qso600 midterm exam

7/25/2019 QSO600 Midterm Exam

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Midterm ExamOperations Management

QSO 600 Operations Management

The mid-term exam consists of two parts. Both parts shall completedusing the midterm examination template. The completed examinationshall e sumitted !ia Blac"oard for grading. The #rst part consists of#!e $%& research-ased case stud' (uestions. Be sure to cite an'appropriate reference material. The second part of the examinationshall consist of #!e $%& prolem from the material co!ered duringModules )-% inclusi!e. Students must show their wor" for full credit.*nswer all the (uestions.

Case Study Questions:

There is no set length for answers+ students ma' e as !erose or riefas the' feel necessar' to co!er the (uestion. ,se this same examdocument for 'our answers placing them elow each (uestion. Thisportion of the exam is worth % points.

Problem Questions:Ma"e sure to show all 'our wor" to get full credit. The instructor needsto "now the formulas and calculations 'ou used to get to 'our #nalanswer. /ou can do part of the exam in Excel and aste 'our Excelwor" into this document. This portion of the exam is worth % points.

File Convention:1ile name for the exam attachment to estudentlastname-#nalexam $Be sure there are no spaces&Be sure to put 'our name on the exam paper.

Note:/ou ma' use the text and an' other materials. /ou are 2OT towor" with an'one else including other students in completing the examnor discuss it with them.


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QSO 600 Midterm Exam Essay Questions

Question 1:/ou are designing a grocer' deli!er' usiness. 3ia the

internet 'our compan' will o4er staples and fro5en foods in a large

metropolitan area and then deli!er them within a customer-de#nedwindow of time. /ou plan to partner with two maor food stores in the

area. 7hat should 'our competiti!e priorities e and what capailities

do 'ou want to de!elop in 'our own core and support processes8

Question 2: * 9owchart helps us see all of the steps in a process

which in turn helps us impro!e the process. :t also helps us identif' and

eliminate an' redundant steps in a process. ,sing 7ord tools $Smart*rt

under the :nsert ta& design a process 9ow chart for the grocer'

deli!er' usiness in Question ) ao!e. :n the discussion element of'our response clearl' de#ne the steps within the process and pro!ide

a rationale for each step. :nclude all elements that 'ou feel are

necessar' and appropriate to the process of a singular customer. The

assumption is that the process is repeatale for e!er' customer using

the ser!ice. Thin" of the elements that 'ou will e addressing or

answering in the succeeding (uestions.

Question : 1or the grocer' deli!er' usiness addressed in Question) the grocer' chains that 'ou are planning to partner with use

di4ering in!entor' control models. ;ompan' * utili5es the


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Question "> E=cienc' is a critical element oth in terms of indi!iduals

and machiner' in an' usiness. ?escrie some e=cienc' measures

that 'ou would implement in 'our grocer' deli!er' usiness. 7hat are

the anal'sis tools that 'ou would utili5e to determine the e4ecti!enessof these e=cienc' measures8

QSO 600 Midterm Exam Problem Questions

Problem 1#

The Bureau of @aor Statistics collects input and output data from

!arious countries for comparison purposes. @aor hours are thestandard measure of input. ;alculate the output per hour from the

following data. 7hich countr' is most producti!e8

$abor %ours &nits o' Out(ut

,nited States A.% )C6

Derman' AC.6 )00


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latest start and #nish times and slac" for each acti!it'. :ndicate how

the critical path would e determined from this information.

)*tivity )*tivity Prede*essor +ime ,-ee.s/

) F F )0

C ) 6

H %

% H

6 C H C

% 6

Problem 3.

Burger Doodle is a fast-food restaurant that processes an average of 680 food orders each

day. The average cost of each order is $6.15. Four percent of the orders are incorrect and

only 10! of the defective orders can "e corrected #ith additional food ites at an

average cost of $1.%5. The reaining defective orders have to "e thro#n out.

a. &opute the average product cost.". 'n order to reduce the nu"er of #rong orders Burger Doodle is going to invest

in a coputeri(ed ordering and cash register syste. The cost of the syste #ill

increase the average order cost "y $0.05 and #ill reduce defective orders to 1!.

)hat is the annual net effect of this *uality iproveent initiative+c. )hat other indirect effects on *uality ight "e reali(ed "y the ne# coputeri(ed

order syste+

Problem !#

* #rm is faced with the attracti!e situation in which it can otain

immediate deli!er' of an item it stoc"s for retail sale. The #rm has

therefore not othered to order the item in an' s'stematic wa'.


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Iowe!er recentl' pro#ts ha!e een s(uee5ed due to increasing

competiti!e pressures and the #rm has retained a management

consultant to stud' its in!entor' management. The consultant has

determined that the !arious costs associated with ma"ing an order for

the item stoc"ed are approximatel' J0 per order. She has alsodetermined that the costs of carr'ing the item in in!entor' amount to

approximatel' J per unit per 'ear $primaril' direct storage costs and

forgone pro#t on in!estment in in!entor'&. ?emand for the item is

reasonal' constant o!er time and the forecast is for )6%00 units per

'ear. 7hen an order is placed for the item the entire order is

immediatel' deli!ered to the #rm ' the supplier. The #rm operates 6

da's a wee" plus a few Sunda's or approximatel' C0 da's per 'ear.

?etermine the following>

a. Optimal order (uantit' per order

. Total annual in!entor' costs

c. Optimal numer of orders to place per 'ear

d. 2umer of operating da's etween orders ased on the optimal

ordering.

Problem "#

The ;ommonwealth Ban"ing ;orporation issues a national credit card

through its !arious an" ranches in #!e southeastern states. The


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an" credit card usiness is highl' competiti!e and interest rates do

not !ar' sustantiall' so the compan' decided to attempt to retain its

customers ' impro!ing customer ser!ice through a reduction in illing

errors. The credit card di!ision monitored its illing department process

' ta"ing dail' samples of 00 customer ills for C0 da's and chec"ingtheir accurac'. The sample results are as follows>

Sam(le Number o' e'e*tives Sam(le Number o' e'e*tives

) )6 )0

) ) )

C )A )H

H 6 ) )6

% % 0 )%

6 A ) )C

)0

A )) C )0

)H H )

)0 )0 % )%

)) 6 )H

) 6 )6

)C C A )

)H )%

)% A C0 )H

?e!elop a -chart for the illing process using control limits and

indicate if the process is out of control.

qso600 midterm exam

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