BSE Bachelor of Science in Engineering Management: Operations and Supply Chain 4 — Questions and Answers
Question 1: A manufacturer's throughput is constrained by a single workstation processing 80 units/hour while all others process 120+ units/hour. According to the Theory of Constraints, the first corrective action should be to:
- Add capacity to all workstations proportionally
- Exploit the constraint by maximizing its utilization (Correct answer)
- Subordinate all other processes to the constraint's needs
- Elevate the constraint by purchasing new equipment immediately
Correct answer: Exploit the constraint by maximizing its utilization
The Theory of Constraints (TOC) prescribes first exploiting (fully utilizing) the existing constraint before spending money to elevate it.
Question 2: Master Production Scheduling (MPS) translates which of the following into specific production quantities and timing?
- A supplier's delivery schedule
- Aggregate production plans into end-item schedules (Correct answer)
- Individual machine maintenance windows
- Financial budget targets for each quarter
Correct answer: Aggregate production plans into end-item schedules
The MPS disaggregates the aggregate plan into specific end-item production quantities by period, driving MRP calculations.
Question 3: Which inventory classification system segments items into categories A, B, and C based on their annual dollar usage to focus management attention?
- ABC analysis (Correct answer)
- XYZ analysis
- EOQ segmentation
- VED analysis
Correct answer: ABC analysis
ABC analysis (Pareto classification) typically shows that ~20% of SKUs (A items) account for ~80% of annual dollar usage.
Question 4: In Material Requirements Planning (MRP), 'gross requirements' for a component are determined by:
- Current on-hand inventory levels
- The planned order releases of its parent items (Correct answer)
- Supplier lead times and delivery frequencies
- Customer demand forecasts for finished goods
Correct answer: The planned order releases of its parent items
MRP explodes the parent's planned order releases through the bill of materials to compute gross requirements for each child component.
Question 5: A supply chain's 'perfect order' metric typically measures the percentage of orders that are:
- Delivered with no damage, on time, in full, and with correct documentation (Correct answer)
- Processed within one business day of receipt
- Fulfilled from a single warehouse location
- Below the budgeted cost per order
Correct answer: Delivered with no damage, on time, in full, and with correct documentation
The perfect order rate combines on-time delivery, complete order fill, damage-free shipment, and accurate invoicing into a single composite KPI.
Question 6: Which lean tool uses a visual card system to authorize and limit the amount of work-in-process in a production system?
- Value Stream Mapping
- 5S
- Kanban (Correct answer)
- Poka-yoke
Correct answer: Kanban
Kanban cards serve as authorization signals that limit WIP and synchronize production to actual downstream consumption.
Question 7: A company shifts from a single-sourcing strategy to dual-sourcing for a critical component. The primary trade-off is:
- Lower unit cost versus reduced supply disruption risk (Correct answer)
- Higher quality versus faster delivery speed
- Better traceability versus simpler supplier relationships
- Reduced lead time versus higher order quantities
Correct answer: Lower unit cost versus reduced supply disruption risk
Dual sourcing typically increases unit cost (less volume discount per supplier) but significantly reduces supply disruption risk by eliminating single-source dependency.
BSE Bachelor of Science in Engineering Management: Operations and Supply Chain 4
A manufacturer's throughput is constrained by a single workstation processing 80 units/hour while all others process 120+ units/hour.
According to the Theory of Constraints, the first corrective action should be to: