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Semester II Examinations 2009/
Exam Code(s) (^) 1AP1, 1AP Exam(s) (^) Master of Applied Science (Enterprise Systems)
Module Code(s) (^) IE Module(s) (^) Operations Management
Paper No. 1 Repeat Paper
External Examiner(s) Prof. J. Antony Internal Examiner(s) Dr P. Donnellan Prof P. McHugh
Instructions: Answer any FOUR questions
Duration (^) 3 Hours
No. of Pages Cover + 3 pages College/Discipline Engineering & Informatics/Industrial Engineering. Course Co-ordinator(s) Dr K Cormican
Requirements :
Candidates may use calculators
a) What are the basic assumptions used in Inventory Management? 5 marks
b) Explain the concept of an economic order quantity (EOQ), and show how the EOQ formula is derived: (use Diagrams please)
C c
2 C 0 D
i.e. EOQ =
8 marks
c) A carpet store wants a reorder point with a 95% service level and a 5% stockout probability. For the data given below calculate the reorder point and an appropriate safety stock level. (Note Z= 1.64 for 95% service level)
5 yardsper day
L= 10 days
= 30 yardsperday
d^
d
12 marks
Question 2 (a) Explain how the Continuous and Periodic Inventory management systems work. Give an example of each system. 10 marks
(b) The manager of a large insurance office is examining the purchasing policy for stationery. He starts with an envelope that is used extremely frequently – he estimates 10,000 per week – and costs 5p each. He estimates that the cost of placing an order is £50, independent of the order quantity, and that the cost of holding stock is approximately 35 per cent of the value of the stock held. (i) Calculate the economic order quantity for the envelope, and suggest how frequently it should be ordered. 8 marks (ii) The supplier offers to reduce the price to 4.5p each, if the whole year’s requirement is ordered and paid for in advanced. Should this offer be accepted? 7 marks
a) Explain how an MRP system works, including inputs, outputs and required data sources. Use a simple example in support of your answer. 12 marks b) Capacity is not factored into the basic MRP calculations as MRP tells you what you need to do, not how to do it. Discuss how you would plan capacity, including capacity expansion strategies, and the concept of load leveling. Also present some strategies you would use to manage fluctuations in demand. In particular discuss how you would handle a variety of demand increase scenarios. 13 marks
Question 6
a) Define Quality from the Producers perspective and from the Consumers perspective. 8 marks
b) Explain the Deming PDCA Cycle 4 marks
c) Explain the DMAIC process used in the 6 Sigma methodology. 8 marks
d) Show a generic Cause effect diagram and a Pareto plot and briefly explain how they are used. 5 marks
