UNIVERSITY OF MALAYA. EXAMINATION FOR THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION ACADEMIC SESSION 2014/2015: SEMESTER 1 CMGB6104: OPERATIONS MANAGEMENT DEC 2014/JAN 2015 TIME: 2 HOURS INSTRUCTIONS TO CANDIDATES: Section A: Candidates must answer ONE compulsory question in this section Section B: Candidates are required to answer any 2 (two) questions from this section. Diagranvillustration must be drawn clearly. (This question paper consists of 4 questions on 7 printed pages)CMGB5104 SECTIONA 1. (a) Explain how Just in Time (JIT) concept can be adapted to service organizations. Use relevant examples to support your answer. (20 marks) (b) ‘Quality improvement plays a significant role in achieving a lean manufacturing system’. Discuss. (20 marks)cMGB6104 SECTION B 2. A relailer sells shoes in a shopping mall. The demand for a branded black shoe, ‘Cools’ is at a constant rate of 500 pairs of shoes every three months. The retailer's current purchasing policy is to order $00 pairs of shoes each time an order is placed. It costs $30 to place an order and the annual cost of holding is 20 percent of price of ‘Cools’. With the order quantity of 500, the retailer obtains the shoes at the lowest possible unit cost of $28 per pair. The price schedule for ‘Cools’ shoes, as offered by the manufacturer is as follows:- ‘Order Quantity] Price per pair (8) 0-99 36 | 100-199 | 32 200 - 299 30 300 or more 2 (a) Evaluate the various discount options and advise the retailer on the optimal quantity of ‘Cools’ shoes that retailer should order at a time. (24 marks) (b) What are the annual savings of your inventory policy over the policy currently being used? (6 marks) anCMGB6104 3. A car dealer has recorded sales data for the year 2014. The data js listed in the table below:- Month Sales Quantity January 9 February 7 March 10 April 8 May 7 June Py July 10 ‘August W ‘September 2 October 0 November 4 December | 16 (@) Compute a three-month moving average forecast for April 2014 to January 2015. (10 marks) (b) Develop an exponential smoothing forecast for January 2015 using a =0.20. (12 marks) (c) Which of the above two methods should be used for accurate forecasting? ustify your answer by using MAD technique. (8 marks)CMGB6104 4. The activities of a waste water treatment plant construction project, their immediate predecessors, and estimated activity times are shown below:- [ Activity ee Time (days) A = 7 B B 3 Cc A 12 D 5 2 E cD 8 F c 3 G F 2 HW F 3 1 EGH Lali ] 1 2 K e m 9 (a) Draw the project network. (8 marks) (b) Identify the critical path(s) by calculating early and late start days, early and late finish days and activity slack. (46 marks) (=) What is the project completion time? Given this analysis, as a project manager, what are your recommendations? (6 marks)CMGB6104 FORMULA : 4. Economic Order Quantity = /205/, 2. Annual Setup Cost = 38 Annual Holding Cost = ou Average inventory level = Maximum inventory level 2 Reorder point = d xt Expected number of orders = N2 9. Length of production cycle = 2 10. EF=ES+t 14. LS=LF-t 12. S=LS-ES of S=LF-EF 48. Cycle time = Production time available per day Units required per day tasktimes S geletime 14. Minimum no. of workstations = 15. Efficiency=___ CS task times (actual number of workstations) X (largest assigned cycle time) 16 demand in previ Wovig average = 222 m prvi pat wot or prea __ ESTERS ay = weights Weighted moving average FR stall, o) where F;= new forecast Fi. = previous forecast & = smoothing (or weighting) Fro ang) * (1 = oF rs * Tea)CMGB6104 Mean Absolute Deviation (MAD) Mean Squared Error (MSE) ¥ (Forecast Errors)? MSE = 7 Mean Absolute Percent Error (MAPE) Sionpeta, + ForecastyActua END 7