process final Flashcards
(93 cards)
1
Q
any activity that takes one or more inputs, transforms them, and provides one or more outputs for its customers
A
process
2
Q
- produces tangible outputs
- inputs and outputs can be inventories
- low customer contact
- high capital investment
- quality easily measured
A
characteristics of manufacturing processes
3
Q
- intangible and perishable outputs
- outputs can’t be inventoried
- high customer contact
A
services
4
Q
interrelated series of processes within or between firms that produce a service/product to satisfy its customers
A
supply chain
5
Q
level in the supply chain
- removing tiers can increase efficiencies
A
tiers
6
Q
moving products down to customers
A
downstream
7
Q
moving products from customers to suppliers
A
upstream (reverse logistics)
8
Q
most basic type of supply stream
- brick and mortar or online but not both
A
single channel supply stream
9
Q
channels are not connected
-ex. can buy online but not return in store
A
multi-channel supply stream
10
Q
channels are interconnected
A
omni-channel supply stream
11
Q
computer system designed to help manufacturers manage dependent demand inventory and schedule replenishment orders
A
material requirements planning (MRP)
12
Q
- bill of materials
-master production schedule (# of end items produced) - inventory record
A
MRP inputs
13
Q
- gross requirements: total amount needed at the beginning of the period
- scheduled receipts: orders that should arrive in the beginning of the period
- projected on hand balance: balance at the end of that period
- planned order release: an indication of when an order is to be issued
A
parts of inventory record
14
Q
difference between when you order an item and when you receive it
A
lead time
15
Q
time between the start and completion of the manufacturing process
A
manufacturing lead time
16
Q
time between order placement and delivery of the final product
A
customer lead time
17
Q
- CLT =0
- no customization
- customer demand is satisfied by existing inventory
- lots of finished good inventory
-ex. grocery stores
A
made to stock
18
Q
- CLT >0
- subassemblies or work in progress inventory is produced prior to the customer’s order and the customer can personalize/customize the order based on a limited amount of options
- no finished good inventory but lots of work in progress inventory
-ex. chipotle, birthday cakes - MLT > CLT> 0
A
assemble to order
19
Q
- CLT > MLT
- no work in progress, subassemblies, or finished goods inventory
- every product is attached to a customer order
- ex. planes and airlines, weddings and bridesmaid dresses
A
made to order
20
Q
- CLT»_space; MLT
- get to pick every aspect
- no finished goods or subassemblies
-ex. custom homes, custom suits, etc.
A
design to order
21
Q
- order release prompt
- open order diagnostics
- expedite order release
A
exception messages
22
Q
anytime you have a planned order release in the current time period you are in
- expected and planned
A
order release prompt
23
Q
- scheduled receipts or pipeline inventory
- you can move it around (closer, defer, or cancel)
A
open order diagnostics
24
Q
used when you have a new order but you have a lead time issue with your new order
A
expedite order release
25
- raw materials
- finished goods
- work in progress
- safety stock inventory
-anticipation inventory
- pipeline inventory
types of inventory
26
surplus inventory that protects against uncertainties in demand, lead time, and supply changes
safety stock inventory
27
inventory used to absorb predictable uneven rates of demand/supply
anticipation inventory
28
when an item is issued but not yet received (aka transit stock; schedule receipts)
pipeline inventory
29
- cost of capital
- storage and holding costs
- taxes, insurance, and shrinkage
- high inventory turnover
pressure for small inventories
30
- customer service: stock outs or back orders
- ordering costs
- setup costs
- transport costs (less than truck load or full truck load)
pressure for large inventories
31
distribution centers act as a high throughput sorting facility for several suppliers and customers
- inbound flows (from suppliers) are directly transferred into outbound flows (to customers) with little, if any warehousing
- saves transport time, reduces inefficiencies, saves retailers billions in storage costs
cross-docking
32
lot size that minimizes total ordering and holding costs
-assumptions: demand is constant, only relevant costs are inventory holding costs and ordering costs, constant lead time
- use for made to stock and if demand is stable
- do not use for made to order
- modify if there is a discount for large quantity orders
EOQ model
33
average inventory formula
Q/2
34
order what you need per period
LFL inventory management
35
order x amount every time you order
EOQ inventory management
36
order enough to cover x weeks at a time
POQ inventory management
37
- way to manage on hand inventory
- divides inventory into different buckets of importance
- helps firms determine the resources to dedicate to each item
- having all three item categories increases customer satisfaction
ABC process
38
monitored closely
- small percentage of inventory with large revenue percentage
- ex. milk
-ex. costco carries only these items (one type of peanut butter)
A items
39
checked monthly
- medium percentage of inventory with small to medium revenue percentage
B items
40
checked quarterly
- large percentage of inventory with very small revenue percentage
-ex. seasonings
C items
41
carrying cost formula
Q/2*(C)
42
ordering cost formula
A/Q *(O)
43
total inventory costs formula
Q/2*(C) + A/Q*(O) + (C*safety stock)
44
unexpected distortion of the supply chain caused by price fluctuations/sales promotions, order batching, shortage gaming, and forecast inaccuracy on projected sales
- customer > retailer > distributor> manufacturer
