12 Questions
What is the primary objective of inventory control?
To achieve satisfactory levels of customer service
According to the product plant strategy, what is typically produced in separate plants?
Entire products or product lines
What is the first step in the general procedure for making a location decision?
Decide on the criteria to use for evaluating location alternatives
Which of the following is NOT a function of inventory management?
Determining the location of the plant
What is the primary characteristic of the market area plant strategy?
Plants serve a particular geographic segment of the market
What is the final step in the general procedure for making a location decision?
Evaluate the alternatives and make a decision
In the product plant strategy, each plant typically supplies only a portion of the domestic market.
False
In the market area plant strategy, plants are designated to produce specific products or product lines.
False
Identifying the general region for location is the first step in the location decision process.
False
The primary objective of inventory control is to maximize profits.
False
Inventory management involves making decisions about when to order, but not how much to order.
False
The location decision process involves identifying the country or countries for location as the final step.
False
Study Notes
Organizing Operations
- Product plant strategy: entire products or product lines are produced in separate plants, and each plant usually supplies the entire domestic market.
- Market area plant strategy: plants are designated to serve a particular geographic segment of the market, and produce most, if not all, of a company's products.
Location Decision: General Procedure
- Step 1: Decide on the criteria to use for evaluating location alternatives.
- Step 2: Identify important factors, such as:
- Location of markets.
- Location of raw materials.
- Step 3: Develop location alternatives:
- Identify the country or countries for location.
- Identify the general region for location.
- Identify a small number of community alternatives.
- Identify the site alternatives among the community alternatives.
- Step 4: Evaluate the alternatives and make a decision.
Inventory Control
- Objectives: to achieve satisfactory levels of customer service while keeping costs low.
- Inventory management involves:
- Establishing a system for tracking items in inventory.
- Making decisions about:
- When to order.
- How much to order.
Organizing Operations
- Product plant strategy: entire products or product lines are produced in separate plants, and each plant usually supplies the entire domestic market.
- Market area plant strategy: plants are designated to serve a particular geographic segment of the market, and produce most, if not all, of a company's products.
Location Decision: General Procedure
- Step 1: Decide on the criteria to use for evaluating location alternatives.
- Step 2: Identify important factors, such as:
- Location of markets.
- Location of raw materials.
- Step 3: Develop location alternatives:
- Identify the country or countries for location.
- Identify the general region for location.
- Identify a small number of community alternatives.
- Identify the site alternatives among the community alternatives.
- Step 4: Evaluate the alternatives and make a decision.
Inventory Control
- Objectives: to achieve satisfactory levels of customer service while keeping costs low.
- Inventory management involves:
- Establishing a system for tracking items in inventory.
- Making decisions about:
- When to order.
- How much to order.
This quiz covers strategies for locating plants in operations management, including product plant strategy and market area plant strategy. It also discusses the general procedure for making location decisions.
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