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process strategy

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an organization's approach to transforming resources into goods and services

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Process Focused

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they provide a high degree of product flexibility as products move intermittently between processes. Each process is designed to perform a wide variety of activities and handle frequent changes. Also called intermittent processes

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repetitive process

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classic assembly line. Widely used in the assembly of virtually all automobiles and household appliances. A product-oriented production process that uses modules

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modules

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parts or components of a product previously prepared, often in a continuous process

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product focused

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high-volume, low-variety. organized around products. They are also called continuous processes, because they have very long, continuous production runs.

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Mass customization

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the rapid, low-cost production of goods and services that fulfill increasingly unique customer desires.

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Build-to-order

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producing to customer orders, not forecasts

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postponement

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product and process design that allow customization to be scheduled late in the production process also contribute to efficient mass customization

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crossover chart

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the comparison of processes can be further enhanced by looking at the point where the total cost of the processes changes

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flow diagram

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a schematic or drawing of the movement of material, product, or people

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time-function mapping (process mapping)

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a flow diagram, but with time added on the horizontal axis

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value-stream mapping (VSM)

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takes an expanded look at where value is added (and not added) in the entire production process, including the supply chain

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Process charts

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use symbols, time, and distance to provide an objective and structured way to analyze and record the activities that make up a process

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Service blueprinting

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a process analysis technique that focuses on the customer and the provider's interaction with the customer

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flexibility

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the ability to respond with little penalty in time, cost, or customer value

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computer numerical control (CNC)

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Machinery with its own computer and memory

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Automatic identification systems (AISs)

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Making data digital is done via computer keyboards, bar codes, radio frequencies, optical characters on bank checks, and so forth. Help us move data into electronic form, where it is easily manipulated

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radio frequency identification (RFID)

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integrated circuitry with its own tiny antennas that use radio waves to send signals a limited range- usually a matter of yards

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Process control

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the use of information technology to monitor and control a physical process

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Vision systems

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combine video cameras and computer technology and are often used in inspection roles

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Robots

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mechanical devices that may have a few electronic impulses stored on semiconductor chips that will activate motors and switches

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automated storage and retrieval systems (ASRSs)

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provide for the automatic placement and withdrawal of parts and products into and from designated places in a warehous

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Automated guided vehicles (AGVs)

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electronically guided and controlled carts used in manufacturing to move parts and equipment

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flexible manufacturing system (FMS)

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When a central computer provides instructions to each workstation and to the material-handling equipment, the system is known as an automated work cell

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computer-integrated manufacturing (CIM)

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integrated with inventory control, warehousing, and shipping as part of a flexible manufacturing system

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Process redesign

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the fundamental rethinking of a business processes to bring about dramatic improvements in performance

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Capacity

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the "throughput," or the number of units a facility can hold, receive, store, or produce in a period of time

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Design capacity

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the maximum theoretical output of a system in a given period under ideal conditions

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Effective capacity

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the capacity a firm expects to achieve given the current operating contraints

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Utilization

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simply the percent of design capacity actually achieved

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Efficiency

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the percent of effective capacity actually achieved

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break-even analysis

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to find the point, in dollars and units, at which costs equal revenue

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Fixed costs

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costs that continue even if no units are produced

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Variable costs

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those that vary with the volume of units produced

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Contribution

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the difference between selling price and variable cost

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Revenue function

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revenue begins at the origin and proceeds upward to the right, increasing by the selling price of each unit

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net present value

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a means of determining the discounted value of a series of future cash receipts

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Office layouts

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require the grouping of workers, their equipment, and spaces to provide for comfort, safety, and movement of information

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Retail layouts

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based on the idea that sales and profitability vary directly with customer exposure to products

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Slotting fees

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fees manufacturers pay to get their goods on the shelf in a retail store or supermarket chain

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servicescape

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the physical surroundings in which the service is delivered and how the surroundings have a humanistic effect on customers and employees

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warehouse layout

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to find the optimum trade-off between handling cost and costs associated with warehouse space

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Cross-docking

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to avoid placing materials or supplies in storage by processing them as they are received

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random stocking

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used in warehousing to locate stock wherever there is an open location

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fixed-position layout

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the project remains in one place and workers and equipment come to that one work area

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Process-oriented layout

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can simultaneously handle a wide variety of products or services

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job lots

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groups or batches of parts processed together

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work cell

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reorganizes people and machines that would ordinarily be dispersed in various departments into a group so that they can focus on making a single product or a group of related products

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CRAFT

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A computer program that systematically examines alternative departmental rearrangements to reduce total material handling costs

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Takt time

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pace of production to meet customer demands

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focused work center

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moves production from a general-purpose, process-oriented facility to a large work cell that remains part of the present plant

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focused factory

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A facility designed to produce similar products or components

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fabrication line

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builds components, such as automobile tires or metal parts fro a refrigerator, on a series of machines

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assembly line

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puts the fabricated parts together at a series of workstations

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assembly-line balancing

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obtaining output at each workstation on a production line so delay is minimized

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cycle time

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The maximum time that a product is allowed at each workstation

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heuristics

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problem solving using procedures and rules rather than mathematical optimization

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Forecasting

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the art and science of predicting future events

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Economic forecasts

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planning indicators that are valuable in helping organizations prepare medium-to long-range forecasts

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Technological forecasts

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Long-term forecasts concerned with the rates of technological progress

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Demand forecasts

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Projections of a company's sales for each time period in the planning horizon

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Quantitative forecasts

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forecasts that employ one or more mathematical models that rely on historical data and/or causal variables to forecast demand

