P370 Midterm 2023 with 100% correct questions and answers

Conditions of Satisfaction Minimal acceptable outcome for any endeavor or project Strategic Decision -Long term -Often involving acquisition of new resources -Electric utility - power station construction Tactical Decision -Medium term -Utilization of existing resources -Assembly plant - workforce commitments Operational Decision -Short term -Execution of schedules or control activities -Hospital - shift scheduling Operations Management The design, operation, and improvement of the systems that creates the firm's primary products and services Transformation System A user of resources to transform inputs into some desired outputs Internally neutral Strategic Role - Don't mess up Externally neutral Strategic Role - Keep up with the Joneses Internally supportive Strategic Role - Be consistent with corporate strategy Externally supportive Strategic Role - Be a full partner in the company Absolute Productivity A snapshot in time Growth Change over time Sources of Productivity Growth -External factors (environment, interest rates) -Improved labor inputs (education, demographics) -Capital-labor substitution -Technological change (equipment and management) Order qualifier A feature that must be present in the product for its purchase to even be considered; constitute a minimal level of acceptability Order winner A product feature used to select the product to be purchased from the pool of acceptable products which meet order qualifying standards Developing your strategy 1. Segment the market according to the market group 2. Identify product requirements, product potential, and profit margins for each group 3. Determine order winners and qualifiers for each group 4. Convert order winning criteria into specific performance requirements Partial Productivity Restricting productivity to a single input Total-Factor Productivity Assessing productivity using the complete set of inputs Multi-Factor Productivity Assessing productivity using less than the total set of measures (though still more than one) Dimensionless Productivity When the productivity figure has no units Project A temporary endeavor (usually involving a series of ordered tasks, requiring time and effort, with a limited amount of resources) undertaken to create a unique product or service What a project should have -Precise boundaries -Specific objectives -Limited resources -Fixed time frame Pure Projects An autonomous, self-contained team is created which works full time on the project Pros of Pure Projects -Project manager authority -One boss -Shortened lines of communication -Pride, motivation, commitment are high Cons of Pure Projects -Duplication of resources -Organizational goals are secondary -Weakened functional divisions -No home - "life after project?" Functional Projects When the project is housed within a single functional division Pros of Functional Projects -Team member can work on several projects -Technical expertise remains -No "life after project" fears Cons of Functional Projects -Non-functional area tasks short-changed -Weak motivation -No cross-sectional skills -Not a lot of diversity Matrix Projects Utilizes people from several different functional areas. The project manager decides what and when tasks will be performed but the functional managers control which people and technologies are used. Pros of Matrix Projects -Enhanced communication -Resource duplication minimized -No "life after project" fears Cons of Matrix Projects -Two bosses -Project manager needs strong negotiating skills Work Breakdown Structure A tool for identifying all the tasks necessary to complete a project. Uses a decomposition approach, and uses the idea of Mutually Exclusive, Collectively Exhaustive to check for completeness Activity Lists -List of all activities/tasks -Precedence/interdependence/technological constraints -Duration of activities Network Diagrams -Consists of nodes and arrows -Construct sequentially -Select one undrawn activity for which all predecessor nodes have already been drawn -Draw a node representing that activity -Draw arrows representing all precedence activities -Repeat steps until all nodes drawn Critical Path Method -Find all paths and compute expected length -All paths must be traversed -Longest path is duration of the project Slack The most you can delay an activity without delaying the project Project Management Planning, directing, and controlling resources to meet the technical, cost, and time constraints of a project Gantt Chart The rows represent individual activities while the columns represent time. The box in each row shows the time contained by the span for the earliest start time to the latest finish time. This shows the time when the activity is actually scheduled to be performed. Project Crashing Reducing the overall duration of a project Ways to crash a project -Add more resources -Change the structure of the project -Change the process Crash costs Costs to reduce the length of an activity by 1 time period Motivation to Crash Projects -Requirement to complete in specified time frame -Economic Advantage -Crash, Administration, and Penalty costs Administrative costs Costs to manage the project. For every time period that the project continues, a certain amount of money is required just to administer the project, over and above the cost of performing the various activities that make up the project. Penalty Costs For every time unit beyond the deadline, this cost is imposed - Performance Clause Program Evaluation and Review Technique Using CPM with three time estimates instead of one Conversion Substance of product changes Fabrication Form of product changes Assembly Two or more discrete products are combined Testing Inspection/Examination according to some critieria Job Shop Wide variety of products in a variety (usually low) of quantities. Jumbled flow Batch Wide variety (standard subset) of products, moderate quantities, jumbled flow with some dominance. Assembly