SCMN 3150 Exam 2 Ch. 3-6 Smedberg || Already Graded
A+.
Short-range planning correct answers job assignments, ordering, job scheduling, dispatching, day
to day activities. For operations managers and supervisors. Hourly, daily, weekly
Intermediate-range planning correct answers demand planning and forecasting, sales and
operations, production planning, budget setting employment, inventory, subcontracting levels
and analyzing operations plans (how many Hershey kisses are we going to sell) For operations
managers. 3-18 months
Long-range planning correct answers Top executives, R&D (research and development) New
product plans, capital expenses, facility location, expansion, capacity planning (what location do
we decide on? What technology do we need?) 2+ yrs
What is Capacity correct answers is the rate at which output can be produced by an operating
unit - machine, process, facility, company, restaurant, movie theater, airplane, etc.
Capacity planning correct answers is the process of establishing the output rate that can be
achieved (throughput). Ex: how many cars can we make at our facility in China?
Design Capacity correct answers (Best operating level) Theoretical or maximum output rate or
service capacity an operation, process or facility is designed for
effective capacity correct answers (Normal operating level) logical or reasonable expectation of
capacity use, design capacity minus typical allowances such as personal time, maintenance and
scrap
Is always going to be greater than effective capacity correct answers design capacity
Builds in a little contingency, don't put the maximum amount correct answers effective capacity
Capacity Utilization correct answers measures how much of the available capacity is actually
being used
Utilization Formula correct answers = actual output / capacity (want 100%)
what measures effectiveness of operations correct answers utilization
Capacity cushion correct answers an additional amount of capacity added onto the expected
demand to allow for greater than expected demand and demand during peak demand seasons.
Creates flexibility adding some cushion or contingency to make sure we are at 100%
effectiveness and efficiency.
, Q1 Over its first 6 months of operations, they produce 23 bikes per day. What was the capacity
utilization?
(Cycle shop should be able to build 30 bikes per day) correct answers 76.7%
Q2 Cost of operations = $3,159 per day
what is the average cost per bike? correct answers $137.35 per bike cost
Revenue per bike = $200
what is the average profit per bike? correct answers $62.65 avg. profit per bike
what is the total daily profit? correct answers $1,440.95
If capacity > demand correct answers then risk = excess inventory
if capacity < demand correct answers then risk = inventory shortage
We made 1076 cars today. our capacity is is 1323 per day. What was the capacity utilization?
correct answers 81.33%
Our cost of operation is 10,876,500 per day. Remember we made 1,076 cars. What is the average
cost per day? correct answers 10,108.27
What do we forecast or predict? correct answers weather, stock market, sports scores, supply and
demand
Forecasting methods are classified into 2 groups correct answers Qualitative and Quantitative
methods
Characteristics under qualitative method correct answers based on human judgement, opinions,
subjective and non-mathematical
strengths under qualitative method correct answers can incorporate latest changes in the
environment and "inside information"
Weaknesses under qualitative method correct answers can bias the forecast and reduce forecast
accuracy
characteristics under quantitative methods correct answers based on mathematics, quantitative in
nature
strengths under quantitative methods correct answers consistent and objective, able to consider
much information and data at one time
weaknesses under quantitative methods correct answers often quantifiable data are not available.
only as good as the data on which the are based
A+.
Short-range planning correct answers job assignments, ordering, job scheduling, dispatching, day
to day activities. For operations managers and supervisors. Hourly, daily, weekly
Intermediate-range planning correct answers demand planning and forecasting, sales and
operations, production planning, budget setting employment, inventory, subcontracting levels
and analyzing operations plans (how many Hershey kisses are we going to sell) For operations
managers. 3-18 months
Long-range planning correct answers Top executives, R&D (research and development) New
product plans, capital expenses, facility location, expansion, capacity planning (what location do
we decide on? What technology do we need?) 2+ yrs
What is Capacity correct answers is the rate at which output can be produced by an operating
unit - machine, process, facility, company, restaurant, movie theater, airplane, etc.
Capacity planning correct answers is the process of establishing the output rate that can be
achieved (throughput). Ex: how many cars can we make at our facility in China?
Design Capacity correct answers (Best operating level) Theoretical or maximum output rate or
service capacity an operation, process or facility is designed for
effective capacity correct answers (Normal operating level) logical or reasonable expectation of
capacity use, design capacity minus typical allowances such as personal time, maintenance and
scrap
Is always going to be greater than effective capacity correct answers design capacity
Builds in a little contingency, don't put the maximum amount correct answers effective capacity
Capacity Utilization correct answers measures how much of the available capacity is actually
being used
Utilization Formula correct answers = actual output / capacity (want 100%)
what measures effectiveness of operations correct answers utilization
Capacity cushion correct answers an additional amount of capacity added onto the expected
demand to allow for greater than expected demand and demand during peak demand seasons.
Creates flexibility adding some cushion or contingency to make sure we are at 100%
effectiveness and efficiency.
, Q1 Over its first 6 months of operations, they produce 23 bikes per day. What was the capacity
utilization?
(Cycle shop should be able to build 30 bikes per day) correct answers 76.7%
Q2 Cost of operations = $3,159 per day
what is the average cost per bike? correct answers $137.35 per bike cost
Revenue per bike = $200
what is the average profit per bike? correct answers $62.65 avg. profit per bike
what is the total daily profit? correct answers $1,440.95
If capacity > demand correct answers then risk = excess inventory
if capacity < demand correct answers then risk = inventory shortage
We made 1076 cars today. our capacity is is 1323 per day. What was the capacity utilization?
correct answers 81.33%
Our cost of operation is 10,876,500 per day. Remember we made 1,076 cars. What is the average
cost per day? correct answers 10,108.27
What do we forecast or predict? correct answers weather, stock market, sports scores, supply and
demand
Forecasting methods are classified into 2 groups correct answers Qualitative and Quantitative
methods
Characteristics under qualitative method correct answers based on human judgement, opinions,
subjective and non-mathematical
strengths under qualitative method correct answers can incorporate latest changes in the
environment and "inside information"
Weaknesses under qualitative method correct answers can bias the forecast and reduce forecast
accuracy
characteristics under quantitative methods correct answers based on mathematics, quantitative in
nature
strengths under quantitative methods correct answers consistent and objective, able to consider
much information and data at one time
weaknesses under quantitative methods correct answers often quantifiable data are not available.
only as good as the data on which the are based
