| · Answer all 86 questions. · Marks are indicated against each question. |
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| Total Marks : 100 |
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| Materials management is the detailed study of complete material flow process of a firm. Which of the following statements is false regarding materials management?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ERP implementation is a long process that involves considerable investment in the form of time and money. To guarantee its success, organizations need to concentrate on issues like I. Functionality. II. Intangibility. III. Technology. IV. Implementability.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following statements is/are true relating to the scheduling of service operations? I. Scheduling of service operations is same as the scheduling of manufacturing activities. II. Services cannot be stored to meet the demand at peak hours. III. Variation of demand is relatively low in service operations.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The implementation of JIT principles is difficult due to certain barriers, in spite of JIT being a powerful tool for reducing the firm’s inventory and improving productivity. Which of the following is not one of those barriers?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following is a process that estimates the requirement of materials starting with the date of requirement and working backward to estimate the date of receipt keeping in view production and waiting time, and estimating date of order, based on delivery lead-time?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Supply chain management provides both tangible and intangible benefits to an organization. Which of the following is/are the intangible benefits to an organization? I. Enhanced customer and supplier relationships. II. Optimized inventory management. III. Improved facility utilization. IV. Improvement in customer satisfaction.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Environ Furnishings, a manufacturer of carpets inspected 12 lots in its plant and identified the following number of defectives in the process.
Find the UCL, LCL and average of proportion of fraction defectives respectively, if the sample size is 18.
| ( | 2 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following statements is false relating to the significance of maintenance management?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following is not an advantage of network modeling?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Materials management that aims at preventing the problem of a shortage of material has several objectives. Which of the following is not an objective accomplished through materials management?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Competitive advantage is becoming a prime factor for an organization to attract and retain business in the competitive environment. Which of the following statements is false with respect to qualifiers and order-winners?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Electronic Data Interchange (EDI) is a system that helps in sharing and transmitting information electronically in between the departments within the same organization or between the customers and suppliers. Which of the following is not an advantage derived by firms through EDI?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following operational issues that demand the attention of strategy managers in the process of globalization relate to decisions concerned with the flow of materials from one facility to another or from one location to another, the cost of transportation, and the availability of distribution channel?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following is the maximum of the set of expected beginning times of an activity?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Materials Requirement Planning (MRP) system helps an organization achieve the objectives such as improved customer service, reduced investment in inventory, improved operating efficiency and faster response to market changes. Which of the following relate to improved operating efficiency? I. Reduced stock-out costs. II. Delaying the outflow of materials. III. Reduced inventory holding costs. IV. Reduced idle time.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The probabilities of failure after maintenance for a machine in the spindles section of the Machine Tools division, Hyderabad of HMT Ltd., are given in the following table:
If there are 8 identical machines in the plant, the average cost of preventive maintenance is Rs.895 and the cost of remedial maintenance per machine is Rs.7,800, calculate the expected number of breakdowns in the 4th quarter and the average total cost of maintenance per month.
| ( | 3 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Control charts are used to check whether the process related to a variable is in control. The variable(s) related to control chart for variables is/are I. Length. II. Weight. III. Tensile strength. IV. Queue waiting time.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The locations in the supply chain where the raw materials and finished goods are stored, and where work-in-progress materials are assembled or fabricated are known as
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Proper equipment maintenance enables an organization to prevent equipment breakdowns. Which of the following is not one of the principles and actions that improve equipment maintenance?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| A firm engaged in manufacturing ceiling fans of three models A, B and C carries out three functions: setup work, fabrication and assembling. From the table given below, calculate the number of employees required for carrying out the setup work, fabrication and assembling functions respectively.
(Assuming each employee works for 9 hours a day).
