structured midterm review 2

# structured midterm review 2 - Chapter4 Inventory Management...

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Chapter4- Inventory Management Price-break model: ABC analysis Chapter 5- Strategic Capacity Planning Capacity planning Time Horizon Capacity Utilization rate. = capacity used / best operating level or 480 cars (currently produced) / 500 cars (best operating level) = .96 or 96% if the annual demand on a facility is 10 million in products per year and the design capacity is 12 million per year it has a 20 percent capacity cushion . A 20 percent capacity cushion equates to an 83 percent utilization rate (100 / 120) Manpower and Machine requirement for capacity planning. Steps: use forecasting to predict sales for individual products, calculate labor and equipment requirements to meet forecasts, project labor and equipment availability over the planning horizon - The Stewart Company produces two brands of salad dressings: Paul's and Newman's. Each is available in bottles and single serving plastic bags. Management would like to determine equipment and labor requirements for their packing operation for the next five years. The demand for the two flavors and for each packaging option is given in this table. The company has three machines that can package 150,000 bottles each year (each machine has two operators ). They also have five machines that can package 250,000 plastic bags per year (each of these machines has three operators ). Will they have enough packaging capacity to meet future demand? Assembly line balancing. Determine theoretical minimum # of workstations required if: 500 wagons are required per day & production time/day is 420 minutes. Decision Tree – Expected Value Assumptions & Conditions: 1. Strong growth as result of increased population of computer fanatics from new electronics firm has a 55% probability. 2. Strong growth w/ new site would give annual returns of \$195,000/year. Weak growth w/ new site would mean annual returns of \$115,000. 3. Strong growth w/ expansion would = annual returns of \$190,000/year. Weak growth w/ expansion would = annual return \$100,000. 4. At the existing store w/ no changes, would be returns of \$170,000/ year if strong growth and \$115,000/ year if weak growth. 5. Expansion at current site would cost \$87,000. 6. Move to new site = \$210,000. 7. If growth strong & existing site is enlarged in 2 nd year, cost = \$87,000. 8. Operating costs for all options are equal. Chapter 7-Manufacturing Process Different production Environment. Make-to-stock: Televisions Clothing Packaged Food Essential issue in satisfying customers is to balance level of inventory against level of customer service. Easy w/ unlimited inventory, inventory is expensive. Trade-off between costs/inventory & level of customer service must be made. Assemble-to-order Dell Computer Define customer’s order in terms of alternative components since are carried inventory. 1 capability required is a design that enables as much flexibility as possible in combining components.

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• Spring '16
• ya boy
• Cycle Time, Economics of production, Capacity utilization, Strategic capacity planning, Aggregate operations

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