final

Question 1

Cycle counting (471)

Answer 1

 A continuing reconciliation of inventory with inventory records.

Question 2

Holding, ordering and setup costs, Q* (474 - 476)

Answer 2

 Holding Cost – the cost to keep or carry inventory.
 Ordering Cost – the cost of the ordering process.
 Setup Cost – the cost to prepare a machine or process for production.
 Q* - Optimum number of units per order (EOQ).

Question 3

Economic Order Quantity vs Production Order Quantity (481)

Answer 3

 EOQ – an inventory-control technique that minimizes the total of ordering and holding cost.
 POQ – an inventory-control technique that receives its inventory over a period of time.

Question 4

Aggregate planning requirements (512)

Answer 4

 A logical overall unit for measuring sales and output.
 A forecast of demand for a reasonable intermediate planning period in these aggregate terms.
 A method for determining the relevant costs.
 A model that combines forecasts and costs so that scheduling decisions can be made for the planning period.

Question 5

Aggregate planning strategies (514)

Answer 5

 Should inventories be used to absorb changes in demand during the planning period?
 Should changes be accommodated by varying the size of the workforce?
 Should part-timers be used, or should overtime and idle time absorb fluctuations?
 Should subcontractors be used on fluctuating orders so a stable workforce can be maintained?
 Should prices or other factors be changed to influence demand?

Question 6

Demand options (516)

Answer 6

 Influencing demand
 Back ordering during high-demand periods
 Counter seasonal product and service mixing

Question 7

Chase strategy (516)

Answer 7

 A planning strategy that sets production equal to forecasted demand.

Question 8

Level strategy (517)

Answer 8

 Also known as level scheduling is an aggregate plan in which maintains a constant output rate, production rate, or workforce level over the planning horizon.

Question 9

MRP (546)

Answer 9

 A material requirement planning is a dependent demand technique that uses a bill-of-material, inventory, expected receipts, and a master production schedule to determine material requirements.

Question 10

Master Production Schedule (546)

Answer 10

 MPS is a timetable that specifies what is to be made and when.

Question 11

Bills of material (548)

Answer 11

 BOM is a list of the components, their description, and the quantity of each required to make one unit of a product.

Question 12

Forward and backward scheduling (586)

Answer 12

 Forward scheduling – begins the schedule as soon as the requirements are known.
 Backward scheduling – begins with the due date by scheduling the final operation first and the other job steps in reverse order.

Question 13

Scheduling criteria (586)

Answer 13

 The four scheduling criteria are: o Minimize completion time o Maximize utilization o Minimize work-in-process (WIP) inventory o Minimize customer waiting time

Question 14

Priority rules for sequencing jobs (594)

Answer 14

 Rules used to determine the sequence of jobs in process-oriented facilities.

Question 15

Johnson’s rule (598)

Answer 15

 An approach that minimizes processing time for sequencing a group of jobs through two work centers while minimizing total idle time in the work centers.

Question 16

Bottlenecks (288)

Answer 16

 A limiting factor or constraint in the system.

Question 17

Push and pull systems (624)

Answer 17

 Pull system is a concept that results in material being produced only when requested and moved to where it is needed as it is needed; whereas the push system the customer does not initiate the request, the company initiate the request to the customer.

Question 18

JIT and JIT techniques—partnerships, layout, inventory, scheduling, quality (624-625)

Answer 18

 Just-in-time (JIT): continuous and forced problem solving via a focus on throughput and reduced inventory.
 JIT Techniques:
o Partnerships (suppliers) – few vendors, supportive supplier relationship, quality deliveries on time, directly to work areas.
o Layout – work-cells, group technology, flexible machinery, organized workplace, reduced space for inventory.
o Inventory – small lot sizes, low setup time, specialized parts bins.
o Scheduling – zero deviation from schedules, level schedules, suppliers informed of schedules, kanban techniques
o Quality – statistical process control, quality suppliers, quality within the firm.

Question 19

Lean (636)

Answer 19

 Lean operations adopt a philosophy of minimizing waste by striving for perfection through continuous learning, creativity, and teamwork.

Question 20

Kanban (632)

Answer 20

 The Japanese word for card, which is come to mean “signal”, a kanban system moves parts through production via a “pull” from a signal.

Question 21

Importance of maintenance and reliability (650)

Answer 21

 The objective of maintenance and reliability is to maintain the capability of the system. Maintenance includes all activities involved in keeping a system’s equipment in working order. Reliability is the probability that a machine part or product will function properly for a specified time under stated condition.

Question 22

Full cost and traditional view of maintenance (654-655)

Answer 22

 The traditional view of maintenance considers a balance between preventive maintenance (PM) and full cost view of maintenance. Allocating more resources to PM will reduce the number of breakdowns. At some point, however, the decrease in breakdown maintenance costs may be less than the increase in PM costs. At this point, the total cost curve begins to rise. Beyond this optimal point, the firm will be better off waiting for breakdowns to occur and repairing them when they do. Full cost of a breakdown seldom considers cost of inventory maintained to compensate for the downtime. Moreover, downtime can have devastating effect on safety and morale. Finally, downtime adversely affects delivery schedules, destroying customer relations and future sales.

Question 23

Decision-making process (668)

Answer 23

The six steps in decision process are:
 Clearly define the problem and the factors that influence it.
 Develop specific and measurable objectives.
 Develop a model – that is, a relationship between objectives and variables (which are measurable quantities).
 Evaluate each alternative solution based on its merits and drawbacks.
 Select the best alternative.
 Implement the decision and set a timetable for completion.

Question 24

Linear programming and its requirements (690-691)

Answer 24

 LP is a mathematical technique designed to help operation managers plan and make decisions relative to allocation of resources.
 All LP problems have four requirements:
o LP problems seek to maximize or minimize some quantity; the objective function of LP problem.
o The presence of restriction, or constraints, limits the degree to which we can pursue our objective. We want, therefore, to maximize or minimize some quantity subject to limited resources.
o There must be alternative courses of action to choose from.
o The objective and constraints in linear programming problems must be expressed in terms of linear equations or inequalities.

Question 25

Transportation modeling and 3 information requirements (718)

Answer 25

 Transportation modeling is an iterative procedure for solving problems that involves minimizing the costs of shipping products from a series of sources to a series of destinations.  3 information requirements are: o The origin points and the capacity or supply per period at each. o The destination points and the demand per period at each. o The cost of shipping one unit from each origin to each destination.

Question 26

Characteristics of waiting line systems (741)

Answer 26

 Arrivals or input to the system – these have characteristics such as population size, behavior, and a statistical distribution.  Queue discipline or the waiting line itself– characteristics of the queue include whether it is limited or unlimited in length and the discipline of people or items in it.  The service facility – its characteristics include its design and the statistical distribution of service times.

Question 27

Queue discipline (742-743)

Answer 27

 FIFO – first in, first out

Question 28

Learning curve definition/understanding (770-771)

Answer 28

 The premise that people and organizations get better at their tasks as the tasks are repeated; sometimes called experience curves.

Question 29

Advantages and disadvantages of simulation (787)

Answer 29

 Advantages o Simulation is relatively straight forward and flexible. o It can be used to analyze large and complex real-world situations.. o Real-world complications can be included o “time compression” is possible. o Simulation allows “what-if?” types of questions. o Simulations do not interfere with real-world systems. o Simulation can study the interactive effects of individual components or variables.  Disadvantages o Good simulation models can be very expensive and take many months to develop. o It is a trial-and-error approach. o The simulation model does not produce answers without adequate realistic input. o Each simulation model is unique.