What are the steps involved in forecasting?

There are some basic steps that should be followed when making a forecast:

1. Decide what to forecast

2. Evaluate and analyze appropriate data.
3. Select and test the forecasting model
4. Generate the forecast.
5. Monitor forecast accuracy

What are the core beliefs of JIT philosophy?

The core beliefs of JIT are the elimination of waste, the ability of the employees to see the “big picture,” simple
solutions, continuous improvement, visibility and flexibility. JIT strives to produce the right products at the right time in
the right quantities. Continuous improvement and flexibility are important beliefs that help us achieve this goal.

How do you see Statistical quality control in the organization?

Statistical quality control in organizations refers to the use of statistical methods in the monitoring and maintaining of
the quality of products and services. All the tools of SQC are helpful in evaluating the quality of services of the
organizations.

Write the characteristics of Total quality management

. Its major characteristics are

1. customer focus,
2. continuous improvement,
3. quality at the source,
4. employee empowerment,
5. understanding quality tools,
6. a team approach,
7. benchmarking
8. and managing supplier quality.

Is there any product to sell without operation management? What is the role of operation
management?
Without operations, there would be no goods or services to sell.

The role of operations management is to transform a company’s inputs into the finished goods or services. Inputs
include human resources (such as workers and managers), facilities and processes (such as buildings and equipment), as
well as materials, technology, and information.
 Long Question
A Gardener wants to develop a forecast for next year’s quarterly sale of Cactus Trees. He has collected quarterly sales
for the past two years and expects total sales for the next year to be 500 cactus trees. The data clearly exhibit
seasonality. How much can he expect to sell during each quarter of next year accounting for seasonality?

Cactus tree Sold

Season Year I Year II

Fall 100 110

Winter 82 95
Spring 180 173
Summer 110 110
Solution:
Step 1

Year 1: 472/4 = 118

Year 2: 488/4 = 122

Step 2

Cactus Trees Sold

Season Year 1 year 2
Fall 100/118 = 0.847 110/122 = 0.902
Winter 82/118 = 0.695 95/122 = 0.778
Spring 180/118 = 1.53 173/122 = 1.42
Summer 110/118 = 0.932 110/122 = 0.902

Step 3

Season Average Seasonal Index

Fall (0.847+0.947)/2 = 0.875
Winter (0.695+0.778)2 = 0.737
Spring (1.53+1.42)/2 = 1.48
Summer (0.932+0.902)/2 = 0.917

Step 4

The sales forecast for next year is 500 cactus trees. The average demand per season, or quarter, is

500/4 = 125

Step 5

Season Forecast(Cactus Trees)

Fall 125(0.875) = 109.4
Winter 125(0.737) = 92.13
Spring 125(1.48) = 185
Summer 125(0.917) = 144.4
Long Question
Zahid dry cleaner has collected the following data for its processing of dress shirts;

Its takes an average of 3.5 hours to dry clean and press a dress shirts, with value added time estimated 110
minutes per shirts.
Workers are paid for a 7 hours’ work day and work 5.5 hours a day on averages, accountings for break and lunch;
labor utilization 75 percent in industry
The dry cleaner completes 25 shirts per day, with an industry standard of 28 shirts per day for a comparable
facility.
Determine process velocity, labor utilization, and the efficiency for the company.

Solution:
Average hours to dry clean and press a shirt = 3.5 Hours or 210 minutues

Value Added minutes = 110 minutes per shirt

Process Velocity =

Process Velocity= = 1.90

.
Labor Utilization =
= 0.786 78.6%

Daily shirts Completed = 25 Per day

Industry Standard = 28 per day

Efficiency = = 0.89 89%

Process velocity shows room for process improvement, as throughput time is almost twice that of value-added time.
Labor utilization is just above the industry standard, though overall efficiency is below.
Long Question
Define productivity and identify productivity measures?
Solution:

A measure of how efficiently inputs are being converted into outputs is called productivity. Productivity measures
how well resources are used. It is computed as a ratio of outputs (goods and services) to inputs (e.g., labor and
materials). The more efficiently a company uses its resources, the more productive it is:

Measures of Productivity

Total productivity
Productivity computed as a ratio of output to all organizational inputs.

When we compute productivity for all inputs combined, such as labor, machines, and capital, we are measuring total
productivity.

Partial productivity
Productivity computed as a ratio of output to only one input (e.g., labor, materials, and machines).

=
ℎ

it is much more useful to measure the productivity of one input variable at a time in order to identify how efficiently
each is being used. When we compute productivity as the ratio of output relative to a single input, we obtain a measure
of partial productivity, also called single-factor productivity.

Multifactor productivity
Productivity computed as a ratio of output to several, but not all, inputs.

=
+

Sometimes we need to compute productivity as the ratio of output relative to a group of inputs, such as labor and
materials. This is a measure of multifactor productivity.