Op Management Final
Silo Mentality
failing to see the big picture, and acting only in regard to a single department within the firm, or single firm within the supply chain
bullwhip effect
occurs when distorted product-demand information ripples from one partner to the next throughout the supply chain
Lean thinking
operating philosophy
Inventory cost reduction results in
profit increase, but only if stockout costs are avoided
Types of inventories
raw materials, work-in-process, and finished goods
Service Level
the percentage of time the firm wants to be in stock
Logistics
the process of planning, implementing, and controlling the efficient, effective flow and storage of goods, services, and related information from point of origin to point of consumption for the purpose of conforming to customer requirements
Order lead time
the time from order receipt to arrival of the order
Lean layouts tend to...
use more visibility than traditional layouts
What percentage of Fortune 500 companies use Six Sigma?
50%
Customer lifetime value value is used to segment customer based upon their:
Both current and future profitability
Managing customer flows effectively leads to
Both enhanced customer satisfaction and firm competetiveness
Strategic fit requires the alignment of product design with:
Both external and internal fit
Which of the following is the most likely result of a process that limits the output of a system?
Bottleneck
Cross-functional teams would be associated with which of Deming's 14 Points for Management?
Break down barriers between departments
A tool used to determine the frequencies of specific problems is referred to as what?
Check Sheet
A new development in the product development and commercialization process is to design new products concurrently or sequentially?
Concurrently
A firm makes what type of plans to accommodate unforeseen changes and forecast errors?
Contingency
A bank emailing monthly statements to a customer would be an example of which type of information flow?
Corporate
Core competencies are primarily used to:
Create competitive advantage
Which of the following is most likely an example of a job shop?
Custom furniture manufacturer
Focus of lean thinking in the services sector
Customer needs
CRM refers to which concept?
Customer relationship management
An airline that divides its customers into VIP, Preferred, and Regular customer sets is practicing what principle?
Customer segmentation
Demand patterns that occur every several years and are influenced by macroeconomic and political factors
Cyclical
T or F: The primary benefit for companies to engage in global sourcing is to procure better quality products.
False
T/f: Differential pricing is viewed as intrinsically fair by customers
False
T/f: Forecast quality is likely to only impact inventory levels of finished goods, raw materials, and components
False
T/f: In CPFR, trading patterns should exercise caution and be reluctant to share information
False
T/f: Integrating lean into the culture of an organization causes unnecessary confusion and lean should be left to the production areas
False
T/f: Lean and sustainability are two concepts that do not go together well
False
T/f: Quantitative forecasts are based on opinions and intuition
False
T/f: Using customers as servers is referred to as yield management
False
T/f: a box of cereal on a grocery store shelf is an example of a work-in-process
False
T/f: the bullwhip effect is used in the meat packing industry to differentiate between beef and pork
False
True/ false: lean systems are largely static and unchanging
False
Supply chain flexibility is _____ than/ as in the past.
Greater
Negative consequences resulting from holding substantial amounts of finished goods for delivery any time that a customer demand is experienced
High carrying costs
Make-to-Stock processes are characterized by all of the following except:
High degree of customization available
An assembly line is characterized by which of the following?
High volume, limited flexibility
For products with similar investments, managers usually will choose to invest in the product with the _________ IRR?
Highest
An organization's strategy is not primarily designed to consider which of the following?
How the organization makes decisions on a day-to-day basis.
The use of too much service capacity can result in...
Idle servers and high labor costs
Six Sigma focuses on?
Improving quality
Successfully implementing lean can potentially result in
Increased productivity, reduced inventory levels, increased customer satisfaction
Holding too little inventory does what to the risk of a stockout?
Increases
Spend Categories
Internal assessment of purchases, the purchases are commonly divided into these categories
Which process is best suited for a company offering customtized products?
Job Shop
A signigicant roadblock to the implementation of lean practices in an organization can be the lack of a?
Lean culture
The reduction of waste, along with continuous improvement, and the synchronization of material flow within the organization and between supply chain trading partners are characteristics of which operations management development.
