Pre-Assessment: Operations and Supply Chain Management

A customer was having trouble entering a vacation rental property. When the customer contacted the host, the host came to help the customer within 10 minutes.

What is the service quality dimension demonstrated in the scenario?

Responsiveness

A customer went to a service center to have new tires installed on their vehicle. An employee at the service center was polite and professional. They were clear in explaining the types of tires available, the replacement process, and the warranty. They were able to answer all the customer's questions.

What is the service quality dimension demonstrated in the scenario?

Assurance

A hotel manager periodically inspects each room of the hotel to assess its condition.

Which cost of quality does this scenario illustrate?

Appraisal costs

A website for a utility company makes customers enter their bank payment information twice. The system compares the data and only proceeds if the data matches.

Which cost of quality is represented in this scenario?

Prevention costs

A small business wants to enhance the quality of its products. The business has begun to send surveys out to ask which features people like about the products and which features they would like to see added.

Which total quality management (TQM) principle is illustrated in the example?

Customer-centered focus

A manufacturing company sources many of its components from another business. The company has sought to know more about this other business over time and has been able to collaborate with the business to customize the components for optimal quality.

What is the core concept of total quality management (TQM) demonstrated in the scenario?

Supplier relationships

After each tool in a manufacturing facility is produced, its maximum RPM is tested. A manager would like to use a data visualization tool to see how many of the 1,000 tools produced last week had a maximum RPM of 10,000–10,049, how many had a maximum RPM of 10,050–10,099, etc.

Which tool of quality management is appropriate for this need?

Histogram

A production facility manufactures a varying number of units per day. A manager has data on the number of units produced and the number of defective units found for each day over the past several months. The manager would like to use a data display to see if the number of defects is related to the total number of units produced per day.

What is the quality management tool that should be used in this situation?

Scatterplot

Which activity is involved in the define phase of Six Sigma?

Detailing an improvement opportunity

Which phase of Six Sigma involves implementing measures to make errors more quickly detectable?

Control

A company produces several models of thickness planers. There is very little variation among the models, with all models having interchangeable parts.

Which type of production process should be used in this scenario?

Assembly line

A manufacturer produces four models of small fishing boats. The manufacturer focuses on producing each model for one week at a time.

Which term describes the appropriate facility layout for this type of production?

Product

A manufacturing facility needs to increase production efficiency to minimize costs, improve profit margins, and achieve economies of scale.

What should be done to work toward achieving this goal?

Reduce the amount of product variation.

A growing business produces a single product. The leaders of the business want to design a new manufacturing facility and want to prioritize the correct processes to best attain economies of scale.
Which processes should the business leaders explore to work toward this goal?

Assembly line

What is one of the factors that is accounted for in effective capacity?

Planned employee breaks

A t-shirt printing company has a design capacity of 40,000 shirts per month. Accounting for planned delays, the capacity is 31,000 shirts per month. Actual output is 26,000 shirts per month.

What is the efficiency rate?

84%

Which scenario demonstrates a resource constraint?

A hardwood flooring manufacturer is struggling to keep up with demand because of a shortage of raw materials.

In the process outlined by the theory of constraints, a production manager has already dedicated specific resources to effectively eliminate a constraint.

What is the next step that should be taken?

Evaluate whether the system has another constraint.

A company that produces power tools wants to hold very little inventory. Because of this, the company wants to align capacity with demand as closely as possible.

What is the appropriate capacity planning strategy for this situation?

Match

What is an example of a company that is using the lead strategy of capacity planning?

An electronics company significantly increases production in anticipation of high demand for a new product.

A fast food restaurant owner is exploring the possibility of opening a second restaurant.

What is a major factor in the decision for the location of the second restaurant?

Proximity to customers

A software company is planning on expanding and needs to determine a location for a new office building.
Which factor is a major consideration in the location decision?

Quality community

Which step of the forecasting process involves assessing the accuracy level of the initial method?

Developing and testing

Which step of the forecasting process involves accounting for real-world limitations?

Considering constraints

Which planning component is part of short-range planning?

Master production schedule

In addition to the cellular phones a company sells, it also sells replacement screens, batteries, and charging cables directly to consumers.

What is an example of a dependent demand item in this scenario?

Speaker

As a part of a company's preparation for the future, an executive is working on choosing a forecasting model for demand. In order to remain objective and consistent, the model should be based on mathematics.

Which model should be considered?

Weighted moving average

A manager is creating a sales forecast by starting at the bottom of an organization and making an overall estimate by adding together component parts.

Which forecasting method is described?

Pyramid method

What is the scheduling technique that allows an organization to determine demand in advance while still being able to limit access to the corresponding service?

