SCM 301 Exam 2

capital intensity

process flexibility

mix of equipment and labor

how easy it is to adjust the system for changes in design, volume, or technology

increases productivity

reduces waste

increase profits

how much volume does the process need to handle?

how much variety does the process need to handle?

high variety, low volume

mechanics

medium variety, medium volume

bakery

low variety, high volume

low variety, extremely high volume

gas pipelines

extremely high variety, low volume

renovating a house

all products follow same or similar sequence

achieve large volume through standardization

organize equipment, activities for step-by-step flow

high degree of variety in job processing requirements

causes discontinuous workflow

activities, equipment organized by type or department

large/bulky products, low volume, highly customized

equipment is transported to/products are built on-site

degree of customer contact

degree of customization

frequency of orders or use of items

correlation between items

traffic patterns and flow

way the layout influences customer attitude

when a customer orders a product, it is produced to their specifications

when a customer orders a product, it is produced from a standard set of modules and components to their specifications

products are sold to customer from finished goods inventory

reduce production costs in low labor cost area

reduce transportation costs by locating near raw material providers

multiple locations (atms, service stations)

investment requirements

operating costs

revenues

operations in general

cost focus

transportation modes/cost

energy availability/costs

labor cost/availability/skills

building/leasing costs

revenue focus

demographics

population

competition

traffic volume/patterns

customer access/parking

includes qualitative and quantitative

determines a location that minimizes shipping costs or travel time to destinations

often used with fire departments, schools, and distribution centers

maximum load or ceiling on the output on operating unit can handle

what kind of capacity is needed? (decided by type of products/services)

how much is needed to match demand? (forecasting)

when is it needed? (forecasting)

determines if system's rate of output can support future demand

affect operating costs

major determinant of initial product cost

affect delivery speed

usually long-term commitment of resources

availability of inputs (# of hospital beds)

rate of output (# of cans of coke produced)

maximum designed output rate or service capacity

design capacity minus allowances for breaks, routine maintenance, planned absenteeism

actual output / effective capacity

actual output / design capacity

size and provision for expansion

distance to market

standardization of methods/material

output quality (how much need for inspection/rework)

process improvements (ways to increase productivity)

available capacity

expertise (do we have it? do we want it?)

quality considerations

nature of demand (high, stable demand = in-house) (wide fluctuations or small orders = outsource)

estimate the difference (and timing) of demand requirements during a product's life cycle

find the bottleneck operation

• operation with capacity lower than the capacities of other operations in the sequence

• bottleneck operation limits system capacity

a constraint is something that limits the performance of a process or system in achieving its goals

market (insufficient demand)

resource (too little of one or more of workers, equipment, or space)

material (too little of one or more materials)

financial (insufficient funds)

supplier (unreliable, long lead time, standard quality)

knowledge or competence (know-how or skill missing or incomplete)

policy (laws or regulations interfere)

identify the biggest constraint

run the operation to achieve maximum benefit, given the bottleneck's capacity

make sure other portions of the process support the decision made in step two

analyze how to overcome the constraint

repeat

incorrectly identifying the bottleneck

maximizing output in individual departments instead of considering the bottleneck

lack of communication about how to optimize the bottleneck

sequence of organizations - their facilities, functions and activities - involved in producing and delivering a product or service

strategic coordination of business functions within a business organization and throughout its supply chain for the purpose of integrating supply and demand management

movement of goods, services, information, and cash within a supply chain

determining appropriate level of outsourcing

managing procurement

managing suppliers

managing customer relationships

being able to quickly identify problems and respond to them

you become someone else's outsourcer

have someone else make your product

having someone else or yourself make a product over seas

quality - having someone else does something for you it is going to be up to your standards

frees up equipment from being updated

having employees on your books

other company assumes risk of fluctuations of demand and hold the capacity

disruptions in supply

quality issues

data security

supplier relationships (foster partnership w/other companies so one one backstabs and creates long-term contracts)

supply chain visibility (sharing info across supply chain between suppliers and buyers)

event-response capability (developing ability to take action when an event happens)

bribery

greenwashing (claiming eco friendly when isn't)

ignoring health, safety, and environmental standards

violating worker's basic rights

mislabeling country of orgin

selling goods abroad that are banned at home

60% purchased parts

90% cost of sales

cost of a good

quality of the goods

timing of deliveries

number of sources we buy from

identify sources of supply

negotiate contracts

issue purchase orders

evaluate suppliers

criteria used to choose suppliers (lead time, flexibility, price, quality)

reviewing supplier adherence to requirements

short-term transactions vs. long-term partnership

high profit impact, low supply risk

exploitation of full purchasing power

targeted pricing strategies/negotiations

abundant supply

high profit impact, high supply risk

development of long-term relationships

collaboration of innovation

natural scarcity

low profit impact, low supply risk

product standardization

process efficiency

abundant supply

low profit impact, high supply risk

low control of suppliers

innovation and product substitution and replacement

production-based scarcity

delivered right products on time

processed correctly, a complete and undamaged shipment

shipped using the customer's preferred method

provided advanced shipping notification of delivery

customers could track the order during shipment

delivered on time and undamaged

listed the correct billing for services provided

how much to hold

when to replenish

what form of inventory hold

where to hold

estimation of impact of changing the number of locations on inventory

lower overall inventory

slower delivery

higher shipping costs

higher overall inventory

faster delivery times

lower shipping costs

rate of which material moves through a supply chain

lower inventory holding costs

faster order fulfillment

faster goods turned into cash

can cause inventory fluctuations to get out of control

inventory oscillations become progressively larger looking backwards through the supply chain

speed (elapsed time required to move from point of origin to destination)

availability (ability to service any possible location)

dependability (the variance in the expected delivery times)

capability (ability to handle any type of product and or size of load)

frequency (number of scheduled movements that can be arranged by a shipper)

storing inventory to protect against seasonality in supply or demand

storing parts and components to support a plant's operations

splitting shipments into individual orders and arranging local delivery to customers

supplier ships entire shipment to warehouse for everything the customer of that company bought from the supplier and the warehouse breaks it down and ships it locally

multiple suppliers ship to warehouse/distribution centers where warehouse combines shipment from a number of sources into on larger shipment that goes to a single location

multiple suppliers ship to warehouse and they split it apart from multiple suppliers and recombine them to shipments to multiple customers