C720 - Operations and Supply Chain Management (10-11)

Which production process would probably be used in the production of automobiles?

Assembly line

Which of the following differentiates MRP II from MRP?

MRP is primarily concerned with materials, while MRP II encompasses the entire manufacturing process.

________ elicit information from specific groups, such as consumers, and are usually conducted via a questionnaire or a phone interview.

Surveys

True of False? Moving from an MRP system to MRP II is likely to facilitate a better integration between manufacturing and human resources.

True

True or False For operations managers who are in charge of continuous flow processes, the primary scheduling dilemma involves knowing the best time to switch from making one product to making another product.

True

Which of the following should result from forecasting efforts?

A prediction of the future

Which of the following involves combining individual end-items into groups for planning purposes?

Aggregate planning

How can balance be achieved on an assembly line?

Assigning the same amount of work to each station.

Historically, what type of manufacturing process has been used in the pharmaceutical industry?

Batch

Which formula can be used to calculate a run-out time?

Current inventory/usage rate = Run-out time

Maine Woods Company has run MRP to determine how purchase orders and shop orders need to be changed to accommodate shipping the order to its customer a week early. This change means that several departments will need to begin work immediately on subassemblies for this order. What is the next action Operations needs to take?

Deliver a daily dispatch list to all departments based on the new priorities.

Which of the following is a qualitative method that requires members of a panel to provide a sequence of forecasts through responses to questionnaires?

Delphi Technique

How is chase demand scheduling usually implemented in the fast-food industry?

Hiring part-time workers.

Which statement relates best to the scheduling of services when a peak demand approach is utilized?

It allows for demand to be met at all times under normal conditions.

________, which is based on current usage rates, helps determine which product to manufacture next.

Run-out time

________ serve as boundaries between periods in the planning horizon and act as planning limits.

Time fences

An operations manager would create a shop order to ________.

authorize production to make component parts

With batch processing, when operations managers know the ----------, they can determine which product should be produced next.

run-out time

The planning horizon shown in this master schedule is ----------. The lead time to buy or make parts and build a tricycle, toy wagon, or scooter is at least ----------. Maine Woods Company uses a time bucket of ---------- for tricycles in its master production schedule.

)3 months (The planning horizon is the length of time displayed in the plan or schedule. This master schedule shows a planning horizon of 3 months.) 10 weeks (The planning horizon for a master production schedule is set at least as long as the cumulative lead time to make a product. Often, it is set one to two weeks longer than the lead time to allow a margin of error. The lead time for tricycles, toy wagons, or scooters must be less than or equal to the 12 weeks of the planning horizon.) 1 week (The MPS for Maine Woods Company wheeled goods products is in weekly buckets.)

An apparel company has an inventory of 2,500 units of style X and a demand or usage rate of 500 units per week. What is the run-out time?

5 weeks

What is run-out time?

A calculation of how long it will take for the company to run out of a product at current usage rates

Which statement relates best to using a chase strategy when scheduling services?

A chase strategy works by adjusting production rates to match demand by varying the workforce and using overtime.

What characteristics are common to scheduling production for continuous processes and assembly lines?

A limited number of products, few possible routings, and small work-in-process inventories

Which type of company might utilize a peak demand approach when scheduling production?

A transportation company (A transportation company provides a service that can only be provided at the time of demand. They might use a peak demand approach when scheduling.)

Which production process would probably be used in the production of multiple ice cream flavors?

Batch process (A batch process exists when a process is stopped, equipment is changed, and the next product is made. This occurs when multiple flavors of ice cream are manufactured.)

Which statement below represents an advantage of using the peak demand method of scheduling?

Capacity is available to accommodate customers when demand is high.

King Burgers schedules more workers on busy weekends and fewer workers on slower week days. King Burgers bases its schedule on ________.

Chase Demand

Which production process would probably be used in the production of bulk paper?

Continuous process (The process of making paper involves shifting tasks from one workstation to another as trouble spots appear. This is a characteristic associated with a continuous production process.)

---------- refers to demand that is generated by a firm's production processes.

Dependent Demand

What challenge is associated with scheduling a batch process?

Determining the number of units to produce in one batch and the sequence of batches

Which statement represents a dilemma when scheduling for continuous processes?

Determining when to change from making one product to making another.

