BADM 3601 Exam 2 Flashcards
5 steps to planning projects
- define work breakdown structure
- diagram the network
- develop the schedule
- analyze cost-time trade-offs
- assess risks
ES, LS, EF, LF
Earliest start: latest earliest finish immediately preceding nodes
Lastest start=LF-t
Earliest finish = ES+t
Latest finish
Activity slack
slack = LS - ES
or LF-EF
Project management
a systemized, phased approach to defining, organizing, planning, monitoring, and controlling projects
WBS
work breakdown structure: statement of all work that has to be completed
-each activity in the WBS must have an “owner” who is responsible for doing the work
Critical path
sequence of activities between a project’s start and finish that takes the longest time to complete
Costs of quality
appraisal costs, prevention costs, internal failure costs, external failure costs
Types of control charts
variable charts: r-charts and x-bar charts (service or product characteristics ex. weight, length, volume, or time)
attribute charts: p-charts and c-charts (service or product characteristics that can be quickly counted for acceptable performance ex. yes-no counts)
when is a sample out of control?
run of 5 dots either above or below dotted line or exceeds UCL or LCL
Prevention and appraisal costs
prevention: costs associated with preventing defects before they happen
appraisal: costs incurred when the firm assesses the performance level of its processes
R-chart, x-bar chart, p-chart
r-chart: range chart
x-bar: mean chart
p-chart: used for controlling proportion of defective services or products
Production control strategies
push system: production trigger is based on forecasts or desired inventory levels, no bounds on inventory
pull system: production trigger is actual consumption of inventory, imposes a bound on inventory aka demand comes in (ex. kanban)
Kanban
japanese word meaning “card” or “visible record” that refers to cards used to control the flow of production through a factory
visible signal used with a pull system
benefits of lean systems
-supply customers with their exact wants when they want it
-eliminate waste; reduce inefficiency
-continuously improve process
-employee involvement
Examples of physical inventory
raw materials, component parts, work in process (WIP), finished goods
Types of conceptual inventory
cycle inventory: assuming constant demand, when to order and how much to order?
safety stock inventory: protects against uncertainties in demand, lead time, and/or supply, place order earlier than needed
anticipation inventory: absorbs uneven rates of demand, predictable, seasonal demand patterns, stockpile during low demand
pipeline inventory: inventory moving from point to point in material flow system
EOQ
economic order quantity: lot size that minimizes total annual cycle-inventory holding and ordering costs
assumption: 1. demand rate is constant 2. no constraints on lot size (Q) 3. only costs are holding and ordering 4. decisions for items are independent 5. no uncertainty in lead time or supply
Periodic Review Systems
system in which an item’s inventory position is reviewed periodically rather than continuously
fixed interval reorder system (periodic reorder system), IP reviewed periodically instead of continuously, new order after every review, TBO fixed at P, Q may vary with each order
Continuous review system
system designed to track the remaining inventory of a SKU each time a withdrawal is made to determine whether it is time to reorder
continuously check your inventory position after every withdrawal
if IP>R, do not place an order
if IP<=R, place and order of size Q
Stockout
inventory is gone forever once you run out of product
order that cannot be satisfied, resulting in loss of the sale
Backorder
plan to bring in more product once it’s gone
customer order that cannot be filled when promised or demanded but its filled later
Upstream and downstream of supply chain
upstream: suppliers and production
downstream: consumers and finished product
Disruptions impairing supply chain
external: volume changes, product mix changes, late deliveries cause production switch, undefiled shipments
internal: shortages, design changes, new product introductions, price promotions, information errors
Strategic fit
-consistency between customer priorities and supply chain capabilities
-a company may fail because its processes do not provide the capabilities to execute the desired strategy
Backward integration
firm’s movement upstream toward the sources of raw materials, parts, and services through acquisition
ex. owning and controlling stages upstream in SC (manufacturing own suppliers)
Forward integration
acquiring more channels of distribution, such as distribution centers and retail stores, or even business customers
ex. owning and controlling stages downstream in SC (manufacturer owns and controls distributor)
Location decisions
separate single facility or facility within a network (interaction among multiple facilities, location, allocation, and capacity issues)
Bullwhip effect
suppliers and manufactures overreact to small changes in consumer demand at retail level and hence overproduce products
Load-distance method
mathematical model used to evaluate locations based on proximity factors
Center of gravity
good starting point to evaluate locations in the target area using the load-distance model
Forecasting techniques
qualitative: judgement methods (opinions of managers, expert opinions, consumer surveys)
quantitative: casual methods (use historical data on independent variables), time-series methods (statistical approach that relies heavily on historical demand data)
Forecast
prediction of future events used for planning purposes
MSE
variability: measurement of the dispersion of forecast errors
MAPE
mean absolute percent error: measurement that relates the forecast error to the level of demand and is useful for putting forecast performance in the proper perspective
MRP
material requirements planning: information system to manage inventory and schedule orders, keeps track of dependent demand items, automatically updates component schedules when production schedules change
computerized information system developed specifically to help manufacturers manage dependent demand inventory and schedule replenishment orders
FOQ
fixed order quantity: high average inventory, creates remnants, rule that maintains the same order quantity each time an order is issued
POQ
periodic order quantity: reduces average on-hand inventory, matches order quantity to requirements, rule that allows a different order quantity for each order issued but issues the order for predetermined time intervals
L4L
lot for lot: minimizes inventory investment, maximizes the number of orders placed, rule under which the lot size ordered covers the gross requirements of a single week
Resource planning
process that takes sales and operations plans; processes information in the way of time standards, routing, and other information on how services or products are produced; then plans the input requirements
MPS
master production schedule: part of the material requirements plan the details how many end items will be produced within specified periods of time
ATP
available-to-promise inventory: quantity of end items that marketing can promise to deliver on specified dates
BOM
bill of materials: record of all components of an item, the parent-component relationships, and the usage quantities derived from engineering and process designs
ERP
enterprise resource planning: large, integrated information systems that support many enterprise processes and data storage needs
BOR
bill or resources: record of a service firm’s parent-component relationships and all of the materials, equipment time, staff, and other resources associated with them, including usage quantities
Formulating a LP
- define decision variables
- write objective function
- write constraints
Linear programming
technique that is useful for allocating scare resources among competing demands
Feasible region
region that represents all permissible combinations of the decision variables in a linear programming model
non negativity
assumption that the decision variables must be positive or zero
