1. We discussed the evolution of industrialized production from what has been described as an evolution from Industry 1.0 through 4.0. This evolution can best be described as:
a. The evolution from inventory card systems to MRP, ERP to the Internet of Things (IOT).
b. The evolution from the Industrial Revolution, to Lean/JIT, to Worldwide Outsourcing, to the Integration of production data and the IOT.
c. The evolution from card systems to MRP, to MPS, to S&OP.
d. The evolution from the Industrial Revolution, to MRP, Lean/JIT, IOT.
2. The single biggest challenge for a sustainable world-wide economics from Industry 4.0 may be:
a. Storing and structuring all the data production-related technologies will create.
b. Educating a workforce capable of taking advantage of the technologies employed.
c. Employing a burgeoning middle-educated, middle-class with technology that engages and enables fewer and fewer workers.
d. Employing enough technically trained professionals capable of programming, maintaining, and performing analytics from the technologies employed.
3. Figure 1.2 pg 7 of Jacobs defines a schema for various production systems that use the "T" or Manufacturing Production Control (MPC) system in some form or another. You see the continuum of examples of production at the bottom of the diagram. Which direction would you say we are trying to move manufacturing from styles more prevalent in Industry 1.0 to now?
a. Left to Right
b. Right to Left
c. No Change (e.g., Ship manufacturing is ship manufacturing; oil refining is oil refining)
d. Depends on the complexity of getting supply from suppliers
Short answer (10 words or less) Why?
4. Referring to figure 1.1 page 4 of Jacobs, (the basic "T" depiction). The 3 major inputs to the Sales &Operations Planning (S&OP) process are Demand Planning (DP), Supply Planning (SP), and Executive/Strategy. The primary contribution of DP to S&OP is:
a. The vetted forecast aggregated from all constituents.
b. The capacity available from actual production after the last S&OP process to make demand for the period.
c. The aggregated demand requirements for the period from all constituents.
d. The disaggregated demand from New Product Development (NPD, customers, and other plants.
5. The major inputs from the executive suite to the S&OP process are:
a. Customer prioritization communication (who gets their demand requirements in allocation scenarios)
b. Market capitalization requirements
c. Organization and customer differentiation strategy
d. Shareholder requirements
e. C&D
f. A, B, C & D
6. The main inputs to the S&OP process from SP are:
a. Providing a capacity profile to gauge the reasonableness of DP's requests.
b. Provide a Rough Cut Capacity (RCCP) planning algorithm for DP's use.
c. Provide a perspective on supplier relationship and current inventory status.
d. To inform NPD and Marketing on the feasibility of adequately provisioning inventory for a scheduled new product rollout.
e. All of the above
7. Long Term S&OP planning (> 1 to 5 year cycle) has different objectives from the intermediate and short term equivalents. The primary objective for planning during this cycle is:
a. Set product/service market/sales strategy
b. Setting operating strategy and selecting/sourcing suppliers of capital equipment and purchased capacity.
c. Overtime and temporary labor budgets planning
d. Tracking utilization from production lines.
Some say that Long Term S&OP is a "one-time-shot" for a CEO. What is meant by that phrase?
What are the implications to operations?
(Keep responses very brief and succinct ... that's part of the grade here).
8. Name one of the most persuasive arguments for building inventory as part of a cogent demand plan.
a. A new product is being introduced and a supply of market test supply has to be available for marketing purposes before steady state growth can be known or better forecast.
b. The equipment purchased can run to scale and therefore provide better economies for when the product does sell. This is the best way to get return for capital invested.
c. Management has made a commitment to the street/stakeholders around investment, return, and performance. Inventory can be made in many cases such that we can decouple (temporarily) the financial requirements from the operational and demand uncertainties if we can sell inventory later at full price.
d. A&C
9. Omnichannel is a term described as the sales and supply chain processes that enable a customer to secure goods and services in ways that best suits their needs whether that be select a product on line with store pickup (retail used as a warehouse) or shop in a store and have purchases shipped to a different location with a myriad of other combinations possible. Most approaches by retailers to original equipment manufacturers (OEM) still revolve around Make-to-Stock (MTS) production and planning models in a sort of "inventory somewhere" will provide for the greatest flexibility & likelihood of customer attraction and satisfaction.
Is there a Customer Decoupling Point (CDP) or manufacturing model MTS -> ETO (XTO) that would better serve an omnichannel goods provider?
Name model(s) preference: ______________________________
Why?
10. When setting up a DP module for a company, Customer Relationship Management (CRM) software is often considered key in providing better insight into the preparation of the unconstrained DP (inbound to pre S&OP meeting). Name the best feature of CRM software to that end:
a. In an engineered sale - CRM can provide a historical & relationship perspective on requirements preferred by a customer. CRM helps document and communicate this ongoing collaboration. (like that described in the Storage Tech example from class lecture). ... if you pick this one ... say why
b. In a repetitive manufacturing sale - pace of consumption can be better predicted through CRM data
c. In a manufacture-to-retail (e.g., manufacturer to Walmart) CRM is where Point of Sale data is collected
d. I can't find great value in CRM software ... it seems like a waste. ... if you pick this one ... say why
11. The CPFR processes (4 activities/8 steps-tasks) have been tailored for different collaborative environments. The major differences in the CPFR activities and steps between the business scenarios: DC Replenishment Collaboration and Collaborative Assortment Planning might be described as:
a. Planning for the new Apple iphone release vs. collaborative trend forecasting
b. High SKU mix, frequent replenishment planning of high volume sellers through warehouse to retail vs. collaborative trend forecasting, VMI and rapid replenishment of sales in season & in-store placement
c. High SKU mix, frequent replenishment planning of high volume sellers through warehouses to retail vs. Frito Lay planning and replenishment of grocery shelves
d. Apple iphone planning vs. Frito Lay planning and replenishment of grocery shelves.