Lean thinking
A batch process requires ________ flexibility versus a job shop.
Less
The use of too little service capacity can result in...
Long customer wait times and lost sales
A process via which a specialty product is made based upon customer specifications would most likely be a __________ process.
Make-to-Order
Which of the following is not a basic operations management activity?
Marketing
What does MRP stand for?
Material requirements planning
In Six Sigma, what is the abbreviation of opportunities for a defect to occur
OFD
The administrative costs associated with purchasing items
Order cost
Production on a limited basis to determine if production equipment can reliably manufacturer the product at full scale is referred to as:
Pilot manufacturing
A diagram showing the sequence of steps involved in a process is a:
Process flowchart
The process of making decisions about the characteristics, features, and performance of a company's goods and services refers to?
Product design
Poor forecasting and production planning can negatively impact all of the following *except*: Customer relationships, product reliability, sales, profitability
Product reliability
Lean systems a.k.a
Pull system
The actual cost of items bought from a supplier
Purchase cost
A firm launching a new product for which historical data does not exist would likely use which type of forecasting technique?
Qualitative
Formal Request for Pricing, Services and Plans
RFP
Unexpected events that may lead to demand
Random variation
What type of inventory is wheat and other ingredients used to make bread considered?
Raw material
Potential benefits of better forecasting
Reduced stockouts, smoother production plans, and reduced costs
The simple moving forecasting technique is...
Relatively easy to use
Example of process automation
Self-service checkouts
Quality philosophy that drives a firm to lower prices, higher quality, and fast responses
Six Sigma
Carrying too little inventory can lead to
Stockouts, plant shut downs, and dissatisfied customers
In a typical supply chain, goods flow in which of the following manners?
Supplier - Manufacturer - Distributor - Retailer - Consumer
Purchase Spend
The amount of money that a firm spends on goods and services
"Managing the relationships among people within an organization and between customers and the company's customer service reps in order to improve the bottom line" is the definition of which concept?
The customer relationship process
Which of the following definitions is most closely associated with "operations management"?
The effective planning, organizing, and controlling of the value-creating activities of the firm
T or F: ISO 9000 is the standard most often associated with quality management
True
T or F: TCO (total cost of ownership) is a relatively common approach used to compare competing price quotes
True
T/f: A multiple server "snake line" style queuing system is more efficient than a system with separate queue lines
True
T/f: Anticipation inventories allows demand to be met during periods of expected high demands
True
T/f: Capacity sharing refers to finding uses for underutilized capactiy
True
T/f: Customer employee interaction takes place at customer contact points
True
T/f: Cycle inventories are created when a firm purchases or produces a quantity large enough to last until the next purchase or production period
True
T/f: Demand management is broadly defined as the process that balances customer requirements with supply chain capabilities
True
T/f: Economic order quantity (EOC) derives the order cost that will minimize the sum of the annual inventory holding cost and annual order cost
True
T/f: Field personnel might be able to generate good forecasts because they are close to their customers and markets
True
T/f: Independent demand refers to the external demand for a firm's finished products
True
T/f: Kanbans are used to control the flow of inventory through the facility
True
T/f: Many lean efforts begin with the implementation of the Five S's
True
T/f: Part-time employees offer companies greater capacity flexibility
True
T/f: SMED stands for single-minute exchange of die
True
T/f: The jury of executive opinion approach is beneficial because of the collective knowledge of the executives
True
T/f: The line of visibility separates a customer contact point from points where customer contact does not take place
True
T/f: When developing a sales forecast, sales force personnel might be inclined to submit lower sales forecasts in order to achieve sales targets and receive greater bonuses
True
T/f:Inventory that is used to satisfy unforeseen demand is referred to as safety stock
True
True or False: One objective of supply chain management is to maintain an uninterrupted glow of goods and services to the organization at desired customer service levels
True
True/ false: the elimination of non-value adding activity is the key focus of lean waste reduction
True
True/False: A batch process is found in organizations where moderate customization and higher volume are required by customers
True
True/False: A process is a method for getting work done.
