Operations Planning and Control
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Course Introduction
Operations Planning and Control explores the fundamental principles and techniques used to efficiently manage and coordinate the resources, processes, and activities involved in the production of goods and delivery of services. The course covers topics such as forecasting, inventory management, capacity planning, scheduling, production control, and the use of information technology systems in operations. Students will analyze real-world case studies and apply quantitative tools to optimize operations, ensuring timely delivery, quality, and cost-effectiveness. Emphasis is placed on decision-making skills and strategies to address challenges in complex and dynamic operational environments across various industries.
Recommended Textbook Operations and Supply Chain Management 15th Edition by F. Robert Jacobs
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Chapter 1: Introduction
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Q1) One of the "package of features" that make up a service is:
A)Appearance
B)Facilitating goods
C)Packaging
D)Cost
E)Implied use
Answer: B
Q2) Use of systems like point-of-sale, radio-frequency identification tags, bar-code scanners, and automatic recognition has made it more difficult to understand what all the information is saying.
A)True
B)False
Answer: False
Q3) Services are intangible processes that cannot be weighed or measured.
A)True
B)False
Answer: True
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Chapter 2: Strategy
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Q1) The process when a company seeks to match the benefits of a successful position while maintaining its existing position by adding new features, services, and technologies into its current portfolio it is called straddling.
A)True
B)False
Answer: True
Q2) Which of the following is a partial measure of productivity?
A)Output/Materials
B)Output/(Labor + Capital + Energy)
C)Output/All resources used
D)Output/Inputs
E)All of these
Answer: A
Q3) Productivity is a relative measure.
A)True
B)False Answer: True
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Chapter 4: Project Management
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Q1) One of the disadvantages of a pure project organizational structure is that the project manager has full authority over the project.
A)True
B)False
Answer: False
Q2) When reducing the planned duration of a project using the time-cost CPM model, we select the activity to crash by determining the cost of each alternative and selecting the one whose cost is the greatest.
A)True
B)False
Answer: False
Q3) What is a work breakdown structure?
A)A list of the activities making up the higher levels of the project
B)A definition of the hierarchy of project tasks, subtasks, and work packages
C)A depiction of the activities making up a project
D)A Gantt chart
E)A structure that is incompatible with the critical path method
Answer: B
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Chapter 3: Design of Products and Services
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Q1) What dimension of competitiveness does quality in product design affect?
A)Engineering hours per project
B)The cost of ongoing service
C)Responsiveness to customer needs
D)Aesthetics of design
E)None of these
Q2) A reason that firms must develop more new products than ever is which of the following?
A)Product life cycles are shorter
B)Commitments to joint venture partners
C)They are replacing old customers with new ones
D)To amortize heavy investments in development labs
E)The increased difficulty of defending patents and trade names
Q3) Target customers are specified during "Phase 0: Planning" of the generic product development process.
A)True
B)False
Q4) One goal of having a core competency is to do something better than anyone else.
A)True
B)False
Page 6
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Chapter 5: Strategic Capacity Management
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Sample Questions
Q1) The capacity focus concept can be put into practice through a mechanism called which of the following?
A)Best operating level (BOL)
B)Plant within a plant (PWP)
C)Total quality management (TQM)
D)Capacity utilization rate (CUR)
E)Zero changeover time (ZXT)
Q2) The frequency of adding to productive capacity should balance the costs of upgrading too frequently and the costs of upgrading too infrequently.
A)True
B)False
Q3) Outsourcing is a common source of external capacity.
A)True
B)False
Q4) The capacity cushion is the ratio of capacity used to the best capacity level. A)True
B)False
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Chapter 6: Learning Curves
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Q1) You are a consultant called in to estimate the costs after the employees learn how to do a job more efficiently by repetition of new product.You find a company can produce a product the first time at a cost of $5,000.If their 90 percent learning curve allows them to reduce their costs on each unit, what is the total cost of producing 100 units of the new product?
A)$500,000
B)$390,000
C)$290,700
D)$250,687
E)$250,000
Q2) An assumption of learning curves is that the time required to complete a unit will decrease at a decreasing rate as the cumulative number of units completed increases.
