Which of the following is MOST likely to be an advantage of a standardization program?
Standardization ensures that products meet uniform quality standards, reducing variability and enhancing customer satisfaction. This advantage is vital in maintaining brand reputation and streamlining production processes.
Consider the following data comparing actual demand versus forecast demand:
Month Actual Demand Forecast Demand
January 100,000 80,000
February 105,000 90,000
March 110,000 100,000
April 70,000 100,000
May 90,000 110,000
June 100,000 90,000
What is the Mean Annual Percent Error (MAPE) for the six months of data?
To calculate the Mean Absolute Percentage Error (MAPE), we follow these steps:
1. Find the absolute error for each month.
2. Convert the absolute error to a percentage of the actual demand for each month.
3. Find the average of these percentage errors over the six-month period.
Here's the calculation:
* January: 100,00080,000100,000100=20%\left| \frac{100,000 - 80,000}{100,000} \right| \times 100 = 20\%100,000100,00080,000100=20%
* February: 105,00090,000105,000100=14.29%\left| \frac{105,000 - 90,000}{105,000} \right| \times 100 = 14.29\%105,000105,00090,000100=14.29%
* March: 110,000100,000110,000100=9.09%\left| \frac{110,000 - 100,000}{110,000} \right| \times 100 = 9.09\%110,000110,000100,000100=9.09%
* April: 70,000100,00070,000100=42.86%\left| \frac{70,000 - 100,000}{70,000} \right| \times 100 = 42.86\%70,00070,000100,000100=42.86%
* May: 90,000110,00090,000100=22.22%\left| \frac{90,000 - 110,000}{90,000} \right| \times 100 = 22.22\%90,00090,000110,000100=22.22%
* June: 100,00090,000100,000100=10%\left| \frac{100,000 - 90,000}{100,000} \right| \times 100 = 10\%100,000100,00090,000100=10%
MAPE=(20+14.29+9.09+42.86+22.22+10)6=19.41%20%MAPE = \frac{(20 + 14.29 + 9.09 + 42.86 + 22.22 + 10)}{6} = 19.41\% \approx 20\%MAPE=6(20+14.29+9.09+42.86+22.22+10)=19.41%20%
Thus, the MAPE for the six months of data is approximately 20%. Reference:
* Chase, R. B., Jacobs, F. R., & Aquilano, N. J. (2006). Operations Management for Compet-itive Advantage. McGraw-Hill/Irwin.
* Hyndman, R. J., & Athanasopoulos, G. (2018). Forecasting: principles and practice. OTexts.
PQR, Inc. produces office supplies for big box retailers. This is a highly competitive market and the requirement for maintaining a continuous inventory of product for retailers is a high priority for PQR. Recently, the firm experienced shipping delays from overseas suppliers. Which of the costs associated with shortages would be MOST critical for PQR?
In a highly competitive market like office supplies, the most critical cost associated with shortag-es is typically lost sales. If PQR, Inc. experiences shipping delays and cannot maintain continuous inventory, customers are likely to turn to competitors to meet their needs. This can result in im-mediate lost sales and potentially long-term loss of customer loyalty. The cost of lost sales often outweighs other costs like idle workers or production downtime because it directly affects revenue and market share. Reference:
* Chopra, S., & Meindl, P. (2015). Supply Chain Management: Strategy, Planning, and Op-eration. Pearson.
* Christopher, M. (2016). Logistics & Supply Chain Management. Pearson UK.
A supply manager is analyzing potential costs associated with the raw materials needed for a new product launch. Tooling costs are known, but the range of forecasts for future sales---and therefore demand for materials-varies widely. Given these circumstances, the supply manager should consider using which of the following?
A decision tree is an effective tool for evaluating potential costs and benefits under conditions of uncertainty, such as varying forecasts for future sales. It allows the supply manager to visually map out different decision paths and their associated costs, probabilities, and outcomes. This helps in comparing different scenarios and making informed decisions about the raw materials needed for a new product launch. Decision trees are particularly useful in situations with multiple possible outcomes and complex decisions. Reference:
* Clemen, R. T., & Reilly, T. (2013). Making Hard Decisions with DecisionTools. Cengage Learning.
* Heizer, J., Render, B., & Munson, C. (2017). Operations Management: Sustainability and Supply Chain Management. Pearson.
A supply manager oversees three distribution centers. Which of the following will be MOST useful for understanding the capacity of these centers7
A Warehouse Management System (WMS) is designed specifically to manage and optimize ware-house operations. It provides real-time data on inventory levels, storage locations, and warehouse capacity, enabling supply managers to understand and maximize the utilization of distribution centers. A WMS can track and improve the efficiency of receiving, putaway, picking, and ship-ping processes, providing a comprehensive view of the warehouse's capacity and performance. Reference:
* Frazelle, E. (2002). World-Class Warehousing and Material Handling. McGraw-Hill.
* Richards, G. (2017). Warehouse Management: A Complete Guide to Improving Efficiency and Minimizing Costs in the Modern Warehouse. Kogan Page Publishers.
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