Reservation scheduling

Which scheduling technique is demonstrated by the use of fast-food kiosks that allow patrons to place their own orders?

Consumer self-service

An organization is implementing a software system to manage and integrate core processes.

Which role does this core system have in enhancing the organization?

Improve collaboration.

When a client places an order, an enterprise resource planning (ERP) system generates an invoice and updates the inventory level.

Which functionality step of ERP systems corresponds to the given situation?

Processing and automation

Which competitive advantage is associated with lean systems?

Inventory reduction

What is a benefit of reducing inventory through lean principles?

Reduced duration of inventory idleness

What is a benefit of total quality management (TQM)?

Fewer warranty repairs

How is flexibility enhanced through lean strategies?

Shorter aggregate planning horizon

The machinery at a factory is being rearranged to reduce worker movements that are unnecessary.

What is a benefit of this lean strategy?

Improved efficiency

In each monthly meeting with the production department, the production manager asks participants for any ideas on how to make processes or products better.

Which benefit comes with this lean strategy?

Enhanced employee engagement

Which scenario demonstrates a non-value-added activity?

A grocery store associate spends one full day counting inventory.

A production facility operates based on a system of small lots and low inventory.

What is used to signal the need for more materials?

Kanban

A food processing facility relies on one primary machine. Long setup times have resulted in less than desirable operational efficiency.

Which step should be taken to improve the setup time?

Make tools needed for the setup readily available.

A manufacturing company produces several final products at one facility. The production manager wants to implement lean principles to improve production efficiency.

Which strategy should the manager use for this facility?

Match component production rates to the final assembly schedule.

A company uses silicon in the production of its product. The company typically imports the silicon from a foreign country, but production has been hindered by recent sanctions preventing any imports from that country.

Which type of bottleneck exists in this situation?

Regulatory

A software company specializes in creating custom analytical software solutions for companies that need to store and analyze vast amounts of data. The number of interested clients is growing, but sales have been slowed by a lack of skilled workers to perform the customization functions.

What is the type of bottleneck described in this scenario?

Labor

A cheese factory requires that each box of products be scanned into a transaction system before being shipped. Delivery trucks are typically waiting for long periods of time because the system is only able to process approximately six boxes per minute.

Which category of bottleneck does this demonstrate?

Technology

Before any shipment of a company's product leaves the production facility, the facility manager must sign off on an inspection. Lately, the facility manager has been dealing with several administrative issues. Because of this, shipments have been delayed until the manager is able to inspect the shipments.

Which type of bottleneck exists in this situation?

Decision-making

A logging company sources its trees from a specific forest region. Production of lumber is at a maximum, despite demand for greater output, due to a restriction of transportation to a single-lane forest road.

Which category of bottleneck does this demonstrate?

Physical

A guitar manufacturer has been experiencing a greater demand for its products lately. However, production has been hindered by a cashflow issue in which there has not been enough cash to pay suppliers for needed materials.

What is the type of bottleneck described in this scenario?

Financial

A retail company decided to buy a distribution center to lower costs.

What is the strategy implemented in this scenario?

Backward vertical integration

A company produces fabric that it sells to other companies. This company recently decided to purchase the distribution center that buys most of its fabric.

What is the strategy implemented in this scenario?

Forward vertical integration

A fashion company faces a frequent need for innovation and new products. The company only works with suppliers that are able to adjust quickly to product changes.

What is the strategy implemented in this scenario?

Agile supply chain

A furniture company sells products with high volume and low variety. The company has chosen manufacturers that are committed to eliminating waste in the production process as much as possible in order to minimize costs.

What is the strategy implemented in this scenario?

Lean supply chain

A company that sells fencing operates at low profit margins. The company works closely with suppliers to minimize costs and maximize production efficiency.

Which concept is illustrated in this example?

Lean supply chain

A manufacturer of wooden furniture works closely with a lumber supplier. The lumber supplier monitors the level of lumber on hand at the manufacturer's factory and makes deliveries when needed.

Which strategy does this scenario demonstrate?

Vendor managed inventory

A company has hired a new operations manager. The manager wants to emphasize ethical operations.

What is an ethical issue that is the direct responsibility of the operations manager?

Potential environmental pollution

An operations manager wants to place a higher emphasis on ethical operations.

What is an important ethical consideration for the operations manager?

Product safety after production

As a company is beginning a new initiative, company leaders would like to emphasize social sustainability.

What should the company do to address this component of sustainability?

Improve employee job security.

An organization is redesigning its operations to improve its environmental sustainability.

Which action is involved in this process?

