Exam Q's

Question 1

What are the limitations of the North west corner method?

Answer 1

heuristic: feasible but not optimal

Sensitive to starting point selected

Complex for multiple item types

No transport variations

Fixed supply / demand

Question 2

Outline the key managerial activities in this conversion process.

Answer 2

• allocate resources to the processes, i.e. to develop forecasts and decide on the production volume, to procure materials, schedule the factory and workers against the predicted demand. The outputs here are purchase orders for suppliers, and work orders for the factory.
• measure the outcome of the conversion process, in order to be able to ensure quality. Also the measurement of a process is a fundamental step in improving it (by being able to compare before and after)
• improve the process. Based on the measurement and other data, such as customer requirements and feedback, the process is improved in order to increase its efficiency.

Question 3

It has been argued that internal company, or ‘overhead’ processes such as accounting or human resources are also service processes, and should be treated as such. Do you agree? Discuss.

Answer 3

In principle it is correct to argue that overhead processes are also service processes. The key distinction is that these processes serve internal customers, and as such there is no “market” for these. Without any external reference or competition it is thus very hard to measure the performance of these processes, and to improve them in relation to a benchmark