Chapter 8, 9 & 11

Question 0

Forecasts are always…

Answer 0

Wrong! Groups and families or aggrigate demand can increase the accuracy of forecasts though.

Question 1

S&OP is for

Answer 1

Tactical planning

Stands for “sales and operations planning”

Question 2

What do aggregate operations plans do?

Answer 2

Specifies the optimal combination of:

1. Production rate
2. Workforce level
3. Inventory on hand

Question 3

What is S&OP?

Answer 3

Sales and Operations Planning. It integrates information from each division to make coordinated decisions across the company.

Question 4

What are the hard benefits of S&OP?

Answer 4

Basically, it make everything more efficient and higher quality: smaller inventories, better customer service, shorter customer lead times, more stable production/service rates.

Question 5

What is yield Management?

Answer 5

The process of allocating the right type of capacity to the right type of customer at the right price and time to maximize revenue or yield.

Question 6

What is ERP?

Answer 6

Enterprise Resource Planning. It integrated both internal and external management information across the organization, embracing various divisions like sales, finance/accounting, customer service. ERP automate this on the computer.

Question 7

What is MRP?

Answer 7

• Materials Requirements Planning. The logic used in determining the number of parts components and materials needed to produce a product to the schedule provided (which is the production of the dependent demand).
• MRP is for dependent demand

Question 8

What is MPS?

Answer 8

Master Production Schedule. It is used to implement the firms aggregate production plan.

Question 9

What is the difference between dependent and independent demand?

Answer 9

Independent demand deals with finished products that are sold to the customer

Question 10

What industry types most benefit from MRP?

Answer 10

• Assemble to stock
• Assemble to order
• Manufacture to order

Question 11

What kind of demand does MPS deal with?

Answer 11

Independent demand. it’s also a major input to the MRP process. The other two inputs are the bill of materials and the inventory records file.

Question 12

What does it mean when a time tense is frozen?

Answer 12

Changes to the production lab are not allowed.

Question 13

What is BOM?

Answer 13

Bill of Materials. The BOM structure is just a tree showing what part of an item make up other part of that item. They are also time phased.

Question 14

Lot sizing: What is Lot for Lot? What is Economic order quantity?

Answer 14

Lot of Lot is where you order the exact amount you need. This minimizes carrying costs.

Economic order quantity. This is calculated using the EOQ formula. It goes along with the reorder point concept.

Question 15

What are the 3 inventory models?

Answer 15

• Single period model (used for a one time purchase)
• Fixed order quantity model (This uses a reorder point)
• Fixed time period model (The item is ordered at a certain interval of time)

Question 16

What is cycle counting?

Answer 16

A physical inventory management technique to more effectively control inventory accuracy.