WGU C215 Operations Management -Objective Assessment Prep Guide & Terminologies Combo Study Guide

Combining C215 Study Guides Objective Assessment Prep Guide & Terminologies Total Quality Management (TQM) Philosophy - 1. customer focus 2. continuous improvement 3. employee empowerment 4. use of quality tools 5. product design 6. process management 7. managing supplier quality Process Capability Index (Cpk) - Basic function of Six Sigma. Measures the process potential and performance of processes. The higher the range of Cpk, the improved is the ability of the process to complete its necessities. Uses both the process variability and the process specifications to determine whether the process is "capable." Six Sigma - A disciplined, data-driven approach and methodology for eliminating defects (driving toward six standard deviations between the mean and the nearest specification limit) in any process - from manufacturing to transactional and from product to service. Design Capacity - The theoretical maximum output of a system in a given period under ideal conditions. Effective Capacity - The capacity a firm expects to achieve given its current operating constraints. Location Analysis - proximity to customers, transportation, source of labor, community attitude, proximity to suppliers, and many other factors. Line Processes - A type of process used to produce a large volume of a standardized product. Batch Processes - A type of process used to produce a small quantity of products in groups or batches based on customer orders or specifications. Project Processes - A type of process used to make a one-at-a-time product exactly to customer specifications. Continuous Processes - A type of process that operates continually to produce a high volume of a fully standardized product. Bottleneck - Longest task in the process. Flexible Manufacturing System (FMS) - A type of automated system that combines the flexibility of intermittent operations with the efficiency of continuous operations. Output/Input Control - A technique for monitoring the flow of jobs between work centers. Value-Added - The net increase created during the transformation of inputs into final outputs. Hybrid Layouts - Layouts that combine characteristics of process and product layouts. Relationship Chart (REL) - Table that reflects opinions of managers with regard to the importance of having any two departments close together. Rectilinear Distance - The shortest distance between two locations using north-south and east-west movements. From-To Matrix - Table that gives the number of trips or units of product moved between any pair of departments. Block Plan - Schematic showing the placement of resources in a facility. Mean Observed Times - The average of the observation times for each of the work elements. Normal Time - The mean observed time multiplied by the performance rating factor by the frequency of occurrence. Standard Time - The length of time it should take a qualified worker using appropriate process and tools to complete a specific job, allowing time for personal fatigue and unavoidable delays. Just-in-Time (JIT) - A philosophy designed to achieve high-volume production through elimination of waste and continuous improvement. Based on a "pull" system rather than a "push" system. The three elements are just-in-time manufacturing, total quality management, and respect for people. Kanban card - A card that specifies the exact quantity of product that needs to be produced. Continuous Improvement - A philosophy of neverending improvement. Tier One Suppliers - Supplies materials or services directly to the processing facility. Tier Two Suppliers - Directly supplies materials or services to a tier one supplier in the supply chain. Tier Three Suppliers - Directly supplies materials or services to a tier two supplier in the supply chain. Supply Chain Management (SCM) - Management of the flow of materials from suppliers to customers in order to reduce overall cost and increase responsiveness to customers. Capacity Requirements Planning (CRP) - Determines the labor and machine resources needed to fill the open and planned orders generated by the MRP. Material Requirements Planning (MRP) - A system that uses the MRP, inventory record data, and BOM to calculate material requirements. Enterprise Resource Planning (ERP) - Large software programs used for planning and coordinating all resources throughout the entire enterprise. Aggregate Plans - Includes the budgeted levels of finished products, inventory, backlogs, workforce size, and aggregate production rate needed to support the marketing plan. Third-Party Logistics (3PL) - Businesses to outsource elements of the company's distribution and fulfillment services. specialize in integrated operation, warehousing and transportation services customized to customers' needs based on the demands and delivery service requirements for their products and material Supply Chain Operations Reference model (SCOR) - the world's leading supply chain framework, linking business processes, performance metrics, practices and people skills into a unified structure. The goals are to increase the speed of system implementations, support organizational learning goals, and improve inventory turns. Project Life Cycle Phases - Initiation, Planning, Execution and Closure. Master Production Schedule (MPS) - A plan for produced in each time period such as production, staffing, inventory, etc. linked to manufacturing where the plan indicates when and how much of each product will be demanded. It gives production, planning, purchasing, and top management the information needed to plan and control the manufacturing operation. Total Quality Management (TQM) - The meaning of quality as defined by the customer. activity-on-node - network diagramming notation that places activities in the nodes and arrows to signify precedence relationships advertising revenue model - provides users with information on services and products and provides an opportunity for suppliers to advertise affiliate revenue model - companies receive a referral fee for directing business to an affiliate aggregate plan - includes the budgeted levels of finished products, inventory, backlogs, workforce size, and aggregate production rate needed to support the marketing plan ALDEP and CRAFT - computer software packages for designing process layouts allowance factor - the amount of time the analyst allows for personal time, fatigue, and unavoidable delays alternative workplace - brings work to the worker rather than the worker to the workplace anticipation inventory - inventory built in anticipation of future demand application service provider (ASP) - sets up and runs ERP systems appraisal costs - costs incurred in the process of uncovering defects assemble-to-order strategy - produces standard components that can be combined to customer specifications assignable causes of variation - causes that can be identified and eliminated automated order entry system - a method using telephone models to send digital orders to suppliers back orders - unfilled customer orders backward scheduling - starts with the due date for an order and works backward to determine the start date for each activity backward scheduling - scheduling method that determines when the job must be started to be done on the due date batch process - a type of process used to produce a small quantity of products in groups or batches based on customer orders or specifications behavioral feasibility - degree to which the job is intrinsically satisfying to the employee benchmarking - studying the business practices of other companies for purposes of comparison best operating level - the volume of output that results in the lowest average unit cost beta probability distribution - typically represents project activities bill of material (BOM) - lists all the subassemblies, component parts, and raw materials that go into an end item and shows the usage quantity of each required block plan - schematic showing the placement of resources in a facility bottleneck - longest task in the process break-even analysis - technique used to compute the amount of goods that must be sold just to cover costs broad view of JIT - a philosophy that encompasses the entire organization broad view of the organization - tasks and procedures are important only if they meet the company's overall goals bullwhip effect - inaccurate or distorted demand information created in the supply chain business strategy - a long-range plan for a business business-to-business (B2B) - electronic commerce between businesses business-to-business e-commerce - businesses selling to and buying from other businesses business-to-consumer e-commerce (B2C) - on-line businesses sell to individual consumers business-to-customers (B2C) - electronic commerce between businesses and their customers capacity - the maximum output rate that can be achieved by a facility capacity cushion - additional capacity added to regular capacity requirements to provide greater flexibility capacity planning - the process of establishing the output rate that can be achieved by a facility capacity planning using overall planning factors (CPOPF) - a rough-cut capacity planning technique. MPS items are multiplied by historically determined planning factors for key resources capacity requirements planning (CRP) - determines the labor and machine resources needed to fill the open and planned orders generated by the MRP capacity utilization - percentage measure of how well available capacity is being used capacity-based options - a group of options that allow the firm to change its current operating capacity cause-and-effect diagram - a chart that identifies potential causes of particular quality problems cell manufacturing - placement of dissimilar machines and equipment together to produce a family of products with similar processing requirements chase aggregate plan - a planning approach that varies production to meet demand each period checklist - a list of common defects and the number of observed occurrences of these defects common causes of variation - random causes that cannot be identified competitive priorities - capabilities that the operations function can develop in order to give a company a competitive advantage in its market components - parts or subassemblies used in the final product conformance to specifications - how well a product or service meets the targets and tolerances determined by its designers constrained optimization problem - a mathematical model in which one is trying to maximize or minimize some quantity, while satisfying a set of constraints constraints - limitations or requirements that must be satisfied continuous improvement - a philosophy of never-ending improvement continuous improvement (kaizen) - a philosophy of never-ending improvement continuous process - a type of process that operates continually to produce a high volume of a fully standardized product control charts - charts used to evaluate whether a process is operating within set expectations core competencies - the unique strengths of a business cost - a competitive priority focusing on low cost critical path - the longest sequential path through the network diagram critical path method (CPM) - network planning technique, with deterministic times, used to determine a project's planned completion date and identify the project's critical path cross-functional decision making - the coordinated interaction and decision making that occur among the different functions of the organization customer relationship management (CRM) - software solutions that enable the firm to collect customer-specific data customer service - the ability to satisfy customer requirements customer-defined quality - the meaning of quality as defined by the customer customer-to-customer (C2C) - electronic commerce between customers cycle counting - prespecified items are counted daily decision tree - modeling tool used to evaluate independent decisions that must be made in sequence decision variables - quantities under the control of the decision maker defining