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SCMA 331 Operations and Supply Chain Management Exam I – Fall 2020  Part A: Multiple Choices (30 pts) Circle the correct answer

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SCMA 331

Operations and Supply Chain Management

Exam I – Fall 2020 

Part A: Multiple Choices (30 pts)

Circle the correct answer.  Each question is 2.5 points.

A1. The goal of Operations Management is to make processes

1. faster
2. cheaper
3. better
4. all options are possible depending on company’s strategy

A2. Which airline boarding strategy is mostly likely to be the fastest to board passengers?

1. boarding starting with the front of the airplane
2. boarding starting with the back of the airplane
3. boarding aisle seats first
4. boarding middle seats first
5. reverse pyramid boarding.

A3. For which of following companies a functional focus process architecture fits best? a) Toyota

2. Coca-cola
3. Louis Vuitton
4. Dell

A4. For Wendy’s, which one of the following fits best as an order winner?

1. Price
2. Response time
3. Quality
4. Variety

 

A5. In which type of processing system would a movie theater operate? 

1. Job shop
2. Batch
3. Line flows
4. Continuous flow

 

Following figure presents competitive product space (quality vs price) in one industry. Use this figure to answer questions A6 and A7.

 

Operations frontier

Quality

Price

low

high

low

high

A

B

C

D

 

A6. Which of the following statements is True?

1. Company A is strategically better positioned than B
2. Company B is strategically better positioned than A
3. Company C is strategically better positioned than D
4. Company D is strategically better positioned than C
5. None of them is true

 

A7. Which company is more likely to represent the strategic positioning of Target?

1. A
2. B
3. C
4. D

 

A8. Efficient supply chains will be most preferred when:

1. Product variety is high and demand is predictable
2. Product variety is high and demand is unpredictable
3. Product variety is low and demand is predictable
4. Product variety is low and demand is unpredictable

 

 

A9. A six-month moving average forecast is generally better than a three-month moving average forecast if demand

1. is rather stable
2. has been changing due to recent promotional efforts
3. follows a downward trend
4. exceeds one million units per year
5. follows an upward trend

 

A10. If two variables were perfectly correlated, the correlation coefficient r would equal to

1. 0
2. -1
3. 1
4. 1 or -1
5. none of the above

 

 

 

Use the following information to answer questions A11 and A12.

Mercy Hospital needs to forecast quarterly usage of units of rare blood type O Rh(–). There are 4 quarters in a year. The hospital has determined that the seasonal indices for quarters 1, 2 and 3 are 0.6, 1.2 and 1.5, respectively.  The average quarterly forecast of blood type O Rh(– ) usage is 420 units.  Assume there is no trend.

A11.  What is the seasonal index for Quarter 4? 

1. 3.3
2. 1.7
3. 0.7
4. 0.6
5. 0.1

 

A12. What is the forecast for Quarter 2’s blood type O Rh(–) usage?

1. 630
2. 504
3. 420
4. 294
5. 252

 

 

 

 

 

 

 

 

 

Part B: Problems (70 points)

 

Question B1 (40 pts): Abby Ohler is sales manager at Brighton Creamery, a company that produces and sells ice-cream. Abby believes that daily temperature in Nebraska would be a good indicator for company’s daily ice cream sales in gallons (gal). Based on the weather data collected at various days with different daily temperature levels (between 54 and 85 Fahrenheit), she has come up with the following regression analysis:

 

Regression Statistics                                                        

Multiple R	0.957
R Square	0.916
Adjusted R Square	0.916
Standard Error	0.0834
Observations	50

                                                                 

ANOVA                                                                 

	df	SS	MS	F	Significance F
Regression	1	0.9648	0.9648	138.26	0.000
Residual	48	0.083736	0.00697
Total	49	1.0485

                                                                 

	Coefficients	Standard Error	t Stat	P-value
Intercept	-980	0.120981	1.904	0.02103
Daily Temperature	22.4	0.012707	1.12	0.0214

 

1. (6 pts) Following regression results given above, if daily temperature in Nebraska is 82, how much ice cream does Brighton Creamery expect to sell?

