In completing the exam, consider the following guidelines:

- Please give specific discussion relating to the question, avoid generalities. For example, simply stating a control chart is not in control does not suffice. You have to be more specific in terms of the variable under consideration, variation type and action.
- Clarity of discussion.
- Graphs, tables should be placed on or near the discussion page; that is, no appendix, etc.
- Begin each problem at the top of a new page.
- Show all your work, units shown and discuss your findings.
- When necessary or asked, show process maps.
- In referencing, give author and page number (Wheeler, 59)

Understanding Variation

In a management meeting attended by senior managers of your company, you will hear from the CEO about flat sales in the last several months. That, unless the company reaches the target goal of $4 million sales in the next couple of months, the bonuses will be reduced, possibly reduce the sales budget and may even resort to sales force reduction. To support her decision, the CEO presents the sales data for the last several months as shown below.

Now that you understand variation and control charts, educate your CEO about the sales process and provide a foundation for decision making. Is the CEO right to think the sales are flat? What are your suggestions about the demand for $4M in sales? Please be sure to have a substantive discussion.

Understanding Variation

A poultry filling process produces chicken patties for a frozen food marketer. The process is depicted below. The two machines are designated as West Machine (W) and the East Machine (E). A plate forms patties under pressure and releases them onto a conveyor belt and transferred to the next process (cooking). Every day a technician collects and tests samples from the two machines for weight. One such set of data is shown below as well. The desired patty weight is 50 grams. You must rely on examples from Wheeler's text and class examples to discuss your answers.

a) Develop a control chart of the individual weight measurements, discuss your findings.

b) Based on your findings in part (a), what do you recommend?

c) The operations manager has suggested all along that there is no difference between the two machines; that is, both produce comparable weight patties. Using quality control charts, support or contradict the manager's assumption.

Project Management

The project below concerns the design, development, and implementation of an order/entry computer program (Metters, et al.).

Activity                                                                  Duration (weeks)                 Immediate Predecessor     

A             Process analysis                                                   4                                              ---

B             Data analysis                                                       3                                              ---

C             Reports design                                                      5                                              A, B

D             Database design                                                  5                                              B

E             Code reports                                                         4                                              C, D

F              Code data entry                                                   3                                              D

G             Code database                                                     4                                              D

H             System and networking testing                         3                                              E, F, G

I              Installation and training                                     1                                              H

a) Show the project network diagram, list all paths and durations. What is the Critical Path?

b) Suppose the project team has arrived at the following time estimates. Estimate the expected time and variance for all activities. What is the probability of completing the project within 19 weeks? Discuss your findings.

            Activity                        Optimistic (a)           Most likely (m)            Pessimistic (b)

                A                                             3                                  4                                 5

                B                                             1                                  2                                 9

                C                                             3                                  5                                 7

                D                                             2                                  5                                 8

                E                                             1                                  4                                 7

                F                                              2                                  3                                 4

                G                                             1                                  4                                 7

                H                                             1                                  2                                 9

                I                                              1                                  1                                 1

Inventory Management

An upscale home fixture supplier has four locations. Each location manages its ordering independently. The specialized lighting fixture sells for $300 and sales are on average 30 units per week. Currently the supplier orders 10-week supply from the manufacturer. The supplier pays $150 per fixture, and it takes two weeks to receive each delivery. The administrative cost of placing each order is estimated at $225. The supplier estimates the cost of capital at 20%. Assume 50 weeks in a year.

a) What are the annual ordering cost, annual holding cost and total cost functions?

b) Given that each outlet orders independently and gets its own delivery, determine the optimal order size at each outlet graphically (find EOQ graphically, show graph).

c) Given that each outlet orders independently and gets its own delivery, determine the optimal order size at each outlet mathematically.

d) What is the average inventory for each outlet? Across all outlets?

e) How many orders must be placed annually?

f) How frequently orders must be placed?

g) What is the inventory turnover ratio? What does the value mean?

If the purchasing centralizes purchasing (for all four outlets), the retailer will only have to place a single order for all the outlets.

h) What is the EOQ under centralization?

i) What is the average inventory across the system (all four outlets)?

j) How many orders must be placed annually?

k) Compare and discuss the two options.

Financial Analysis

"Accuray Incorporated (Nasdaq: ARAY) invents, manufactures and supports a complete portfolio of radiation therapy and radiosurgery platforms for treating multiple forms of cancer. We design our solutions in collaboration with oncology professionals who share our goals of continuously improving care and helping patients live long and healthy lives. We surround our platforms with a full range of expert services that our customers confidently leverage to drive the outcomes that matter most to them - optimizing patient care, enabling staff efficiency and sustaining practice prosperity."

Review the financial report for fiscal year ending June 30, 2017.

a) Show the financial process map.

b) On average, how long does a dollar spend in Production Process (time in production)?

c) On average, how long does a dollar spend in Account Receivable process (time in A/R)?

d) What is the total time, when a dollar invested in production process until it is collected from a customer?

e) What is the inventory turnover?

The Goal Discussion

Questions relating to The Goal: Reference the page number from the Goal to support your discussion.

In Chapter 23, Alex has gained considerable increase in productivity by implementing a number of actions to help the bottleneck machines. List and briefly discuss at least five of such actions.

In Chapter 25 Jona states that activating a resource and utilizing a resource is not synonymous. Discuss in detail the background and the context in which this conversation is taking place.

In Chapter 28, flow time; that is, "the time from the moment the material comes into the plant to the minute it goes out the door as part of a finished product" is introduced. What are the components of this time and the knowledge gained from this discussion?

Simulation: Hospital Emergency Room

Review Example 7: A hospital emergency room, SimQuick text. Work Exercise 7(a). Show and submit the process map. Note: the process map on Page 41 of the text is incomplete; you should provide a complete process map. Present an appropriate table of your findings. Discuss your results and findings as they relate to the following questions:

I. Using the SimQuick results identify the bottleneck? Show your work (why it is a bottleneck)?

II. How long does it take for a patient to complete the process if the patient goes through the Ambulatory workstation?

III. How long does it take for a patient to complete the process if the patient goes through the X-Ray workstation?

IV. How long does it take for a patient to complete the process if the patient goes through the Lab workstation?

Now work 7(b) and discuss your findings.

Optional Assignment for Extra Credit: The Goal Experiment

The match experiment in The Goal is intended to demonstrate several characteristics of a balance plant. The average quota is 3.5 per cycle (average of six sides of a die). Also, Alex states that "the deviations, of course, have to be cumulative...". The table below shows four cycles of the experiment. The values for the roll of the die for each Boy Scout (workstation) are shown.Complete the table. Complete the table.

a) The Boy Scout march and match experiment are trying to show two factors/characteristics that affect a balanced plant? Discuss.

b) What is the total input to the process?

c) What is the total output of the process?

d) What is the work-in-process?

e) What is the average throughput?

f) What is the capacity utilization?

g) By the end of the fourth cycle, what is cumulative deviation (how behind is the production)?

h) What does Alex mean when he says that "... the ability to go faster than average is restricted"?