Chapter 14 Sales and Operations Planning Process
Adjusting available capacity by hiring and firing workers to match demand is an example of a(n) ________ strategy.
b. chase demand
Sales and operations planning is an aggregate planning process for a(n)______________ time horizon.
b. intermediate
Beginning Workforce = 125 workers Production per Employee = 500 units per quarter Hiring Cost = $750 per worker Firing Cost = $1,500 per worker Inventory Carrying Cost = $10 per unit per quarter If a chase demand strategy is used the total hiring and firing costs for the production plan is
c. $202,500.00
Beginning Workforce = 125 workers Production per Employee = 500 units per quarter Hiring Cost = $750 per worker Firing Cost = $1,500 per worker Inventory Carrying Cost = $10 per unit per quarter If a chase demand strategy is used then the number of workers hired at the start of quarter 4 is
c. 75
Beginning Workforce = 125 workers Production per Employee = 500 units per quarter Hiring Cost = $750 per worker Firing Cost = $1,500 per worker Inventory Carrying Cost = $10 per unit per quarter If a level production strategy is used the number of workers required each quarter is
c. 85
Which of the following is not a strategy for managing demand?
c. Redirecting demand to a competitor.
Problems associated with using a part-time workers strategy for adjusting capacity include all of the following except
d. high retirement costs.
Which of the following is not a strategy for adjusting capacity?
d. product substitution
A chase demand strategy is one of several alternatives available for managing demand.
f
A chase strategy involves hiring and firing workers so that production trails demand.
f
A mixed strategy for adjusting capacity is simpler and easier to implement than any pure strategy.
f
Aggregate planning involves the process of determining the timing and quantity of production for an individual item over an intermediate time frame.
f
An operations plan is an input into the sales and operations planning process.
f
One objective of sales and operations planning is to develop a companywide game plan to satisfy production.
f
Overtime and undertime are common strategies for adjusting demand.
f
Sharing information and synchronizing production across the supply chain is known as disaggregation.
f
The transportation method is used for aggregate planning when the strategy for adjusting capacity is hiring and firing workers.
f
When demand fluctuations are extreme using overtime and undertime is a feasible strategy for adjusting capacity.
f
Disaggregation is the process of breaking a sales and operations plan into more detailed plans.
t
Financial constraints are one of the major inputs of the sales and operations planning process.
t
Inventory holding costs are an important consideration for the level production strategy.
t
Most companies use mixed strategies for managing demand.
t
Most companies use mixed strategies for production planning.
t
One of several strategies for managing demand is to shift it into other time periods using incentives, sales promotions, and advertising.
t
Revenue management seeks to maximize profit from time-sensitive products and services.
t
Subcontracting is a feasible alternative for adjusting capacity provided the supplier can reliably meet quality and time requirements.
t
With a pure strategy for aggregate planning only one capacity variable is changed.
t
Strategies for proactive demand management would not include
using subcontracting to meet unexpected high demand levels.
Beginning Workforce = 125 workers Production per Employee = 500 units per quarter Hiring Cost = $750 per worker Firing Cost = $1,500 per worker Inventory Carrying Cost = $10 per unit per quarter If a level production strategy is used the number of units to produce each quarter is
A. 42500
Implementing a companywide game plan for allocating resources addresses the long-standing battle between operations and finance.
Ans: False
Sales and operations planning is an aggregate planning process that determines the capacity needed to meet immediate demand.
Ans: False
The level strategy for adjusting capacity is only appropriate when there is no variation in demand.
Ans: False
An aggregate operations plan specifies the production quantities for an entire product family or product line.
Ans: True
An economic strategy for adjusting demand can include adjusting capacity or managing demand.
Ans: True
Which of the following is an objective to sales and operations planning?
Develop an economic strategy for meeting demand.
The primary cost associated with the level production strategy is the cost of
a. holding inventory.
The term aggregate planning reflects the fact that plans are developed for ___________, rather than _____________.
a. product families, individual products
Beginning Workforce = 35 workers Production per Employee = 1,250 units per quarter Hiring Cost = $500 per worker Firing Cost = $1,000 per worker Inventory Carrying Cost = $20 per unit per quarter If a chase demand strategy is used then the number of workers hired at the start of quarter 2 is
b. 20
Beginning Workforce = 125 workers Production per Employee = 500 units per quarter Hiring Cost = $750 per worker Firing Cost = $1,500 per worker Inventory Carrying Cost = $10 per unit per quarter If a chase demand strategy is used the number of workers fired at the start of quarter 3 is
b. 40
Which of the following is an output of sales and operations planning?
c. operations plans
All of the following are inputs to the aggregate production planning process except
c. sales plans
Beginning Workforce = 125 workers Production per Employee = 500 units per quarter Hiring Cost = $750 per worker Firing Cost = $1,500 per worker Inventory Carrying Cost = $10 per unit per quarter If a level production strategy is used the number of units in inventory at the end of quarter 3 is
d. 20,000
Shifting demand into other time periods can be accomplished through
d. All of these answer choices are correct.
The most effective aggregate planning strategy depends on
d. All of these answer choices are correct.