12. The ratio of the numerator to the denominator of the ROI calculation can be dramatically different depending on the industry. For example, in capital intensive businesses like metal fabrication, printing, telephone network provisioning, hospitals, ... businesses where margins can be small relative to the investments made (hoping to make money in volume). Which C-suite officer might be more pleased and less pleased with a supply chain improvement that only improves working capital and thus free cash balances when the market capitalization of a company is determined in this business by income generated annually? (Note: being pleased is a relative thing so this is a measure of "more" or "less" pleased).
a. CFO more pleased, COO less pleased
b. COO more pleased, CFO less pleased
c. COO more pleased, Chief Marketing Officer less pleased
d. VP of Sales more leased, COO less pleased
e. Everybody's pleased
13. Which phrase best explains what we mean by "$'s up, Units Down"?
a. Money is tracked by the CFO and the accountants, production schedules are tracked by operations
b. After the unconstrained DP is prepared from the forecast and other sources the forecast is dollarized for the executive suite. In the same way the operations staff unitize the forecast and send it to MRP directly to discover parts requirements.
c. S&O is an adjudication of 3 things: corporate strategy and financial commitment, unconstrained demand requirements, optimal capacities, material, inventory available for use in satisfying demand.
d. None of the above.
14. What is the best explanation of what we've called tenet 3 of the 4 tenets of great supply chains, "There is no substitute for capacity"?
a. A process has capacity for making something or it doesn't.
b. A process has capability for making something or it doesn't.
c. Attempt to remove all non-value-added and unexpected breakdown for a processing line being down before adding additional capacity as after you add capacity to a process riddled with unplanned downtime you'll be unable to tell the difference between what you need and how much you really have (capacity).
d. A&C
e. All of the above.
15. Power Tools (PT) has just received an order for 70 PT band saws, to be shipped at the beginning of week 9. Information concerning the saw assembly is given here:
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Item
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Lead Time (wks)
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Components
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Saw
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2
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A(2*), B, C(3)
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A
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1
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E(3), D
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B
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2
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D(2), F(3)
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C
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2
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E(2), D(2)
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D
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1
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E
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1
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F
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3
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* Number of parts required to make one parent
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A parent is the part that uses its subcomponents
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a. Draw the (BOM) product structure tree.
b. Construct a Gantt chart for the new order using back schedule logic.
c. Describe each of the 3 key elements of the MRP process: Gross-to-Net Explosion, Lead Time Offset, Lot Sizing (separate from actual demand as dictated by the BOM ... how is that determined.)
16. Describe what 2 key elements the MPS adds to aggregated unit plan that comes from S&OP.
a. What is the advantage of having an MPS from an Executive Suite perspective?
b. What is the advantage of having an MPS from a Salesperson's perspective?
The Fresh Connection:
17. List the directional effects on ROI, in a positive and/or negative direction, of decreasing contracted customer shelf life. Assume that all other decisions remain the same, i.e., the decrease is your only change. Include a short explanation for each positive and/or negative effect, describing how and why the component is affected. Add rows if required.
NEGATIVE EFFECT ON ROI
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ROI Component Affected
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How and why is the component affected?
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POSITIVE EFFECT ON ROI
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ROI Component Affected
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How and why is the component affected?
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ROI Components:
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Contracted sales revenue
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Bonus or penalties
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Realized revenue
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Purchase value
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Production costs
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Cost of goods sold
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Gross margin
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Overhead costs
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Stock costs
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Handling costs
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Administration costs
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Distribution costs
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Project costs
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Interest
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Indirect cost
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Operating profit
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Investment
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18. The following are some key decisions of the Fresh Connection. Place an "X" in the box indicating whether a higher or lower value for each decision ismore consistent with flexible and responsive supply chain strategy and provide an explanation.
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Decision
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Higher
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Lower
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Reasoning
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Component purchasing lot size weeks
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Contracted Service level %
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Contracted shelf life %
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Finished goods safety stock weeks
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Frozen production period weeks
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Order deadline (lower=later)
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Production interval days
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Promotion horizon weeks
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19. Suppose a team participating in the Fresh Connection had the following results:
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Realized revenue
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3,200,000
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Production costs
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640,000
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Purchase value
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960,000
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Indirect cost
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1,100,000
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Investment
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3,800,000
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a. What is the team's resulting Gross margin?
b. What is the team's resulting ROI?
c. What would the team's ROI be if Payment terms were reduced by 300,000?
Please show your calculations.
20. Suppose a team participating in the Fresh Connection took an action with the intent to lower FG inventory. What line item(s) in the ROI calculation would you review to see the effects of lower FG inventory on ROI, and what direction (higher vs. lower) would the effect be on the line item(s), assuming no other changes are made?
21. Suppose a team participating in the Fresh Connection increased the Payment term to all suppliers from 4 to 8 weeks while decreasing the Payment term to customers from 4 weeks to 2 weeks. What line item(s) in the ROI calculation would you review to see the effects of the change in Payment terms on ROI, and what direction (higher vs. lower) would the effect be on the line item(s), assuming no other changes are made?
Operations and Financial Performance
22. Why is Return on Invested Capital (ROIC) an important Key Performance Indicator for company performance? (100-word limit)
23. Say a company earns an ROIC = 7.4%. Does this result represent a good or poor result? Why? (100-word limit)
24. What are the three primary components of cash flow that are affected by supply chain processes? (50-word limit).
This is the link to the book that we use in class:
https://doc.mbalib.com/view/bb365d7865dda44494a917c0f0c4bc97.html.