Scm300 Exam 2

Front 1

Waiting Line Basics

Back 1

One or more people waiting for service; partially determined by variability in demand; can be humans, machines, sales orders waiting to be shipped; inventory items waiting to be used

Front 2

Four elements of Waiting Lines

Back 2

1. an input, or customer population, that generates potential customers

2. a waiting line of customers

3. the service facility, consisting of a person, a machine, or both necessary to perform the service for the customer

4. a priority rule, which selects the next customer to be served by the service facility

Front 3

Customer Population- Finite vs. Infinite

Back 3

Finite- if the potential number of new customers for the service system is appreciably affected by the number of customers already in the line

infinite- the number of customers in the system does not affect the rate at which the population generates new customers

Front 4

Service Facility

Back 4

consists of the personnel and equipment necessary to perform the service for the customer.

Front 5

Priority Rule

Back 5

determines which customers to serve next; most company's use the first come, first serve rule; other rules are the earliest promised due date(EDD) and shortest expected processing time(SPT)

Front 6

Balks and Reneges

Back 6

types of impatient customers

balks- an impatient customer who doesn't enter the system

reneges- an impatient customer who leaves the system before being served

Front 7

Number of Lines- Single vs. Multiple

Back 7

single lines- airline counters, fastfood, banks; best for when customers believe they are being served fcfs

multiple lines- grocery store, drive through bank, discount stores; special services i.e. 10 items or less or cash only

Front 8

(arrangement service facility) single channel, single phase system

Back 8

all services demanded by a customer can be done by a single server facility. i.e. drive thru car wash

Front 9

(arrangement service facility) single channel, multiple phase system

Back 9

used when services are best performed in sequence by more than one facility, yet customer constraintslimit the design to one channel. i.e. mcdonalds drive thru where first phase takes order, second takes money, third gives food

Front 10

(arrangement service facility) multiple channel, single phase system

Back 10

used when demand is large enough to warrant providing the same sevice at more than one facility or when the services offered by the facilities are different i.e. bank drive thru

Front 11

(arrangement service facility) multiple channel, multiple phase system

Back 11

occurs when customers can be served by one of the first phase facilities but then require service from a second phase facility and so on. I.e. laundromat washer then dryer but choice of large load or normal.

Front 12

operations characteristics of waiting lines

Back 12

line length, number of customer in system, waiting time in line, total time in system, service faciliy utilization(percentage of time busy)

Front 13

littles law

Back 13

a fundamental law that relates the number of customer's in a waiting line system to the waiting time of customers

Front 14

decision areas for management

Back 14

arrival rates, number of service facilities, number of phases, number of servers per facility, server efficiency, priority rule, line arrangement

Front 15

Goals and Trade-offs, Changes possible

Back 15

Find the Proper BALANCE between Long Lines/Unhappy Customers and Idle Staff/High Cost.

Front 16

jockeying

Back 16

line jumping

Front 17

how customers have effect on service rate

Back 17

Prepared/unprepared customer, Big/small orders, high/low maintenance customers, Paying cash vs. check

Front 18

Office Layout Considerations

Back 18

office layout affects productivity and quality of work life; 2 important factors:proximity and privacy;

Front 19

proximity

Back 19

accessibility to coworkers and supervisors can enhance communication and develop mutual interest

Front 20

privacy

Back 20

somewhat culturally dependent

Front 21

options in office layout

Back 21

management must arrive at a compromise between proximity and privacy because they are conflicting ideas

Front 22

online considerations

Back 22

Keep content current since online consumers browse frequently 2 aspects should be considered merchandise presentation and merchandise description; make the site easy and enjoyable to use; structure an online community where consumers can interact with one another or contribute to the site's content;

Front 23

space productivity

Back 23

represents how effectively the retailer utilizes its space and is usually measured by sales per square foor of selling space or gross margin dollars per square foot of selling space

Front 24

elements that compose the store environment

Back 24

visual communication(graphics, signage), store planning(space allocation, layout), store design(exterior design, ambiance, lighting), merchandising(fixture selection, merchandise presentation, visual merchandising all play a role in store image and productivity