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Qualitative forecasts

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forecasts that incorporate such factors as the decision maker's intuition, emotions, personal experiences, and value system

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Jury of executive opinion

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A forecasting technique that takes the opinion of a small group of high-level managers and results in a group estimate of demand

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Delphi method

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A forecasting technique using a group process that allows experts to make forecasts

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Sales force composite

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A forecasting technique based on salespersons' estimates of expected sales

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Consumer market survey

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A forecasting method that solicits input from customers or potential customer regarding future purchasing plans

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Time series

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A forecasting technique that uses a series of past data points to make a forecast

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Naive approach

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A forecasting technique that assumes demand in the next period is equal to demand in the most recent period

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Moving averages

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A forecasting method that uses an average of the n most recent period of data to forecast the next period

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Exponential smoothing

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A weighted-moving-average forecasting technique in which data points are weighted by an exponential function

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Smoothing constant

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The weighted factor used in an exponential smoothing forecast, a number between 0 and 1

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Mean absolute deviation (MAD)

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A measure of the overall forecast error for a model

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Mean squared error (MSE)

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The average of the squared differences between the forecasted and observed values

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Mean absolute percent error (MAPE)

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The average of the absolute differences between the forecast and actual values, expressed as a percent of actual values

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Trend projection

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A time-series forecasting method that fits a trend line to a series of historical data points and then projects the line into the future for forecasts

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Seasonal variations

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Regular upward or downward movements in a time series that tie to recurring events

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Cycles

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patterns in the data that occur every several years

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Linear-regression analysis

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A straight-line mathematical model to describe the functional relationships between independent and dependent variables

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Standard error of the estimate

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A measure of variability around the regression line- its standard deviation

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Coefficient of correlation

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A measure of the strength of the relationship between two variables

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Coefficient of determination

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A measure of the amount of variation in the dependent variable about its mean that is explained by the regression equation

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Multiple regression

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An associative forecasting method with more than one independent variable

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Tracking signal

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A measurement of how well the forecast is predicting actual values

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Bias

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A forecast that is consistently higher or consistently lower than actual values of a time series

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Adaptive smoothing

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An approach to exponential smoothing forecasting in which the smoothing constant is automatically changed to keep error to a minimum

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Focus forecasting

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Forecasting that tries a variety of computer models and selects the best one for a particular application

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D) Forecasting is exclusively an objective predication

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Which of the following is NOT true regarding forecasting? A) Forecasting may involve taking historical data and projecting them into the future with a mathematical model B) Forecasting is the art and science of predicting future events C) A forecest is usually classified by the future time horizon that it covers D) Forecasting is exclusively an objective prediction

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C) Short Range

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The forecasting time horizon that would typically be easiest to predict for would be the A) long range B) medium range C) Short Range D) Intermediate range

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A) An economic forecast

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A forecast that addresses the business cycle by predicting planning indicators is A) an economic forecast B) an environmental forecast C) a technological forecast D) a demand forecast

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D) a demand forecast

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A forecast that projects a company's sales is A) an environmental forecast B) a technological forecast C) an economic forecast D) a demand forecast

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B) collaborative, planning, forecasting, and replenishment

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CPER is A) complete, planning, forecasting, and replenishment B) collaborative, planning, forecasting, and replenishment C) collaborative, partner, forecasting, and replenishment D) complete, partner, forecasting, and replenishment

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D) create significantly more accurate information that can power the supply chain

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The goal of CPFR is to A) ensure product innovation B) determine which model needs to be used to predict future events C) Create good relations with suppliers D) create significantly more accurate information that can power the supply chain

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B) When excess capacity exists, cost can decrease

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Which of the following statements is NOT true? A) when capacity is inadequate, market share can shrink B) when excess capacity exists, cost can decrease C) when excess capacity exists, cost can increase D) when capacity is inadequate, customer can be lost

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D) Determine the use of the forecast

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Which of the following is the FIRST step in a forecasting system? A) select the forecast model(s) B) select the items to be forecasted C) Determine the time horizon of the forecast D) Determine the use of the forecast

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A) Validate and implement the results

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Which of the following is the FINAL step in a forecasting system? A) Validate and implement the results B) Make the forecast C) Gather the data needed to make the forecast D) Select the forecast model(s)

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D) Outside factors that we cannot predict or control often impact the forecast

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Which of the following is a reality each company faces regarding its forecasting system? A) product family forecast are less accurate than individual product forecasts B) After automating their predictions using computerized forecasting software, firms closely monitor only the product items whose demand is stable C) Most forecasting techniques assume there is no underlying stability in the system D) Outside factors that we cannot predict or control often impact the forecast

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D) select the forecasting model(s)

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Which of the following forecasting steps comes directly after determining the time horizon of the forecast? A) Gather the data B) Select the items to be forecasted C) make the forecast D) select the forecasting model(s)

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C) Sales force composite

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Which forecasting model is based upon salespersons' estimates of expected sales? A) Delphi method B) Jury of executive opinion C) Sales force composite D) market survey

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A) exponential smoothing

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Which of the following is a quantitative forecasting method? A) exponential smoothing B) market survey C) jury of executive opinion D) sales force composite

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D) Delphi method

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Which of the following is a qualitative forecasting method? A) trend projection B) naive approach C) linear regression D) Delphi method

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B) Linear regression

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Which of the following is NOT a time-series model? A) moving averages B) linear regression C) naive approach D) exponential smoothing

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To build a production process that meets customer requirements and product specifications within cost and other managerial constraints

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What is the objective of a process strategy?

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