True/False: (50 pts. / 2 pts. ea.) Underline the phrase that makes the statement false in order to get credit for you answer!!! One of the risks associated with the implementation of an MPC system is that there is no guarantee that it will be effective and its benefits achieved. An effective MPC system should provide means for the coordination of the supply chain. Demand management provides the link to the market place. The MPC system design does not depend on the nature of the production process, the degree of supply chain integration, customer's expectation, and the needs of management. The support activities of the MPC system can be broken into three time horizons: long term, medium term, and short term. In an MTO environment, monitoring and tracking of engineering changes by the MPC system is key in order to satisfy customer requests. In the ATO environment, uncertainty involves not only the quantity and timing of customer orders but product mix as well. In the ATO environment the primary task of demand management is to define the customer order in terms of alternative components and options. In the ATO environment the primary task of demand management is to define the customer order in terms of alternative components and options. In the MTS environment the inventory that defines the customer service is the inventory of components. The objective of moving average is to smooth out the random fluctuations while being sensitive to any possible changes that may be taking place with the underlying average. 11._ Often the most recent history is the most relevant in forecasting short-term demand. 2.__ The mean error (ME) is concerned with the error magnitude. 13._ The mean absolute deviation (MAD) is used to measure bias. Page 7 of 8 The MPC system must be dynamic as result of market, economic, technological, and organizational changes. Long-term or product-line forecast are more accurate than short-term and/or detailed forecast The aggregate forecast must be consistent with the individual product forecasts. The whole must equal the sum of the parts. Companies with a formal MPC system have usually less indirect employees than a company with no formal system. The engine of the MPC system depicts all processes related to the execution of the customer order. The backend of the MPC system encompasses all processes related to the detailed material and capacity planning. The MPC system is concerned with planning and controlling all aspects of manufacturing except scheduling machines and people. Forecasts are always inaccurate and should thus include both the expected value of the forecast and a measure of forecast error. In general, the farther up the supply chain a company is, the greater is the distortion of information it receives. Through the demand management module, information on the market is gathered, orders are entered, products are configured, manufacturing specifications are developed, and customers are informed of product availability and delivery times. 24. Sales and operations planning provide the key communication links for top management to coordinate the various planning activities in a business. 25. Top management looks at aggregate data for strategic decisions because it usually has less uncertainty than detailed data