| ( | 2 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The process of materials management is explained as an overlap of three functions – production control, inventory control and materials handling. In which of the following departments does an overlap exist in these three functions? I. Purchasing department. II. Raw materials inventory department. III. Production department. IV. Finished goods inventory department.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ERP implementation is done in a phased manner to ensure success. Who among the following should set the milestones to be achieved in the various phases of the ERP implementation process and review the progress continuously against the milestones?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Globalizing the activities of an organization is hindered by certain impediments. Which of the following serves as an economic impediment faced by the organizations?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following statements relates to expert systems?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following statements is false relating to the Materials Requirement Planning (MRP) system inputs?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following is/are the condition(s) that need to be satisfied for crashing a selected activity to the possible extent? I. The activity time is at its minimum possible value. II. The time reduced is equal to the smallest slack value of the critical activities. III. The reduced time is equal to the desired project completion time.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Pranathi Group of Industries Ltd. uses the ‘bathtub curve’ to predict when the probability of equipment failure will be highest. Which of the following is/are the stage(s) where the probability of failure is very high attributed to improper design and installation and where the functional defects in the product come to fore? I. Infant mortality. II. Burn in stage. III. Wear out stage.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The time estimates of five activities of a project on a critical path are:
The standard deviation of the duration of the critical path of this project is (in weeks)
| ( | 2 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The principles of supply chain management enable an organization to attain a balance between customers’ expectations and its growth and profitability objectives. Which of the following statements is false?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following is not true regarding Acceptance Plans used in quality control?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Quest Enterprises Ltd. has 5 jobs. The information relating to these jobs after the lapse of 22 days is given below.
x = 1.8 times more than the work remaining to complete job A y = 1.1 times more than the work remaining to complete job B. The job that will be given 4th priority, and its critical ratio are
| ( | 2 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The primary responsibility of the receiving department in an organization is to process the incoming shipments of materials. In the absence of a separate receiving department in an organization, its activities/functions are usually taken care of by
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The plan for effective ERP implementation includes various stages. Which of the following is performed after the customization and master data transfer stages?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following characteristics of the JIT systems can be enabled through the usage of procedures such as heating, cleaning and streamlining work?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| MRP system uses information from product structure file and lead-time information to develop purchase and production schedule for the component using three steps. Which of the following statements represents Netting, one of the steps in the MRP system information processing?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following statements relating to the automation in design and engineering support and controlling processing equipment is true?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Managing globalization requires changing the organization structure, managing the changing attitude of managers and developing core competencies for global learning. Which of the following statements relating to managing globalization is/are false? I. Most global organizations are characterized by the presence of authority in the lower levels of the hierarchy. II. Designing an organizational structure for a global organization requires considering the objectives of sales personnel and engineers purchase agents. III. Changing the attitude of managers involves conducting various training sessions at many levels. IV. The approaches for managing core competencies are the same as the approaches used for managing capital base or strategic business units.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Operations manager has to make a trade-off between various types of maintenance that has implications on the overall performance of the organization by reducing the total maintenance cost. The total cost of maintenance includes components such as I. Preventive maintenance costs. II. Predictive maintenance costs. III. Remedial maintenance costs. IV. Contract maintenance costs.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Select the right formula from the options given below for arriving at an activity slack time (EST: Earliest Start Time; LST: Latest Start Time; EFT: Earliest Finish Time; LFT: Latest Finish Time)
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following forces shaping the supply chain focuses on finding a balance between cost and quality, and customization and availability without compromising on any one of them?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The cost of quality can be divided into three categories. Which of the following relate to the cost of prevention? I. Investments made in machinery. II. Costs of vendor certification. III. Costs of equipment maintenance. IV. Costs related to disposition of defective items.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Queuing analysis involves the study of waiting lines and queuing systems. Which of the following statements is not true with respect to queuing analysis?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following statements relating to the functions of materials management is/are true? I. The tasks of inventory control in the raw materials storage and production departments are the same as that in the production control department. II. The focus of inventory control is on materials availability, whereas production control focuses on cost minimization. III. The finished goods inventory of a firm is planned on the basis of marketing strategy and market demand. IV. Physical distribution, a sub-function of the materials management function deals with obtaining, producing and distributing materials and products at/to the desired place, at the right time.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| In the implementation of the ERP package, teams are formed consisting of members from various functions and implementation consultants. The key activity of monitoring the implementation process continuously in order to identify deviations, cost overruns, resource requirements, etc. during implementation is the responsibility of
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| From the product structure tree given below, calculate the number of units of F required to manufacture 240 units of A. The on-hand inventory available is 120 units of subassembly B and 80 units of subassembly C.
| ( | 3 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Flexible Manufacturing Systems (FMS) were introduced in the production lines to overcome the inefficiencies of the early automation systems. Which of the following does not represent the components of FMS?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following is advisable for firms in the maintenance of non-critical equipment, also referred to as breakdown maintenance?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following is not true for the Program Evaluation and Review Technique (PERT) of project management?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| JIT systems offer various benefits to organizations as well as suppliers. Which of the following is not an operational benefit derived by firms from the use of JIT systems?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Lyke Spares Ltd. has two job orders, J1 to produce 380 nuts of 1.2 mm and J2 to produce 290 screws of 1 inch. Both these orders have to be processed on two machines A and B. The route sheets for the jobs which should be ready in the next nine hours with the machines starting processing from now are given below.
