Operations Strategy & Planning Flashcards
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Read the first 7 Operations Strategy & Planning flashcards as text
Which analytical technique uses a weighted scoring model to evaluate and select between competing facility location alternatives?
Answer: Factor rating method
The factor rating method assigns weights to key location criteria (labor, infrastructure, costs) and scores each alternative to produce a comparable weighted total.
An operations manager observes that small demand fluctuations at the retail level cause increasingly large swings in orders upstream to suppliers. This phenomenon is called:
Answer: The bullwhip effect
The bullwhip effect describes how demand variability amplifies as it moves upstream in a supply chain due to order batching, price fluctuations, and demand forecast errors.
When applying the resource-based view (RBV) to operations strategy, competitive advantage derives from resources that are:
Answer: Valuable, rare, inimitable, and non-substitutable (VRIN)
RBV theory holds that durable competitive advantage comes from firm-specific resources and capabilities that competitors cannot easily replicate or substitute.
A company switches from annual budgeting to a rolling 12-month forecast updated monthly. The main operational benefit of this change is:
Answer: Enabling more responsive planning as conditions change throughout the year
Rolling forecasts allow operations teams to continuously adjust plans based on current data rather than relying on an outdated annual snapshot.
Which operations planning tool visually displays the sequence and timing of project activities to support scheduling and resource allocation?
Answer: Gantt chart
A Gantt chart shows tasks as horizontal bars along a timeline, making it easy to see task sequences, durations, and overlaps for project planning.
An organization implementing 'blue ocean strategy' in its operations would focus on:
Answer: Creating uncontested market space by making the competition irrelevant
Blue ocean strategy, developed by Kim and Mauborgne, emphasizes creating new demand in unexplored markets rather than fighting over existing customers.
Which capacity planning strategy involves waiting until demand is proven before adding capacity, minimizing investment risk but potentially losing sales?
Answer: Lag strategy
A lag strategy adds capacity only after demand has materialized, reducing the risk of excess capacity but potentially causing stockouts and lost customers during the delay.