Exam 19: Sales and Operations Planning

The sales and marketing plans are typically developed separately from the aggregate operations plan as a way of cross-checking results to ensure the integrity of assumptions about the future.

Aggregation in sales and operations planning is by groups of customers on the supply side and by product families on the demand side of the firm's supply chain.

The aggregate operations plan differs in virtually every aspect in service organizations as contrasted with manufacturing organizations.

Sales and operations planning is a process that helps a firm design products that are easier for marketing to sell.

The operations plan should not be updated but should be followed precisely until the longest-term planning horizon has passed.

Which of the following is considered a "pure" production planning strategy?

Firms that match the production rate to the order rate by hiring and laying off employees as the order rate varies are following what is known as the chase strategy.

A rate fence is a logical justification for different prices for what is essentially the same service.

The increasing complexity of modern operations management has made simple cut-and-try charting and graphical methods formerly used to develop aggregate operations plans impractical and obsolete.

The term sales and operations planning was coined by companies to refer to a process that was traditionally referred to as capacity planning.

Pricing for a service should primarily relate to the cost of providing the service and has little to do with capacity issues the service provider might face.

Backordering costs incurred in producing a given product type in a given time period are relevant aggregate operations planning costs.

In conducting aggregate operations planning, there are a number of required inputs. Which of the following inputs are considered internal to the firm?

In an overview of the major operations planning activities in a typical logistics organization, which of the following activities does not come after sales and operations (aggregate) planning?

What should have been the initial inventory in units of demand, if the production requirement in units of product is 900, demand forecast is 1,000, and the necessary safety stock is 20 percent of the demand forecast?

The master scheduling is a crucial input into the aggregate operations plan.

Aggregate sales and operations planning occur in a company about every 3 to 18 months.

In conducting aggregate operations planning, there are a number of required inputs. Which of the following inputs are considered external to the firm?

The aggregate operations planning variable "inventory on hand" refers to the balance of unused inventory carried over from the previous time period.

Subcontracting is viewed as a risky strategy because the firm may lose control of product design and pricing.