Line Low variety, high volume, dominant line flow Continuous Flow Commodity product, highest volume, dominant flow Product Design Process 1. Concept Design 2. Product Planning (market defined/investments needed) 3. Product/Process Engineering (prototypes built, equipment) 4. Pilot Production/Ramp-Up (testing, changes) Product Development Tradeoffs -Product Performance -Development Speed -Product Cost -Development Costs Quality Function Deployment -Requires the use of cross-functional work teams -Uses customer needs/desires/requirements -Primary tool is the House of Quality -Gives common ground/language to the development process Process Layout When equipment is grouped by function Product Layout When equipment is organized around the required sequence of operations Product-Process Matrix The central idea is that companies and plants fair best when they lie on the diagonal - they have successfully matched their production processes with their product types Out-of-pocket costs Deviation off of the product-process matrix diagonal to the left/below Opportunity costs Deviation off of the product-process matrix diagonal to the right/above Concept Development The overall conceptual design is laid out and the general product architecture is developed. A target market is defined. Product Planning Investment requirements are determined. The market is further defined and built through small scale testing and interaction with potential customers. Product/Process Engineering Prototypes are built and decisions about tooling and equipment to be used in full scale production are made. Pilot production/Ramp-Up Non-commercial production begins. The planned process is tested for its ability to produce at desired volumes. Detailed testing of the product. Concurrent Engineering A parallel approach where as many steps as possible are occurring simultaneously. Industrial Design Designing with the needs of the customer in mind House of Quality A matrix that helps bring customer needs/desires into the decision making process. Forces members to work together in a cooperative rather than competitive manner. Presents the needs and/or requirements of each area in a form that all can understand. Idiosyncratic What works for one may not work for others Designs for On-Site Service -Production Line Approach -Self-Service Approach -Personal Attention Approach Queuing Systems -The "waiting in line" situation -Frustrating, annoying -Managing well is key Balking Not entering the line if it is too long Reneging Leaving the line after entering if the wait for service has been too long Priorities Jumping to the head of the queue Utilization Rate λ/m Arrival Rate λ Inter-Arrival Time 1/λ Service rate per server m Average service time 1/m Probability no one is in line 1 - p Average number in system λ(m - λ) Average number in queue number in system - p Average time in system 1/(m - λ) Average time in queue time in system - 1/m Service package A mix of tangible and intangible attributes Service-System Design Matrix As the system becomes more reactive to the customer, higher sales opportunities exist at the price of lower production efficiency. Production Line Approach -Treats the delivery of the service as a manufacturing process rather than a service process. -Efficient production of results not on the attendance of others Self-Service Approach Places a greater burden on the customer in the production of the service Personal Attention Approach Direct contact with a service provider who tailors the service to the customer Capacity The ability to hold, receive, store, or accommodate Strategic Capacity Planning An approach for determining the overall capacity level of capital intensive resources, including facilities, equipment, and overall labor force size Experience Curve As plants produce more products, they gain experience in the best production methods and reduce their costs per unit. Focused Factory -Production facilities work best when they focus on a fairly limited set of production objectives -Plants Within Plants Capacity Planning -Frequency of capacity additions -External sources of capacity (subcontracting, sharing capacity) Determining Capacity Requirements -Forecast sales within each individual product line -Calculate equipment and labor requirements to meet the forecasts -Project equipment and labor availability over the planning horizon Planning Service Capacity -Time -Location -Volatility of Demand Capacity Utilization Rate Reveals how close a firm is to its best operating point Economies of Scale As a plant gets larger and volume increases, the average cost per unit of output drops Capacity Flexibility Having the ability to rapidly increase or decrease production level, or to shift production capacity quickly from one product or service to another Flexible Plants Using movable equipment, knockdown walls, and easily accessible and reroutable utilities Flexible Processes Rapid low-cost switching from one product line to another, enabling economies of scope Flexible Workers Multiple skills and the ability to easily switch from one kind of task to another. Broader training Maintaining system balance -Add capacity to stages that are bottlenecks -Use of buffer inventories in front of the bottleneck stage to ensure it always has something to work on -Duplicating facilities of one department on which another is dependent Capacity Cushion An amount of capacity in excess of expected demand Volatility of Service Demand -Services cannot be stored -Customers interact directly with the production system and each has different needs -Directly affected by consumer behavior Learning Curve A relationship between unit processing time and the number of consecutive units processed Organizational Learning -Changes in administration, equipment, and product design -Technology, equipment - training and engineering Individual Learning -People repeat a process and gain skill from experience -Training, selection of workers, teamwork, specialization