Using forward scheduling, the two jobs can be completed earliest by the end of
| ( | 2 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Supply Chain Management (SCM) components represent business processes and practices. Which of the following SCM components focuses on how different entities of the supply chain perform as a group?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Many organizations implementing ERP may not prefer to purchase a complete package at one instance. Which of the following is to be examined in such a scenario?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Following are the means (
(Conversion factors for sample size 8 are given as A2 = 0.373, D3 = 0.136, D4 = 1.864) The upper control limit, lower control limit and the central line respectively for the X-chart are
| ( | 2 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Robots are versatile, computer-controlled machines programmed to perform various tasks independently. Which of the following statements is/are true relating to robots? I. The work envelope of a robot is the physical movement capability of the robot’s arms and hands. II. The sequence of actions of variable–sequence robots is usually triggered by electronic sensors. III. Intelligent robots are used to perform manufacturing operations where high precision is required. IV. Playback robots can store a sequence of operations in memory.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Identify the critical path from the following information related to a project of Pioneer Infrastructures.
| ( | 2 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following system develops schedules for production equipment and coordinates the activities and flow of materials throughout the manufacturing unit and also tracks the movement of product in production units, monitors product quality and tool wear, and simultaneously stores the data for future analysis?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| An MRP system generates many types of reports and planning information as outputs. Inventory forecasts, purchase commitment report etc., are examples of
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Maintaining which of the following requires the identification and elimination of production bottlenecks, balance in the production system and reduction in setup time?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Ms.Likitha, Sr.HR Manager of Pioneer Financial Services wishes to consider the opinions of the employees in scheduling their work times. The employees were given a choice to choose from the five personnel-related scheduling approaches, based on which the employees have chosen to work a specified number of hours per week provided they are given the choice of selecting their work times. Which of the following approaches did the employees of Pioneer Financial Services opt for?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Maintenance in a firm is carried out in three major areas. Which of the following come under the purview of civil maintenance? I. Maintaining fire fighting equipment. II. Maintenance of transport vehicles. III. Waste disposal. IV. Maintenance of materials handling equipment.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| A well established supermarket chain group is considering to implement ERP in all its supermarkets. In which of the following stages of the ERP implementation program does the group require setting performance standards for each process by using benchmarking techniques?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following quality dimensions, influenced by individual preferences, can be used to cater to a niche market?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Enablers are responsible for the overall performance of the SCM. Which of the following SCM enablers is the comprehensive process that defines the overall requirements both external and internal to the organization, after considering the feedback from customers and suppliers?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Outsourcing of facilities management to external agencies is not always considered profitable due to the costs involved. With respect to outsourcing, costs related to which of the following would not result in benefits to the client? I. Control of facilities. II. Flexibility in terms of time frame of the contracts. III. Staffing quality. IV. Operations.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Materials managers use several techniques to carry out their tasks. Which of the following statements does not correctly represent the materials management techniques?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Production process in a firm involves a series of activities, which is formulated after detailed technical and engineering analysis. Which of the following activities are carried out as part of the production process? I. Equipment maintenance. II. Raw material sourcing. III. Inventory maintenance. IV. Packaging.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| MRP system implementation fails many times due to various reasons. Which of the following relate to inappropriate product environment, one of the reasons for the failure? I. Majority of components and parts as part of the purchase items results in an appropriate product environment. II. The demand pattern of these items should be independent in nature. III. The timing of these items should be irregular.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Operations are classified into various types for the effective preparation of schedules by the Operations managers. Which of the following statements represents repetitive operations?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following statements relating to the implementation of JIT systems is false?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Medha Projects is contemplating to reduce the time taken by some of the activities of the ongoing project to complete the project on time. Identify the activity that can be crashed first.
