Question 1

Which approach to capacity management would require that the workforce be multi-skilled and easily adapt to being moved from line to line?

Accepted Answer

Designing product flexibility into the production processes would require the workforce to be multi-skilled and adaptable to working in different lines, as the production processes are designed to be flexible to accommodate changes in demand and product variety. Time flexibility from the workforce and the use of seasonal workforce may not necessarily require multi-skilled workers. The use of dual facilities (dedicated and flexible) may provide some level of flexibility, but may not be as efficient as designing product flexibility into the production processes.

Question 2

One key to successful collaboration when the supply chain is performing aggregate planning is

Accepted Answer

When supply chain members collaborate for aggregate planning, it is important to determine how profits will be allocated to different members of the supply chain in order to ensure mutual benefit and motivation for collaboration. Losses may also be considered, but the goal should be to maximize profits for all members involved. Labor allocation and customer allocation are not directly related to collaboration for aggregate planning.

Question 3

Which of the following is an approach that firms can use when managing inventory to meet predictable demand variability?

Accepted Answer

Using common components across multiple products can help firms manage inventory to meet predictable demand variability by reducing the number of unique parts needed to produce a variety of products. This approach allows the firm to have a more streamlined inventory system and can help manage fluctuations in demand. Choices A, B, and C are not directly related to inventory management for predictable demand variability.

Question 4

Which approach to capacity management makes use of overtime, which is varied to match the variation in demand?

Accepted Answer

Time flexibility from workforce approach makes use of overtime, which is varied to match the variation in demand. This approach involves offering employees the opportunity to work extra hours during busy periods, and reducing their hours during quieter periods. This approach allows the organization to vary its capacity in response to changing demand levels without incurring the costs associated with hiring and training additional staff or investing in additional facilities.

Question 5

Pricing decisions based only on revenue considerations often result in

Accepted Answer

Pricing decisions that are based solely on revenue considerations can lead to a decrease in overall profitability as profits depend not only on the revenue earned but also on the costs involved in production and distribution. A pricing strategy that undermines profitability can have serious long-term consequences for the business. Therefore, pricing decisions should be based on a more comprehensive analysis of the costs involved, the competitive environment, and the overall business strategy.

Question 6

When planning, the goal of all firms in the supply chain should be to maximize supply chain profits because

Accepted Answer

Maximizing supply chain profits means that each member in the supply chain is contributing to maximizing the overall profit of the entire chain, which ultimately benefits all parties involved. This allows for a fair distribution of profits among all members and encourages collaboration and efficiency throughout the supply chain.

Question 7

The promotion and pricing decisions made by marketing and sales typically have the objective of

Accepted Answer

The objective of marketing and sales is typically to maximize revenue, which is the amount of money earned from the sale of goods or services. Pricing decisions play a key role in determining the revenue generated, and promotions can also impact revenue through increased sales volume. While profitability is important, it is typically a secondary objective after maximizing revenue.

Question 8

Supply chains can influence demand by using

Accepted Answer

Supply chains can influence demand through pricing and other promotions like discounts, loyalty points, free samples, etc. These promotions can attract customers and increase demand for the product. Production capacity and inventory can only indirectly affect demand by ensuring that there is sufficient supply to meet the demand that is already present. Inventory promotions may help to increase demand, but they are not a direct influence on consumer behavior.

Question 9

Which approach to capacity management would use production machinery that can be changed easily from producing one product to another?

Accepted Answer

Designing product flexibility into the production processes would allow for easy switching between products, which is the approach described in the question. The other options (time flexibility from workforce, use of subcontracting, use of dual facilities) do not necessarily address the use of production machinery that can be easily changed between products.

Question 10

The capacity management approach where a firm purchases peak production from another firm so that internal production remains level and can be done cheaply is

Accepted Answer

The use of subcontracting allows a firm to maintain a level of internal production while also being able to meet peak demands. By purchasing peak production from another firm, the firm can ensure that its own production remains level and can be done at a lower cost. The other options, such as time flexibility from workforce, the use of seasonal workforce, and the use of dual facilities, may also be useful capacity management approaches but do not specifically address the need to manage peak demand.

Question 11

Which approach to capacity management would use a part-time workforce to increase capacity flexibility by enabling the firm to have more people at work during peak periods?

Accepted Answer

The answer of Which approach to capacity management would use...

Question 12

The capacity management approach where a firm builds facilities to produce a relatively stable output of products over time in a very efficient manner and facilities to produce a widely varying volume and variety of products, but at a higher unit cost is

Accepted Answer

The use of dual facilities-dedicated and flexible is the capacity management approach where a firm builds facilities to produce a relatively stable output of products over time in a very efficient manner and facilities to produce a widely varying volume and variety of products, but at a higher unit cost. Option A is referring to time flexibility from workforce, which is a part of workforce management and not capacity management. Option B is referring to the use of seasonal workforce, which is a staffing strategy and not a capacity management approach. Option C is referring to the use of subcontracting, which is a procurement strategy and not a capacity management approach.

Question 13

Which approach to capacity management would only be effective if the overall demand across all the products is relatively constant?

Accepted Answer

The answer of Which approach to capacity management would only...

Question 14

Which approach to capacity management would schedule the workforce so that the available capacity better matches demand?

Accepted Answer

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Question 15

The pricing and promotion decisions are often made by

Accepted Answer

Pricing and promotion decisions are typically within the purview of the marketing and sales departments, as they directly relate to market positioning, customer engagement, and revenue generation.

Question 16

The capacity management approach where a firm has production lines whose production rate can easily be varied to match demand is

Accepted Answer

Designing product flexibility into the production processes allows a firm to quickly adjust their production rate to match changing demand. This means that they can easily increase or decrease their production to match customer needs without experiencing excessive inventory or stock shortages.

Question 17

When most of the products a firm produces have the same peak demand season, in order to meet predictable variability with inventory, it must

Accepted Answer

Building inventory of high demand or predictable demand products allows the firm to have enough inventory to meet the demand during the peak season. This will help them meet the predictable variability in demand without having to rely on other strategies such as seasonal workforce, subcontracting, or using common components across multiple products.

Question 18

Which approach to capacity management makes use of spare plant capacity that exists in the form of hours when the plant is not operational?

Accepted Answer

The approach of time flexibility from the workforce allows the use of spare plant capacity during the hours when the plant is not operational, by adjusting the working hours of the workforce. This approach helps to make the most efficient use of existing resources and reduce the need for additional capacity or resources. The other options, such as the use of seasonal workforce, subcontracting, or dual facilities, may also help to manage capacity, but they do not specifically address the use of spare plant capacity during non-operational hours.

Question 19

Which approach to capacity management may be hard to sustain if the labor market is tight?

Accepted Answer

Using seasonal workforce may be hard to sustain if the labor market is tight because it relies on finding temporary workers who are only available during certain times of the year. In a tight labor market, these workers may be hard to find or may demand higher wages, thereby making it difficult to maintain capacity levels. The other options listed (time flexibility, subcontracting, dual facilities) may still be viable even in a tight labor market.

Question 20

The key to which capacity management approach would involve having both volume (fluctuating demand from a manufacturer) and variety flexibility (demand from several manufacturers) to be sustainable?

Accepted Answer

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Quiz 9: Sales and Operations Planning: Planning Supply and Demand in a Supply Chain