Front 25

store image

Back 25

is the overall perception the consumer has of the store's environment

Front 26

consumer behavior: supermarkets

Back 26

most consumers are not only right handed but they are right headed: shoppers are prone to look right; most consumers think "neatness: counts: consumers are often tricked psychologically to think items are cheap due to messy displays or handwritten signs so it makes them likely to buy them; most consumers are likely to focus on a large central display: endcaps are a consumers focus; consumers are creatures of habit and when something is out o place they become more sensitive to their environment: by changing around the display but not changing location in store a consumer is more likely to make an impulse buy; there is a little bit of greed in every one of us: when a product has a limit the customer will usually buy the limit, when an item is 10 for 10 customers will typically purchase more of them, and if peanutbutter is on sale consumers will tend to fail to notice that the items complements jelly and bread have their prices raised

Front 27

objectives of store environment

Back 27

get customers into the store, once inside the store, convert them to customers buying merchandise, do this in the most efficient manner possible; the retailer must constantly balance the first two elements as they are often at odds.

Front 28

increasing space productivity

Back 28

the more merchandise customers are exposed to that is presented in an orderly manner, the more they tend to buy; successful retailers design their stores to expose shoppers to as much merchandise as possible, displayed in a safe and orderly manner, while creating an uncongested shopping environment

Front 29

floor plan, exhibit 13.2-warning signs may indicate a space problem

Back 29

open spaces on the selling floor, even if the product is on hand, cluttered and disorganized aisles, hallways, and stockrooms, excessive time required to put away new receipts,insufficient staging space for large shipments of advertised products, sales associates continually required to leave the sales floor to locate additional merchandise, poor utilization of vertical space and excessive time required to retrieve products stored on high shelves, sales lag expectations for specific location where space or fixtures are a known issue, off-site storage or multiple stockrooms required for a single commodity

Front 30

floor plan

Back 30

is a schematic that shows where merchandise and customer service departments are located, how customers circulate through the store, and how much space is dedicated to each department

Front 31

microretailing

Back 31

occurs when a chain store retailer operating over wide geographic area, usually nationally, tailors its merchandise and services in each store to the needs of the immediate trading area

Front 32

merchandise placement

Back 32

I.E. placing peanutbutter near jelly, keeping all brands from the same manufacturer together, keeping toys low for kids to reach and keeping denture cream up at eye level so seniors don't have to bend down

Front 33

stack outs

Back 33

are pallets of merchandise set out on the floor in front of the main shelves; not always beneficial because it might cause women to skip the aisle; butt-brush- likelihood of a woman being converted from a browser to a buyer is inversely proportional to her being brushed on her backside while she is examining merchandise

Front 34

allocating space

Back 34

can be based on math calculation of returns generated by different types of merchandise; types of space needed: 1)backroom 2)office and other functional spaces 3) aisles, service areas, and other nonselling areas of the main sales floor 4)wall merchandise space 5)floor merchandise space

Front 35

space allocation

Back 35

for existing store- use space productivity index

for new store- base decisions off of industry standards, previous experience with similar formats, or more frequently, the space required to carry the number of items specified by the buyers.

Front 36

Robert Khans theories

Back 36

sales per square foot= f(number of customers) * length of time spent in the store; 1. in every aisle customers should be able to comfortably pass another customer with a cart with their own cart 2. Make the restrooms the best in town so customers don't rush out of the store to use the restroom 3. put at least one bench in each store at the alcove of the front door 4. In all large stores, install a coffee stand catty corner from the snack bar so that customers could recharge themselves and do more shopping

Front 37

free flow layout

Back 37

is a type of store layout n which fixtures and merchandise are grouped into free flowing patterns on the sales floor

Front 38

grid layout

Back 38

is a type of store layout in which counters and fixtures are placed in long rows or rns, usually at right angles, throughout the store. supermarkets and drug stores

Front 39

loop layout

Back 39

is a type of layout in which a major customer aisle begins at the entrance, oops through the store-usually in the shape of a cicle, square, or rectangel- and then returns the customer to the front of the store. exposes consumers to the greatest ammount of merchandise

Front 40

spine layout

Back 40

essentially a variation of the free flow, grid, and loop and comines all of them; a type of store layout in which a snigle main aisle runs from the front to the nach of te store, transporting customers in both directions, and where on either side of this spine, merchandise departments using either a fre flow or grid pattern branch off toward the back or side walls

Front 41

interior design

Back 41

broken into two types of elements: the finishes applied to surfaces and the architectural shape

Front 42

lighting design

Back 42

lighting affects sales

Front 43

types of employee turnover costs

Back 43

direct- recruiting applicants, evaluating applicants, training classes, employees wages for training, part of supervisors pay spent helping new employee; indirect- loss of customers who were loyal to former employee, lost sales resulting from the employees intial lack of product knowledge, alienated customers, decreased employee morale due to loss of employee, effect of that morale on customers

Front 44

process integration

Back 44

coordinating and sharing information and resources to jointly manage a process.

