COM Operations Strategy & Planning 3 — Questions and Answers
Question 1: Which tool is commonly used to translate high-level strategic goals into measurable operational objectives across four perspectives: financial, customer, internal process, and learning?
- Balanced Scorecard (Correct answer)
- Hoshin Kanri
- Value stream mapping
- Gantt chart
Correct answer: Balanced Scorecard
The Balanced Scorecard links strategic objectives to operational metrics across four perspectives, ensuring strategy execution at all levels.
Question 2: In aggregate production planning, the 'chase strategy' refers to:
- Maintaining a constant workforce while varying inventory levels
- Adjusting production output to match demand fluctuations by hiring and firing (Correct answer)
- Outsourcing production during peak demand periods exclusively
- Using overtime to meet seasonal demand without changing headcount
Correct answer: Adjusting production output to match demand fluctuations by hiring and firing
The chase strategy matches production rate to demand by varying workforce size, avoiding inventory buildup but increasing hiring costs.
Question 3: What is the primary purpose of a Sales and Operations Planning (S&OP) process?
- To negotiate supplier contracts for the coming quarter
- To align supply capability with demand forecasts across business functions (Correct answer)
- To set individual employee performance targets
- To approve capital expenditure budgets for new equipment
Correct answer: To align supply capability with demand forecasts across business functions
S&OP integrates sales, marketing, finance, and operations plans to balance supply and demand and support business strategy.
Question 4: A company that adopts a 'make-to-order' (MTO) production strategy typically experiences:
- High finished goods inventory and short customer lead times
- Low finished goods inventory and longer customer lead times (Correct answer)
- High work-in-process inventory and no customer wait times
- Fixed production schedules unaffected by customer orders
Correct answer: Low finished goods inventory and longer customer lead times
MTO production begins only after a customer order is received, reducing inventory risk but extending the time customers wait for delivery.
Question 5: Which concept describes the point in a supply chain where a customer order first influences production or procurement decisions?
- Bullwhip effect origin
- Customer order decoupling point (Correct answer)
- Economic order quantity trigger
- Safety stock threshold
Correct answer: Customer order decoupling point
The customer order decoupling point separates forecast-driven upstream activities from order-driven downstream activities in a supply chain.
Question 6: Hoshin Kanri (policy deployment) is best described as:
- A quality control method for reducing defects on the production floor
- A strategic planning methodology that cascades annual objectives throughout the organization (Correct answer)
- A lean tool for eliminating waste in manufacturing processes
- A financial budgeting technique linking costs to activities
Correct answer: A strategic planning methodology that cascades annual objectives throughout the organization
Hoshin Kanri ensures strategic priorities flow from senior leadership down to frontline teams through aligned goals and action plans (catchball process).
Question 7: When forecasting long-term capacity needs, operations managers should account for which of the following factors?
- Daily shift schedules and supervisor availability
- Technological change, market growth trends, and competitive dynamics (Correct answer)
- Current employee overtime hours and absenteeism rates
- Short-term raw material price fluctuations
Correct answer: Technological change, market growth trends, and competitive dynamics
Long-term capacity planning requires evaluating macro-level factors like technology evolution, market demand trajectories, and competitor actions.
COM Operations Strategy & Planning 3
Which tool is commonly used to translate high-level strategic goals into measurable operational objectives across four perspectives: financial, customer, internal process, and learning?