| ( | 2 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Who among the following acts as change managers in situations where existing processes or infrastructure is modified or replaced with new ones to suit the organizational goals?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| WTO establishes the principles of trade between nations. Which of the following is/are the key aim(s) of WTO? I. To enable easy and quick repeal and modification of the trade rules and regulations. II. To provide a forum for discussion among member countries with respect to trade related issues and concerns. III. To act as a dispute settlement body for trade related disputes among member countries.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following statements represent a misconception about the customer focus in supply chain management?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following statements represents the integrated data model?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Productivity can be increased either by increasing the output with the same number of inputs or by producing the same output using fewer inputs. This refers to
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Megha Industries Pvt. Ltd.’s Automated Storage and Retrieval Systems are computer–controlled and mechanically–operated materials handling systems that use automated guided vehicles and conveyance systems. Which of the following is/are the traditional materials handling equipment that are replaced by automated guided vehicles? I. Manually operated trucks. II. Hydraulic. III. Robots. IV. Straddle trucks.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The small parts division of a manufacturing firm dealing in heavy machinery received 4 job orders – S1, S2, S3 and S4 to prepare nuts of varying sizes for 3 different machines of Leci Ltd. From the following information, calculate the average delay of a job using the dispatching rule – slack time remaining.
| ( | 2 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Just-In-Time (JIT) systems can be successful through achievement and maintenance of high performance levels in all their operational areas. JIT manufacturing, based on the concept of continuous improvement includes certain mutually supporting component(s) such as I. People involvement. II. Machine utilization. III. Total quality control.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Organizations using automation to control and manage their operations gain a considerable economic advantage. Which of the following is not an area of advantage derived by organizations from automation?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following, considered as an integrated system by the operations managers is used to analyze complete product cycles, from corporate production plans to finished goods distribution?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Trash removal, hazardous waste removal and management, energy management, disaster recovery planning and management, and energy management are the activities covered under the function of
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Which of the following statements are true with respect to performance? I. Performance can be split into qualitative and quantitative performance. II. Qualitative performance provides a good measure of performance at the national, industry or individual business level. III. Quantitative performance is measured in terms of the ratio of the outputs to inputs. IV. Quantitative performance can be used as a controlling tool to ensure that all the resources are utilized judiciously and efficiently.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Implementation of ESCM can be made effective through adoption of certain activities. Which of the following is false relating to those activities?
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| A structured and measured set of activities designed to produce a specified output for a particular customer or market is referred to as
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Scheduling of operations within a firm is done with the main objective of providing best service to the customers through efficient use of the firm’s resources. Which of the following statements is/are true regarding scheduling? I. Scheduling too much capacity results in incomplete jobs. II. It is a short-range planning activity. III. It is a medium-range planning activity. IV. Backward scheduling is used in fabrication operations.
| ( | 1 | mark) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Following is the information related to a project.
Calculate the earliest and latest times of the activity 2 – 5.
| ( | 2 | marks) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
) and range (R) of 15 samples, each sample containing 8 items.
END OF QUESTION PAPER
Suggested Answers
Operations Management - II (MB2E4): October 2008
| | Answer | Reason | | ||||||||||||||||||||||||||||||||||||||||||||||||
| d | Management of materials is very significant in a firm as a reduction in expenditure on materials can improve the profits of a firm. Since, overheads other than material costs like labor costs and administration expenses are relatively fixed and do not offer much scope for reduction, material is only the major area for cost reduction. Hence, option (d) is the answer. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The success of an ERP implementation methodology depends on three issues like – functionality, technology and implementability. Intangibility is not one of those issues. An ERP package cannot be intangible. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | Scheduling of service operations is different from the scheduling of manufacturing activities. Variation of demand is relatively high in service operations. Hence, statements (I) and (III) are false. Option (b) is the answer. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The implementation of JIT principles is difficult as it has to overcome the following barriers: · Workers’ resistance to change · Difficulty in accomplishing zero lead-time · Difficulty in accomplishing zero safety stock · Difficulty in accomplishing zero idle time. Difficulty in reducing the paper work is not a barrier of JIT implementation. Adopting a JIT system will automatically reduce the formal paper work of the firm. It is one of the operational benefits derived by firms through a JIT system. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| a | Materials requirement planning is a backward scheduling process that estimates the requirement of materials starting with the date of requirement and working backward to estimate the date of receipt keeping in view production and waiting time, and estimating date of order, based on delivery lead-time. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Enhanced customer and supplier relationships and improvement in customer satisfaction are the intangible benefits derived by organizations through supply chain management. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | n = Sample size = 18, N = Number of samples = 12
