Mgt 302 Chapter 8

Front 1

What is the objective of sales and operations planning?

Back 1

to reach a concenus on a single operating plan to allocate resources like people, capacity, materials time and money to most effectively meet the market in a profitable way

Front 2

What are the reasources of S&OP?

Back 2

• materials
• people
• capacity
• time
• money

Front 3

Sales and Operations is intergrated into what tier of the business

Back 3

the functional level of the organization

Front 4

Describe strategic planing?

Back 4

• long range plan
• years out
• major decisions
• high level of org planning
• 1/4 or annually
• high risk

Front 5

What is a rolling horizon

Back 5

• long range
• updated annually

Front 6

What are the internal and external factors for planning for production

Back 6

• current physical capacity
• current workforce
• inventory level
• activities for production

economic condition

raw material available

competitor's behavior

market demand

Front 7

Forecasting is always what?

Back 7

wrong by some amount

Front 8

shorter time period generally have what kind of forecasts?

Back 8

more accurate

Front 9

Aggregate

Back 9

a group of products

Front 10

aggreagate planning captures the importance of what

Back 10

cross-functional work

Front 11

aggregate planning takens a intergrated effort from these departments

Back 11

• sals, product development, finance, logistics, operations, distribution

Front 12

a sales plan is typically stated in what

Back 12

units of aggregate product groups and is tied into marketing activities and incentive programs

Front 13

On the supply side aggregation is done by

Back 13

product families

Front 14

on the demand side aggregation is done by what

Back 14

groups of customers

Front 15

S&OP is rightfully called "top mgt's handle on business" because

Back 15

tool in age of rapid changes, increasing demand, and widespread trade

Front 16

Name the 4 cost types

Back 16

• basic production cost
• cost associated with changes in production rate
• inventory holding cost
• backorder costs

Front 17

describe the 3 operation strategies

1. peak demand
2. level production strategy
3. chase demand stragtegy

Back 17

• subcontracting, overtime, flexability, emergency services, high cost of back order, easily obtainable
• inventory, stable workforce, low cost, delivery speed, repetitive manufacturing, continuous processes, high skilled workers
• worforce size, flexiability, pure service, job shops, batch manufacturing, high cost of inventory

Front 18

hard benefits of S&OP* (high understaning)

Back 18

• higher customer service
• lower finished goods inventories
• stable production/service rates
• faster and more controlled new product intros
• reduce obsolescense
• shorter customer lead times

Front 19

Soft benefits of S&OP

Back 19

• enhanced teamwork in the executive and mid0mgt groups
• better decisions with less effort
• one set #'s in both units and dollar -run business
• tight link b/t strategic plans and day-to-day activities
• window into the future" for the org

Front 20

Key points understand

Back 20

• balance S&D
• harmonize units and dollars
• focus is volume and medium/long term
• monthly cycle
• cross-functional
• decision making
• window into the future
• top mgt handle on the business

Front 21

Yield mgt is what

Back 21

process of allocating the right type of capacity to the right type of customer at the right price and time to max. revenue or yiel = return

Front 22

American airlines scientific application is know was what

Back 22

computerized reservation system (SABRE)

Front 23

What are the factors that make yield mgt a success

Back 23

1. demand can be segmented by customer
2. fixed costs are high and variable costs are low
3. inventory is perishable
4. product can be sold in advance
5. demand is highly variable

Front 24

LO1: What is sales and operations planning?

Back 24

• helps firms provide better customer service, lower inventory, shortern customer lead times, stabilize production rates, give mgt a handle on business
• a way to insure you have enough total capacity
• coined as the way companies keep demand and supply in balance
• Overall helps all functional level of businesses create plans to meet demand + helps identify trends or other external factors that impact demand

Front 25

LO3: Yield mgt and how is it important for leveling demand

Back 25

duration: predictable vs unpredictable

price: fixed vs. variable

help shape demand patterns so firm can operate more efficiently