True
True/False: An organization's strategic plan addresses the organization intends to achieve its mission.
True
True/False: Another name for environmental product impacts known as life cycle assessments is cradle-to-grave analysis.
True
True/False: Business Process Reengineering is the fundamental rethinking and redesign of a process to achieve dramatic improvements in efficiency and effectiveness.
True
True/False: Customer Relationship Management (CRM) is managing the firm's customer base so they remain satisfied and continue to purchase goods and services.
True
True/False: Customer segmentation refers to a firm grouping its customers within its customer database.
True
True/False: Firms compete using three competitive directions: cost, quality, and customer service.
True
True/False: In many industries, more than 40% of revenues are generated from products introduced during the previous year.
True
True/False: Mass customization processes is a hybrid process, combining several aspects of the job process and the assembly line process
True
True/False: Operations strategies are a set of decisions with the operations function to support the mission and strategy of the frim.
True
True/False: Production processes are matched to the product by considering the desired production volume and the variety of goods/services that customer desire.
True
True/False: Quality Function Development (QFD) begins with identifying, listening to, and surveying customers.
True
True/False: Supply Chain Management is the integration of key business processes concerning the flow of materials from raw material suppliers to the final customer.
True
Kanban
Used to signal a need for items from an upstream manufacturing cell
Pricing policies/ promotions
Utilizing pricing changes to alter demand
Strategic-alliance-based approach to controlling inventory and reducing costs
VMI
Costs that would contribute to inventory carrying cost
Warehouse rent, Shrinkage costs, and Handling costs
Lean systems
Waste elimination
What type of inventory is bread being baked?
Work-in-process
Five-S
a common approach to waste reduction
Kaizen
A Japanese term for continuous improvement
Example of Employee scheduling
A restaurant using more servers on busy evenings
Example of a customer contact point
A ticket window at a theater
Meeting forecasted demand while minimizing costs and maximizing customer service over a series of planning periods
Aggregate Planning
5 modes of transportation
Air, Rail, Truck, Water, Pipeline Carriers
Employee cross-training
Allowing employees to seamlessly move from an idle process to a busy process
Example of yield/ revenue management
An airline that overbooks seats on its aircraft
Dell's computer production process is most closely associated with which type of process?
Assemble-to-Order
All of the following are leading to shortened product life cycles except?
Decreased competition
Lean thinking with a firm's suppliers involves
Delivery of smaller quantities, more frequent deliveries, and delivery to point of use
A quantitative forecasting technique that relies on group convergence
Delphi method
Forecasted demand and customer requirements with supply chain capabilities are part of this supply chain process.
Demand management
Queuing analysis can likely be used to do...
Determine customer waiting times, determine the number of customers waiting in queue, and assist in capacity decisions
Lean Warehousing
Eliminate non-value-added steps and waste in storage process
What does ERP stand for?
Enterprise resource planning
A customer paying a bill through a bank's online systems would be an example of which type of information flow?
Environmental
Most accurately describes the concept of forecasting
Estimate future demand
Waste
Excess inventories, scrap losses, rejects, and rework
Over-forecasting likely leads to
Excessive hiring
Capacity sharing
The matching of service capacity to customer demand to minimize customer waiting
Work flow
The movement or transfer of work from the customer through the organization
Risk Pooling
The relationship between the number of warehouses, system inventories and customer service
Business process integration refers to which of the following?
The sharing and coordination of key processes between companies in a supply chain.
Yield/ revenue management
The use of overbooking, allocating capacity among customer segments, and differential pricing
A philosophy that suggests that a system is only as good as its weakest part is the:
Theory of Constraints
What is the x-axis on a Ghatt Chart?
Time
A philosophy that encompasses a collection of processes that seek to improve quality continuously to please customers, reduce costs, and ultimately create a competitive advantage for the firm is referred to as:
Total Quality Management (TQM)
What type of inventory function is oil that is on an oil tanker that is in transit to a customer?
Transportation
Successfully managing inventories can positively impacts
customer service, competitiveness, and cost
