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| Section | Weight | Objectives |
|---|---|---|
| Forecasting and Project Management | 20% | - Demand Forecasting
|
| Supply Chain and Inventory Management | 20% | - Supply Chain Design
|
| Quality Management Methods | 25% | - Quality Tools and Techniques
|
| Capacity Planning and Facility Layout | 15% | - Capacity Concepts
|
| Process Design and Analysis | 20% | - Process Performance
|
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NEW QUESTION # 14
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,B
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 # 15
A company is experiencing an unusual amount of deliveries that are either late or an incorrect quantity.
Which type of system is used to identify and manage this type of problem?
Answer: D
Explanation:
Comprehensive and Detailed Explanation (#280 words):
The correct system to identify and manage frequent issues such aslate deliveries or incorrect quantitiesis MRP (Material Requirements Planning)(AnswerD).
MRP is designed to translate demand into detailed plans forwhat materials are needed, in what quantities, and when-and then to time-phased plan purchase and production orders accordingly. The document states that MRP combines detailed demand forecasts and actual requests, translates higher-level forecasts into more detailed requirements, and tracks customer requests. It also emphasizes that the MPS (which sets specific dates) is used to plan material requirements.
When deliveries are late or wrong quantities are shipped, a frequent root cause is that materials were not available when needed, orders were not released correctly, or priorities were mismanaged. MRP directly addresses these by:
* Exploding bills of materials into components
* Time-phasing planned orders
* Coordinating purchasing and production schedules
* Updating plans when demand or system status changes
ERP is broader (enterprise-wide integration), CRP focuses on comparing capacity vs workloads, and FMS is a production technology-not a planning system for material timing and quantities. Because the symptoms described are classic planning/coordination failures in materials and order timing,MRP is the best fit.
NEW QUESTION # 16
Which two capacity measurement concepts should a firm consider when conducting a location analysis?
Choose 2 answers
Answer: B,D
Explanation:
When conducting a location analysis, firms must considerproximity to sources of supplyandsite considerationsas key capacity-related factors.
Proximity to sources of supplyaffects:
* Transportation cost and reliability
* Lead times
* Inventory requirements
* Production continuity
Reliable supply access directly influences effective capacity by reducing disruptions and variability.
Site considerationsinclude:
* Land availability and cost
* Infrastructure and utilities
* Expansion potential
* Zoning and regulatory constraints
These factors determine how much capacity can be installed, expanded, and operated efficiently over time.
The other options are less relevant:
* Throughput time is a process performance metric
* Employee relations are important but not capacity measurement concepts Operations Management emphasizes that capacity decisions are long-term and capital-intensive. Poor location choices constrain future capacity, flexibility, and growth.
NEW QUESTION # 17
A manufacturing firm uses warehouses and shippers in their supply chain.
At which stage of the firm's inventory management system would the statement
"percentage of line items shipped on schedule" be used?
Answer: A
Explanation:
The performance measure"percentage of line items shipped on schedule"applies tofinished goods inventory.
Finished goods inventory represents completed products ready for shipment to customers. On-time shipment is a critical service-level indicator at this stage because it directly affects:
* Customer satisfaction
* Order fulfillment performance
* Distribution efficiency
Work-in-progress and raw materials inventories are internal to production and do not involve customer shipment commitments. "Sold goods" is not an inventory classification used in Operations Management.
Supply chain metrics for finished goods typically include:
* On-time delivery rate
* Order accuracy
* Fill rate
* Shipment reliability
By tracking shipment performance at the finished goods stage, firms ensure that downstream distribution aligns with customer expectations and supply chain objectives.
NEW QUESTION # 18
Which capacity planning measurement tells how much capacity a company is using?
Answer: C
Explanation:
Comprehensive and Detailed Explanation (#250 words):
Capacity utilizationmeasures how much of a company's available capacity is actually being used.
It is calculated as:
Capacity Utilization = Actual Output / Design or Effective Capacity
In Operations Management, capacity utilization provides insight into:
* Operational efficiency
* Resource usage
* Potential bottlenecks or underutilization
High utilization may indicate efficiency but can also lead to congestion, fatigue, and quality problems. Low utilization suggests excess capacity and higher unit costs.
The other terms describe different concepts:
* Design capacityis the maximum theoretical output
* Effective capacityaccounts for normal disruptions
* Capacity focusrefers to strategic specialization
Capacity utilization helps managers balance efficiency with flexibility, making it a core performance metric in both manufacturing and service operations.
NEW QUESTION # 19
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