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C215 > Chapters 12, 13, 14, 16 > Flashcards

Chapters 12, 13, 14, 16 Flashcards

1
Q

Raw materials

A

Purchased items or extracted materials transformed into components or products.

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2
Q

Components

A

Parts or subassemblies used in the final product.

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3
Q

Work-in-process (WIP)

A

Items in process throughout the plant.

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4
Q

Finished goods

A

Products sold to customers.
Distribution inventory Finished goods in the distribution system.

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5
Q

Anticipation inventory

A

Inventory built in anticipation of future demand.

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6
Q

Fluctuation inventory

A

Provides a cushion against unexpected demand. Lot-size inventory A result of the quantity ordered or produced.

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7
Q

Transportation inventory

A

Inventory in movement between locations.

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8
Q

Speculative inventory

A

Used to protect against some future event.

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9
Q

Maintenance, repair, and operating (MRO) inventory

A

Items used in support of manufacturing and maintenance.

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10
Q

Percentage of orders shipped on schedule

A

A customer service measure appropriate for use when orders have similar value.

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11
Q

Percentage of line items shipped on schedule

A

A customer service measure appropriate when customer orders vary in number of line items ordered.

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12
Q

Percentage of dollar volume shipped on schedule

A

A customer service measure appropriate when customer orders vary in value.

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13
Q

Setup cost

A

Costs such as scrap costs, calibration costs, and downtime costs associated with preparing the equipment for the next product being produced.
Inventory turnover A measure of inventory policy effectiveness.

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14
Q

Weeks of supply

A

A measure of inventory policy effectiveness.

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15
Q

Item cost

A

Includes price paid for the item plus other direct costs associated with the purchase.

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16
Q

Holding costs

A

Include the variable expenses incurred by the plant related to the volume of inventory held.

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17
Q

Capital costs

A

The higher of either the cost of the capital or the opportunity cost for the company.
Storage costs Include the variable expenses for space, workers, and equipment related to the volume of inventory held.

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18
Q

Risk costs

A

Include obsolescence, damage or deterioration, theft, insurance, and taxes associated with the volume of inventory held.

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19
Q

Ordering costs

A

The fixed costs associated with either placing an order with a supplier or setup costs incurred for in-house production.

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20
Q

Shortage costs

A

Incurred when demand exceeds supply.

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21
Q

Back-order

A

Delaying delivery to the customer until the item becomes available.

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22
Q

Lost sale

A

Occurs when the customer is not willing to wait for delivery.

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23
Q

Continuous review system

A

Updates inventory balances after each inventory transaction.

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24
Q

Periodic review system

A

Requires regular periodic reviews of the on-hand quantity to determine the size of the replenishment order.

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25
Q

Two-bin system

A

One bin with enough stock to satisfy demand during replenishment time is kept in the storeroom; the other bin is placed on the
manufacturing floor.

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26
Q

Lead time

A

Time from order placement to order receipt.

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27
Q

Periodic counting

A

A physical inventory is taken periodically, usually annually.

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28
Q

Cycle counting

A

Prespecified items are counted daily

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29
Q

Strategic business plan

A

A statement of long-range strategy and revenue, cost, and profit objectives.

30
Q

Sales and operations planning

A

The process that brings together all the functional business plans (marketing, operations, engineering, and finance) into one integrated plan.

31
Q

Marketing plan

A

Identifies the markets to be served, desired levels of customer service, product competitive advantage, profit margins, and the market share needed to achieve the objectives of the strategic business plan.

32
Q

Aggregate plan

A

Includes the budgeted levels of finished products, inventory, backlogs, workforce size, and aggregate production rate needed to support the marketing plan.

33
Q

Financial plan

A

Identifies the sources and uses of funds; projects cash flows, profits, return on investment; and provides budgets in support of the strategic business plan.

34
Q

Engineering plan

A

Identifies new products or modifications to existing products that are needed to support the marketing plan.

35
Q

Master production schedule

A

The anticipated production schedule for the company expressed in specific configurations, quantities, and dates.

