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Prod Ops Exam 2
| Question | Answer |
|---|---|
| Supply Chain | A company's network of facilities, assets and suppliers used to acquire, manufacture and distribute a product to customers |
| What is the flow of information in the supply chain? | Raw Materials Supplier -> Manufacturer -> Local Distributor -> Regional Distributor -> Retailer -> Customer |
| Supply Chain Management | Involves coordinating movements of goods and delivery of services |
| Procurement Management | Acquiring and paying for the raw materials or components needed for business activities |
| Manufacturing Management | Producing the required item through planning and coordination of production assets to include quality assurance |
| Logistics Management | Managing the transportation of incoming and outgoing materials and products using various carriers, managing the distribution of products and handling transit to the end user |
| What are the five primary modes of transportation? | Water, pipeline, truck/ground, air and rail |
| What is intermodal transportation? | using two or more modes of transport to move goods, rather than relying on a single mode for the entire journey |
| External Suppliers | Provide necessary raw materials, services and component parts |
| Who bridges the gap between Sales/Marketing and Production/Operations? | Sales and Operations Planning |
| What are technologies used to share information during the transport of assets in the supply chain? | GPS, RFID tags, package tracking numbers and automated inventory systems |
| Bullwhip Effect | Wild fluctuations in inventory and ordering patterns due to a lack of information sharing or inaccurate information |
| Who experiences the worst of the bullwhip effect in the supply chain? | Raw material suppliers, as the farther a company is away from customers the information quality gets worse |
| Vertical Integration | A measure of how much of the supply chain is owned by a single company, the manufacturer (Should only be pursued if the proprietary firm has a high level of expertise) |
| Backward Integration | Occurs when a manufacturer acquires ownership of raw material suppliers |
| Forward Integration | Occurs when a manufacturer acquires ownership of forward distribution channels |
| What are the three issues that need addressed in developing a supplier base? | 1. How do you choose between a supplier? 2. Should one or several suppliers be used? 3. Should active partnering with the suppliers be pursued? |
| Considerations when choosing a supplier | Cost, quality and on-time delivery |
| When is it best to choose a single supplier? | For the long term advantage and for the availability for better pricing and better responsiveness |
| When is it best to choose multiple suppliers? | For short term usage only if there isn't sufficient capacity from one supplier, competition may be better and multiple suppliers would spread the risk of supply chain interruption |
| What trend has Lean Management caused in choosing suppliers? | One supplier per item instead of multiple |
| What is the purpose of warehouses? | To serve as an accumulation points for either short-term or long-term storage for inventory in the supply chain |
| General Warehouses | Used for long-term storage of goods |
| Distribution Centers | Used for mixing products in transit, short-term storage and improved customer response times |
| What is cross-docking? | Unloading a shipment from a supplier in a distribution center and then reloading into outbound transportation with no time spent in storage |
| Household Replenishment | Fulfilling consumer demand at the point of use (Last Mile Problem) |
| Freeze Point Delay | Last-minute customization to provide exactly what a customer wants while maintaining very small inventories |
| What is NOT a characteristic of supply chains? | That they are virtually identical in every industry |
| What is NOT involved in integrated supply chain management? | Making strategic product and service design decisions |
| What mode of transportation is the slowest? | Water |
| What mode of transportation is the lease versatile? | Pipeline |
| What mode of transportation is the most expensive? | Air |
| What is NOT a typical result of the bullwhip effect? | Absenteeism |
| What is the most critical success factor for integrating a supply chain? | Sharing information |
| What is one method of controlling proprietary information in the supply chain? | Vertical Integration |
| If you are a manufacturer what would be an example of backward integration? | Purchasing a raw materials supplier |
| What is a critical supply chain management activity? | Developing a supplier base |
| Does one supplier or multiple suppliers result in a long-term advantage? | One supplier |
| Total Quality Management | Coordinated and integrated effort to improve quality performance throughout a organization |
| User-Based Characteristics | What does the customer think? |
| Product-Based Characteristics | Being on target with minimum variance on the quality characteristics of the product/service |
| Production/Service-Based Characteristics | Providing the product/service in a consistent, reliable and repeatable way the conforms to specifications and standards |
| What are some keys ideas of quality? | The customer is the driver of quality, price paid is critical and quality involves not only product design but also production conformance |
| Service Dimensions | Intangible factors |
