WGU C215 Operations Management Study Guide

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 Appraisal cost - The cost associated with uncovering defects Automated order entry systems - A method using telephone models to send digital orders to suppliers. Backwards integration - Owning or controlling sources of raw materials and components. Benchmarking - Studying other companies business practices for comparison. Bullwhip effect - Inaccurate or distorted demand information created in the supply chain. Business to Business commerce - Businesses buying and selling to other businesses. Business to consumer commerce - Businesses selling to individual consumers. Cause and effect diagrams - A chart that identifies potential causes of particular quality problems. Checklist - A list of common defects and the number of observed occurrences of each. Conformance to specifications - how well a product or service meets the targets and tolerances set by designers. Continuous improvement - A philosophy of never ending improvement. Control charts - Charts used to evaluate whether a process is operating within expectations. Crossdocking - Eliminates storage and order picking functions of a distribution warehouse. Customer defined quality - an integrated effort designed to improve quality performance at every level of the organization. Deming Prize - Japanese award for companies to recognize efforts in quality improvement. Distribution management - Responsible for the movement of material from the manufacturer to the customer. Distribution warehouse - Used for short term storage, consolidation, and product mixing. Distributor crossdocking - the receiving and consolidating of inbound products from different vendors into a multi-SKU pallet. E-commerce - Using the internet and web to do business. E-distributors - Independently owned net marketplaces having catalogs representing thousands of suppliers and designed for spot purchases. E-purchasing - Companies that connect onlone MRO suppliers to businesses that pay fees to join the market, usually for long term contractual purchasing. Early supplier involment (ESI) - Involvement of critical suppliers in new product design. Electronic data interchange (EDI) - A form of computer to computer communications that enables sharing business documents. Electronic requests for quotes (eRFQs) - An electronic request for a quote on goods and services. Electronic storefront - online catalogs of products made available to the general public by a single supplier Exchanges - Marketplaces that focus on spot requirements of larger firms in a single industry External Failure costs - Costs associated with failures that occur at the customer site. Extranets - intranets that are linked to the internet so that suppliers and customers can be included in the system. Fitness for use - How well the product performs its intended purpose. Flowchart - A schematic of the sequence of steps involved in a process. Forward integration - Owning or controlling the channels of distributions General warehouse - used for long term storage Green supply chain management - Focucses on the role of the supply chain with regard to its impact on the environment. Histogram - A chart that shows frequency distribution of observed values of a variable. Incoming inspection - verifies the quality of incoming goods Industry consortia - Industry owned markets for purchase of direct inputs from limited number of suppliers. Insourced - processes and activities completed in house Internal failure costs - costs associated with discovering poor quality product before it reaches customers. Intranets - networks internal to the organization ISO 14000 - Set of standards & certification focused on environmental responsiblity ISO 9000 - Set of quality standards & certification indicating companies have met that standard. Kaizen - Japanese term for continuous improvement through learning and problem solving. Logistics - Obtaining, producing an distributing materials and products. Malcolm Baldridge Award - Award for demonstrating quality excellence and establishing best practices. Manufacturing crossdocking - receiving and consolidating inbound supplies and materials for JIT manufacturing. Net Marketplaces - suppliers and buyers conduct trade in a single internet based environment. Outsourced - Processes/activities completed by suppliers. Pareto Analysis - A technique used to identify quality problems based on their degree of importance. Partnering - A process of developing long term relationships with a supplier based on trust, shared vision, and shared information, and shared risk. Plan-do-study-act (PDSA) cycle - a diagram that describes the actvities that need to be performed to incorporate continuous improvement. Postponement - Strategy shifts production differentiation closer to the consumer by postponing final configuration Prevention costs - Costs associated with preventing poor quality/defects from occurring. Price and availability - Current prices and whether the quantity is available when needed. Psychological criteria - way of defining quality, focuses on judgement of what constitutes product or service excellence. Purchase order - legal document committing to buy goods and providing details of purchase. Quality at the source - best to uncover problems at source and correct it. Quality Circle - Team of volunteer production workers and supervisors who meet regularly to solve quality issue. Quality function deployment (QFD) - tool to translate preferences of the customer into specific technical requirements. Radio frequency identificaion (RFID) - unpowered microchips used to transmit encoded info through antennae Reliability - probability of part, product or services will perform as intended. Requisition request - indicates the need for an item. Retail crossdocking - sorting product from multiple vendors onto outbound trucks headed for specific stores. Robust design - A design that results in a product that can perform over a wide range of conditions. Sales revenue model - a means of selling goods, information, or services directly to consumers. Scatter diagram - Graphs that show how two variables relate. Sourcing strategy - A plan indicating suppliers to be used when making purchases. Subscription revenue model - a web site that charges a subscription fee for access to its contents and services. Supply Chain - All the activities involved in delivering a finished product or service to customer Supply chain management - Coordinates and manages all the activities of the supply chain Supply chain management - The speed at which product moves through a pipeline from the manufacturer to the customer Supply chain velocity - The speed at which product moves through a pipeline from manufacturer to the customer. Support Serviecs - Quality defined in terms of the support provided after the product services is purchased. Taguchi loss function - costs of quality increase as a quadratic function as conformance values move away from target. Tier one suppliers - Supplies materials directly to processing facility Tier three suppliers - Directly supplies materials or services to a tier two supplier in the supply chain. Tier two suppliers - directly supplies tier one suppliers Total quality management - The meaning of quality as defined by the customer Transaction fee model - A company receives a fee for executing a transaction Transportation crossdocking - Consideration of LTL shipments to gain economics of scale. Value for price paid - Quality defined in terms of consumer's perception of usefulness of service or product related to prices paid. Vertical integration - A measure of how much of the supply chain is owned by the manufacturing company. Virtual private network (VPN) - A private internet based communications environment that is used by the company, its suppliers, and its customers for day to day activities. Best Operating level - the output volume that results in lowest average unit cost. Break even analysis - used to compute the amount of goods that must be sold just to cover costs. Capacity - maximum output rate that can be achieved by a facility.