36
Q

Demand-based options

A

A group of options that respond to demand fluctuations through the use of inventory or back orders, or by shifting the demand
pattern.

37
Q

Capacity-based options

A

A group of options that allow the firm to change its current operating capacity.

38
Q

Finished goods inventory

A

Products available for shipment to the customer.

39
Q

Back orders

A

Unfilled customer orders.

40
Q

Shifting demand

A

A marketing strategy that attempts to shift demand from peak periods to nonpeak periods to smooth out the demand pattern.

41
Q

Overtime

A

Work beyond normal established operation hours that usually requires a premium be paid to the workers.

42
Q

Undertime

A

A condition occurring when there are more people on the payroll than are needed to produce the planned output.

43
Q

Subcontracting

A

Sending production work outside to another manufacturer or service provider.

44
Q

Hiring and firing

A

Long-term option for increasing or decreasing capacity.

45
Q

Point of departure

A

The percentage of normal capacity the company is currently using.

46
Q

Magnitude of the change

A

The relative size of the change needed.

47
Q

Duration of the change

A

The expected length of time the different capacity level is needed.

48
Q

Level aggregate plan

A

A planning approach that produces the same quantity each time period. Inventory and back orders are used to absorb demand fluctuations. A level aggregate plan maintains a constant workforce and produces the same amount of product in each time period of the plan.

49
Q

Chase aggregate plan

A

produces exactly what is needed to satisfy demand during each period. The production rate changes in response to demand fluctuations. Whereas the level aggregate plan sets capacity to accommodate average demand, the chase aggregate plan sets labor and equipment capacity to satisfy demand each period.

50
Q

Hybrid aggregate plan

A

A planning approach that uses a combination of level and chase approaches while developing the aggregate plan.

51
Q

Enterprise resource planning (ERP)

A

Large, sophisticated software systems used for identifying and planning the enterprise-wide resources needed to coordinate all activities involved in producing and delivering products.

52
Q

SCM software

A

Designed to improve decision making in the supply chain.

53
Q

Closed-loop MRP

A

An MRP system that includes production planning, master production scheduling, and capacity requirements planning.

54
Q

Manufacturing resource planning (MRP II)

A

A method for the effective planning and integration of all internal resources.

55
Q

Material requirements planning (MRP)

A

A system that uses the MPS, inventory record data, and BOM to calculate material requirements.

56
Q

Backward scheduling

A

Starts with the due date for an order and works backward to determine the start date for each activity.

57
Q

Capacity requirements planning (CRP)

A

Determines the labor and machine resources needed to fill the open and planned orders generated by the MRP. CRP enables a company to evaluate both the feasibility of the MRP system and how well the company is using its critical work centers.

58
Q

Precedence relationships

A

Establishes the sequencing of activities to ensure that all necessary activities are completed before a subsequent activity is begun.

59
Q

Bill of material (BOM)

A

Lists all the subassemblies, component parts, and raw materials that go into an end item and shows the usage quantity of each required.

60
Q

Independent demand

A

The demand for an item is unrelated to the demand for other items.

61
Q

Dependent demand

A

The demand for component parts is based on the number of end items being produced.

62
Q

Time-phased

A

Expressing future demand, supply, and inventories by time period.

63
Q

Open shop orders

A

Released manufacturing orders.

64
Q

Project

A

Endeavor with a specific objective, multiple activities, and defined precedence relationships, to be completed in a specified time period.

65
Q

Concept

A

Identify the need for the project.
Feasibility analysis or study Evaluate costs, benefits, and risks.

66
Q

Planning

A

Decide who does what, how long it should take, and what you need to do it.

67
Q

Execution

A

Do the project.

68
Q

Termination

A

End the project.

69
Q

Program evaluation and review technique (PERT)

A

Network planning technique used to determine a project’s planned completion date and identify the
project’s critical path.

70
Q

Critical path method (CPM) Network

A

planning technique, with deterministic times, used to determine a project’s planned completion date and identify the project’s critical path.

71
Q

Project activities

A

Specific tasks that must be completed and that require resources.

C215 (3 decks)

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