Front 45

the eight key supply chain busies processes

Back 45

Customer relationship management, Customer service management, demand management, order fulfillment, manufacturing flow management, supplier relationship management, product development and commercialization, returns management

Front 46

importance of performance measurements

Back 46

used to assure that processes are supporting th supply chain strategy, performance is continuously measured using a set of metrics designed for each process

Front 47

RFID tags

Back 47

attached to a product to relay information on the products whereabouts as it moves through the supply chain

Front 48

Bulgari story

Back 48

luxury items, extremely difficult to predict demand, difficult to manage the supply chain because they demand the highest quality for their luxury items, implemented a system by 4r systems; they needed to improve the reliability and accuracy of their demand forecasting tools, gain a better understanding of new product, improve inventory planning at the store level; the 4r system takes into account pos sales data to take into account past sales, seasonality, and trends. It also corrects for past stock outs. The 4r sytem predicts demand for Bulgari now.

Front 49

Obstacles to supply chain integration

Back 49

silo mentality lack of supply chain visibility, lack of trust, lack of knowledge, activities causing the bullwhip effect

Front 50

silo mentality

Back 50

filing to see the big picture and acting only in regard to a single department within the firm or a single firm within the supply chain

Front 51

lack of supply chain visibility

Back 51

the inability to easily share or retrieve trading partner information in real time, as desired by the supply chain participants

Front 52

lack of trust

Back 52

unwillingness to work together or share information because of the fear that the other party will take advantage of them or use the information unethically

Front 53

lack of knowledge

Back 53

lack of process and information system skills and lack of knowledge regarding the benefits of SCM among management and other employees, within the firm and among partners

Front 54

activity causing the bullwhip effect- demand forecast updating

Back 54

using varing customer orders to create and update forecasts, production schedules, and purchases requirements

Front 55

activity causing the bullwhip affect- order batching

Back 55

making large orders for goods from suppliers on an infrequent basis to reduce order and transportation costs

Front 56

activity causing the bullwhip affect- price fluctuations

Back 56

offering price discounts to buyers, causing erratic buying patterns

Front 57

activities causing the bullwhip effect- rationing and shortage gaming

Back 57

allocating short product supplies to byers, causing buyers to increase future orders beyond what they really need

Front 58

vendor managed inventory

Back 58

a way that buyers allow suppliers to obseve their demand, create forecasts, and determine resupply schedules. reduces iventory substantially.

Front 59

forward buying

Back 59

purchasing more due to significant price decreases

Front 60

everyday low prices

Back 60

offering uniform wholesale prices to customers. eliminates safety stock and problems by stopping the fluctuation of prices

Front 61

shortage gaming

Back 61

the strategy that is used when demand exceeds the supply. if supply is 75% of total demand buyers would be allocated 75% of what they ordered. when buyers figure out the relationship between their orders and what is supplied, they tend to inflate their orders to satisfy their real needs.

Front 62

figure 9.7 bullwhip affect

Back 62

the amplitude of sales over time is smaller than the variation in the order quantity. time lags associated with information and material flow cause a mismatch between the actual customer demand and the supply chain's ability to satisf that demand.

Front 63

efficient supply chains

Back 63

designed for efficiency and low cost by minimizing inventory and maximizing efficiencies in process flow

Front 64

responsive supply chains

Back 64

focus on flexibility and responsive service and are able to react quickly to changing market demand and requirements

Front 65

walmart

Back 65

hooked up to suppliers via supply chain information systems that let suppliers know sales data for walmart. increases efficiency and helps walmart lower costs for consumers

Front 66

push system

Back 66

produces goods in advance of customer demand using a forecast of sales and moves them through supply chain to points of sale where they are stored as finished goods inventory

Front 67

pull system

Back 67

produces only what is needed at upstream stages in the supply chain in response to customer demand signals from downstream stages

Front 68

push-pull boundary

Back 68

the point in a supply chain that separates the push system from the pull system

Front 69

postponement

Back 69

the process of delaying product customization until the product is closer to the customer at the end of the supply chain

Front 70

contract manufacturing

Back 70

a firm that specializes in certain types of goods-producing activities, such as customized design, manufacturing, assembly, and packaging, and works under contract for end users

Front 71

toyota production system

Back 71

one of the most admired lean manufacturing systems in existence; doesn't work for others; lean systems require constant improvements to increase efficiency and reduce waste; 4 principles: 1) all work must be completely specified as to content, sequence, timing, and outcome 2)every customer supplier connection must be direct and unambiguous 3) the pathway for every service and product must be simple and direct 4) any improvement to the system must be mde in accordance with the scientific method, under the guidance of a teacher, at the lowest possible organizational level.