beliefs of JIT - broad view of operations, simplicity, continuous improvement, visibility, and flexibility demand-based options - a group of options that respond to demand fluctuations through the use of inventory or back orders, or by shifting the demand pattern Deming Prize - a Japanese award given to companies to recognize efforts in quality improvement demonstrated capacity - proven capacity calculated from actual performance data dependent demand - demand for component parts is based on the number of end items being produced design capacity - the maximum output rate that can be achieved by a facility under ideal conditions deterministic time estimate - assumption that the activity duration is known with certainty diseconomies of scale - a condition in which the cost of each additional unit made increases distribution inventory - finished goods in the distribution system distribution management - responsible for movement of material from the manufacturer to the customer due date - time when the job is supposed to be finished duration of the change - the expected length of time the different capacity level is needed e-commerce - using the Internet and Web to transact business economic feasibility - the cost of the job should be less than the value it adds economies of scale - a condition in which the average cost of a unit produced is reduced as the amount of output is increased effective capacity - the maximum output rate that can be sustained under normal conditions efficiency - performing activities at the lowest possible cost efficiency - ratio of actual output to standard output electronic data interchange (EDI) - a form of computer-to-computer communications that enables sharing business documents electronic request for quote (eRFQs) - an electronic request for a quote on goods and services electronic storefronts - on-line catalogs of products made available to the general public by a single supplier elemental time data - establish standards based on previously completed time studies, stored in an organization's database engineering plan - identifies new products or modifications to existing products that are needed to support the marketing plan enterprise resource planning (ERP) - large, sophisticated software systems used for identifying and planning the enterprise-wide resources needed to coordinate all activities involved in producing and delivering products environmental scanning - monitoring the external environment for changes and trends to determine business opportunities and threats equality constraint - a constraint such as 6x ₁ + 3x ₂ = 30, used to specify that a requirement must be met exactly expected value (EV) - a weighted average of chance events, where each chance event is given a probability of occurrence external failure costs - costs associated with quality problems that occur at the customer site external setup - can be performed while the machine is still running extranets - intranets that are linked to the Internet so that suppliers and customers can be included in the system factor rating - a procedure that can be used to evaluate multiple alternative locations based on a number of selected factors feasible solution - a specific combination of values of the decision variables such that all of the constraints are satisfied financial plan - identifies the sources and uses of funds; projects cash flows, profits, return on investment; and provides budgets in support of the strategic business plan finished goods - products sold to customers finished goods inventory - products available for shipment to the customer finite loading - scheduling that loads work centers up to a predetermined amount of capacity fitness for use - a definition of quality that evaluates how well the product performs for its intended use fixed-position layout - a layout in which the product cannot be moved due to its size and all the resources have to come to the production site flexibility - an organizational strategy in which the company attempts to offer a greater variety of product choices to its customers flexibility - a competitive priority focusing on offering a wide variety of goods or services flexibility - a company can quickly adapt to the changing needs of its customers flowchart - a schematic of the sequence of steps involved in an operation or process fluctuation inventory - provides a cushion against unexpected demand focused factories - facilities that are small, specialized, and focused on a narrow set of objectives formulation - a formal, algebraic statement of a constrained optimization problem forward scheduling - schedule that determines the earliest possible completion date for a job frequency of occurrence - how often the work element must be done each cycle from-to matrix - table that gives the number of trips or units of product moved between any pair of departments global marketplace - a trend in business focusing on customers, suppliers, and competitors from a global perspective globalization - the process of locating facilities around the world greater-than-or-equal-to constraint - a constraint such as 4x ₁ + 7x ₂ ≥ 50, often used to model a requirement that must be satisfied green supply chain management - focuses on the role of the supply chain with regard to its impact on the environment gross requirements - the total-period demand for an item group technology (GT) or cell layouts - hybrid layouts that create groups of products based on similar processing requirements Hawthorne studies - the studies responsible for creating the human relations movement, which focused on giving more consideration to workers' needs hiring and firing - long-term option for increasing or decreasing capacity histogram - a chart that shows the frequency distribution of observed values of a variable human relations movement - a philosophy based on the recognition that factors other than money can contribute to worker productivity hybrid aggregate plan - a planning approach that uses a combination of level and chase approaches while developing the aggregate plan