CHAPTER 8 – MAKING YOUR PRODUCTS OR SERVICES

Question 1

SCOR stands for

Answer 1

Supply Chain Operations Reference

Question 2

refers to the group of processes that transform components into a new product or service that has value for a customer.
(from SCOR framework)

Answer 2

make

Question 3

The job of overseeing these processes (transform components into a new product or service) is often called

Answer 3

Operations management

Question 4

-The process of making anything really starts when you decide what to make, how much to make, and when to make it (term for manufacturing company)

-for service companies

Answer 4

-production planning and scheduling
-service planning and scheduling

Question 5

planning production steps (3)

Answer 5

a. Setting a demand goal
b. Creating a production schedule
c. Finalizing the production schedule

Question 6

Production planning starts with a high-level goal: _______
– This high-level demand goal is called the _____

Answer 6

-how much you want to sell.
-Master Demand Schedule (MDS).

Question 7

After determining your demand goal, you break that sales goal down into a ________

Answer 7

Master Production Schedule (MPS).

Question 8

building the____is how you decide what you’ll need to make each day to meet the MDS goal.

Answer 8

MPS

Question 9

bottlenecks or problems that may interfere with production

Answer 9

Production constraints

Question 10

The ______ gives your team their actual production targets — how much you expect to make and when you expect to make it.

Answer 10

final production schedule

Question 11

– often combines parts sequencing and JIT deliveries

Answer 11

Lean manufacturing

Question 12

– A production schedule that changes too often
– _____create waste in a supply chain such as unnecessary work and excess inventory

Answer 12

-nervous schedule
-Nervous production schedules

Question 13

– threshold, usually measured in days or weeks
– how far in advance they can realistically change the production schedule without creating chaos for their supply chain

Answer 13

Time Fence

Question 14

– production targets should always be aligned with your sales goals to ensure that you aren’t making too much or too little to satisfy your customers.

Answer 14

Sales and operations planning (S&OP)

Question 15

– used by companies to update schedules automatically

Answer 15

Material requirements planning (MRP) software

Question 16

there are three concepts that every supply chain manager needs to understand because they factor into your production plan:

Answer 16

a. Design Capacity
b. Operating Capacity
c. Capacity Utilization

Question 17

– (or theoretical capacity) is the maximum that a machine (or person) can possibly produce.

Answer 17

a. Design Capacity

Question 18

– (or effective capacity)w limit on how much you can make, which is much lower than your design capacity

Answer 18

b. Operating Capacity

Question 19

– A common way to measure production output, or_____, is the percentage of operating capacity that you actually use
– This percentage is called_______

Answer 19

yield, Capacity Utilization

Question 20

supply chain management has two types of processes for manufacturing products:

Answer 20

a. Discrete manufacturing
b. Continuous manufacturing

Question 21

– Some products are manufactured as separate items or in batches.

Answer 21

a. Discrete manufacturing

Question 22

The output of a discrete manufacturing process typically is measured by the number of items produced during a certain period, usually per hour or per day. This metric is the ____.

Answer 22

production rate

Question 23

there are two different ways to execute this work (discrete manufacturing):

Answer 23

Assembly line
Cellular manufacturing

Question 24

bringing the work to the workers

Answer 24

Assembly line

Question 25

bringing the workers to the work

Answer 25

Cellular manufacturing

Question 26

time required for each step in an assembly line process.

Answer 26

Takt time

Question 27

Adjusting process steps to achieve consistent takt times is called _____

Answer 27

balancing or leveling a line.

Question 28

time required for all the production steps to be completed, from beginning to end; the minimum amount of time required to make each product (or batch of products)

Answer 28

Cycle time

Question 29

place where these products (bulky and difficult to move) are built

Answer 29

Manufacturing cell/manufacturing stall

Question 30

– Other products can’t be easily separated into individual units or batches (items are made in stream)

Answer 30

b. Continuous manufacturing

Question 31

Continuous manufacturing
-tend to be highly efficient, because the capacity of each step in the process can be sized for the same ____ or _____

Answer 31

rate of material flow, or throughput

Question 32

term for rate of material flow

Answer 32

throughput

Question 33

Choosing the right production environment is based on two factors:

Answer 33

what you’re making
what your customers need.

Question 34

– also called customer response time
– is the time between when a customer places an order and when you deliver the product to them.

Answer 34

Total lead time

Question 35

Three types of production environments

Answer 35

a. Make-to-stock
b. Make-to-order
c. Engineer-to-order

Question 36

– If your customers need a product right away, and the product doesn’t require customization, you probably want to have some items premade and ready for them to buy
– Having a high level of ___ is important for keeping customers happy and growing your market share.

Answer 36

a. Make-to-stock
- product availability

Question 37

– a jargon term to describe products that are stolen, damaged, or wasted
– they lead to a reduction — or shrinking — of inventory.

Answer 37

Shrinkage

Question 38

– If your manufacturing lead time is shorter than your customer’s required response time, you may not need to have any inventory.
– Instead, you can wait until an order comes in and then produce the product for your customer.
– eliminates inventory and warehousing costs, thereby freeing up cash, which translates directly into increased profits

Answer 38

b. Make-to-order

Question 39

– In some cases, customers want specific products and services that really can’t be pre-planned, such as yachts, racing engines, or custom cabinets.
– When your customers want this type of customization, you must wait until they place an order

Answer 39

c. Engineer-to-order

Question 40

You can measure the quality of a product – and how much variability you have in a process to make a product – through:

Answer 40

Quality control (QC)
Quality assurance (QA)

Question 41

(testing the products) involves testing and measuring the outputs to make sure they are acceptable.

Answer 41

Quality control (QC)

Question 42

– (managing the process) is about looking at each step in a production process and ensuring that things are working properly by measuring variability.

Answer 42

Quality assurance (QA)

Question 43

– There are lots of things in a production environment that can change throughout the day, such as temperature and humidity, and each of these changes results in small variations in a process

Answer 43

Controlled Variability

Question 44

the amount of variability that you choose to accept

Answer 44

Controlled limit or the Tolerance

Question 45

– variability becomes a problem when it is unexpected and your process exceeds your control limits

Answer 45

Random variability or uncontrolled variability

Question 46

– talk about common cause variability, which is similar to controlled variability, and special cause variability, which is similar to random variability

Answer 46

Quality gurus

Question 47

comes from something in the environment

Answer 47

Common cause variability = controlled variability

Question 48

can be assigned to a specific source or event, like a misplaced order

Answer 48

special cause variability = random variability

Question 49

– Anything that’s left over at some point in the manufacturing process
– outputs that are not useful and end up being discarded

Answer 49

Waste

Question 50

– Three options to keep in mind when looking at manufacturing waste:

Answer 50

a. Reduce
b. Reuse
c. Recycle

Question 51

– ____can have a positive effect both on the planet and on your company’s profits, because it’s often the fastest, most effective way to make huge improvements

Answer 51

Reducing waste

Question 52

measures the performance of a company based on social effects, financial performance, and environmental sustainability.

Answer 52

triple bottom line

Question 53

other term for triple bottom line approach

Answer 53

three Ps (people, profit, and planet).