WGU C215 Operations Management PVDC Final Exam

WGU C215 Operations Management PVDC Final Exam Which definition is used for quality, evaluates how well a product performs its intended function? - ✔Fitness for use 14 points for quality improvement - ✔Which total quality management (TQM) process was developed to stress management's responsibility for quality?

ISO 9000 - ✔Set of international standards on quality management and quality assurance, critical to international business -TQM process consists of 13 published standards and guidelines -Like when joint commission shows up at the hospitals Checklist - ✔A list of common defects and the number of observed occurrences of these defects. scatter diagram - ✔a plot of two variables showing whether they are related Control Chart - ✔A graph that shows whether a sample of data falls within the common or normal range of variation. mean - ✔A statistical measure of central tendency, or average, based on dividing a total by the number of individual cases. assignable causes of variation - ✔-Causes can be identified and eliminated -e.g. poor employee training, worn tool, machine needing repair common causes or random - ✔Stuff you cannot identify -Random causes that we cannot identify, unavoidable Cpk measures - ✔How close one is to a target and how consistent one is with the average performance.

-How closely it measures Six Sigma - ✔Technical tolls and people involvement The empirical rule, 3 standard deviations. This is 3 sigma's.

6 sigmas and you are almost at 100% DMAIC DMAIC (Define, Measure, Analyze, Improve, Control) - ✔a six sigma process that outlines the steps that should be followed to improve an existing business process define stage - ✔includes the voice of the customer and value stream

Job Design - ✔It does not have anything to do with people.

-The process by which managers decide how to divide tasks into specific jobs waiting time - ✔-Screen patients and fast track those with minor ailments -amount of time a process has been waiting in the ready queue Service location decisions - ✔-proximity to customers -Quality of life issues proximity to customers - ✔-key factor of a location analysis for a service company -if you need to have a car repaired, you wont drive too far.

Capacity Planning - ✔Hospital- Capacity is beds and output is the patients. If you have 1 pt for 2 days and one for 3 days. The output is how many patients and not how many beds we have. capacity utilization - ✔are you using more workers and what are your resources?

Measures how much of the available capacity is actually being used. Measures effectiveness.

Capacity Focus - ✔facilities that are small, specialized, and focused on a narrow set of objectives. effective capacity - ✔ capacity measurement at the best operating level - ✔when the average unit cost is minimized center of gravity approach - ✔an approach for locating a single facility that minimizes the distance to existing facilities.

-use the breakeven analysis -how many units needed to manufacture to breakeven. break-even analysis - ✔the process of determining the number of units a firm must sell to cover all costs. Considers fixed costs, variable costs.eg Fed EX is in Tennessee so it will be in the middle repetitive process - ✔classic assembly line. A line process, a continuous process.

Project Process - ✔make a one-at-a-time product exactly to customer specifications, expensive. Like an automobile collision shop that does body and engine repair as well as custom vehicle paint job.

Batch Process - ✔a process in which goods or services are produced in groups (batches) and not in a continuous stream eg. auto shop offers body repair, engine repair, and custom vehicle paint options Bottleneck in a flowchart - ✔the longest part in the process eg manufacturing a car and the car needs to be painted or the time the cake in the oven. compute process velocity - ✔Throughput time/value-added time -How fast we are going Actual output/standard output - ✔Which formula would indicate that a fast-food restaurant was performing at, above, or below its benchmark?

-We know how many burgers were making and what the standard is output/input - ✔productivity formula Throughput time/value-added time - ✔How long it takes from the raw materials to become finished goods.

Process - ✔Each item goes through process Which total quality management (TQM) process was developed to stress management's responsibility for quality? - ✔14 points for quality improvement Hybrid - ✔any mix of elements from a product layout and a process layout, to gain the advantages of both eg group technology standard time - ✔Determines how long it takes a qualified operator to perform a duty of the job requirements under the assumption that the operator is working at a sustainable pace with the proper tools for the process.

-How long t takes somebody to finish the work performance time - ✔How long it actually took observed time - ✔Actual time -The time measured from stopwatch infinite loading - ✔A scheduling approach that ignores capacity constraints.

-Working backwards -ex Amazon doesn't have the computer you want but they have a network where they can send you to someone who can give it to you finite loading - ✔-Working forward.

-Jobs are assigned to work centers taking into account the work center capacity and job processing times.

