TINIV ERSITY OIi CO[,ON4BO.

SRI I-ANKA
FACULTY OF h'llAhiAfjHlvlENTct Fi'INANCE
Unit
& &tid-LlareerDeveIt-'pmt::nt
Post6ira.ciuate
Masterof Bu'sinessAdministration(S,{BA)/ MII A.in Marketing
2407
Seine';ter-Il(First-Haif)Examination- .Tutre
MBA 538 * OperationsManagemenit
Threer(03) Lfr:urs

Instructionsf,rr cartrliql*lteri
i

from
at leastUf.(}l{UD questions
questioilsin all selectron
AnswcrL[YS-,{,t$-].
eachpart.

ii

Answersto ff,RT:-Lqrgt FAR:L,-[! shouidbc writtenin WPAK$TElII^SW

to the supervisor
B08KS anclI tendr-rver
,SUHffiAT&LX

flAffiT-I
I
i.

The total ilcrernelultr cost of simpierrnodel of an inventory control systemis given

by:

"t'ic : i()/2)* LjH-+

(R/Q)*Cu
w*here
C,, '.''iJolr"lingcost/ unit I Year
(lp -=OrrJeritrgcost / order
Q ---0rdering quantitY
R '= Anfiiial drrnand
and the econotnicorderqttantii)'is given Lry:
I-*;_

--

EOO
- .= ^l{K!:

V C n

Stateall assurtFtionsmadein derivingthe aborreequations

[03 Marks]

iead tine is not constantand varying

rvhensu5i1r1'',
Anal-vzethe model graphrca111,
'.ime
an oreleris plaet:cl.
with each
t03 Nfarksl
Discuss hor,vthis rnocleiiri applieclra'heuyoLt leai r.vithquantity price breaks.Y our
tu the economicorderquantity.
stepsinvoh'cd in ar','ir,'ing
answer.mustincluctre

tll

[04 Marksj
IV

Items pi:rchasedliom a vencli;ioi]:it iiZi} each, and tire fbrecastfbr next year's
time arrorderis placedfcrrmore units and
demandis 1,000units.lf it costs$5 *,'v'ery
the i'ollo'wlllSl:
Ca.lc"rjatr:
the stor;rgecost is $4 per r"rnitper.vear'"
i'r.
I

o
c^

eachtinle'i
What quantit)'shouldhs ,rrdere{"|
a year?
fi)r
cost
the
totalr:rderi'in6
is
What
r,:ost{br a vear'/
What is the total st{-lrage

[04 Marks]
[03 Marks]
[03Marks]

(Total20 Marks)

in bilsines-';planning?Explain
What is the strategicnole of dernanii iirrtc;,rsting:
brieflv.

[02 Marksl
What are the steps involved ill fixing a forecasting rnoclei to an organization
consideringpastdatii?Lixpiain.

[06 Marks]
lll.

The formulae for expcnential srnoothingand adjustedexponential smoothingwith

standardnotationsare gil'en below:
Simpleexponentialsmootltiug F1nr==cr.Dt+ (li - u)F1
AF,*r =F1*1*T1*1
Adjustedexponentiitlsmoothinl;
WhereTt*r

= i3(Ftor- F,) :"(l - P) Tt

Discussthe behaviorof smooilLingconstantt,r.

102Marksl

Quarterlysalesof tlovierse.ta wtrolesalerareas fblitrws:

y*"-]-q"1lilr;;ls;t"s($)-i.
($)T. Ii
i-0ffir;;il-s;t"'
__----j-

2 { ) 0 5 I* _ . _ _ .

.-.i_

lllur!

!4lruJ

138

l"orecastquarterly salesfbr r'cr* 2007 usinq

a.
b.

with tr:0'l
srnonthing
Simpleexponential
u'ith sr.'=0.1 and 1p'= 11.1
exponentialrir;r,;othiug
,z\djustcd
Stateail ynui ottumpti,.,r:s.

110Marks]
(Total20 Marks)

102Marksl

What i:i DistributionRequirementPlanning{DRI'}i?

Dii;cr:ssstepsinvolveclin implementilg supplv chaitt prar;ticesin your organizatton.

