unique product, service, or result clear starting and ending points after which the people and resources dedicated to the project are reassigned projects are non-routine, can be large or small, and may be difficult to manage projects typically require significant levels of cross-functional and interorganizational coordination
service level (ch11)
a term used to indicate the amount of demand to be met under conditions of demand and supply uncertainty assumes that the demand during the reorder period and the order lead time is normally distributed
MRP nervousness
a term used to refer to the observation that any change, even a small one, in the requirements for items at the top of the bill of materials can have drastic effects on items further down the bill of material
Distribution requirements planning (DRP)
a time phased planning approach similar to MRP that uses planned orders at the point of demand (customer, warehouse, etc.) to determine forecasted demand at the source level (often a plant) instead of gross requirements, they show forecasted demand activities at distribution centers are synchronized when their total weekly planned orders become forecasted demand in the factory's master schedule
lean supply chain management (ch13)
an extension of the lean philosophy to supply chain efforts beyond production. Lean supply chain management seeks to minimize the level of resources required to carry out all supply chain activities
bullwhip effect (ch11)
an extreme change in the supply position upstream in a supply chain generated by a small change in demand downstream in the supply chain
periodic review system (ch11)
an inventory system that is used to manage independent demand inventory where the inventory level for an item is checked at regular intervals and restocked to some predetermined level
continuous review system (ch11)
an inventory system used to manage independent demand inventory where the inventory level for an item is constantly monitored and when the reorder point is reached, an order is released inventory levels are monitored constantly, and replenishment order is issued only when a preestablished reorder point has been reached the size of a replenishment order is typically based on the trade-off between holding costs and ordering costs the reorder point is based on both demand and supply considerations, as well as on how much safety stock managers want to hold
waste (ch13)
any activity that does not add value to the good or service in the eyes of the consumer
projected ending inventory (ch12)
best estimate of what inventory levels will look like at the end of each week based on current information
concept phase (ch14)
broad definition and scope budget estimates within +- 30%
inventory drivers (ch11)
business conditions that force companies to hold inventory
cycle stock (ch11)
components or products that are received in bulk by a downstream partner, gradually used up, and then replenished again in bulk by an upstream partner
booked orders (ch12)
confirmed demand for products
inventory positioning (ch11)
deciding where in the supply chain to hold inventory the cost and value of inventory increase as materials move down the supply chain the flexibility of inventory decreases as materials move down the supply chain
planning phase (ch14)
detailed plans, timing, budgets and resources milestones project management tools and techniques
performance phase (ch14)
execution and control
safety stock (ch11)
extra inventory that a company holds to protect itself against uncertainties in wither demand or replenishment time
network diagrams (ch14)
graphical tools that show the logical linkages between activities in a project
gantt charts (ch14)
graphical tools used to show expected start and end times for project activities and to track actual progress against these time targets
replace the move card with the production card that was freed at the previous step
in a two-card system, a worker pulls a box of raw materials into the production process. After she removes the move card from the box, she should
forecasted demand
in distribution requirements planning the MRP records do not use the term gross requirements; instead the amount is shown as
independent demand inventory (ch11)
inventory items whose demand levels are beyond a company's complete control
dependent demand inventory (ch11)
inventory items whose demand levels are tied directly to a company's planned production of another item
transportation inventory
inventory that is "in the pipeline" moving from one link to another
anticipation inventory (ch11)
inventory that is held in anticipation of customer demand
transportation inventory (ch11)
inventory that is moving from one link in the supply chain to another
smoothing inventory (ch11)
inventory that is used to smooth out differences between upstream production levels and downstream demand
strategic change (ch14)
new product lines are introduced more often to fight off competitors information technology solutions become quickly out-of-date customer and supplier networks quickly change
eight commonly recognized sources of waste (ch13)
overproduction waiting unnecessary transportation inappropriate process unnecessary inventory unnecessary/excess motion defects underutilization of employees
critical activities (ch14)
project activities for which the earliest start time and latest start time are equal
crashing a project
shortening the overall duration of a project by reducing the time it takes to perform certain activities
project definition phase (ch14)
tentative schedules and budgets, organization, key personnel and resource requirements budgets estimates refined within +- 5% to 10%
master production schedule (MPS) (ch12)
the amount of product that will be finished and available for sale at the beginning of each week the MPS drives more detailed planning activities, such as material requirements planning (MRP)
planning horizon (ch12)
the amount of time the master schedule record of MRP record extends into the future the longer the production and supplier lead times, the longer the planning horizon must be
order quantity (q) (ch11)
the amount required to bring the inventory level back up to R
project management (ch14)
the application of knowledge, skills, tools, and techniques to project activities to meet project requirements
the project management institute
the association that actively promotes excellence in project management
MRP is based on:
the bill of material (BOM) backward scheduling explosion of the bill of material
project duration (ch14)
the duration of a project is equal to the duration of the critical path
project management trends (ch14)
the faster pace of strategic change the changing role of middle management
When using MRP and kanban together:
the number of kanbans is recalculated from the MRP system's order changes throughout the horizon.
forecasted demand (ch12)
the number of snow blowers each center expects to ship to retail customers each week when forecasted demand changes, mangers will need to increase the master production schedules accordingly DRP quickly translates downstream demand into upstream production decisions
economic order quantity (EOQ) (ch11)
the order quantity that minimizes annual holding and ordering costs for an item
rough-cut capacity planning
the planning technique that uses the master production schedule to monitor key resources requirements
supply uncertainty (ch11)
the risk of interruptions in the flow of components from upstream suppliers
demand uncertainty (ch11)
the risk of significant and unpredictable fluctuations in downstream demand
middle management (ch14)
the role has decreased due to more advanced information systems handling many of the tasks responsibilities given to middle managers have been pushed down to supervisors and employees
target service level (ch11)
the service level at which the expected cost of a shortage equals the expected cost of having excess units
target stocking point (ch11)
the stocking point at which the expected cost of a shortage equals the expected cost of having excess units
inflexible and unreliable processes
the waste of overproduction is caused by
inventory (ch11)
those stocks or items used to support production (raw materials and work-in-process items), supporting activities (maintenance, repair, and operating supplies) and customer service (finished goods and spare parts)
key characteristics of kanban (ch13)
uses simple signaling mechanisms to indicate when specific items should be produced or moved can be used to synchronize activities either within a plant or between different supply chain partners are not considered planning tools, but rather control mechanisms that are designed to pull parts or goods through the supply chain based on downstream demand
After a successful lean program (ch13)
wasted movement and space are eliminated and work centers are moved closer together inventory levels are reduced dramatically and work centers make only what is needed when it is needed
more deliveries of inventory
what would we expect from a JIT plant as compared to a plant that does not use JIT?
each box of raw materials must have a move card and each box of finished goods must have a production card
which of the following statements about a two-card kanban system is best?
lower lead time
which of these conditions is likely to cause a decrease in the probability of a stockout
performance phase
work on a project's constituent activities begins in the project's