Fraction defective (p) =
Control limits for the P-chart or the fraction defective chart for the given data are UCL = = 0.1675 + 3 = 0.1675 + 3 (0.088) = 0.1675 + 0.264 = 0.4315 LCL = = 0.1675 – 3 = 0.1675 – 3 (0.088) = 0.1675 - 0.264 = – 0.0965 LCL cannot be negative (-ve), so it should be taken as zero. Therefore, CL = | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Effective implementation of maintenance activities improves the economic lifetime and salvage value of the equipment. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | Managers need to be trained on the statistical and mathematical calculations to effectively use the tool. This is not considered as an advantage since the training to be imparted to the managers’ results in an upward shift in the costs and delay in implementing the tool. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | One of the objectives accomplished through materials management is to maintain high inventory turnover so that less capital is tied up in inventory. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| a | With the increased focus on quality, ISO standards have become key qualifiers for any organization operating in the global markets. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | EDI helps organizations to cut down their inventory levels and plan for better production and shipment schedules, but does not help in maintaining high levels of inventory. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Integration decisions are concerned with the flow of materials from one facility to another or from one location to another, the cost of transportation, and the availability of distribution channel. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Earliest start time is the maximum of the set of expected beginning times of an activity. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | Based on the actual requirements, MRP systems can expedite or delay the inflow of materials. As a result, both stock-out costs and inventory holding costs can be reduced. Moreover, timely supply of needed materials reduces the idle time and improves the overall operating efficiency of organizations. Delaying the outflow of materials implies the delay in the flow of materials from the raw materials inventory department to the production department. This does not result in the improvement in operating efficiency as holding the inventory for long time increases the inventory holding costs. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| B | Bt = Expected number of breakdowns. Cp = Average cost of preventive maintenance = Rs.895 CR = Cost of remedial maintenance = Rs.7,800 N = Number of machines t = Time period Bt = N (P1 + P2 + P3 + … + Pt) + Bt-1 P1 + Bt-2 P2 + …+ B1 Pt-1 N = 8 and t = 4 B1 = NP1 = 8 × 0.2 = 1.6
= 4.8 + 0.864 + 0.48 = 6.144
= 6.4 + 1.2288 + 1.296 + 0.16 = 9.0848 Hence, expected number of breakdowns in the 4th quarter = 9.08 Total cost of maintenance for every 4 quarters = TC(4) = Average total cost per period = TC(t) / t
= 19,496/3 = 6,498.67 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| e | All the given variables are checked using control charts for variables. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | Facilities are the locations in the supply chain where the raw materials and finished goods are stored, and where work-in-progress materials are assembled or fabricated. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | According to the principles and actions that improve equipment maintenance, the number of machines used during the production should be minimized. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | Based on the information given, the time required for completing each function of all models of ceiling fans is calculated as follows:
The processing times for each function are calculated using the formula - The number of employees required can be obtained by dividing the total number of hours with 9, as the number of hours an employee works per day is assumed to be 9 hours.
Number of employees required for fabricating work = Number of employees required for fabricating work = | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The raw materials inventory department and the production department are the two departments involved in all the three functions of materials management, i.e., which overlap in the three functions of materials management. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | Project leaders should set the milestones to be achieved in the various phases of the implementation and review progress continuously against the milestones. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The performance requirements being different in different markets serve as an economic impediment faced by organizations. All other options relate to institutional impediments. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| a | Expert systems consist of an inference engine, which is a program that enables the system to evaluate the rules in the knowledge base. It determines the set of rules that will be invoked based on the nature of the problem. Option (b) is related to robotics. Option (c) is related to systems with artificial intelligence. Option (d) is related to the categorization of manufacturing operations. Option (e) is related to robots. Robots use sensors to determine whether or not a product being produced is consistent with the quality specifications. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | Time fences are the periods of time during which no change or very minor change is allowed in the MPS, whereas time buckets are the division of time horizon in the MPS into shorter time buckets such as a day or two to plan for short-term requirements and longer time buckets such as a fortnight or a month to plan for long-term requirements by the managers. Hence, option (b) is false. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The time reduced should be equal to the smallest slack value of the non-critical activities. Hence, option (c) is correct. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | In the first stage of infant mortality, the probability of failure is very high but it decreases rapidly. The reason for these failures can be attributed to improper design and installation. This stage is also known as ‘burn in’ stage where the functional defects in the products come to fore. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b |
Standard deviation = The critical path of this network is 1 – 3 – 4 – 6 – 7 – 8.