After another year of excellent performance, the aircraft company representatives visit your uncle's growing shop. They invite him to join their "Gold Vendor" program and the offer includes two new contracts for a new kind of conduit they will use in a new jumbo jet. They inform him that the "Gold Vendor" program will require him to document a centralized system for managing all data that originates in his company. He does not have to share the data with them, but must prove that he collects, stores and uses it. Of the three types of systems we have studied, which would you recommend if he wants to become a "Gold Vendor"?

ERP (Your uncle's needs have expanded such that he now needs enterprise-level data to support his new contracts and fulfill the "Gold Vendor" program.)

True or False A fast-food restaurant that schedules more workers on historically busy days of the week and fewer workers on typically slow days is using the peak demand scheduling approach.

False (Chase demand scheduling, not peak demand, involves adjusting production rates to match demand by varying the workforce or using overtime.)

True of False? Demand from customers is considered dependent demand, while demand generated by a firm's production process is considered independent demand.

False (Dependent demand is usually demand for an item that is generated by a company's production process.)

True or false? Mean squared error (MSE) is calculated by subtracting a forecast for one time period from the actual value for the same time period.

False (Forecasting error can be calculated by subtracting the forecast for one time period from the actual value for the same time period. However, mean squared error (MSE) is the average of all squared errors.)

True or False? MRP II is an extension of MRP I that become necessary when computer hardware speed exceeded the ability of MRP I to keep up.

False (MRP II expanded manufacturers' ability to add data from non-manufacturing processes.)

MRP systems were sufficient to handle the data manufacturers required to manage their materials requirements flows.

False (MRP II systems evolved to enable manufacturers to integrate data from non-manufacturing departments and processes into their overall enterprises.)

True & False The peak demand approach and chase strategy are the only scheduling methods that can be used to deal with the uneven demand of services.

False (Other methods such as scheduling appointments or reservations for service, increasing consumer self-service, creating adjustable capacity, sharing capacity, and cross-training employees can also be used to cope with uneven demand.)

True or false? If a service firm develops a schedule according to chase demand, the firm will have enough capacity available at all times to meet maximum expected demand.

False (Peak demand, not chase demand, means that sufficient capacity will be available at any time to meet the peak expected demand.)

True of False? The bill of materials identifies the quantity of materials needed to support the master schedule.

False (The material requirements plan (MRP) identifies how much of each material is needed to support the master schedule. The bill of materials identifies how much of each material is needed for a single item of the finished good.)

True or False? An appliance manufacturer, Freddie's Fridges, has a time fence of 10 weeks. The Marketing Manager has just told Freddie that he expects a 20% increase in demand in 12 weeks. This increase should be captured in the current master schedule.

False (The time fence is 10 weeks. Events outside the time fence are not captured in the master schedule.)

True or false? In a master production schedule, time buckets serve as boundaries between periods in the planning horizon. As a result, items that fall outside of the time bucket are not included in the plan.

False (Time fences, not time buckets, act as boundaries between periods in the planning horizon and represent the limits for planning. Items falling outside the time fence are not included in the plan.)

________ is an attempt to predict the future by studying past experiences for the purpose of gaining insights.

Forecasting

Which of the following is a key question for successful scheduling in a batch process?

How many units should be produced at one time?

Review the Maine Woods Company aggregate plan above. Note that the aggregate plan, as a medium-term planning tool, extends 12 months into the future. Maine Woods Company is developing a master schedule for the products in its wheeled goods product line. The master schedule for Maine Woods Company will only cover 8 to 12 weeks. Which of the following best explains why a master schedule will typically cover a shorter time frame than an aggregate plan?

Information about customer demand for the specific mix of products will be more accurate in the shorter term. (The master schedule determines the exact product mix that will be produced by a company. Most companies use a shorter planning period for the master schedule because the knowledge of what product mix is demanded by the customer is more accurate in the near future, and less accurate further out in time.)

Which statement represents an advantage of using the chase strategy in scheduling services?

It enables an organization to meet anticipated demand.

Chase demand is a strategy useful for some types of businesses when scheduling employees.

It requires a flexible workforce.

Which statement represents a disadvantage of using the chase strategy method of scheduling services?

It requires an extremely flexible workforce.

Franklin Industries uses a continuous flow process to manufacture two different products. What is most likely the primary scheduling dilemma the firm experiences?

Knowing when to change the type of product being manufactured.

Review the previous example about Monster Energy Company. MRP has been described as a tool which helps to "plan a meal." If a 15 ounce can of Java Monster Loca Moca is the meal, one of the ingredients is ____.

Liquid coffee

Merck is interested in moving to a continuous manufacturing process for solid oral dose products because they desire ----------.

Localized manufacturing closer to the consumer

The Merck executive mentioned several advantages of the continuous manufacturing process. Which of the following IS NOT an advantage of continuous manufacturing?

Lower costs

Your uncle runs a one-person job shop. He has just been awarded a contract by an aircraft manufacturer to build a very specialized seal for its new plane. The vendor does not demand access to any data from your uncle, just the finished product. He does not currently use a resource planning tool. Because of the volume of the contract, he asks you to recommend a system. Of the three we have studied, which would you recommend?

MRP (Your uncle only needs to track the production of one simple item. MRP will provide him with planning power without disrupting his overall system.)

After one year, your uncle has produced seals of high enough quality to qualify for the aircraft manufacturer's "zero defects vendor" program. In order to participate, he must supply the company with detailed data about his suppliers, ordering processes, shop layout, inventory and shipping procedures. He recognizes the need for a system to track and integrate all of his data. Of the three we have studied, which would you recommend?

MRP ll (MRP II gives your uncle the power to integrate systems such as finance, HR and shipping, which matches the customer's data requirements.)

What statement relates to continuous processes, assembly lines, and batch processes?

Many batch operations use continuous flow or assembly line processing.

Which of the following is based on the aggregate plan and is designed to specify exactly what will be produced and when it will be produced?

Master production schedule

MRP II is considered an improvement on MRP because:

More data, if managed properly, tends to drive better decisions.

Continuous flow processes are used in which of the following industries?

Oil refinery

Which scheduling approach involves having enough capacity available at all times to meet the maximum expected demand?

Peak demand scheduling

Which of the following best explains why assembly line balancing is not an exact science?

People assigned to the tasks have different abilities.

A company produces three products X, Y, and Z. Product X has a run-out time of two weeks, Product Y has a time of four weeks, and Product Z three weeks, respectively. Which product should be produced next? Which product, X, Y, or Z, should be produced next?

Product X Product Z

Scheduling in manufacturing is complex because different production processes will also incur different problems, and certain criteria will, therefore, be more important. Which criteria or factors should be evaluated regardless of process types?

Providing goods when the customer wants them and minimizing flow time, WIP, machine idle time, employee idle time, and costs.

Maine Woods Company prides itself on carrying very little inventory of finished goods, and making products when they are due. One of Maine Woods Company's biggest customers contacted the Sales department to ask for its next order, which is due in three weeks, to be shipped a week early. This customer is rolling out a large promotional campaign for wooden toys to boost sales of children's toys. Once the Operations department agreed to try to finish production early, the master schedule was updated to move the customer order to an earlier time bucket. What is the next action Operations needs to take?

Run MRP again to determine changes to shop orders and purchase orders.

Which of the following is NOT input data needed for MRP? Inventory records Master production schedule Shop order Bill of materials

Shop order

Recall from the previous module that Apple is likely to use the iPod product line as the basis of an aggregate plan. When Apple disaggregates its iPod aggregate plan, which of the following will be an output from the disaggregation?

The master production schedule for 5th generation iPod Touch in Space Gray and Silver (Disaggregation of an aggregate plan (which is at the product level) results in a master production schedule for each individual end item or product model.)

What relevant criteria contribute to challenges in scheduling continuous production processes?

The minimization of costs and idle time

Which characteristic is considered important for scheduling to balance an assembly line?

The ratio of work to workstations

An appliance manufacturer, Freddie's Fridges, makes the Model X Compact Refrigerator, which is most often installed in motor homes and RVs. One of Freddie's suppliers has just notified the company that the lead time will increase from three weeks to five weeks. This supplier was already the longest lead time in the production process. What will be the effect on the time fence?

The time fence will increase by two weeks.

Which statement below represents a disadvantage of using the peak demand method of scheduling services?

The underutilization of capacity a large percentage of time

True or false? Demand from customers is a type of independent demand, while demand from a firm's production processes is a type of dependent demand.

True

True or false? To ensure that raw materials are ordered, component parts are manufactured, and final products are assembled and shipped in a time that will satisfy demand, a master scheduling horizon should be at least equal to the longest cumulative lead time of any product or its components.

True

True of False? A time bucket can be one hour.