Front 72

lean systems

Back 72

operations sysems that mazimize the value added by each of a companies activities by paring unneccessary resources and delays for them.

Front 73

JIT philosophy

Back 73

the belief that wste can be eliminated by cutting unneccessary capacity or inventory and removing non-value-added activities in operations.

Front 74

push method

Back 74

a method in which production ofthe item begins in advance of customer need

Front 75

pull method

Back 75

a method in which customer demand activates production of the service or item.

Front 76

quality at the source

Back 76

an organization wide effort to improve the quality of a firm's products by having employees act as their own quality inspectors

Front 77

poka-yoke

Back 77

mistake proofing methods aimed at designing fail-safe systems that minimize human error

Front 78

value of small lot sizes

Back 78

a lot is a quantity of items that are processed together. small lots have the advantage of reducing the average level of inventory relative to large lots. small lots pass through the system faster. if a defect is found it is much quicker to examine all items in a small lot.

Front 79

short setup times

Back 79

setup times must be brief for small lot sizes otherwise it creates waste in the form of idle employees. achieving brief setup times often requres close cooeration among engineering, management, and labor

Front 80

standardized components and work methods

Back 80

example: a firm producing 10 products from 1000 different components could redesign its products so that they consist of only 100 different components with larger daily requequirements. since requirement per component increases, so does repeatability. each worker performs a standardized task or work method more often each day. help a firm to achieve the high productivity, low inventory objectives of a lean system

Front 81

close supplier ties

Back 81

three ways: reduce the number of suppliers, use local suppliers, improve supplier relations.

Front 82

flexible workforce

Back 82

train employees to perform more than one job

Front 83

line flows

Back 83

eliminate wasted employee time, can eliminate setups

Front 84

automation

Back 84

key to low cost operations. lead to greater profits and greater market share because prices can be cut. ATM

Front 85

maintenance

Back 85

preventitive maintenance prevents machine failures

Front 86

Continuous improvement and Kaizen

Back 86

by spotlighting areas that need improvement, lean systems lead to continuous improvement in quality and productivity. This is called Kaizen. Key to Kaizen- the understanding that excess capacity or inventory hides underlying problems with the processes that produce a service or product.

Front 87

rocks water level picture

Back 87

water- inventory
rocks-underlying problems that need to be fixed

Front 88

New Balance article

Back 88

uses lean manufacturing; 25% of shoes made in us; migrated away from traditional shoe manuf. to small-lot, cellular flow production; ship directly to retailers and customers without the intervening intermediaries who may discount their products

Front 89

triple bottom line

Back 89

a theory by john elkington, requires that companies track their performance on all three dimensions.

Front 90

cost of non compliance

Back 90

failing to report hazardous chemicals results in gvt fines; basically fines surmount if companies dont comply with federal law

Front 91

cost savings through good environmental practices

Back 91

delta- pioneered the practice of using only one engine while taxiing. Reduced fuel consumption by 40 million gallons per year.

Home Depot- commits to the efforts of sustainable forestry offers environmentally preferred products in their stores

UPS- teamed with alliance for environmental innovation to redesign packaging. It made packaging lighter and reusable. Conserved energy, saved trees, and saved them money.

Front 92

environmental services square

Back 92

y axis- degree of labor intensity, x axis- degree of interaction and customization

From top left, clockwise- service factory, service shop, professional service, mass service

Front 93

environmental concerns for buildings

Back 93

Five design areas recognized by LEED: 1)building site 2) water efficiency 3)energy and atmosphere 4)materials and resources 5)indoor environmental quality

Front 94

environmental improvement strategies and options

Back 94

process improvement, process certification, e commerce; product redesign, value added services, dematerialize

Front 95

ISO14000

Back 95

the most common environmental certification. looks at 6 major areas: environmental management systems, environmental auditin investigations, environmental labels and declarations,environmental performance evaluation,life cycle assessment, terms and definitions