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| Section | Objectives |
|---|---|
| Topic 1: Competency 2: Quality Management | - Total Quality Management (TQM) - Cost of quality (prevention, appraisal, internal/external failure) - Malcolm Baldrige National Quality Award criteria - Quality management philosophies (Deming, Juran, Crosby) |
| Topic 2: Competency 7: Forecasting | - Qualitative forecasting methods - Forecast accuracy measures - Quantitative forecasting methods (moving averages, exponential smoothing) |
| Topic 3: Competency 5: Capacity Planning and Facility Layout | - Capacity planning strategies - Facility layout types (process, product, cellular, fixed-position) - Location analysis and decisions |
| Topic 4: Competency 6: Production Planning and Scheduling | - Master Production Schedule (MPS) - Aggregate planning - Material Requirements Planning (MRP) - Theory of Constraints (TOC) - Just-in-Time (JIT) and Kanban systems |
| Topic 5: Competency 4: Supply Chain Management | - Inventory management - Supply chain design and strategy - Sourcing and procurement - Logistics and distribution |
| Topic 6: Competency 1: Operations Management Fundamentals | - Operations strategy and competitive priorities - History and evolution of operations management - Product and service design |
| Topic 7: Competency 3: Process Improvement and Problem Solving | - Statistical Process Control (SPC) - Six Sigma methodology - Plan-Do-Study-Act (PDSA) cycle - Cause-and-effect diagrams (fishbone diagrams) - Lean operations and waste elimination |
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NEW QUESTION # 69
A manufacturing company decides to open a new distribution center location in order to minimize distribution costs to warehouses or stores.
What tool should the manufacturing company use to determine where the new distribution center should be located?
Answer: D
Explanation:
Thecenter-of-gravity approachis the most appropriate tool for determining the optimal location of a distribution center when the goal is tominimize total transportation costs.
This method calculates a weighted average location based on:
* Geographic coordinates of demand points
* Volume shipped to each location
The result identifies a location that minimizes the overall distance-weighted transportation cost.
Other options serve different purposes:
* Load-distance models compare alternative sites
* Transportation methods optimize shipping routes, not facility location
* Break-even analysis compares cost structures, not spatial efficiency
In Operations Management, the center-of-gravity approach is widely used for strategic distribution planning because it provides aquantitative, objective basisfor location decisions.
NEW QUESTION # 70
A company manufactures and distributes its own products.
When should the company consider outsourcing its distribution?
Answer: A
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 # 71
Which capacity planning measurement tells how much capacity a company is using?
Answer: B
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 # 72
Which project life cycle phase focuses on determining whether the proposed project is technically, financially, and operationally viable?
Answer: A
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 # 73
Why is the marketing plan essential to the creation of the aggregate plan?
Answer: C
Explanation:
The marketing plan is essential to the aggregate plan because itprovides insight into operations goals and activities for the year.
Aggregate planning aligns production, workforce, and inventory decisions withexpected demand, which is forecasted by marketing. Marketing defines:
* Sales volume expectations
* Product mix
* Promotional timing
* Market priorities
Operations uses this information to:
* Set capacity levels
* Plan workforce size
* Schedule production rates
* Manage inventory
While demand data and cash flow matter, the key contribution of marketing is translating market strategy into operational requirements.
Operations Management emphasizes cross-functional integration; without marketing input, aggregate plans risk misalignment with actual market needs.
NEW QUESTION # 74
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