| Manufacturing Dimensions | Tangible factors |
| Philip Crosby | Quality is conformance to customer specifications |
| Joseph Juran | Quality is fitness for use by the customer, developed ideas of prevention/appraisal costs and failure costs |
| W. Edwards Deming | Quality is on target with minimum variance, suggested that management is source of most problems (95%) |
| Genichi Taguchi | Quality is a loss imparted to society, developed quality loss function and the idea of quality targets instead of range specifications |
| What is the most widely used set of internationally recognized quality standards? | ISO 9000 Standards |
| Deming Prize | Japanese industry award given to worldwide companies |
| How have quality concepts evolved? | From inspecting poor quality out of products to building good quality into products |
| What is an example of building good quality into products? | Statistical process control |
| Statistical Process Control | Processes monitored at key points |
| Design of Experiments | Statistical experiments used to improve the product and processes |
| Continuous Improvement | Good isn't good enough the goal is perfection |
| Customer Focus | Monitor customer needs and allow customers to determine what's important |
| Problem Solving | Identifying root causes of reoccurring problems |
| Employee Empowerment | Involving everyone in the organization, recognizing the next worker in the supply chain is your customer |
| Teamwork | Providing training, developing quality circles and having employee communication |
| Benchmarking | Identifies industry wide "best-practices" and strives to meet and then surpass the industry leader |
| What are the initiatives of the TQM Philosophy? | Continuous improvement, customer focus, problem solving, employee empowerment, teamwork, and benchmarking |
| What TQM philosophy initiative involves duplication of best practices? | Benchmarking |
| Deming created the PDSA cycle to continuously improve, what does it stand for? | Plan, Do, Study Act |
| Is internal or external failure more expensive? | External failure |
| What do appraisal and prevention costs do? | Eliminate problems at their source with the hopes of |
| Why is TQM sometimes considered free? | For every $1 invested in prevention and appraisal it will result in a $5 reduction in internal and external failure costs |
| Internal Failure Costs | Costs of scrap, rework and WIP losses |
| External Failure Costs | Costs at the customer that include warranties, returns, repairs and recalls |
| Prevention Costs | Costs of developing and implementing a quality plan |
| Appraisal Costs | Costs of evaluating, testing, measuring and inspecting quality |
| Quality Function Development | Comprehensive technique to examine the customer requirements, the competitors advantage, and possible improvements by integrating concepts into a "house of quality" |
| Cause and Effect Diagrams | Help identify potential causes of specific effects (Fishbone or Ishikawa) |
| Flow Charts | Visual diagrams of the steps involved in a process (Graphical SOP) |
| Checklists | Simple data collection forms utilized to record the type of defect and frequency of occurrence |
| Pareto Analysis | Identifies the degree of importance of different quality problems by plotting the quality problems from most troublesome to least troublesome (80/20 Rule) |
| Control Charts | Dynamic charts that are used to provide operating decision on whether a process is operating as expected over time or whether unusual occurrences are affecting the process |
| Scatter Diagrams | Charts that demonstrate the graphical relationship between two variable factors |
| Histograms | Provide pictorial representation of the frequency distribution of a quality characteristic |
| Walter Shewhart | First to apply statistics to quality problems and developed the X-bar and R control charts |
| What are the necessary requirements for TQM success? | Development of a quality culture, management support/commitment, reliance of statistical methods, and a never ending pursuit of quality |
| What is an example of a user-based quality characteristic? | Customer desire for a high gas mileage automobile |
| Why are JIT systems an example of the importance of quality? | They require no excess inventory |
| What is an example of building good quality into products? | Statistical process control |
| Variable Data | Measured using a continuous scale, examples include: length, weights, time and temperature, used charts for this type are X bar and R charts |
| Attribute Level Data | Descriptive and discrete characteristics, either a product or service possesses the desired quality or it doesn't |
| Descriptive Statistics | Used to describe the data be central tendency and by variability |
| Normal Distribution | Based on the central limit theorem of statistics, in which samples are normally distributed if the process is stable and repeatable and predictable |
| What is SPC used to determine? | Whether a process is performing as expected, predictability and repeatability are the goals, essentially an auditing procedure |
| What do Mean (x bar) charts track? | The average performance over time |
| What do Range (R) charts track? | The variation of performance over time |
| What do control charts for attribute data do? | Audit the repeatability of a pattern of non-conforming quality that are being produced |
| P-Chart | Track the proportion defective in a large sample |
