Exam 2 Material 3, 5, 11, 14, 17 Flashcards Preview

Operations Management > Exam 2 Material 3, 5, 11, 14, 17 > Flashcards

Flashcards in Exam 2 Material 3, 5, 11, 14, 17 Deck (62)
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1

What is a forecast?

a statement about the future value of a variable of interest

2

What are two important aspects of forecast?

1. expected level of demand
2. accuracy

3

Explain time-series forecast

a time-ordered sequence of observations taken at regular time intervals

4

5 time series behaviors

1. trend
2. seasonality
3. cycles
4. irregular variations
5. random variation

5

Explain trend

a long-term upward/downward movement in data

6

Explain Cycle

wavelike variations lasting more than one year

7

Explain Naive

uses a single previous value of a time series as the basis for a forecast

8

Explain moving average

averages a number of the most recent actual values in generating a forecast

9

Explain weighted moving average

most recent values in a time series are given more weight in computing a forecast

10

Explain exponential smoothing

based on previous forecast plus a percentage of forecast error

11

What is capacity?

The upper limit or ceiling on the load that an operating unit can handle

12

What is design capacity?

max output rate or service capacity of an operation, process or facility it is designed for

13

What is effective capacity?

design capacity-allowance such as personal time and maintenance

14

What is efficiency?

actual/effective

15

What is utilization?

actual/design

16

Explain leading

build capacity in anticipation of future demand increases

17

Explain following

build capacity when demand exceeds current capacity

18

Explain tracking

Add capacity in relatively small increments to keep pace with increasing demand

19

Short term considerations relate to ____ in capacity requirements

variations

20

long term considerations relate to ______ in capacity requirements

level

21

Name 3 challenges related to service capacity

1. need to be near customers
2. inability to store services
3. degree of demand volatility

22

Name strategies used to offset capacity limitations and that intended to achieve a closer match between supply and demand

pricing, promotion, discounts

23

What is a bottleneck operation?

an operation in a sequence of operations whose capacity is lower than that of the other operations

24

Explain economies of scale

if output rate is less than optimal level, increasing the output rate results in decreasing average per unit costs

25

Explain diseconomies of scale

if output rate is less than optimal level, increasing the output rate results in increasing average per unit costs

26

What is the break even point?

the volume of output at which total cost and total revenue are equal

27

What is aggregate planning?

production plan that will effectively utilize the organization's resources to satisfy demand

28

What are aggregated planners concerned with?

demand quantity and timing of demand

29

What does aggregate planning project levels of?

inventory, output, employment, subcontracting, backordering

30

Explain proactive

alter demand to match capacity