MGT 301 Study Guide - Midterm Guide: Inventory Turnover, Carrying Cost, Master Production Schedule
Document Summary
Capacity: the rate of output from an operations management system, a variable in the long-term, a constraint in the short-term. Must be managed because it is a major determinant of cost and customer service. Effective capacity influenced by: product mix, skill level of labor, product change-overs, preventative maintenance, machine/tool breakdowns, quality problems, machine starvation and blockage. **bottleneck- finding the start and stop time for cycle: how to improve bottleneck: Intermediate range: master production schedule (mps) Individual products or end items plan far enough into the future to cover cumulative lead time: iii. Short-range- (materials requirement planning- mrp) detailed planning process for components & parts to support the master production schedule. Hierarchical planning: translates annual business and marketing plans and demand forecasts into a production plan for all products in a plant. Planning horizon of app: long enough to add capacity. Costs relevant to the app decision include inventory, setup, machine operation, hiring, firing, training, and overtime costs.
