Exam 19: Sales and Operations Planning

In a logistics organization, vehicle dispatching immediately precedes vehicle loading.

The International Aggregate Planning Society (IAPS) has developed aggregate operations planning guidelines that are followed by a majority of manufacturing firms.

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

The main purpose of aggregate operations planning is to specify the optimal combination of which of the following?

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.

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 plan translates annual and quarterly business plans into broad labor and output plans for the intermediate term of 3 to 18 months.

Yield management is the process of allocating the right type of capacity to the right type of customer at the right prices at the right time to maximize revenue or yield.

In an overview of the major operations planning activities in a typical service organization, which of the following activities follows aggregate sales and operations planning?

One of the conditions that makes yield management effective is when inventory is easily stored and held for a time when demand is stronger.

Yield management is an important tool that can be used to shape demand patterns.

From an operational perspective, yield management is least effective under which of the following circumstances?

Using the cut-and-try method for aggregate operations planning, we can determine the production requirement in units of product.If beginning inventory is 4,000 units, the demand forecast is 2,900 units, and the required safety stock is 10 percent of the demand forecast, what is the production requirement? ________________________________

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

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

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.

Explain how yield management works and why some companies are able to use it to manage demand patterns.

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.

Costs incurred in hiring, training, and laying off personnel are considered relevant aggregate operations planning costs.

The main purpose of the aggregate production plan is to specify the optimal combination of workforce level and inventory on hand.