-ex. if there is an excess demand for paper towels, the retailer places an order to the distributor, who then sends that information to the manufacturer who then has to make the adjustments for processes before getting the new order out; by the time the order is ready, the demand is no longer there and the systems spent more money
bullwhip effect
45
bullwhip effect is mitigated by:
everyday low prices
- frequent ordering
- forecast on sales history
- sharing information with suppliers
46
minimum level that an inventory position must reach before an order is placed
reorder point
47
orders a fixed number every time
- reorder point system or fixed order quantity system
- tracks inventory position each time there is a withdrawal
- assumes constant demand, constant lead times, and supplier shipping Q units each time
continuous review system
48
time between orders is fixed
- fixed interval reorder system
- item's inventory position is reviewed periodically
periodic review system
49
inventory position formula
on hand inventory + scheduled receipts - backorders
50
maximum rate of outputs of a process
- inputs, outputs, or both
- inventory is viewed as stored capacity
capacity
51
process of determining how much capacity is needed and when it is needed
capacity planning
52
proportion of the available time that a piece of equipment/system is operating
- most manufacturing firms should maintain capacity cushions which varies by industry
-made to stock > design to order utilization
utilization
53
utilization formula
(average output rate/maximum capacity) * 100%
54
capacity cushion formula
100%- average utilization rate
55
relates to the capacity shortage of a process
- operation with the lowest capacity
- can be internal or external with more than one bottleneck
bottleneck
56
the total capacity of that process is the sum of the individual processes
parallel processes
57
total elapsed time from start to finish of a job that includes processing time and time between units
throughput time
58
when firms delay further investment into a product until the last possible moment
-ex NFL jersey article
postponement
59
maximize the value added by each of a company's activities by removing waste and delays
- can be applied to any process
- value stream map
lean system
60
focuses on efficiency, cutting excess capacity/inventory, and removing non-value added activities
just in time system
61
- quality at the source
-right work slow
- avoid seven deadly sins
- uniform workstation loads
- automation
- flexible workforce
key aspects of lean systems
62
make it right the first time
- poka-yoke
quality at the source
63
mistake proofing methods aimed at designing fail-safe systems that minimize human error
- ex. google email reminder when something is not attached but you see attached in the email
poka-yoke
64
customer demand activates production of the service/item
pull method
65
production of the item begins in advance of customer needs
push method
66
1. over production
2. defects
3. inventory
4. over processing
5. waiting/delay
6. transportation
7. motion
seven deadly sins
67
processing too soon/too much
over-production (deadly sin)
68
errors, mistakes, or rework
defects (deadly sin)
69
holding too much inventory (WIP, raw materials, or finished goods)
inventory (deadly sin)
70
processing more than required/steps that don't add value
over-processing (deadly sin)
71
employees, customers, or equipment waiting
waiting/delay (deadly sin)
72
movement of product that doesn't add value
transportation (deadly sin)
73
movement of people that doesn't add value
motion (deadly sin)
74
interrelated set of activities with a definite starting/ending point and unique outcome
projects
75
phased approach to defining, organizing, planning, monitoring, and controlling projects
project management
76
1. defining the scope of project
2. time frame
3. resources needed
3 key decisions before starting a project
77
1. complete on time or earlier
2. do not exceed the budget
3. meet specifications to the satisfaction of the customer
3 main goals of a project manager
78
nodes represent activities and arcs represent the relationship between activities
- benefits: predicts time needed, determines which activities to focus on, shows critical activities, and allows managers to make necessary changes
network diagram
79
used by customers to describe their satisfaction with a good or service
quality
80
1. continuous process improvement
2. employee empowerment
3. customer satisfaction
total quality management
81
1. plan
2. do
3. study
4. act
continuous process improvement
82
move decision making down the organization chart
employee empowerment
83
value, support, and psychological impressions
customer satisfaction
84
improves processes by ensuring a process is on target and minimizing variability by identifying and removing causes of defects
-99.997% defect free
-five step process
six sigma
85
1. define
2. measure
3. analyze
4. improve
5. control
five step process for six sigma
86
time ordered diagram used to determine whether observed variations are abnormal
-lies between upper and lower control limits
control chart
87
-prevention costs
-appraisal costs
- internal failure costs
- external failure costs
costs of quality
88
costs associated with preventing defects before they happen
prevention costs
89
costs incurred when a firm assesses the quality of its output
- aka quality inspection costs
appraisal costs
90
costs associated with discovering defects during the production process
internal failure costs
91
costs associated when a defect is discovered after the customer receives the service/product
external failure costs
92
moving inventory downstream to optimize the forward flow of logistics
- from suppliers to manufacturers to consumers
forward logistics
93
from customers to manufacturers to suppliers
- ex. product recalls
reverse logistics