-Have fixed capacity -ex I go to a bike shop to buy a bike. They know what people will want. They offer repair, the can say I need this employee for repair shop. They have resources to manage Backwards Scheduling - ✔Begins with required delivery date and works in the reverse order to determine when each process step must be preformed.

Respect for people - ✔A 3rd element element of JIT that considers human resources as an essential part of the JIT philosophy.

Reducing waste is achieved - ✔by Just in time and lean system Lean Systems - ✔systems that maximize productivity by reducing waste and delays.

Not sacrificing productivity -JIT is a part of lean system Kanban System - ✔a pull system that uses cards to visually signal the need for inventory.

-Exact quantity that needs to be produced -small lot and shorten manufacturing lead time -forecast how much inventory your going to need Which total quality management (TQM) process consists of 13 published standards and guidelines? - ✔ISO 9000 ISO 9000 - ✔total quality management (TQM) process consists of 13 published standards and guidelines A company manufactures shoes using a quality management system. The company needs to put a process in place to measure any defects. The company would like to measure the number of defects and observe the number of occurrences to isolate the particular defect.

Which quality tool should the company use to focus on correcting this particular issue? ✔checklist Which quality control tool should be used to monitor the current status or end result of a process? - ✔Flowchart

Which group of keywords or phrases describes the crucial role that marketing plays in the total quality management (TQM) process? - ✔Review and recommend product changes, satisfy customers needs, open communication What is the common theme in total quality management (TQM) across all functions in an organization? - ✔To satisfy customer needs Which concept of variation measures the central tendency of a set of data? - ✔mean What do assignable causes of variation indicate? - ✔Equipment was found out of control Which continuous improvement method does Cpk measure? - ✔How close one is to a target and how consistent one is with the average performance What are two important aspects of Six Sigma? - ✔people involvement technical tools Which strategy is used by some emergency rooms to overcome customer frustrations about long waiting times? - ✔Screen patients and fast-track those with minor ailments Which two factors affect a service location decision? - ✔Proximity to customers Quality of life issues Which is a key factor of a location analysis for a service company? - ✔Proximity to customers What helps an organization identify and plan the actions necessary to meet current and future customer demands? - ✔capacity planning Which capacity planning measurement tells how much capacity a company is using? ✔Capacity utilization Design Capacity - ✔The maximum output rate or service capacity an operation, process, or facility is designed for.

-the maximum designed service capacity or output rate.

Effective capacity - ✔Design capacity minus allowances such as personal time and maintenance.

-Lower than design capacity.

-eg on the average, the bakery can make 20 custom cakes but during Christmas can do30 custom cakes

Capacity measurement at the best operating level - ✔when the average unit cost is minimized conducting a location analysis - ✔-proximity to sources of supply -site consideration proximity to customers - ✔major factor in the decision to locate a business near its primary market territory Which two statements are true about effective capacity? - ✔An effective capacity maintains a minimum output rate under normal conditions.

An effective capacity is lower than design capacity When is capacity measurement at the best operating level? - ✔When the average unit cost is minimized Which two capacity measurement concepts should a firm consider when conducting a location analysis? - ✔proximity to sources of supply site considerations What is a major factor in the decision to locate a business near its primary market territory? - ✔proximity to customers load-distance model - ✔a model used in designing functional layouts where movement is minimized e.g. open a new distribution center location in order to minimize distribution costs A manufacturing company decides to open a new distribution center location in order to minimize distribution costs to warehouses or stores.

What tool should the manufacturing company use to determine where the new distribution center should be located? - ✔by using the load-distance model Which two types of operations include repetitive processes? - ✔continuous process line process A comprehensive automobile collision shop offers body and engine repair as well as custom vehicle paint options.

Which two operational processes would suit this shop? - ✔batch process project process What is a bottleneck in a flowchart? - ✔The longest task in the process

throughput time/value-added time - ✔Which formula would compute process velocity?