True (A time bucket can be any amount of time a company uses to group demand and requirements for master schedules and material requirements planning.)

True of False? The BOM is exploded each time a company runs MRP.

True (In order to run MRP, a company must explode the bill of materials, that is, run MRP for all of the components and subassemblies which are part of the product shown in the master schedule.)

Different operational processes require different scheduling techniques. However, managers use the same two key questions to determine which to deploy. Fill in the blank to complete each question. ---------- should a given job, order, or product be processed? How many ---------- should be processed at one time?

When units

Sequencing is another characteristic associated with balancing an assembly line. It involves determining the order for making different products. When is sequencing most important in scheduling to balance an assembly line?

When the product differences vary significantly

A manufacturer that uses the assembly line process strives to attain ________, which requires assigning the same amount of work to each workstation and having the appropriate number and type of workstations.

balance

On an assembly line, assigning the same amount of work to each workstation and having the appropriate number and type of workstations is necessary to achieve ________.

balance

In a manufacturing environment that uses a(n) ________, the main scheduling dilemma stems from knowing the best time to switch from making one product to making another product.

continuous flow process

Maine Woods Company has an inventory management system which is continually updated as parts (such as wood blocks, wheels, and front axles) are used in production. However, the Inventory Manager has found that a physical count of what is in stock should be made at least once a month in order to ensure errors are adjusted in the system. The physical count is a ----------. The timing of the count is the ------------.

cycle count replenishment cycle

One characteristic includes the amount of work assigned to a workstation with the most work and time and is called ------------.

cycle time

The scheduling of continuous production processes are generally characterized by--------- different finished products, ---------- possible routings, and ---------- work-in-process inventories.

few few low

To use an MRP II system, an organization needs all of the data required by MRP, plus data from sources such as ----------, ---------- and ----------.

finance (MRP II enables manufacturers to add data from their finance systems.) human resources (MRP II introduced the ability to integrate human resource data with the production planning modules in MRP.) shipping (MRP II introduced the ability to integrate shipping information into the production planning process.)

For a company that manufactures motorcycles, ________ would be considered independent demand items.

finished motorcycles

The build quantities in the master schedule become a data input to the material requirements plan. The material requirements plan determines how many components or subassemblies are needed to make the build quantities. For companies which build custom products, the master schedule may be at the subassembly level. In that case, the material requirements plan will determine _____.

how many components are needed to make the build quantities.

Maine Woods Company has created a master schedule for the next 12 weeks for its "scooters." The master production schedule represents ----------. Maine Woods Company will next use its material requirements planning (MRP) system to determine how many wheels, platforms, etc to order to support the build schedule. MRP represents ----------.

independent demand dependent demand

Executives at Babson Batteries are developing a 5-year plan that addresses the number of new facilities the firm should build and the type of process technologies that should be used. The executives are engaged in ________.

long-range operations planning

A ________, which is based on the aggregate plan, is designed to specify exactly what will be manufactured and when it will be manufactured.

master production schedule

A company has determined that the cumulative lead time to produce one of its products is five months. "Five months" will be the minimum -----------.

master schedule planning horizon (The master schedule's planning horizon is at least as long as the cumulative lead time for the product. If the lead time for this product is five months, then the master schedule will be at least five months, to ensure the company has the right mix of parts and other resources needed to build this product to meet customer demand.)

Many firms manage inventory for dependent demand items by using ________.

material requirements planning

When planning takes place for a time period of 6 to 18 months, it is best described as ________ operations planning.

medium-range

When companies switched from MRP to MRP II, it enabled them to integrate data from ----------.

non-manufacturing departments (MRP II enabled companies to add modules to their MRP systems that exchanged data with internal departments and processes.)

Data that are needed for scheduling begin with _________________.

orders from the customer

A service firm that has sufficient capacity available at all time to meet maximum expected demand is using the ----------- approach to scheduling.

peak

With batch processing, run-out time is calculated to determine the ________.

product to manufacture next

The peak demand approach and chase strategy are common approaches that can be used when scheduling ------------ that ---------- be produced for inventory to deal with ---------- demand.

services (These common approaches are used to schedule services.) cannot (Unlike goods, services cannot be inventoried.) uneven (Services often deal with uneven demand.)

In a master production schedule, ---------- serve as boundaries between periods in the planning horizon.

time fences

The costs of phone and Internet service is considered a ----------- cost to the company.

variable