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Operations Management

Amazon.com. Amazon.com started as a ?virtual" retailer ? no inventory, no warehouses, no overhead; just computers taking orders to be filled by othersGrowth has forced Amazon.com to become a world leader in warehousing and inventory management. Amazon.com. Each order is assigned by computer to the

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Operations Management

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    2. Amazon.com

    3. Amazon.com Each order is assigned by computer to the closest distribution center that has the product(s) A “flow meister” at each distribution center assigns work crews Lights indicate products that are to be picked and the light is reset Items are placed in crates on a conveyor. Bar code scanners scan each item 15 times to virtually eliminate errors.

    4. Amazon.com

    5. Inventory

    6. Functions of Inventory

    7. Types of Inventory

    8. The Material Flow Cycle

    9. Inventory Management

    10. ABC Analysis

    11. ABC Analysis

    12. ABC Analysis

    13. ABC Analysis

    14. ABC Analysis

    15. ABC Analysis

    16. Record Accuracy

    17. Cycle Counting

    18. Cycle Counting Example

    19. Control of Service Inventories

    20. Independent Versus Dependent Demand

    21. Holding, Ordering, and Setup Costs

    22. Holding Costs

    23. Inventory Models for Independent Demand

    24. Basic EOQ Model

    25. Inventory Usage Over Time

    26. Minimizing Costs

    27. The EOQ Model

    28. The EOQ Model

    29. The EOQ Model

    30. An EOQ Example

    31. An EOQ Example

    32. An EOQ Example

    33. An EOQ Example

    34. Robust Model

    35. An EOQ Example

    36. An EOQ Example

    37. Reorder Points

    38. Reorder Point Curve

    39. Reorder Point Example

    40. Production Order Quantity Model

    41. Production Order Quantity Model

    42. Production Order Quantity Model

    43. Production Order Quantity Model

    44. Production Order Quantity Model

    45. Production Order Quantity Example

    46. Production Order Quantity Model

    47. Quantity Discount Models

    48. Quantity Discount Models

    49. Quantity Discount Models

    50. Quantity Discount Models

    51. Quantity Discount Example

    52. Quantity Discount Example

    53. Quantity Discount Example

    54. Probabilistic Models and Safety Stock

    55. Safety Stock Example

    56. Safety Stock Example

    57. Probabilistic Demand

    58. Probabilistic Demand

    59. Probabilistic Demand

    60. Probabilistic Example

    61. Other Probabilistic Models

    62. Other Probabilistic Models

    63. Probabilistic Example

    64. Other Probabilistic Models

    65. Probabilistic Example

    66. Other Probabilistic Models

    67. Probabilistic Example

    68. Fixed-Period (P) Systems

    69. Fixed-Period (P) Systems

    70. Fixed-Period (P) Example

    71. Fixed-Period Systems

    72. Companies must strike a balance between: Inventory costs and customer service. Holding costs and shortage costs. Shortage costs and ordering costs.

    73. Inventories are associated with: Manufacturing organizations. Service organizations. Manufacturing and service organizations.

    74. Which is not a function of inventories? To decouple various parts of the production process. To decouple the firm from fluctuations in demand. To take advantage of quantity discounts. To hedge against inflation. To guard against product obsolescence.

    75. “WIP” refers to: Materials that are usually purchased but have yet to enter the manufacturing process. Products that are no longer raw materials but have yet to become finished products. Maintenance, repair and operating materials. An end item ready to be sold.

    76. The purpose of ABC analysis is to: Gauge the level of literacy of the work force. Separate the “important” from the “unimportant”. Determine which items in inventory should be monitored with most intensity.

    77. Class A items represent approximately: 15% of items and 75% of the total dollar value. 30% of items and 20% of the total dollar value. 55% of items and 5% of the total dollar value.

    79. A continuing reconciliation of inventory items with inventory records is known as: Record accuracy. Cycle counting. Taking stock.

    80. Retailers lose what percentage of their profits due to poor inventory records? 1-5% 3-8% 8-15% 10-25% 15-35%

    81. The basic EOQ model assumptions do not include: Demand is known, constant and independent. Receipt of inventory is instantaneous. Stockouts (shortages) are unavoidable. Quantity discounts are not possible. Lead time is known and constant.

    82. As the order quantity increases: Total cost increases. Ordering cost increases. Holding cost decreases. Holding cost increases.

    83. Total inventory costs are relatively insensitive to changes in: Holding cost. Ordering cost. Order quantity. Demand. All of the above.

    84. The lead time and reorder point are related by: Holding cost. Setup cost. Order quantity. Demand.

    85. The POQ model assumptions do not include: Demand is known, constant and independent. Receipt of inventory is instantaneous. Stockouts are avoidable. Quantity discounts are not possible. Lead time is known and constant.

    86. Which is not variable with respect to order quantity in the quantity discount model? Holding cost. Setup cost. Annual demand. Order quantity. Unit cost.

    87. Fixing the service level in a probabilistic inventory model does not impact: Holding cost. Total cost. Lead time. Order quantity.

    88. When safety stock is zero and demand is normally distributed, the probability of a shortage is: 100% 75% 50% 25% 0%

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