A)True
B)False
Q3) A learning curve is a line displaying the way unit production time decreases as time passes.
A)True
B)False
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Chapter 7: Manufacturing Processes
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Q1) Break-even analysis can only be used in production equipment decision making when dealing solely with fixed costs, not variable costs.
A)True
B)False
Q2) You are hired as a consultant to decide if your client should purchase a new, highly specialized piece of equipment.The product to be produced by this equipment is forecast to have a total worldwide demand of 15,000 units over the entire product life.The initial investment to acquire and install the equipment is $256,000.The variable cost to produce each unit will be $15, and the selling price for the finished product will be $30.Which of the following best describes the situation the firm is facing?
A)The company will recover its initial investment.
B)The company's total margin will be less than its investment.
C)It is a good investment.
D)The break-even is lower than the 15,000 units that are expected to sell.
E)All of these
Q3) A project layout is characterized by a high degree of task ordering.
A)True
B)False
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Chapter 8: Facility Layout
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Q1) Using the assembly-line balancing procedure, which of the following is the theoretical minimum number of workstations if the task times for the six tasks that make up the job are 4, 6, 7, 2, 6, and 5 minutes, and the cycle time is 10 minutes?
A)3
B)5
C)6
D)8
E)None of these
Q2) Having a lot of interstage storage of materials is considered a good layout design for a manufacturing plant.
A)True
B)False
Q3) Which of the following is not among the suggestions for a good layout for manufacturing and back-office operations?
A)Production time predictable
B)Straight-line flow pattern
C)Open plant floors so everyone can see what is happing
D)Brightly colored walls and good lighting
E)Workstations close together
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Chapter 9: Service Processes
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Q1) The term "encounter" is defined by Webster's Dictionary as "meeting in conflict or battle" and is used to also designate meetings between consumers and service systems.
A)True
B)False
Q2) Choosing how to accommodate customer induced variability in a service business is the decision of the front-line service provider.
A)True B)False
Q3) Services often take the form of repeated encounters involving face-to-face interactions.
A)True
B)False
Q4) Poka-yokes are procedures that block the inevitable mistake from becoming a service defect.
A)True B)False
Q5) It is not necessary that a well-designed service system be robust. A)True B)False
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Chapter 10: Waiting Line Analysis and Simulation
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Q1) Regardless of the computer language chosen for a simulation model, too much data from a simulation can be dysfunctional to problem solving.
A)True
B)False
Q2) Which of the following are the three major components of a queuing system?
A)The source population, how customers exit the system, and the queuing discipline
B)The number of servers, the service speed, and the waiting line
C)The source population, how the customer exits the system, and the servicing system
D)The source population and the way customers arrive at the system, the serving systems, and how customers exit the system
E)The service speed, the queue discipline, and the waiting line
Q3) The customer arrivals in a queuing system come almost exclusively from finite populations.
A)True
B)False
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Chapter 11: Process Design and Analysis
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Q1) A diamond is conventionally used in a process flowchart to represent a storage area or queue.
A)True
B)False
Q2) Make-to-order production processes are well suited for high-volume production of a standardized product.
A)True
B)False
Q3) A process flowchart uses which of the following symbols to represent storage areas or queues in a flow diagram?
A)Rectangle
B)Arrow
C)Inverted triangle
D)Diamond
E)A dashed line
Q4) Inventory turn is a better measure than the total value of inventory for comparative purposes because it is a relative measure.
A)True
B)False
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Chapter 12: Six Sigma Quality
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Sample Questions
Q1) An operational goal of total quality management is ensuring that the organization's systems can consistently produce the product or service as it is designed.
A)True
B)False
Q2) Design of experiments is a statistical methodology often used in Six-Sigma projects.It aims to accomplish which of the following?
A)Keep careful track of the occurrences of each possible defect.
B)Determine the cause-and-effect relationships between process variables and output.
C)Report defects to management on a Pareto chart.
D)Carefully change each individual process variable until the cause of a defect is found.
E)Eliminate defects by finding out who or what is causing them.
Q3) A quality guru named Philip Crosby suggested that a general approach to quality management should involve prevention, not inspection.