| C Charts | Track the average number of defects per single unit of output |
| Process Capability | Measure of the ability of a process to meet preset design specifications and determines whether the process can do what we are asking it to do |
| If specification limits and process variability are equal what does that say about the process? | That it is barely capable of meeting customer demands |
| If specifications are narrower than the process variability what does that say about the process? | The process is incapable |
| If process variability is smaller than the specification limits what does that say about the process? | The process is highly capable |
| Centered Process | The mean of the process and the middle of the specification limits are equal |
| Uncentered Process | The mean of the process and the middle of the specification limits are not equal |
| If Cp (or Cpk) is < 1 what does that say about the process? | It is incapable and process improvement must begin |
| If Cp (or Cpk) is > 1 what does that say about the process? | It is capable and process improvement should be part of routine management |
| What descriptive statistic measures the center of a process? | Sample mean |
| What is a sign that data observation are widely spread out around the mean? | Large range and large standard deviation |
| If you are analyzing attribute data which control chart would you utilize? | P Chart |
| If a process capability is 0.8 what is the correct interpretation of the Cp? | The process is incapable of meeting customer expectations |
| Using a 3 sigma limit implies what about quality? | That there are an average of 2,600 defects per million |
| Using a 6 sigma limit implies what about quality? | That there are an average of 3.4 defects per million |
| What is a type 1 Alpha error? | Thinking something is wrong when it is actually fine |
| What is a type 2 Alpha error? | Thinking nothing is wrong when something is wrong |
| Capacity | The maximum output rate of a production or service facility |
| Capacity Planning | Process of creating future available capacity and can be segmented into strategic and tactical issues |
| Design Capacity | Maximum output rate under ideal conditions |
| Effective Capacity | Maximum output rate under normal conditions, (90% roughly of design capacity) |
| When does economies of scale occur? | When the cost per unit of output drops as volume of output increases and fixed costs are spread over increasing number of units |
| When does diseconomies of scale occur? | Cost per unit rises as volume increases and the process is overwhelmed with too much WIP (beyond a certain point the cost of each additional unit made increases) |
| Decision Trees | Model the alternatives being considered and the possible outcomes and expected payoffs to choose a course of action that will result in the largest payoff |
| Facility Location Decision | Process of finding the best geographic location for a service or production facility |
| What are the 5 decision support tools? | 1. The factor rating method 2. The load-distance model 3. Center of gravity approach 4. Breakeven analysis 5. Transportation method |
| What does the load-distance model evaluate? | The multiplicative sum of the different loads and distances between a source and several destinations |
| What is the best operating level most closely related to? | The lowest average cost unit |
| What is NOT a consideration in location analysis? | Automation of factories |
| Where do service organizations typically focus most heavily on locating? | Near their customers |
| What are some factors affecting location decisions? | Proximity to suppliers, customers and labor, community and site considerations, etc |
| Linear Programming | Involves constructing a mathematical model to represent a problem of interest and applying a algorithm to find the best solution to the problem |
| Algorithim | Programmable process |
| Linear Function | The only mathematical modification of a variable is multiplication by a constant |
| Non-Linear Function | Mathematical modification other than multiplication by a constant exist |
| Linear Program | Mathematical program with a linear objective function and linear constraints |
| Constraints | Conditions on the decision variables that put restrictions on the possible values of the variables |
| Layout Planning | Determining the best physical arrangement of resources within a facility |
| Process Layouts | Groups similar resources together |
| Product Layouts | Designed to produce a specific product efficiently utilizing specialized equipment to make large volumes of one or a few products |
| Hybrid Layouts | Combine the beneficial elements of both product and process layouts by maintaining efficiencies of product layouts and the flexibility of process layouts |
| Fixed Position Layout | Product cannot be moved |
| Office Layout | Minimize the cost of information flow (Becoming obsolete) |
| Warehouse Layout | Focuses on both material handling and ease of access |
| Retail Layout | Requires 3D thinking |
| Why are assembly lines utilized? | To meet high-levels of demand and increase efficiency by replacing individual workers |
| Takt Time | Number of seconds between units of output exiting the system |
| What ideas does a pull system follow? | That sales regulate production |
| In the golf ball and sticker exercise, which product line shape was the most effective? | U-Shapes |
Created by:
Erika.Meakins
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