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| Section | Objectives |
|---|---|
| Topic 1: Competency 7: Forecasting | - Forecast accuracy measures - Quantitative forecasting methods (moving averages, exponential smoothing) - Qualitative forecasting methods |
| Topic 2: Competency 4: Supply Chain Management | - Logistics and distribution - Sourcing and procurement - Supply chain design and strategy - Inventory management |
| Topic 3: Competency 2: Quality Management | - Quality management philosophies (Deming, Juran, Crosby) - Cost of quality (prevention, appraisal, internal/external failure) - Malcolm Baldrige National Quality Award criteria - Total Quality Management (TQM) |
| Topic 4: Competency 6: Production Planning and Scheduling | - Material Requirements Planning (MRP) - Master Production Schedule (MPS) - Just-in-Time (JIT) and Kanban systems - Aggregate planning - Theory of Constraints (TOC) |
| Topic 5: Competency 3: Process Improvement and Problem Solving | - Plan-Do-Study-Act (PDSA) cycle - Lean operations and waste elimination - Statistical Process Control (SPC) - Cause-and-effect diagrams (fishbone diagrams) - Six Sigma methodology |
| Topic 6: Competency 1: Operations Management Fundamentals | - Operations strategy and competitive priorities - Product and service design - History and evolution of operations management |
| Topic 7: Competency 5: Capacity Planning and Facility Layout | - Facility layout types (process, product, cellular, fixed-position) - Capacity planning strategies - Location analysis and decisions |
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NEW QUESTION # 21
How does inventory management differ for manufacturing organizations compared to service organizations?
Answer: A
Explanation:
Manufacturing organizations differ from service organizations because they mustmaintain tangible inventory
.
In manufacturing, inventory includes:
* Raw materials
* Work-in-progress
* Finished goods
These physical items require storage, handling, tracking, and capital investment. Inventory management is therefore a central operational concern in manufacturing.
Service organizations, by contrast, typically do not produce tangible goods. Their primary "inventory" consists of:
* Labor availability
* Time
* Capacity
Idle capacity in services cannot be stored for future use, making demand management more critical than inventory storage.
The incorrect options misrepresent service and manufacturing realities:
* Services do not maintain physical WIP
* Manufacturers do not hold inventory regardless of demand
* Idle time in services is not caused by material shortages
Operations Management highlights inventory as afundamental structural differencebetween manufacturing and service systems.
NEW QUESTION # 22
What is one advantage of a periodic review system?
Answer: D
Explanation:
A key advantage of aperiodic review inventory systemis thatall items are reviewed at the same time interval.
In a periodic review system:
* Inventory levels are checked at fixed intervals (e.g., weekly, monthly)
* Orders are placed to raise inventory to a target level
* Multiple items can be ordered together
This approach simplifies administration and reduces ordering costs, making it especially suitable for:
* Retail environments
* Low-value or slow-moving items
* Situations where continuous monitoring is impractical
The other options describe continuous review systems:
* Individual item handling
* Real-time inventory updates
* Lower safety stock requirements
Operations Management recognizes periodic review as a trade-off between control and simplicity. While it may require higher safety stock, it offers operational efficiency and cost savings in many contexts.
NEW QUESTION # 23
What are two reasons a company might be hesitant to provide overtime as a capacity-based option?
Choose 2 answers
Answer: A,D
Explanation:
Companies may hesitate to use overtime becauseit is not a long-term solutionandit carries a wage premium
, typically around50% higher than regular pay.
Overtime can quickly increase capacity, but prolonged use leads to:
* Employee fatigue
* Quality deterioration
* Increased absenteeism
* Higher error rates
Additionally, overtime raises labor costs substantially, increasing unit production cost and reducing profitability.
The incorrect options are misleading:
* Overtime does not necessarily build excess inventory
* Overtime increases, not decreases, labor cost per unit
Operations Management views overtime as atemporary capacity buffer, appropriate for short demand spikes but risky if used continuously.
NEW QUESTION # 24
Which two statements are true about effective capacity?
Choose 2 answers
Answer: A,B
Explanation:
Effective capacityrepresents themaximum output a system can realistically achieve under normal operating conditions. It is alwayslower than design capacity, which assumes ideal, uninterrupted conditions.
StatementAis correct because effective capacity accounts for:
* Scheduled maintenance
* Breaks and shift changes
* Setup times
* Normal inefficiencies
StatementBis also correct because effective capacity is considered astable, ongoing measureused for operational planning and performance evaluation. It reflects how a system is designed to operate sustainably over time, not temporarily.
StatementCis incorrect because effective capacity is not a short-term or temporary measure; it is used consistently for planning, scheduling, and forecasting.
StatementDis incorrect because effective capacity does not define aminimumoutput level-it defines a realistic maximumunder expected conditions.
In Operations Management, effective capacity is essential for:
* Capacity utilization calculations
* Aggregate planning
* Location and facility decisions
* Bottleneck analysis
By distinguishing between design and effective capacity, managers avoid unrealistic expectations and plan resources more accurately, reducing congestion, overtime, and quality problems.
NEW QUESTION # 25
Which work system acknowledges the benefits of employee proficiency?
Answer: D
Explanation:
Comprehensive and Detailed Explanation (#250 words):
Labor specializationacknowledges the benefits of employee proficiency by allowing workers to focus on specific tasks, increasing skill, speed, and consistency.
In Operations Management, labor specialization:
* Reduces learning time
* Increases productivity
* Improves quality consistency
* Lowers unit costs
Employees become highly proficient through repetition and experience. This principle underpins early scientific management and remains relevant in many high-volume environments.
The other options are outcomes or enablers, not work systems:
* Employee longevity is a result, not a system
* Enhanced relations support performance but do not define task design
* Lower operating cost is a consequence of specialization
While specialization can create efficiency, it must be balanced with job design strategies (e.g., enrichment or rotation) to avoid fatigue and disengagement.
NEW QUESTION # 26
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