A)True
B)False
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Chapter 13: Statistical Quality Control
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Q1) You are going to develop an R-chart based on range statistics, and you are using a sample size of 9 for your charting purposes.Which of the following is the lower control limit D3 factor for the chart?
A)0.08
B)0.14
C)0.18
D)0.22
E)0.29
Q2) Consider a sampling plan with n=40 and c=1 and given Acceptable quality level (AQL), Lot tolerance percent defective (LTPD), producer's risk ( ) and consumer's risk ( ).Suppose that c is increased to 2, keeping AQL and LTPD unchanged, consumer's risk ( ) will
A)Always decrease
B)Always increase
C)Sometime decrease
D)Stay the same.
E)None of the above.
Q3) Total, 100 percent inspection can never be cost justified.
A)True
B)False
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Chapter 14: Lean Supply Chains
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Q1) Which of the following is not listed in the textbook as a component of a lean supply chain?
A)Lean customers
B)Lean management
C)Lean logistics
D)Lean warehousing
E)Lean procurement
Q2) Lean production makes implementing green strategies in manufacturing processes more difficult.
A)True
B)False
Q3) Value stream mapping is used to identify all of the value-adding as well as non-value-adding processes that materials are subjected to within a plant.
A)True
B)False
Q4) One of the few lean techniques that does not work well in service firms is demand-pull scheduling.
A)True
B)False
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Chapter 15: Logistics Distribution, and Transportation
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Q1) What transportation mode has very high initial investment costs but gives a very low cost per mile for products that are highly specialized and require no packaging?
A)Highway
B)Rail
C)Water
D)Pipeline
E)Air
Q2) One of the objectives of facility location analysis is to select a site with the lowest total cost.Which of the following costs should not be included in the analysis?
A)Outbound distribution costs
B)Incidental costs
C)Energy costs
D)Hidden costs
E)Taxes
Q3) Facility location analysis considers proximity to customers important to timeliness of deliveries.
A)True
B)False
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Chapter 16: Global Sourcing and Procurement
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Q1) Two common measures to evaluate supply chain efficiency are the inventory turnover and weeks-of-supply ratios.
A)True
B)False
Q2) Which of the following is one of the strategic characteristics to consider when deciding how supplier relationships should be structured on the continuum between vertical integration (do not outsource) and arm's length relationships (outsource)?
A)Cost
B)Location
C)Investment
D)Coordination
E)Control
Q3) A stable supply process is one where the manufacturing process and the underlying technology are mature and the supply base is well established.
A)True
B)False
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Chapter 17: Enterprise Resource Planning Systems
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Q1) When selecting an ERP system, it is possible to take a multivendor approach.
A)True
B)False
Q2) If a small company has average daily sales of $5,000 and accounts receivable of $150,000, what is the average days of accounts receivable?
A)30 days
B)3.3 days
C)$5,000/month
D)33.3 days
Q3) In the cash-to-cash cycle calculation, if the cost of goods sold per day increases, but all other data such as average inventory and average payables and receivables remain the same, then the value of cash-to-cash cycle will
A)go down
B)go up
C)stay the same
D)May go up or down, but cannot tell without more information
Q4) The term "enterprise resource planning (ERP)" can mean different things.
A)True
B)False
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Chapter 18: Forecasting
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Q1) As a consultant, you have been thinking about choosing the "right" alpha (smoothing constant) for forecasting using exponential smoothing.Which of the following is most accurate about alpha?
A)If alpha is high, speed of reaction to changes in actually low.
B)If a firm produces standard product with relatively stable demand, alpha should be small.
C)Products experiencing growth should be assigned higher alpha value.
D)Alpha could be more than 1.0, and in this case (1-alpha) will become negative to make up for it.
E)B and C
Q2) Which of the following forecasting methods can be used for short-term forecasting?
A)Simple exponential smoothing
B)Delphi technique
C)Market research
D)Hoskins-Hamilton smoothing
E)Serial regression
Q3) Simple exponential smoothing lags changes in demand.