[08 Marks]
t.t.

iv]rich {}perates,at a location far

{BC' l]iq;ycle(l]vt) X,rrJ.has .r centrrl warehr-ritsc.
f,r\\nitilc assemblyplanf. T'hebic;r'ciesare disr:'itrutediiom the central warehouse
'I'he
currently has 950 bicycies and a
to rcgilnal warehouse:;.
central r.!'atreholt.:ie
tr: cater demand uncertainty.The
safeV stock of 150 is to be strictXyrr,.aintaine:il
as 2 r;ionths"A containerfull load could
distri:rutionlead-timehas beenestimai.ed
acconrmodate200 bicl'cles and tirere.''orethe film expects at least a minirnum
order size of 200 units" Fiovrever, the warehouse can order more than the
minirnum order quantity bLrteachlot siz:ernust satisfy the fi"rllcontainerload. The
dafti gatheredfrom a number of distribution points ha'uebeen tabulatedas a total
'bicycle.
gross reqirirement for thu
Note that due to a kiss in demand of the
bir;yclessince August" the ,Cistributionnranagerhas decided to reduce the safety
slock to 75 units startinsftom Juiv.

f M"rh

-.

-T
tpi-Ir't"r;
t#;-lF.'bTM*
I
--l]sr

i-E!;yrtgl-

iaqqhse-It:Ll?zq

Derivea plan to nlanageilrerciemand.

Aus
3_50 30u 1 2 0

Jun

Jul

p0 Marksl
(Total20Marks)

4
i

List two MF{P II problernuunil gx-piainlrow it is soivedrn APS (AdvancedPlanning

and Schedr"i
ling) system.

[03 Marks]

lt

Briefly explain the follorvingtcririinologiesin h,LRP.

(a) Shrinl,ragefactor
(b) Scra',:r
facror
(c) Do'.;kto stock lead time
(d) O'.'dermultiple
(e) (.'hildrenof the parentr

[05 Marks]
lll

In the bill of rnaterial stnicturr-'sirrrl'rt trelolv. the nuinhers within the bracket
represenls quantitiestr)eriisserrrhl)'.

L*i
The rnasterprodr,rctionst:hedulefor th"efinished item A is given below;

2
100

3
300

A
1+

6
5
?"50 1 5 0

The other datato considerduring materiai planning is listed in the table below:

-T--o.d*
il;* fQ;'titifil;d
rt'".]_---o'd;;
_ ___ Lq-sHrydll_qtsg!) | Ivtiqipusq__t_vlglSxle
noiq--j --ryte-L- | -19---j-----t ---l
20
100

Perform a conrplete material pianning for the planning horizon of 5 periods

con:,ider
ins traditionalMI{P concept.
[2 marks]
(Total20 Marks)

)
ABC Co l,td. presenllirmanufacturescustomlzedmachine elements.Its highly skilled
work fbrce, who has diversifled skills" is a gr:eatstrengthfbr th,ecornpany.The company
claim ilremium price for its highllr cnstomized prochlcts. I{owever factory manger
recentlyobservecisome complaintsfi'om its customers.MissinE5
some importantfeatures
of the product ancl delaS'sin deliverl, are the major complaiirs noticed by the factory
manalJer.
i

\\rhat ob"iectives
shouldbe aitroptcrl
in rnanufhcturing
i.vithrespectto cost,delivery,
quality.ancii {,:.xibiIitv?
[05 marks]

ii

What may be tlie causesfor irrobienrsin nresentproductionsystem?What are the

possibleimprov':rnenttools to elirninatethem'J
[05 marksi

iii

The company rvishes to change its businessstrategy by shif,tingits market fr6m

customizedptoducts to trigh t'oJufiicstancJarcj
producls. What are the changes
neededin mernufacturing
strateE)'u'i,th respe'ctto pror:ess.equiprnent,workf,orce,
and quality rr:anagement?
[08 marks]
(Total20 lVlarks)

6
What are the relative ach'antages
and rjisaclv,{ntageous
srJ'incrementaland one-step
capacitystr"ategies?
Discussin what situationseachof tliesestrategies
is suitable.
[08 marks]
An assernt,lyline is trl be designr:dto cper;rtell rzihours per tial,and supply a steady
demandof 300 units prercia,v"Tlre tasir:ancifheir penfbrrnurr,,"l
tirnes u.* giu*n in the
tablenexr page.

a. Draw the precedenceciiagram

b . What is the c-y-cle
tirnel)
Assignthe tasksinto workstatlonstn give an eflicient line.

[03 marks]
[02 marks]
[07 marks]

(Total20Marks)

Expiainthe sa"rpeof 'Qualit3,ccntrol' "Qualitvi{ssurance',

and'Total Quality
Management'(fQM).
[06 Marks]
Explain'Quali.tyof design'and 'Qr.la.lity
of'confi:rrrnanco'.
Discnsstheir impacton
the organizationalperformanci:.
[07 Marks]

lll

Head of an academic departmentis itusrlratedb1, the depa.rtment'sinability to

provide good computer facilities for the str:rXenls
ot the:department. Show how
you would use a fishbone(causeand effect) diagramto analyzethis situation.
[07 marks]
(Total20 Marks)