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| Section | Weight | Objectives |
|---|---|---|
| Capacity Planning and Facility Layout | 15% | - Layout Design
|
| Process Design and Analysis | 20% | - Process Types
|
| Supply Chain and Inventory Management | 20% | - Inventory Control
|
| Quality Management Methods | 25% | - Total Quality Management (TQM)
|
| Forecasting and Project Management | 20% | - Demand Forecasting
|
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NEW QUESTION # 50
A company manufactures and distributes its own products.
When should the company consider outsourcing its distribution?
Answer: B
Explanation:
A company should consider outsourcing distributionwhen it determines that distribution is no longer a core function.
Operations Management defines core functions as activities that:
* Create competitive advantage
* Differentiate the firm
* Require proprietary knowledge or capabilities
If distribution does not meet these criteria, outsourcing can:
* Lower costs
* Improve service reliability
* Increase scalability
* Allow management to focus on strategic priorities
The other options do not justify outsourcing:
* Forecasting difficulty is a management issue
* Lowest-cost operators should retain distribution
* Regulations do not eliminate strategic relevance
Outsourcing decisions must align with long-term operations strategy, not short-term cost fluctuations.
NEW QUESTION # 51
A company suddenly finds demand has increased to 140% of its previous capacity. It has been able to hire only a fraction of the employees previously laid off, and a warehouse fire destroyed 80% of its inventory.
Which two options does the company have to rapidly meet the new demand?
Choose 2 answers
Answer: A,C
Explanation:
When demand rises suddenly to140% of existing capacity, the firm must rely onshort-term, flexible capacity optionsto respond quickly.
The two appropriate options are:
* Hiring temporary workers
* Subcontracting a portion of production capacity
Temporary workers can be deployed rapidly with minimal onboarding time, allowing the firm to increase output without long-term labor commitments. This option is especially effective when the demand surge may be temporary or uncertain.
Subcontracting provides immediate access toexternal capacitywithout requiring capital investment. It allows the firm to meet demand while avoiding the risks associated with permanent expansion.
The other options are not viable in the short term:
* Building new facilities is capital-intensive and slow
* Hiring and training full-time employees requires time and long-term commitment Operations Management distinguishescapacity-based optionsinto short-term (temporary labor, overtime, subcontracting) and long-term (facilities, permanent workforce). In crisis situations, speed and flexibility dominate decision-making.
NEW QUESTION # 52
A comprehensive automobile collision shop offers body and engine repair as well as custom vehicle paint options.
Which two operational processes would suit this shop?
Choose 2 answers
Answer: A,C
Explanation:
An automobile collision shop performingbody repair, engine repair, and custom paint jobsrequires both projectandbatchprocesses.
Aproject processis appropriate because many repair jobs areunique, varying in scope, damage severity, customer requirements, and repair time. Each vehicle may require a distinct sequence of tasks, making standardized flow impractical.
Abatch processis suitable for activities such as painting or part refurbishment, where similar tasks are grouped together to improve efficiency. For example, multiple vehicles may be painted in the same color batch to reduce setup time and material waste.
Line and continuous processes are unsuitable because:
* Repairs are not standardized
* Volume is relatively low
* Customization is high
Operations Management emphasizes aligning process type withproduct variety and volume. This hybrid approach allows flexibility while maintaining efficiency where possible.
NEW QUESTION # 53
Why is capacity requirements planning (CRP) important?
Answer: B
Explanation:
Capacity Requirements Planning (CRP) is important because itcompares available production capacity to planned workloads, ensuring feasibility.
Once demand has been translated into production and material plans, CRP validates whether:
* Machines are available
* Labor hours are sufficient
* Work centers are not overloaded
Without CRP, organizations risk releasing production plans that cannot be executed, resulting in:
* Bottlenecks
* Overtime
* Missed delivery dates
* Poor resource utilization
The incorrect options describe other functions:
* Employee efficiency is evaluated through performance metrics
* Lead time transparency is a scheduling outcome, not CRP's core purpose
* Material coordination is handled by MRP
CRP ensures alignment betweenwhat is plannedandwhat is possible, making it a critical link between planning and execution in Operations Management.
NEW QUESTION # 54
Which project life cycle phase focuses on determining whether the proposed project is technically, financially, and operationally viable?
Answer: B
Explanation:
Thefeasibility analysis phaseevaluates whether a proposed project istechnically, financially, and operationally viable.
During feasibility analysis, organizations assess:
* Cost-benefit justification
* Resource availability
* Technical constraints
* Operational impact
* Risk and uncertainty
This phase prevents organizations from committing to projects that:
* Are too costly
* Lack capability support
* Conflict with operational capacity
* Fail to deliver strategic value
Planning and execution only proceed if feasibility criteria are satisfied.
In Operations Management, feasibility analysis is especially critical for projects involving:
* Capacity expansion
* New facilities
* System implementations
* Process redesign
It serves as a decision gate that protects organizational resources and ensures disciplined project selection.
NEW QUESTION # 55
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