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Exam 9: Production and Operations Management

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Question 131

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Mini-Case "These are exciting times for our company. We've made a lot of changes over the past two years that have really improved our operations and lowered our costs. Now we are ready to expand into new markets. Minimotors is on its way to becoming a global player." The speaker was Sparky Weyer, president and CEO of Minimotors, Inc., a growing manufacturer of small (some of them downright tiny) electric motors used in a variety of power tools and appliances. Sparky was meeting with potential financial backers in an effort to obtain funding for some expensive new machinery he wanted to purchase. "You may have heard about some of the ways we've cut costs," Sparky continued. "We've developed a new arrangement with several of our biggest suppliers. They've agreed to make more frequent deliveries tied directly to our production schedules. This will help us reduce our inventory costs dramatically. We've also greatly reduced the number of defective motors we produce by carefully keeping tabs on all of our manufacturing processes. In fact, we have set a goal of reducing our defects to 3.4 parts per million. The main purpose of my meeting with you today is because we want to install some sophisticated new machinery and software that will allow us to quickly design and produce motors to the exact specifications of our customers. The machinery is computer-controlled and can produce custom-designed products at very little increase in cost compared to our mass produced motors. We feel this flexibility and quick response time will give us a tremendous competitive advantage and help us attract new customers. Installing the new equipment and training our workers to use it properly will be a complex project, but I'm confident that once we get everything up and running we'll be able to strengthen our position as the leading maker of high-quality electric motors." -In order to schedule deliveries, Minimotors's suppliers need detailed information about when parts are needed. Minimotors will purchase a sophisticated computer application that will link its operation to sales forecasts to make sure needed parts and supplies are available at the right time to meet customer demands. This planning system is known as:

A) Materials requirement planning (MRP) .
B) Program evaluation and review technique (PERT) .
C) Minimum daily requirements scheduling (MDRS) .
D) Sales-based requirements forecasting (SBRF) .

E) B) and D)
F) A) and D)

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Question 132

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When considering the issue of facility location, it is important to find an isolated location so that work can get done without interruption from customers.

A) True
B) False

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Question 133

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Manufacturing firms that want to minimize time-to-market are likely to choose facility sites that give them easy access to their preferred modes of transportation.

A Gantt chart is a bar graph showing production managers what projects are being worked on and the stage of development at any given time.

The goal of lean manufacturing is to:

When firms successfully produce products, they create form utility.

An assembly process involves physically or chemically manipulating raw materials to create a product.

A company becomes lean by its capacity to produce high-quality goods, while its need for resources.

J & R Industries typically produces very large batches of standardized products used by plumbers, such as pipefittings and valves that must be produced in standard sizes. A continuous production process would work well for J & R.

A continuous production process is characterized by long production runs that turn out finished goods over time.

Mass customization is tailoring products to meet the needs of individual customers.

The main difference between process manufacturing and an assembly process is: Process manufacturing uses sophisticated robots and automated machinery to produce a good or service, while an assembly process uses labor and simple tools to make a product.

If a company achieves Six Sigma quality standards, they automatically win the Malcolm Baldrige award.

The production of a bridge, ship, or large airplane usually involves a variable-position facility layout.

The Ritz-Carlton hotel offers restaurants with the finest service, elevators that run smoothly, and a front desk that processes people quickly. Many times fresh-cut flowers are in the lobbies and dishes of fruit are in each room.is responsible for implementing these customer benefits.

In recent years, operations management has become more focused on providing services, because that is where the growth and profit potential is greatest.

is the physical arrangement of resources in the production process.

A key element of the statistical quality control [SQC] process is the reliance on quality control experts to inspect at the end of the production line to make sure that no defective products are shipped to final customers.

Mini-Case "These are exciting times for our company. We've made a lot of changes over the past two years that have really improved our operations and lowered our costs. Now we are ready to expand into new markets. Minimotors is on its way to becoming a global player." The speaker was Sparky Weyer, president and CEO of Minimotors, Inc., a growing manufacturer of small (some of them downright tiny) electric motors used in a variety of power tools and appliances. Sparky was meeting with potential financial backers in an effort to obtain funding for some expensive new machinery he wanted to purchase. "You may have heard about some of the ways we've cut costs," Sparky continued. "We've developed a new arrangement with several of our biggest suppliers. They've agreed to make more frequent deliveries tied directly to our production schedules. This will help us reduce our inventory costs dramatically. We've also greatly reduced the number of defective motors we produce by carefully keeping tabs on all of our manufacturing processes. In fact, we have set a goal of reducing our defects to 3.4 parts per million. The main purpose of my meeting with you today is because we want to install some sophisticated new machinery and software that will allow us to quickly design and produce motors to the exact specifications of our customers. The machinery is computer-controlled and can produce custom-designed products at very little increase in cost compared to our mass produced motors. We feel this flexibility and quick response time will give us a tremendous competitive advantage and help us attract new customers. Installing the new equipment and training our workers to use it properly will be a complex project, but I'm confident that once we get everything up and running we'll be able to strengthen our position as the leading maker of high-quality electric motors." -Sparky sees quality control in terms of detecting potential problems to prevent their occurrence and thus save Minimotors money. The quality control process that is most closely linked to Sparky's goal is known as:

Six Sigma is a benchmark of quality standards that many product and service industries try to achieve.