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Essentials Of Operations Managment > Chapter 8 > Flashcards

Chapter 8 Flashcards

1
Q

Why are location decisions strategically important?

A

Because they represent long term commitment of scarce resources

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2
Q

What are the six things that location planning can impact ?

A
  1. Competitive advantage
  2. Organization
  3. Financing
  4. Capacity and flexibility
  5. Revenues
  6. Supply chain
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3
Q

What are the 5 reasons for moving into a new location?

A
  1. New markets 2. Changes in Market 3. Depletion of raw materials 4. Expansion will not satisfy demands, so moving away is better 5. cost of business is too much, time to move away
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4
Q

Planning a location general procedure? 5 steps

A
  1. Determine technique for evaluating location 2. Identify operational factors such as markets and supplier 3. Determine alternatives 4. Use decision making technique to evaluate the alternatives 5. Select the location
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5
Q

Location cost profit volume analysis is used to evaluate locations in purely ____________.

A

Economic terms

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6
Q

Locational cost profit volume analysis assumptions? (4)

A
  1. Only 1 product is produced 2. Level of output can be estimated 3. Fixed costs are constant 4. Variable costs are linear
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7
Q

What is the factor rating method

A

A method that use qualitative and quantitative data

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8
Q

Quantitative

A

Hard data Statistical research

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9
Q

Qualitative

A

Soft data Surveys and social questioning

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10
Q

8 parts of the factor rating general procedure

A

Basically you are making a game… Qualitative or Quantitative 1. Determine relevant factors 2. Decide on common scale 3. Assign weight to factors 4. Set minimum 5. Score each factor 6. Multiply the score by factor weight and add the scores 7. Choose location with highest score

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11
Q

What do you do if the factor rating general procedure fails?

A

Reevaluate and start all over

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12
Q

What is the transportation model?

A

A technique used when transportation location and cost will effect production

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13
Q

What is the center of gravity model

A

Used to evaluate distribution centers Sometime uses Geographic information system GIS

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14
Q

Center of gravity Assumptions? (2)

A

Shipping quantities are fixed Distribution costs are linear

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15
Q

Expansion Decision alternatives…(4)

A
  1. We can expand existing building 2. Add new location 3. Shutdown existing facility after moving to new place 4. Do nothing
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16
Q

What is an example of a product plant?

A

Harley Davidson No matter where the demand is, the product will only be made in one place!! WISCOOO

17
Q

What is an example of process plant?

A

Ford They use raw materials to make a new product

18
Q

What is an example of a market area?

A

Miller-Coors They will market in only one area

19
Q

The tendency of similar service and retail businesses to locate near each other?

A

Clustering

20
Q

GATT

A

General Agreement of Trade and Tarrifs Reduced barriers to international trade

21
Q

EEC

A

European economic community Promotion of free trade in Europe

22
Q

WTO

A

World trade organization Enforce the General agreement on Tarriffs and trade rules, and regulate disputes Basically the referee of the trade world

23
Q

NAFTA

A

North American Free Trade Agreement Eliminated free trade between Canada US and Mexico

24
Q

When was the Internet invented?

A

1995

25
Q

Global location decision- opportunities (4)

A

1.Access new markets 2.cost saving 3.Relaxed regulations 4.Minimal currency fluctuations

26
Q

Global Location Decisions-Risks (5)

A
  1. Changes in laws 2. Ethics 3.Terrorism 4.Economic instability 5.Cultural differences
27
Q

Global Location Decisions-Challenges (5)

A
  1. Public image 2. Restrictions 3. Labor 4. Security 5. Increased costs
28
Q

What is location planning and analysis ?

A

Involves finding the right place to grow and expand

Essentials Of Operations Managment (4 decks)

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