Production Methods Quality Assurance & Production Planning Costs, Revenue, & Break-Even Analysis Quality Assurance & Production Planning LocationPotpourri

Answer: This is an example of job production. ? Designing a one-of-a-kind piece of jewelry is an example of what type of production?

? When work is divided into a number of operations, this is called _____ production. Answer: This is an example of batch production.

? A car assembly line is an example of _____ production. Answer: This is an example of mass (line, flow) production.

? When more machines are employed in production than people, this is known as a(n) _____ intensive process. Answer: This is a capital intensive process (think robots).

? Name one advantage of job production. Answer: Orders can be customized for individuals—not mass produced—personal touch Workers may be motivated since they don’t have to complete repetitive tasks Workers see the job all the way through—from beginning to end—not just part of the process Easier to deal with problems since only one job is being completed at a time

Answer: This is Kaizen. ? The Japanese term for continuous improvement is _____.

Answer: This is Just-in-Case manufacturing. ? Keeping a buffer stock of materials is known as JIC manufacturing which stands for _____ _____ _____.

Answer: This is SMED—Single Minute Exchange of Dies. ? The Japanese theory that refers to the amount of time it takes to change machines from one process to another (similar to a NASCAR pitstop), is known as _____ _____ _____ _____.

Answer: This is lean production. ? Cutting back on the amount of resources, time, waste, defects, and costs of production and doing more with less is an example of _____ production.

Answer: Get stocks just as business needs them—don’t store them as it ties up cash Business must keep detailed records and be very organized to use this method of production Business must deal with reliable suppliers to use this method of production If demand for a product increases quickly, it may be difficult for business to respond quickly since there is no backstock ? What is a disadvantage of JIT manufacturing?

? Costs that stay the same at all levels of output in the short run are known as _____ costs. Answer: These are fixed costs.

? Costs which are partially fixed and partially variable such as a water bill are called _____-_____ costs. Answer: These are semi- variable costs.

? Costs that are tied directly to a product such as cotton for jeans or wood for home building are known as _____ costs. Answer: These are direct costs.

? The money left after variable costs are subtracted from revenue is known as the _____. Answer: This is the contribution which goes towards fixed costs and profit.

? As output increases, fixed costs become a _____ portion of total costs. Answer: Fixed costs become a smaller portion of total costs with increased output.

? Comparing your business standards against other industry standards is known as _____. Answer: This is benchmarking.

? The goal of having no defects in any product is known as _____ defects. Answer: Zero defects, of course!

? Businesses are sometimes awarded a certificate for having quality assurance procedures in place. Name one example of a product seal that we discussed in class. Answer: UL seal (lighting) and Good Housekeeping seal (products advertised in their magazine).

? Give an example of a Poka-Yoke quality management technique. Answer: Varies—ex.—socket and plug; furniture and left- over screws, etc.

? What is muda? Answer: Muda is a Japanese word for waste.

? When a company refuses to leave its original location even when the factors that made it locate there have disappeared, this is called _____ _____. Answer: This is known as industrial inertia.

? Name one factor which could influence the location decision of a business. Answer: Business is conveniently located for customers Near suppliers Available and skilled or low-cost labor supply Located near transportation options Quality infrastructure Cost of buying or leasing building or property is affordable—expansion possible

? When businesses weigh all the factors in deciding on a location and then try to make the best decision possible, this is known as the _____ decision. Answer: This is called the optimal decision.

? _____ is moving a business process from one country to another—for example, a U.S. call center to India. Answer: This is offshoring.

? Using the following scenario, determine the break-even point: Assume park benches have a fixed cost of $60,000 and variable costs of $40 per bench. Selling price is $100 per bench. Answer: The break-even point is 1000 benches: Contribution = selling price – variable costs = $100 - $40 = $60 Break-even point = Fixed costs $60,000 = 1000 benches Contribution $60

? Which type of production method would require the most skilled labor force: job, batch, or mass? Answer: Job production would require the most skilled labor force because the worker completes the job from start to finish and must know how to complete each task.

? Which is an example of a fixed cost: gas for a trucking company or monthly payments on a business loan? Answer: Payment on a business loan is a fixed cost as it stays the same. The amount of gas for a trucking company is a variable cost.

Answer: This is called Six Sigma. ? A statistical approach to eliminate defects in production is known as _____ _____.

Answer: The last one is improvement. ? Quality management today has four main points. They are: Prevention, detection, correction, and _____.

? What is the name of the decision making tool below? Answer: This is an Ansoff’s Matrix. MARKET PRODUCT ExistingNew ExistingMarket penetrationProduct development New Market extension/ development Diversification

? A trade restriction that allows only a set quantity of a product to come into a country or leave a country is called a(n) _____. Answer: This is a quota.