BMS231 Final Exam

Question 1

What is inventory?

Answer 1

stock of items kept for use or sale in the future

Question 2

Decisions of inventory management

Answer 2

• how many units to order

- when to order

Question 3

Capital costs

Answer 3

interest rate to borrow money to invest in inventory

Question 4

Storage costs

Answer 4

cost of space, workers and equipment

Question 5

risk costs

Answer 5

damage, deterioration, theft, insurance, taxes

Question 6

Economic Order Quantity (EOQ)

Answer 6

The order size that minimizes total inventory control cost

Question 7

Economic production quantity (EPQ)

Answer 7

determines optimal production lot size to minimize total annual production setup and inventory holding

Question 8

supply chain

Answer 8

sequence of organizations- their facilities and activities- that are involved in producing and delivering a product

Question 9

supply chain management

Answer 9

collaboration of supply chain company and coordination to their activities so that market demand is met as efficiently and effectively as possible

Question 10

bullwhip effect

Answer 10

demand/order variability gets progressively larger the farther back on a supply chain the company is

Question 11

Risk pooling

Answer 11

holding safety stocks in one central location rather than in multiple locations

Question 12

delayed differentiation

Answer 12

production of standard components and products, and adding differentiating features later in the process

Question 13

cross-docking

Answer 13

goods arriving at a warehouse from a supplier are unloaded from the supplier’s truck and loaded onto outbound trucks

Question 14

purchasing

Answer 14

responsible for buying the. materials, parts, supplies and service needed by the company

Question 15

purchasing cycle

Answer 15

series of the steps that begin with a request for purchase and ends with paying the supplier

Question 16

Logistics

Answer 16

Refers to the movement and warehousing of materials/ products

Question 17

Reverse Logistics

Answer 17

the backward flow of goods returned by consumers or retailers

Question 18

gatekeeping

Answer 18

screening goods to prevent incorrect acceptance of goods

Question 19

avoidance

Answer 19

finding ways to minimize the number of items that are returned

Question 20

Quality

Answer 20

the ability of a product or service to consistently meet or exceed customer expectations

Question 21

quality control

Answer 21

monitoring, testing and correcting quality problems after they occur

Question 22

quality assurance

Answer 22

ensuring a products quality will be good by preventing defects before they occur

Question 23

product design

Answer 23

intention of designers to include or exclude features that customers require

Question 24

process design

Answer 24

translating product characteristics into process specifications and tolerences

Question 25

production/ manufacturability

Answer 25

the degree to which goods/ services conform to design specifications

Question 26

statistical quality control

Answer 26

statical techniques and sampling to monitor and test the quality of goods and services

Question 27

acceptance sampling

Answer 27

relies on inspection, determines to accept or reject a product

Question 28

statistical process control

Answer 28

determines if process is operating within acceptable limits during production

Question 29

inspection

Answer 29

the appraisal of goods and services against standards

Question 30

random variation

Answer 30

natural variations in the output of process, created by countless minor factors

Question 31

assignable variation

Answer 31

a variation whose source can be identified

Question 32

statistical process control

Answer 32

involves inspecting a random sampling of output from a process deciding whether the process is producing products with characteristics that fall within preset specifications

Question 33

process capability

Answer 33

is the ability of the production process to meet or exceed preset specifications

Question 34

product specifications

Answer 34

preset ranges of acceptable quality characteristics

Question 35

design specifications

Answer 35

range of acceptable values established by engineering design or customer requirements

Question 36

process variability

Answer 36

natural variability in a process

Question 37

Goals of Lean Production

Answer 37

-to have a balanced system -eliminate disruptions -eliminate waste -make system flexible continuous improvement

Question 38

Pull system

Answer 38

system for moving work where a workstation pulls output from the preceding station as needed (kanban)

Question 39

Push System

Answer 39

system for moving work where output is pushed to the next station as it is completed

Question 40

Kanban

Answer 40

card or other device that communicates demand for work or materials from the preceding station

Question 41

preventive maintenance and housekeeping

Answer 41

maintaining equipment in good condition and replacing parts that have a tendency to fail before they actually fall

Question 42

Implementing JIT/Lean

Answer 42

- study operations carefully - Convert suppliers to JIT/ lean - reduce setup time while maintaining the current system