\ Standard deviation of the critical path = | ||||||||||||||||||||||||||||||||||||||||||||||||||
| e | An IT system should help in planning and decision-making and effective resource allocation through a master production schedule in the medium term. In the long term, it should provide the top managers with tools for strategic analysis. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | Acceptance Plans help to decide whether lots of raw materials, purchased parts and finished goods meet prescribed quality standards. Acceptance Plans do not have large sample sizes because their inspection costs are higher. Hence, from above discussion, we can infer that option (b) is not true regarding Acceptance Plans used in quality control. Option (a) is true, as it is the definition of Acceptance Plans. Option (d) is true. Operations managers can either accept or reject a lot, on the basis of Acceptance Plans. Option (c) is true. Acceptance Plans protect an organization by limiting the percentage of defective products that are shipped to customers. Option (e) is true. Average Outgoing Quality Curves and Operating Characteristic Curves are two important concepts of Acceptance Plans. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | Work remaining for job B = 1.8 times of work remaining for job A = 27 days Work remaining for job E = 1.1 times of work remaining for job B = 29.7 days ~ 30 days.
Critical Ratio = Planned time remaining / Actual work remaining The critical ratios of the jobs are as follows:
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| a | The activities of the receiving department are taken care of by the purchasing department in some firms. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| a | Test runs are conducted to see the performance of the system after customization and master data transfer. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The successful implementation of a JIT system is greatly dependent on its ability to reduce setup times. In reducing the setup times, firms adopt various procedures like converting internal setup activities into external setup activities, enabled through the procedures like heating, cleaning and streamlining work. This relates to the characteristic – Quick and economic setups. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | Netting is the second step in the MRP system information processing that is to develop a materials requirement plan for each item in the BOM file for each time bucket. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | · CAM computers are used directly to control the processing equipment or indirectly to support the manufacturing operations. · CAD packages eliminate the need for costly prototype testing at the initial stages of the product design. · FMS is useful in organizations producing different items with similar processing requirements. · CNC machines are one of the key elements of CAM. · Implementation of CAM results in reduced labor costs. Hence, option (c) is the answer. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The approaches for managing core competencies differ widely from the approaches that are used for managing capital base or strategic business units. All other statements are true. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | The total cost of maintenance is the sum of preventive maintenance costs and remedial maintenance costs. Predictive maintenance costs also form a part of the total maintenance costs, as predictive maintenance is a part of preventive maintenance. The total cost of maintenance includes the cost of in-house maintenance that includes the preventive maintenance costs, remedial maintenance costs and predictive maintenance costs. Contract maintenance is the process of outsourcing the maintenance activities of a firm. This forms a part of their outsourcing costs. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| C | The slack time for an activity is the time by which that activity can be delayed without delaying the total project. This is the difference of either the latest start time and earliest start time or the latest finish time and the earliest finish time. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| a | Consumer demand is the force shaping the supply chain management that emphasizes that the key focus of an organization is to find a balance between cost and quality, and customization and availability without compromising on any one of them. The objective of supply chain management is to keep the customers satisfied by providing them with what they want, when they want it and at a price they can afford. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| a | Investment made in machinery is a category of cost of prevention. Cost for vendor certification is included under cost of prevention. Costs of equipment maintenance relate to cost of detection. Costs related to disposition of defective items relate to cost of failure. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The effects of long queues on new arrivals not being considered is a limitation of the queuing analysis. Hence, option (c) is the answer. Option (e) relates to the queuing analysis. Options (a), (b) and (d) relate to the limitations of the queuing analysis. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Statement (II) & (IV) are false. Statement II – Inventory control focuses on cost minimization, whereas the focus of production control is on materials availability. Statement IV – Logistics is the sub-function of the materials management function that deals with obtaining, producing and distributing materials and products at/to the desired place, at the right time. Statements (I) and (III) are true. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | The key activity of the steering committee is to monitor the implementation process continuously in order to identify deviations, cost overruns, resource requirements, etc. during implementation. The steering committee consists of project managers, project leaders and module leaders chosen from the implementation team. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | For every unit of A, 2 units of B and 3 units of C are required. Quantity of A to be produced = 240 units
Available inventory of B = 120 units Quantity of B to be produced = Quantity required – Available inventory = 360 units 2 units of F are required to produce one unit of D, and 1 unit of D to produce one unit of B. Hence, 720 units (360 × 2 × 1) of F are required to produce 360 units of B. Quantity of C required to produce 240 units of A = 720 units Available inventory of C = 80 units Quantity of C to be produced = Quantity required – Available inventory = 640 units 3 units of F are required to produce one unit of H. 2 units of H are required to produce one unit of C. Hence, 3,840 units (640 × 2 × 3) of F are required to produce 640 units of C.
