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Supply Chain > Exam 3 > Flashcards

Exam 3 Flashcards

1
Q

What is Material Requirement Planning?

A

a logical, easily understood approach to the problem of managing the parts, components and materials needed to produce end items

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2
Q

what are the two question in MRP

A

1.) how much of each part is needed
2.) when to order the part

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3
Q

What drives the MRP system

A

Dependent Demand

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4
Q

What are the data sources needed for an MRP program

A

1.) Master production schedule
2.) Bill of material file
3.) Inventory records file

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5
Q

What is Master Production Schedule

A

Aggregate plan shows overall quantities to produce

shows quantities of each type, with information about the production time frame

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6
Q

What is the Bill of Material

A

“need 3 of product B to make 1 of product A”

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7
Q

What is the Inventory Status Record

A

tells you information describing the item and information about part availability

“thing we did in class with figuring out gross requirement”

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8
Q

What is the gross requirment (MRP)

A

total required for an item

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9
Q

What is the projected available balance (MRP)

A

inventory of an item expected at the end of a period

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10
Q

what is scheduled receipts (MRP)

A

orders that have already been released and scheduled to arrive in this time period

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11
Q

what are net requirements (MRP)

A

amount needed when the previous period’s projected available balance plus scheduled receipts is not sufficient to cover the gross requirements

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12
Q

what are planned order receipts (MRP)

A

quantity that is planned to be released and will arrive in this time period

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13
Q

What to do if Safety Stock is needed

A

reduce the projected available balance for the first period ONLY by the safety stock amount

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14
Q

Term: Available to Promise

A
  • Identifies the difference between the number of units currently
    included in the master schedule and the actual customer orders
  • Stock currently held in inventory may be assigned to a customer order
    (allocated) or may be available for future customer orders (available to
    promise)
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15
Q

What is the MRP Process

A
  1. start with level 0 items (independent demand)
  2. calculate the net requirement and if it is below 1 plan order receipts
  3. calculate the projected available balance and move it to next week
  4. continue to level 1 item (dependent demand)
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16
Q

what should you do if Net requirement is less than 1

A

plan order receipts

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17
Q

Lot sizes

A

the part quantities issued in the planned order receipts and planned order releases section of MRP

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18
Q

Lot for Lot

A

produces exactly what is needed

-minimizes carrying costs

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19
Q

Economic Order Quantity (EOQ)

A

calculate reorder quantity based on EOQ

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20
Q

what are the EOQ cautions

A

not designed for a system for discrete time periods

do not always cover the entire number of periods

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21
Q

What is Least Total Cost

A

pick product that has holding cost and setup costs closest to eachother

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22
Q

sustainability

A

the ability to meet current resource needs without compromising the ability of the future generations to meet their needs

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23
Q

shareholders

A

individuals or companies that legally own one or more shares of stock in the company

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24
Q

stakeholders

A

individuals or organizations who are directly or indirectly influenced by the actions of the firm

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25
Q

what is the triple bottom line

A

the firm focuses on three areas

economic prosperity

environmental stewardship

social responsibility

26
Q

what is economic prosperity

A

shareholders must be compensated via a competitive return

27
Q

what is environmental stewardship

A

the company should protect the environment as much as possible

28
Q

what is social repsonsibility

A

business practices should be fair to labor, the community and the region where the firm conducts buisness

29
Q

what are the 7 risk mitigation strategies

A

1.) increase capacity
2.) get redundant suplliers
3.) increase responsiveness
4.) increase inventory
5.) increase flexibility
6.) pool or aggregate demand
7.) increase source capability

30
Q

what does increase capacity mean

A

build centralized capacity for unpredictable demand

31
Q

what does get redundant supplier mean

A

more redundant supply for high volume products

centralize redundancy for low volume products

32
Q

what does increase responsiveness mean

A

favor responsiveness over cost for short life

33
Q

what does increase inventory mean

A

centralize inventory of less predictable, higher value products

34
Q

what does increase flexibility mean

A

favor flexibility for unpredictable low volume products. centralize flexibility

35
Q

what does pool or aggregate demand mean

A

increase aggregation as unpredictability grows

36
Q

what does increase source capability mean

A

prefer capability over cost for high - value high - risk products

centralize high capability

37
Q

what are purposes of inventory

A

1.) customer service
2.) Account for variability
3.) Allow flexibility in production scheduling
4.) Maintain independence of operations
5.) Take advantage of economic order sizes
5.) take advantage of quantity discounts

38
Q

What are the four inventory control systems

A

Fixed order Quantity
1.) Basic EOQ model
2.) Price - Break Model

Fixed Time Period
3.) P- Model
4.) Single-Period Model

39
Q

What is the optimal order quantity

A

when holding cost is equal to ordering cost

40
Q

in the Fixed order quantity what is the equation for when to order

A

R = dL + SS

41
Q

in fixed order quantity what is the equation for how much to order

A

Q opt = EOQ equation

42
Q

In an EOQ inventory model how do you know how many units to order whn it drops to a certain point

A

order (EOQ) when inventory drops to (R)

43
Q

What is the price break model

A

model for when price varies with order size

44
Q

what is the two-step process for price break inventory

A

1.) Sort prices from lowest to highest and calculate EOQ
2.) if feasible it is good calculate the total price for feasible and compare to cheapest

45
Q

What is fixed period P model

A

inventory levels are checked at regular intervals

46
Q

how does fixed time period work with reordering

A

order (R-I) units every blank week

47
Q

What is single period model

A

balancing overstocking and under stocking products

48
Q

What is Pareto principal

A

a few items have significant importance

49
Q

what is ABC inventory classification

A

scheme that divides inventory items into three groupingsw

50
Q

What are the 3 groupings of ABC inventory classification

A

1.) High dollar volume (A)
2.) Moderate Dollar volume (B)
3.) Low dollar volume (C)

51
Q

what is dollar volume

A

measure of importance to the company

52
Q

what is inventory accuracy

A

how closely the inventory records agree with the physical count

53
Q

what is cycle counting

A

inventory is counted on a frequent basis

54
Q

What is TQM

A

management system for a customer focused organization and involves all employees

55
Q

what are the key concepts of TQM

A

1.) quality is defined by customer
2.) top tier management is responsible for the process
3.) Analysis and data drive improvements
4.) continuous and organization-wide product

56
Q

What are costs of Quality

A

appraisal costs - testing and inspection

prevention cost - prevent defects

internal failure costs - defects within system

external failure costs - costs for defects that reach customer

57
Q

what is six sigma quality

A

set of methods companies to reduce defects

reduce variation that lead to product defects

a statistical term to describe the quality goal of no more than 3.4 million defects

58
Q

what is DMAIC

A
  1. define the goals
  2. measure the existing process
    3.) analyze the process
    4.) improve the process
    5.) control the new process
59
Q

if your process capability index is 1.0 or more then

A

then 99.7 of the parts will be within specification

3 or fewer per 1000

60
Q

What is the traditional view of variation

A

costs are only incurred outside of ranges

61
Q

what is Taguichi’s view of variation

A

any deviation from the target increases cost

Supply Chain (3 decks)

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