Exam 6: Process Design and Facility Layout

If the company's operations performance is considered superior to that of potential suppliers.

Upstream vertical integration refers to the strategy of expanding on the supply side of the network.

The suppliers and customers who have direct contact with an operation are called its 'Immediate Supply Network'

Of the supply-side influences community factors include all, bar one, of the following considerations:

Every link in a supply network contributes equally to the operation's success.

Community factors are those influences on an operation's cost that derive from the social, political and economic environment of its site.

Second-tier suppliers may also supply an operation directly, thus missing out a link in the network.

An organisation's vertical integration strategy does NOT include:

Late delivery penalties in a supply contract can encourage good delivery performance, but distance and organisational barriers may inhibit communication.

Determine whether the stated disadvantage is created by a capacity-leading strategy or a capacity-lagging strategy: Utilisation of the plants is always relatively low, therefore costs will be High.

Operations managers are not involved in designing the shape and form of the network in which their operation is set.

Any critical start-up problems with new plants are less likely to affect supply to customers.

The centre-of-gravity method to find a location for a factory works by:

No operation exists in isolation.

An advantage of a smoothing with inventory strategy is that it reduces the risk of product deterioration and obsolescence.

For a plastic homewares manufacturer, a chemical company is most likely to be a:

Vertical integration is:

Strategic network design decisions help to:

If a car assembly operation were to buy a wholesaler this is a form of:

Second-tier customers are the main customer group for an operation.