Operations and Supply Chain Management





1. At the operational strategy level, which of the following questions might be asked?  (1 Mark)A) Why does the organization exist?B) How should the operation perform?C) What are our corporate priorities?D) What is our mission statement?
2. Which of the following is defined as an intangible in service quality? (1 Mark)A) AppearanceB) PriceC) AssuranceD) Functionality
3. The following statement is true about a job shop: (1 Mark)A) Deliver a make-to-order item custom made to customer specificationsB) Uses continuous flowC) Has very low unit costsD) Will use very low skilled labour
4. Assemble-to-order orders: (1 Mark)A) are part customizedB) have very long relative lead timesC) have very expensive relative unit pricesD) are often held in large finished goods stores
5. The best example of a standardized commodity product below is: (1 Mark)A) a hair cutB) a pizza ordered in a take-away pizza restaurantC) a car tyre bought from a standard garage off-the-shelfD) a university lecture

6. What’s the operation strategy for the following companies? How do they execute it?A) Southwest             B) Walmart (2 Marks)C) Toyota (2 Marks)D) Amazon (2 Marks)Example Answer:A) Southwest Operations – low cost• Point-to-point between midsize cities & secondary airports in large cities• 15-min gate turnaround• No meals• No assigned seats• No interline baggage checking• No premium classes of service• Automated gate ticketing• Standardized fleet of aircraft

7. Dell has recently become the number one maker of file servers in the United States (computers used to serve up files on a computer network – as found in a university library, for example), and holds the number two position worldwide. Dell builds servers efficiently, and their customers know exactly where their server is during every step of the production process.The production process begins when the customer orders the server. This information is placed in a production queue that itemizes every component to be built into the server. The required inventory is then sent to the assembly area to make sure that it is queued. Dell collaborates closely with its suppliers to provide them with real-time production data, so it can have inventory available on the loading docks connected to the factory floor. This allows Dell to keep only two hours’ worth of inventory on the factory floor.Assembly begins when the chassis, motherboard and memory are put together and moved to the ‘kitting’ area, where the other various internal components (same as drives, cards and connectors) from suppliers are added to the ‘kit’ tray. These kits are then moved to the assembly area, where they are automatically routed to the next available assembler. Each assembler can build a variety of servers (each is typically certified to build up to 15 different models). Once a server has been completed and tested, it is mechanically placed in a container and shipped out. Although production occurs very quickly, each server is customized specifically. The factory produces servers on a mass scale. a) What is Dell’s strategy and unique approach to order processing? (1 Mark)b) How has the design of its products helped mass customization? (2 Mark)c) What makes it possible to deliver high variation at competitive prices and lead times?(2 Mark)d) Why don’t its competitors do the same? (2 Mark)

8. Ford Motor Company must select a production process for its new product, Centura, from among three different alternatives. The following cost data have been collected:  Process A Process B Process CFixed Cost $15,000 $25,000 $55,000Variable Cost $6/unit $5/unit $3/unitFor what volume of demand would each process be desirable? (3 Marks)





9. A process has three tasks, A, B and C. A takes 40 seconds, B 10 seconds and C 5 seconds. The waiting time between A and B is 10 minutes, and the waiting time between B and C is 2 hours. What is (a) the total processing time, (b) the process capacity, (c) the total lead time, (d) in-process inventory, the utilization of task B? (5 Marks)





10. For the following process, the flow rate at station 1 is 20 units/hour and the flow rate at station 2 is 30 units/hour. There is no buffer between the two stations.a. Is there any starving or blocking in this system? If yes, where and how much? (1 Mark)b. Which station is the bottleneck? (1 Mark)c. What is the capacity of the system? (1 mark)d. Assuming a make-to-stock system, what is the average work-in-process in the system?(2 Marks)




5. A machine shop manufactures cylinders with outside diameter that has a 1.0 ± .01 inch specification. The operator takes several sample measurements over time and found that the mean outer diameter of the samples to be 1.0 inches with a standard deviation of .003 inch.a. Calculate the process capability index for this example. (1 Mark)b. What does this figure tell you about the process? (1 Mark)



11. An organization wants to study the fraction of incorrect sales invoices that are sent to its customers. A random sample of 100 sales invoices was collected each week for 40 weeks. It reveals that the total number of incorrect sales invoices from all samples is 97a. Calculate the fraction of incorrect sales invoices (1 Mark)b. Calculate the center line (CL), the upper control limit (UCL) and the lower control limit (LCL) for the control chart (1 Mark)c. What is your comment regarding the performance of the invoicing department if another sample that was taken later shows the number of incorrect invoices to be 105 invoices. (1 Mark)

12. Al-Ain Mineral Water Bottling Company is using a high-speed production line to treat, process and fill water bottles for local consumption. The production line is set up to produce a large batch of 1,000 mL bottles. To set up the production line and to create a control chart to be used throughout the production run, 15 samples were taken with four bottles in each sample. The complete list of samples and their measured values are as follows: Develop the appropriate control chart and plot the values. From the charts, what comments can you make about the process? (Use three-sigma c




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