A)True
B)False
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Chapter 19: Sales and Operations Planning
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Q1) Using constant workforce and varying inventory and stock out, what would be the constant workforce? Production required in periods 1,2 and 3 respectively are 1200, 1500 and 900 units.One worker during the panning horizon can produce two units in one day.Number of work days are 22 in period 17 in period 2 and 21 in period 3.Assume that the beginning inventory and the edniong inventory required are 300 units each.What is the number of workers required during the planning horizon of three periods?
A)60
B)600
C)35
D)30
E)300
Q2) In an overview of the major operations planning activities in a typical service organization, which of the following activities follows aggregate sales and operations planning?
A)Process planning
B)Workforce scheduling
C)Master scheduling
D)Materials requirements planning
E)Order scheduling
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21
Chapter 20: Inventory Management
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Q1) If annual demand is 50,000 units, the ordering cost is $25 per order, and the holding cost is $5 per unit per year, which of the following is the optimal order quantity using the fixed-order-quantity model?
A)909
B)707
C)634
D)500
E)141
Q2) A company wants to determine its reorder point (R).Demand is variable and the company wants to build a safety stock into R.If the average daily demand is 12, the lead time is 5 days, the desired z value is 1.96, and the standard deviation of usage during lead time is 3, which of the following is the desired value of R?
A)About 6
B)About 16
C)About 61
D)About 66
E)About 79
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Chapter 21: Material Requirements Planning
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Q1) MRP is based on dependent demand.
A)True
B)False
Q2) Which of the following is an input to the master production schedule?
A)Prototype products from product development
B)Aggregate component schedule
C)Peg reports
D)Exception reports
E)Forecasts of random demand from customers
Q3) A lot-for-lot (L4L) lot-sizing technique does not take into account setup costs or capacity limitations.
A)True
B)False
Q4) In a typical inventory status record, which of the following would you not expect to see?
A)Scrap allowance
B)Order quantity
C)Gross requirements
D)Planned-order releases
E)Lost items
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Chapter 22: Workcenter Scheduling
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Q1) Which of the following priority rule will minimize the average flow time of jobs and also perform well in other measures such as average lateness
A)STR
B)CR
C)SOT
D)LCFS
E)EDD
Q2) A backward schedule tells when an order must be started in order to be done by a specific date.
A)True
B)False
Q3) A system that "backward schedules" is designed to determine and report the earliest date an order can be completed.
A)True
B)False
Q4) One of the principles of work center scheduling is that once started, a job should not be interrupted.
A)True
B)False
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Chapter 23: Theory of Constraints
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Q1) On an assembly line, a transfer batch can be one unit.
A)True
B)False
Q2) OPT stands for optimal purchasing technique.
A)True
B)False
Q3) Larger transfer batches give shorter lead times and lower inventories, and there is more material handling than smaller transfer batches.
A)True
B)False
Q4) In a process sequence where a product flows from process A to process B, process A is called the mother process.
A)True
B)False
Q5) In a process sequence where a product flows from process A to process B, process B is called the contingent process.
A)True
B)False
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Chapter 24: Health Care
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Q1) What is the starting point in developing a capacity plan for a health care operation?
A)Forecasting patient demand for a reasonable length of time
B)Estimating design capacity
C)Discovery of the bottleneck operation
D)Determining the effective capacity over time
E)Holding a meeting of concerned staff physicians
Q2) Medicine error severity would be reported on the key process performance dashboard.
A)True
B)False
Q3) Health care is the most intensive of service industries.
A)True
B)False
Q4) Average inventory for a medium-size hospital represents about 25 percent of its current assets.
A)True
B)False
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Chapter 25: Operations Consulting
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Q1) In the five forces model, which of the following is not one of the five forces?
A)Buyer power
B)New technologies
C)Supplier power
D)Substitute products
E)Potential entrants
Q2) Fishbone diagrams and cause-and-effect diagrams give different information.
A)True
B)False
Q3) Which of the following is a data-gathering tool from the operations consulting tool kit?
A)Gap analysis
B)Employee surveys
C)Organization charts
D)Statistical tools
E)Bottleneck analysis
Q4) Operations consulting deals with assisting clients in developing operations strategies and improving production processes.
A)True
B)False
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