 

 

2. (8pts) Are you confident in the forecast you obtained in part B1 (a)? Explain  your answer with support.

 

 

 

 

 

3. (8 pts) Abby Ohler also has the following data on ice cream demand in the last 8 days. Based on this data, forecast the demand for day 9 using exponential smoothing with a smoothing constant of 0.4 and given that the forecast for day 7 was 380.

 

Day	Day 1	Day 2	Day 3	Day 4	Day 5	Day 6	Day 7	Day 8
Demand	365	350	320	382	402	375	390	372

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Abby has been using another method to forecast ice cream demand. Using this new method, she came up with the following forecasts given in Table 1 for the past 8 days’ demand.

 

Table 1
Day	Demand	Forecast	Error	Error2
Day 1	365	342	23	529
Day 2	350	331	19	361
Day 3	320	353	-33	1089
Day 4	382	352	30	900
Day 5	402	371	31	961
Day 6	375	396	-21	441
Day 7	390	372	18	324
Day 8	372	391	-19	361
		Total	48	4966

                                           

 

 

 

4. (8 pts) Using the results for the past 8 days given in Table 1 above, do any of the errors appear to be unusually small or large, considering the variability in the data?  

 

Circle one and show supporting calculations:                                    Yes                         No

 

 

 

 

 

 

 

 

 

5. (10 pts) Customers will be very dissatisfied if Brighton Creamery is out of stock when they want to buy ice cream, and this may lead to irreversible market share loss. Furthermore, Brighton Creamery has a limited freezer space and storing more than available freezer space may not be possible or extremely costly.  Abby Ohler has many alternative methods available for her to forecast ice cream demand. What measure of forecast accuracy is most appropriate to evaluate and compare the performances of the alternative forecasting methods available for Abby for ice cream demand? 

 

Choose (circle) one and briefly explain the reason:                                 MSE             MAD         MAPE Question B2 (30 pts): CafeLux is a restaurant in Lincoln famous for its delicious wraps and salads. Jill Gardner, restaurant manager, wants to understand the operational flow in her restaurant. Jill observes that an arriving customer first joins a line to place his/her order and waits in that line for an average of 5 minutes. Next, customer places his/her order, which takes a minute on average. After the order is placed, each customer moves to a different food pick-up section depending on whether customer ordered a wrap or a salad (25% of the customers order wrap and the rest salad). In the pickup section, a customer first joins a line to pick-up his/her food. On average there are 10 customers in the wrap pick up line. Next, customer picks up his/her order, which takes on average a minute for a wrap and 6 minutes for a salad. All customers have their meal in the restaurant. In the dining area there are 60 customers on average. Jill observes that on average 120 customers per hour arrive at the restaurant. Below is the process flow chart, summarizing the data given above. (Assume for simplicity that there are no group arrivals and the process is stable.)

1. (8 pts) On average, how many customers are there whether waiting in the order-line A or placing their orders?

   Order line

   A

   5

   min

   Place order

   min

   1

   Wrap pick

   -

   up line

   customers

   10

   Pick

   -

   up

   min

   1

   Pick

   -

   up

   min

   6

   Salad pick

   -

   up line

   Dining area

   customers

   60

   cust/hour

   120

   25

   %

   %

   75

   Wrap pick

   -

   up section

   Salad pick

   -

   up section

 

 

 

 

 

 

2. (8 pts) On average, how long a customer, who ordered a wrap waits in the wrap pick-up line?

 

 

 

3. (8 pts)  On average, how long a customer who purchased a wrap spends at CafeLux?

 

 

 

 

 

 

 

 

4. (6 pts) On average, how long a customer who purchased a salad spends at Cafelux, if a customer spends on average 54 minutes at CafeLux?