ETZC412 Compre Regular Answer Keys

Birla Institute of Technology & Science, Pilani

Work-Integrated Learning Programmes DivisionB.Tech - ET

Second Semester 2015-16Comprehensive Examination (Regular)

Course No. ETZC 412

Course Title: Production Planning & Control

Nature of Exam: Open Book

Weightage: 50%

Duration: 3 Hours

Date of Exam: 18-Apr-2015

Note:

1. Please follow all the Instructions to Candidates given on the cover page of the answer book2. All parts of the questions should be answered. Each answer should start from a fresh page3. Write your answers to the topic and preferably in bullet points. Include sketches

appropriately

Q1) You have launched an innovative product and it is currently in the growth phase of its product life cycle. On a spectrum between Chase and Level strategy, where will you pitch? What specific strategic options will you consider and why? [7]

The features of this innovative product on its growth phase of the PDC are:

1. The demand is more market driven assuming that the product has been designed to meet market expectations and the early signals are addressed adequately

2. The market mediation is required to match the demand with supply3. Design / strategy changes are limited4. There are budgets planned for the capacity related investments5. The demand has a definite trend and the random variations are minimal as the period of

window is short (compared to the maturity phase)6. The process and product is vulnerable to bad practices in its urge to grow, which may impact

its maturity phase

Given the above points it is appropriate to fix the strategy towards ‘demand-chase’ for the following reasons:

1. The demand is market driven hence it has to meet the same2. Lack of product availability can impact the growth and vulnerable to competitors. See the

example of Tata Zest3. The inventory will not stagnate as the design changes are limited and flowing to meet the

market demand4. There are no constraints in terms of increasing the capacity hence chase is possible5. The demand is growing and it is prudent to exploit the same for quicker break-even

A level strategy will lengthen the growth phase, which will intensify the vulnerability of the product and process as well instigate competitors

Q2) Joe Henry machine shop uses 2,500 brackets during the course of a year. These brackets are purchased from a supplier 90 miles away. The following information is known about the brackets:

No. of Pages = 3

No. of Questions = 6




Annual demand 2,500Holding cost per bracket per year $1.50Order cost $18.75Lead time 2 daysWorking days per year 250

a) What would be the EOQ? 250 [2]b) What would be average inventory? 125 [1]c) How many orders would be made each year and what would be the annual order cost? 10;

$187.5 [2]d) What is the ROP? 20 [2]

Q3) VanOyen Manufacturing has gone out on bid for a regular component. Expected demand is 700 units per month. The item can be purchased from either Allen Manufacturing or Baker Manufacturing. Their pricelists are as shown in the table. Ordering cost is $50, and annual holding cost per unit is $5 and is independent of purchase price

Allen Manufacturing Baker ManufacturingQuantity Unit Price $ Quantity Unit Price $

1-499 16.00 1-399 16.10500-999 15.50 400-799 15.601,000+ 15.00 800+ 15.10

a. What is the economic order quantity? 410 [2]b. Which supplier should be used? Baker Manufacturing Co. [3]c. What is the optimal order quantity and total annual cost? 410; 1,33,089 [3]

Q4) The President of Hill Enterprises, projects the firm’s aggregate demand requirements over the next 8 months as follows:

Month DemandJan 1,400Feb 1,600Mar 1,800Apr 1,800May 2,200Jun 2,200Jul 1,800Aug 1,800

The opening inventory in Jan is 200 units on hand. Stock-out cost of lost sales is $100 per unit. Inventory holding cost is $20 per unit per month. No idle time costs considered

(a) Their Operations Manager is considering a plan (Plan A). The plan is to vary the workforce level to execute a strategy that produces the quantity demanded in the prior month. The Dec demand was 1,600 units. The cost of hiring additional worker is $5,000 per hundred units. The cost of laying-off workers is $7,500 per hundred units. Evaluate this plan based on cost 1,53,000 [5]




(b) Evaluate Plan B, which envisages producing at a constant rate of 1,400 units per month, which will meet minimum demands. Then use subcontracting, for additional units at a premium price of $75 per unit. Evaluate this plan and compare against Plan A 2,44,000 [5]

(c) Consider Plan C, keeping a stable workforce by maintaining a constant production rate equal to the average demand of the eight months and allow varying inventory levels. Evaluate Plan C against Plan A and Plan B 86,000 [5]

Q5) The monthly sales for a given product is:

Month Actual demandMvg Avg

Wt. Mvg. Avg

Exp smoothing

Jan 20 20.00Feb 21 20.00Mar 15 18.67 17.83 20.30Apr 14 16.67 15.50 18.71May 13 14.00 13.67 17.30Jun 16 14.33 14.67 16.01Jul 17 15.33 16.00 16.01Aug 18 17.00 17.33 16.30Sep 20 18.33 18.83 16.81Oct 20 19.33 19.67 17.77Nov 21 20.33 20.50 18.44Dec 23 21.33 21.83 19.21Model the forecasting using the following:

a) 3-monthly moving average [1]b) 3-monthly moving average with 3,2,1 as weightage with the highest for the most recent past [2]c) Simple exponential smoothing using α = 0.3 (assume Jan forecast as 20) [2]d) Suggest the best model based on MAD Weighted moving average is the best model as the

MAD is the least at 1.12 [2]

Q6) Stanford Rosenberg Computing wants to establish an assembly line for producing a new product, the Personal Digital Assistant (PDA). The tasks, task times and immediate predecessors for the tasks are as follows:

Task Time (Sec) Immediate predecessorsA 12 -B 15 AC 8 AD 5 B, CE 20 D

Rosenberg’s goal is to produce 180 PDAs per hour

d. What is the cycle time? 20 seconds / unit [2]e. What is the theoretical minimum for the number of workstations that Rosenberg can

achieve in this assembly line? 3 [2]




f. Can the theoretical minimum actually be reached when work stations are assigned Yes, it can be reached as follows

A

B

C

D E

[2]

ETZC412 Compre Regular Answer Keys

Documents

Transcript of ETZC412 Compre Regular Answer Keys