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Midterm

MSCI432 Study Guide - Midterm Guide: Msci


Department
Management Sciences
Course Code
MSCI432
Professor
Binyamin Mantin
Study Guide
Midterm

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MSCI 432 cheat sheet
Competitive
Dimensions
Operational Capabilities
Price
Low cost process
and reliability
High quality process
;
Consistent quality
Time
Delivery speed
;
On
-
time
delivery; Development speed
Flexibility
Customization
;
Variety
;
Volume flexibility
Productivity: maximize output for a given amount of
input;
Efficiency: minimize cost
The product life cycle
Product-Process Matrix
1
Very
low
Low,
many
High,
stand.
Very high,
commod.
Project
Job shop
Batch
Assembly
/flow
Continuous
Learning curve: Y(u)= time to produce the u
th
unit. Y(u)
= a u
-b
.
Capacity additions: D = Annual Increase in Demand; x =
Time interval between additions; r = annual discount
rate (comp. continuously); f(y) = operating cost at
capacity y; Total discounted cost =



;
assuming  
, then



, which is
minimized at x that solves



 .
The OM triangle: Capacity, Variability reduction, and
Inventory
Forecasting
Qualitative methods: Executive judgment; Historical
analogy; Delphi method; Grass roots; Market research;
Panel consensus; Leader indicators;
Quantitative methods:
Casual methods:
Linear regression: y = a+bx. Correlation:  



, where:


,


.  
, and   
Alternatively,  

Time series analysis:
Characteristics: Trend, level, seasonality, cycles,
randomness, auto-correlation
Evaluation: MSE=

; MAD=

;
MAPE=
*100%
Last-value: F
t
=D
t-1
Simple Moving Average F
t
=


MA with trend: 


,




,
and the forecast is:
 

.
Weighted moving average:


, with
 


.
Exponential smoothing:
 



.
Linear regression:  


, where :

 

,



, and
  
.

Double exponential smoothing using Holt’s method:
Intercept:
 




. Slope:




. The -step ahead:

 

. Use linear regression find initial
intercept S
0
and slope G
0
.
Seasonal series: Obtain the sample mean; Divide
each observation by the mean to obtain factors for
each period; Average the factors for corresponding
periods within each season; Forecast for period t is
given by C
t
x Sample Mean
Winter’s method: The series:
 






. The trend:
 



. Seasonal factors:


. The -step ahead:

 



.
Aggregate Planning
Chase strategy
Level strategy
Combination: max profit/min cost

(i.e., hiring+firing+holding+Prod.@regular time
+Prod.@overtime+idle+subcontracting), s.t.
Conservation of workforce
Conservation of units
Relating production levels to workforce levels
Non-negativity
More constraints
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