Study Guide Test 2Ch. 4Definitions- Reverse engineering – dismantling and inspecting a competitor’s product to discover product improvements- Research and development (R&D) – organized efforts to increase scientific knowledge or product innovationo Basic – advancing the state of knowledge about a subject w/o any near-term expectation of commercial applicationo Applied- objective of achieving commercial applicationso Development – converts the results of applied into useful commercial applications- Product liability – the responsibility of a manufacturer for any injuries or damages caused by a faulty product- Uniform commercial code – products carry an implication of merchantability and fitness- Value analysis – examination of the function of parts and materials in an effort to reduce cost and/or improve product performance- Remanufacturing – refurbishing used products by replacing worn-out or defective components- Recycling – recovering materials for future use- Standardization – extent to which a product, service, or process lacks variety- Mass customization – strategy of producing basically standardized goods, but incorporating some degree of customization- Delayed differentiation – producing, but not quite completing a product or service until customer preferences are known- Reliability – ability of a product, part, or system to perform its intended function under a prescribed set of conditions- Failure- product, part, system does not perform as intended- Normal operating conditions- set of conditions under which an item’s reliability is specified- Robust design – design that results in products/services that can function over a broad range of conditions- Concurrent Engineering - Bringing engineering design and manufacturing personnel together early in the design phase- Computer – aided design (CAD) Product design using computer graphics - Service – Something that is done to or for a customerCH 5- Capacity- upper limit on the load that an operating unit can handleo Key questions in capacity What kind of capacity is needed How much is needed to match demand When is it needed- Design capacity- the maximum designed service capacity or output rate- Effective capacity – design capacity minus personal and other allowances- Capacity cushion – Extra capacity used to offset demand uncertainty- Bottleneck operation – an operation in a sequence of operations whose capacity is lower than that of the other operations- Constraint – something that limits the performance of a process or system in achieving its goals- Break – even point (BEP) – the volume of output at which total cost and total revenue are equal- Indifference point - the quantity that would make two alternatives equivalent- Cash flow – the difference between cash received from sales and other sources, and cash outflow for labor, material, overhead, and taxes- Certainty – environment in which relevant parameters have known values- Risk – environment in which certain future events have probably outcomes - Uncertainty – environment in which it is impossible to assess the likelihood of various future events- Maximin – choose the alternative with the best of the worst possible payoffs- Maximax – best possible payoff- Laplace- best average payoff of any of the alternatives- Minimax regret – alternative that has the least of the worst regrets- Expected Monetary value(EMV) – best expected value among the alternatives- Decision trees – payoff table – o Alternatives (nodes) – like do nothing, replace, expand,- Over capacity – overshoot demand, overstocked/inefficient- Undercapacity – cant meet demand-CH 19 Decision variables – amounts of either inputs or outputs Constraints – limitations that restrict the available alternatives Feasible solution space – the set of all feasible combinations of decision variables as defined by the constraints Parameters – numerical constantsCONCEPTS Ch. 4- Product life cycleo Introduction - not expecting to make $$ during phase because of costso Growth – price decrease, begin to make $$o Maturity – Really making $$ , repeat customers, gained loyaltyo Decline – “BOOM” is over, start to fallBackup Reliability1 - (1-R)(1-R)Negative Exponential Distribution – Time/Mean Time between failureSTUDY DISTRIBUTION CHARTS IN BACK OF BOOK (ALTHOUGH YOU WILL HAVE ONE GIVEN ON TEST)If you’re looking for time (t) and have an associated probability , look up probability in table B. Get the z- score, plug z – score into formulaZ = (Time – Mean)/ Standard DeviationCH 5- Decision theory o 1. Identify possible future decisions (states of nature)o 2. Develop list of possible alternativeso 3. Estimate known payoffso 4. Estimate likelihood of each possible future conditiono 5. Evaluate- Environments o Certainty o Uncertaintyo RiskKnow Maximax, maximin, laplace, ****minimax regret****Expected Value of Perfect Information (EVPI)1. Expected Value under certainty – Expectived value under risk (EMV)2. Minimum expected regret – choose lowest of regretsDecision trees – payoff table (schematic that includes states of nature, alternatives, and known payoffs)Alternatives States of Nature – nodeDemand = low, med, highCH 19- Linear programming – map constraints as equations to decide how many products to manufacture in order to maximize profits and minimize costs- Components of a LP problemo 1. Decision variables (x1, x2) AKA (H,W)o 2.Objective function (state) – maximize z = $40H & $30Wo 3. Constraints (identify) Fabrication – 4H+2W < 600 Assembly – 2H + 6W <480o 4.Parameters (40,30,4,2,6)o 5. Identify feasible solution space – plug parameters into functiono 6. Identify cornerpoints of feasible solution space – set the 2 constraints against each other and solve for one
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