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| a | The components of a FMS include: · An automated loading system · Two or more machining centers · A system to move materials in between machining centers · An unloading system · A central computer A fixed-path conveyor is not one of the components of the FMS. It was used as a part of the early automation systems. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | Remedial maintenance is carried out when a machine or equipment breaks down or is malfunctioning. Remedial maintenance is also referred to as ‘breakdown maintenance’ or ‘corrective maintenance’. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | PERT cannot handle situations in which two or more projects have to be planned together to share the available resources. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | Less expenditure on promotional activities is a benefit derived by suppliers to firms from JIT systems. Though organizations also benefit in the form of low promotional (marketing) expenses in the sale of their products, it is not an operational benefit derived through JIT systems. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Forward Scheduling:
Job J can be completed earliest by the end of six hours and Job K by the end of seven hours using forward scheduling. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | A firm’s SCM strategy component focuses on how different entities of the supply chain perform as a group. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | Organizations not preferring to purchase a complete package at one instance may prefer implementing it in modules. In such cases, the modularity of the package i.e., the availability of the package in separate modules should be examined. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | UCL =
| ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The sequence of actions of fixed sequence robots is usually triggered by electronic sensors. Numerical control robots are used to perform manufacturing operations where high precision is required. Therefore, Statement (II) and (III) are false. Statements (I) and (IV) are true. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b |
Critical path has the maximum time estimate. So, A – C – E – F – H is the critical path. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | A typical CIM (Computer Integrated Manufacturing) system takes product design details from CAD system and other customer order information systems, and uses this information to create purchase orders (for producing necessary materials), work instructions, tooling requirements and so on. The system develops schedules for production equipment and coordinates the activities and flow of materials throughout the manufacturing unit. It also tracks the movement of product in production units, monitors product quality and tool wear, and simultaneously stores the data for future analysis. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Examples of Planning reports are inventory forecasts, purchase commitment report and long-range materials requirement planning information. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Linearity of production i.e., maintaining linear production schedules requires the identification and elimination of production bottlenecks, balance in the production system, and reduction in setup time. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| a | The choice of the employees of Pioneer Financial Services was to work a specified number of hours per week provided they are given the option to select their work times. This relates to the flextime approach used by operations managers as a personnel-related scheduling approach. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| a | Civil maintenance includes maintaining fire fighting equipment and waste disposal. Maintenance of transport vehicles and materials handling equipment come under mechanical maintenance. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Performance standards set for each process by using benchmarking techniques in the third stage of the ERP implementation program i.e., in the process of deciding the desired would-be situation for the business. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The aesthetics value of a product is influenced by individual preferences. Companies use this quality dimension to cater to a niche market. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Design is the comprehensive process that after considering the feedback from customers and suppliers defines the overall requirements both external and internal to the organization. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Costs associated with outsourcing are: · Loss of control – In terms of control of facilities, outsourcing results in a loss of control by the client, and hence is not considered a benefit. · Decrease in flexibility – In terms of flexibility relating to the time frame of the contracts, generally the vendor would require a long time to realize the profits from those operations and would desire a long-term contract. The client, on the other hand, would not like to go for a long-term outsourcing contract as this would result in the vendor gaining control on the operations of the client organization. Therefore, there is less flexibility to the client with respect to long-term contracts. · Decrease in staffing quality – The vendors may employ semi-skilled or unskilled personnel as the contract progresses, resulting in low quality staffing and high costs to the client. Cost of operations is an area where costs can be reduced, as outsourcing the management of facilities results in the management not requiring to pay salaries and wages to the employees regularly. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | The dual-card Kanban system makes use of the conveyance authorization card and the vendor authorization card. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | During the production process, activities like equipment maintenance, raw material sourcing, quality control and packaging are carried out, as and when required. As part of the production process, raw materials are sourced when they are required but they do not maintain inventory. Hence, inventory maintenance is not one of the activities carried out during the production process. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The product environment is considered to be appropriate only if the organization needs to purchase many items, a majority of which are components and parts. The demand pattern of these items should be dependent in nature and irregular in timing. Hence, statement (II) is false. The other statements relate to the inappropriate product environment. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | In repetitive operations, the labor is trained and the equipment designed for a narrow range of activities. All other statements in options (a), (b) and (d) relate to job operations and option (e) relates to labor-intensive operations. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | In quality circles, people working in similar types of operations meet at regular intervals and discuss ways of improving the quality of their processes. In suggestion programs, employees are encouraged to make suggestions to improve a process. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c |
Time-Cost Slope =
The critical path activity with the smallest time-cost ratio is selected and crashed first.
| ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | Facilities managers act as change managers in situations where existing processes or infrastructure is modified or replaced with new ones to suit the organizational goals. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | To enable easy and quick repeal and modification of the trade rules and regulations is not a key issue of WTO. One of the key issues of WTO is to increase awareness about the trade rules and regulations of different countries and ensure that these rules and regulations are not repealed or modified suddenly. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | In demand chains, business-to-business companies need to monitor only their customers. This is a misconception about demand chains as the companies need to monitor not only their immediate customers but also their customer’s customers’. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | An integrated data model minimizes the data redundancy and ensures the availability of the right information to all concerned. Options (a), (c) and (e) relate to business process reengineering. Option (d) relates to business modeling. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | Technical efficiency refers to gaining efficiency by modifying the existing production processes, introducing automation in production processes etc. Productivity can be increased either by increasing the output with the same number of inputs or by producing the same output using fewer inputs refers to technical efficiency, as it implies a modification in the existing production processes. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| e | The traditional materials handling equipment that are replaced by automated guided vehicles are: · Manually operated trucks · Hydraulic. · Hand pallet trucks · Straddle trucks. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | According to the rule of Slack Time Remaining, the jobs with the shortest slack time are dispatched first. Slack Time = Due Date (–) Processing Times.
Slack times for the four jobs are: S1: 6 – 4 = 2 S2: 8 – 5 = 3 S3: 5 – 3 = 2 S4: 9 – 6 = 3 As the slack times for the jobs S1 and S3, and that for S2 and S4 are same, these jobs are dispatched based on their processing times i.e., the job with the smallest processing time is dispatched first. So, the order of the jobs according to their slack time remaining is S3 – S1 – S2 – S4. The average delay of a job is calculated as follows:
Average delay of a job = (0 + 1 + 4 + 9)/4 = 14/4 = 3.5 days. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | JIT manufacturing is based on the concept of continuous improvement, which includes two important and mutually supporting components: · People involvement · Total quality control. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | Organizations derive advantage from automation in the form of: · Improvement in productivity · Efficient use of materials · Improvement in the quality of the product · Improvement in work environment for the workers · Reduced factory lead-time. Feedback from employees is considered as an disadvantage of automation because usually employees resist automation for the fear of losing their jobs, as automation results in less requirement for employees. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | Manufacturing resource planning system (MRP II) is the system considered as an integrated system by the operations managers, and is used to analyze complete product cycles, from corporate production plans to finished goods distribution. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | Operations, maintenance and repair function includes activities like trash removal, hazardous waste removal and management, energy management, disaster recovery planning and management, and energy management. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| d | Quantitative performance, also called productivity, provides a good measure of performance at the national, industry or individual business level. All other statements are true with respect to the measurement of performance. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | The customer base is defined in terms of sales, profitability, size etc. The suppliers are divided into different categories such as: first tier, second tier etc. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| a | Business process is a structured and measured set of activities designed to produce a specified output for a particular customer or market. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| c | (I) – Scheduling too much capacity results in the facilities remaining idle, whereas scheduling low capacity results in incomplete jobs. (II) and (III) – Scheduling can be either a medium-range planning activity or a short-range planning activity. (IV) – Forward scheduling is used in fabrication operations where the products are so customized that customers specify the product specifications. Hence, statements (II) and (III) are true. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| b | The earliest and latest event times of the activity 2 – 5 relate to the E2, L2 and E5, L5 E2 = E1 + t1,2 = 0 + 2 = 2 L2 = L5 – t2,5 = 11 – 4 = 7 E5 = E2 + t2,5 = 2 + 4 = 6 L5 = L8 – t5,8 = 12 – 1 = 11. | ||||||||||||||||||||||||||||||||||||||||||||||||||
= 
= 
= 0.1675
= 0.1675 + 3
9.08
=
= 7160 + 70824 = Rs. 77,984
Number of employees required for setup work = 
= 
= 1.10 weeks.
Quantity of B required to produce 240 units of A = 480 units
+ A2
, LCL = 
= 
.
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