Study Guide

1 January 2017

Xerox studied the distribution system of L. L. Bean. Xerox compared the performance of it’s distribution system with L. L. Bean’s and used what it learned to improve its operations. This process is called a. employee empowerment b. benchmarking c. copycatting d. industrial espionage 2. You are auditing account transactions. You develop a p-chart for the percent of accounts transactions that have at least 1 error. You examine 200 transactions every day for 20 days.

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The value of p-bar used to calculate the upper and lower control limits for the p-chart is: a. 0. 045 b. 0. 100 c. 0. 111 d. 0. 900 3. Mr. Johnson from Motorola gave an example of a supplier, Ampenol, producing a part for one of their systems. After producing the part in Mexico, instead of shipping it to Motorola, this company ships the part directly to the customer. This is an example of a. drop shipping b. backward integration c. postponement d. timely customization 4. Statistical process control charts are used a. o signal when assignable variation is present in a process. b. to determine when it’s time to shut down the process. c. to inspect supplier shipments. d. to reject bad parts.

This concept was illustrated in the Beer Game played during class and is called: a. vertical integration effect b. outsourcing c. channel integration d. bullwhip effect 13. ABC analysis is based upon the principle that a. all items in inventory must be monitored very closely b. an item is critical (Class A) only if its usage is high c. there are usually a few critical items (Class A), and many items which are less critical d. an item is critical (Class A) only if its unit price is high 14. Successful TQM (total quality management) incorporates all of the following except a. ontinuous improvement b. employment involvement c. benchmarking d. centralized decision-making authority 15. Which of the following would not generally be a motive for a firm to hold inventories? To a. take advantage of quantity discounts b. minimize holding costs c. reduce risk of losing a sale d. meet unanticipated demand 16. Most inventory models attempt to minimize a. the likelihood of a stockout b. the number of items ordered c. total inventory based costs d. the number of orders placed. 17. ACE Distributors supplies retail stores across the country.

ACE is implementing statistical process control to monitor its on-time performance. ACE has collected data on the number of orders filled each week and the number of those orders that are delivered on-time. What is the most appropriate chart(s)? a. p-chart b. [pic]-chart and R chart c. z-chart d. pareto chart 18. The two most basic inventory questions answered by the typical inventory model are: a. timing and cost of orders b. quantity and cost of orders c. timing and quantity of orders d. ordering cost and carrying cost 19.

In an assembly process to produce Lego tables, an assembler assembles legs for the table. Her supplies are replenished regularly and she assembles legs as long as her supplies last. After completing a batch, she moves the assembled legs to the next workstation regardless of any backlog at the next workstation. This is an example of a a. push system b. pull system c. kanban system d. JIT system 20. IBM is continuing to focus on its core competency of developing new technology and service. Recently, IBM has contracted with Sanmino to have them manufacture many IBM products.

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