Which formula would compute process velocity? - ✔(Throughput time) / (Value Added Time) Which formula would indicate that a fast-food restaurant was performing at, above, or below its benchmark? - ✔actual output/standard output process layout - ✔similar equipment and functions are grouped together In which organizational layout would one expect to see items arranged by type? ✔process hybrid layout - ✔any mix of elements from a product layout and a process layout, to gain the advantages of both eg group technology Process Layout Advantages - ✔-can handle a variety of processing requirements -not particularly vulnerable to equipment failures -general-purpose equipment is often less costly than the specialized equipment used in product layouts -it is possible to use individual incentive plans Product Layout Advantages - ✔higher output rates, lower work-in-process inventories, less material handling, higher labor/equipment utilization, simple planning/control systems group technology - ✔challenges within one of the facilities: -production qualities are low and only a small number of homes are built efficiently -the facility space allows for low handling of materials -there is limited space available for employees to operate -hybrid layout -is where you have a number of facilities and each facility is responsible for a particular process.

A construction company produces pre-fabricated homes. The manager has discovered the following challenges within one of the facilities: -production qualities are low and only a small number of homes are built efficiently -the facility space allows for low handling of materials -there is limited space available for employees to operate Which hybrid layout should be used to address the company's needs? - ✔group technology

block plan - ✔a plan that allocates space and indicates the placement of each operation. -would use an allocation process for space requirements in an industry scenario.

-A From to Matrix gives the number of trips between departments.

-Use Rectilinear distance rectilinear distance - ✔The shortest distance between two points measured by using only north-south and east-west movements from-to matrix - ✔A table that gives the number of trips or units of product moved between any pair of departments.

Which instrument would use an allocation process for space requirements in an industry scenario? - ✔block plan What would be an organizations next step after it has revised or implemented new operations? - ✔-follow up to make sure the new operation resolves -----quality problems Why is it beneficial for an organization to designate employees to communicate alternative ways to complete a job in a methods analysis? - ✔they may have suggestions for improving the operation Which factor determines how long it takes a qualified operator to perform a duty of the job requirements under the assumption that the operator is working at a sustainable pace with the proper tools for the process? - ✔standard time Which design work system minimizes repetitiveness in tasks by assigning employees the role of planning and scheduling? - ✔job enrichment labor specialization - ✔The division of labor into specialized activities that allow individuals to be more productive. - acknowledges the benefits of employee proficiency?

Which work system acknowledges the benefits of employee proficiency? - ✔labor specialization forward scheduling - ✔Starting an activity as soon as possible, regardless of its deadline.

Which term means to schedule a job that starts immediately, regardless of the due date? - ✔forward scheduling just-in-time (JIT) system - ✔An inventory management and control system whose objective is to reduce waste throughout the production and delivery of a product or

service; in manufacturing, also known as lean production or value-added manufacturing.

Use a pull system basic element in the just in time (JIT) system are - ✔1. TQM 2. JIT manufacturing 3. respect for people Push vs. Pull - ✔Push: workflow idea that you make something even if no one is buying it Pull: you use what you need but get enough just in time --> continuous work flow, Kanban system What is the third basic element in the just in time (JIT) system if the first element is the total quality management (TQM) and the second is JIT manufacturing? - ✔respect for people How do just in time (JIT) and lean systems add value? - ✔by reducing waste Enterprise Resource Planning (ERP) Systems - ✔the concept takes a total system approach to create an efficient operation and combines concepts such as just in time (JIT), total quality management (TQM), and continuous improvement a software system that integrates information from across the entire company, Which concept takes a total system approach to creating an efficient operation and combines concepts such as just in time (JIT), total quality management (TQM), and continuous improvement? - ✔enterprise resource planning (ERP) Kanban System is a - ✔a pull system that uses cards to visually signal the need for inventory. It specifies the exact quantity of a product that needs to be produced kanban significant to the "pull" system? - ✔It specifies the exact quantity of a product that needs to be produced What are two product system differences between the push and pull processes? ✔push moves the product forward in anticipation for demand pull eliminates excessive inventory Which function does marketing play in a just in time (JIT) organization? - ✔JIT marketing focuses on customer driven quality How does a just in time (JIT) system influence all functional areas within a company? ✔-companies are able to reduce waste -companies enhance workers ability to perform

What are two ways management can assist employees focus in a just in time (JIT) processing environment? - ✔-ensure that workers receive multifunctional training -develop an incentive system to reward workers for their efforts Supply Chain Management - ✔managing upstream and downstream value-added flows of materials, final goods, and related information among suppliers, the company, resellers, and final consumers Tier one supplier - ✔Supplies materials or services directly to the processing facility.