Reduce the net-sum of depleted resources.

An organization decided to give all employees four personal days for mental health.

What is the component of the triple bottom line that this decision addresses?

Social responsibility

What is a benefit of SWOT analysis?

It helps a company take the greatest advantage of available opportunities.

What is a primary consideration of SWOT analysis?

External elements that could create difficulties

Which question is among those that a company should ask when determining opportunities for SWOT analysis?

What do advantageous external changes look like?

Which factor represents a source of opportunities when conducting SWOT analysis?

Change in government policy

What is one of the two internal elements of SWOT analysis?

Weaknesses

A clothing retailer uses a perpetual inventory system to track its inventory of all its clothing products.

What is an advantage of this type of inventory system?

A constant awareness of inventory levels

A manufacturing facility uses a perpetual system to manage its inventory of product components.

What is a disadvantage of this type of inventory system?

Maintenance of this type of system is expensive.

A small grocery store manages its inventory based on a periodic inventory system.

Which advantage does this type of inventory system have?

There is no need for a computerized system.

An auto parts retailer uses a periodic system to manage its inventory of parts.

Which drawback does this type of inventory system have?

An inability to easily determine exact inventory balances

What is the inventory management model that assumes that an organization's manufacturing capacity for a product exceeds the demand for that product?

Economic production quantity

Which costs are primarily considered in inventory management models?

Stockout costs

What is the form of inventory costs that include costs associated with lost customers?

Stockout

What is an amount of inventory that triggers the process of replenishment?

Order point

Total Quality Management (TQM) is used to:

Streamline supply chain management, improve customer service, and ensure that employees are properly trained.

External customers

People or organizations that purchase the good or service the company produces.

Internal customers

Part of an organization that uses information or outputs from another functional area inside the organization.

The voice of the customer

Describes what customers want and what they like or dislike.

What are the benefits of listening to the voice of the customer?

It drives customer retention, prevents waste, and gives a competitive advantage.

A team is investigating why a manufacturing line is experiencing frequent production bottlenecks and needs to analyze machine performance, operator methods, and raw material variations.

Which tool of quality management is appropriate for this need?

Cause-and-Effect (Fishbone) Diagram

A technician on a motor assembly line needs to record the exact types and frequencies of defects as they happen.

Which tool of quality management is appropriate for this need?

Check Sheets

A tech is evaluating pharmacy prescription fill times and needs to know the most frequent time interval required to fill a prescription.

Which tool of quality management is appropriate for this need?

Histograms

A doctor is comparing an athlete’s height and weight to determine if there is a positive relationship between the two variables.

Which tool of quality management is appropriate for this need?

Scatterplots

A manager is analyzing customer complaints across various categories to discover that complaints regarding “documents” happen much more frequently than any others, allowing them to focus their resources there first.

Which tool of quality management is appropriate for this need?

Pareto Charts

An operations manager monitors the production process to track stability and catch variation

Which tool of quality management is appropriate for this need?

Control Charts

You are mapping out the sequential workflow of a customer service or IT troubleshooting process to identify redundant or inefficient steps.

Which tool of quality management is appropriate for this need?

Flow Charts

A histogram demonstrates ___________________.

The frequency of values in a given range

What is the purpose of benchmarking?

To set a performance standard for a business activity

What would be an external measurement of quality?

Customer satisfaction

What is the goal of Six Sigma?

To reduce defects and to manage and improve organizational processes by using facts, data, and statistical analysis.

Which activity is involved in the define phase of Six Sigma?

Listening to customer feedback to learn what their needs are.

Which activity is involved in the measure phase of Six Sigma?

Creating a process map.

Which activity is involved in the analyze phase of Six Sigma?

Plotting measurements, problems, and defect frequencies using scatterplots, Pareto charts, and histograms.

Which activity is involved in the improve phase of Six Sigma?

Changing the current process.

Which activity is involved in the control phase of Six Sigma?

Creating a control plan to document requirements and maintain long-term improvements.

Six Sigma methodology used for new products or processes

DMADV (or DFSS)

Design capacity

The maximum achievable output of a process or system based on what a service firm or a manufacturer can produce under ideal conditions for a short period of time

Effective capacity

The maximum capacity, allowing for planned or scheduled delays given the product mix, scheduled equipment changeovers, and scheduled downtime, such as employee breaks or maintenance

The three primary constraints in a system

Market, Process, and Product

Constraint

Any resource that has a capacity that is less than or equal to demand for that resource.

What is the first step in the theory of constraints process?

Identify the constraint

What is the primary purpose of the "elevate the constraint" step?

Find ways to make the constraint less of a limiting factor