Which tier-level supplier directly supplies materials or services to a processing and packaging plant? - ✔tier one suppliers External Distributors - ✔transport finished products to appropriate locations -third party logistics providers play in the supply chain Third-party logistics (3PL) provider - ✔an independent logistics provider that performs any or all of the functions required to get a client's product to market. transport finished products to appropriate locations eg fed ex Which role do third party logistics providers play in the supply chain? - ✔external distributors A company manufactures and distributes its own products.

When should the company consider outsourcing distribution? - ✔when the company determines that distribution is no longer a core function verticle integration - ✔the measure of how much supply chain is owned or operated by the manufacturer. Gaining control of all the steps used to change raw materials into finished products What is the measure of how much supply chain is owned or operated by the manufacturer? - ✔vertical integration Which two areas should managers consider in order to adapt to the business dynamics affecting their company? - ✔-their control over internal operations -their advertising costs What are two strategic objectives for every member of the supply chain? - ✔-becoming more efficient -reducing production and delivery times

How does the status of overall customer satisfaction support supply chain objectives? ✔it measures efficiency Supply Chain Operations Reference Model (SCOR) - ✔the model that has been created to examine the four different supply chain perspectives of reliability, flexibility, expenses, and asset/utilization What is the name of the model that has been created to examine the four different supply chain perspectives of reliability, flexibility, expenses, and asset/utilization? ✔SCOR (Supply Chain Operations Reference) The annual cost of goods sold for a company is $8,400,000 and the average inventory is $1,200,000.

What is the number of weeks of supply? - ✔7 percentage of line items shipped on schedule - ✔When there are Finished Goods a customer service measure appropriate when customer orders vary in number of line items ordered A manufacturing firm uses warehouses and shippers in their supply chain.

At which stage of the firm's inventory management system would the statement "percentage of the line items shipped on schedule" be used? - ✔finished goods How does inventory management differ for manufacturing organizations compared to service organizations? - ✔manufacturing organizations must keep a large amount of product on hand at all times, regardless of demand What is one advantage of a periodic review system? - ✔less inventory is needed to protect against stockouts A company's monthly widgets demand has been consistent for the past few years but now a variable shift in demand is forecasted.

The demands are predicted to be: -Jan 20,000 units -Feb 17,000 units -Mar 19,000 units -Apr 21,000 units -May 22,000 units June 24,000 units Beginning inventory of 10,000 units should be maintained.

What is the average monthly new widget production demand for the company? ✔20,500 A company suddenly finds demand has increased to 140% of its previous capacity. It has been able to hire only a fraction of the employees previously laid off, and a warehouse fire destroyed 80% of its inventory.

Which two options does the company have to rapidly meet the new demand? - ✔subcontract a portion of production capacity -hire temporary workers What are two reasons a company might be hesitant to provide overtime as a capacitybased option? - ✔-overtime is not a long term solution -overtime is typically a 50% wage premium demand-based options - ✔A group of options that respond to demand fluctuations through the use of inventory or back orders, or by shifting the demand pattern. IT IS RISKY Why might a company avoid using demand-based options such as inventory and backorders over a long period of time? - ✔it is more risky Which element is part of a financial plan? - ✔budget projections Why is the marketing plan essential to the creation of the aggregate plan? - ✔the marketing plan provides insight into operations goals and activities for the year What is meant by "duration of the change"? - ✔the length of time one expects to need the different level of capacity chase aggregated plan - ✔is preferable when a company produces custom or special purpose equipment, one of a kind, or highly perishable products Which type of aggregated plan is preferable when a company produces custom or special purpose equipment, one of a kind, or highly perishable products? - ✔a chase aggregated plan What are two common drawbacks of implementing an enterprise resource planning (ERP) solution? - ✔-it requires extensive, often complex, training -it takes a long time to implement and to see any benefits What is the primary purpose in using the master production schedule (MPS) in the marketing department of an organization? - ✔to identify new product demand

Capacity Requirements Planning (CRP) - ✔ A company is experiencing an unusual amount of deliveries that are either late or an incorrect quantity.

Which type of system is used to identify and manage this typ of problem? - ✔CRP (capacity requirements planning) Which statement is true about capacity requirements planning (CRP)? - ✔production capacity is created for future production time Why is capacity requirements planning (CRP) important? - ✔it provides the ability to compare available production capabilities to the planned workload Which project life cycle phase includes identifying the need for a project? - ✔conception A company decides and makes plans to enter into a new market.

Which project life cycle phase does this strategy relate to? - ✔feasibility analysis