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Homework answers / question archive / Chapter 13   Operations Management 1) The tools and techniques of operations management do not apply to service firms or service activities

Chapter 13   Operations Management 1) The tools and techniques of operations management do not apply to service firms or service activities


Chapter 13   Operations Management

1) The tools and techniques of operations management do not apply to service firms or service activities.




2) The term operations management is used to describe the activities related to producing both products and services.




3) Operations management is purely a specialized function, without organizational or strategic importance.



4) A popular definition of quality is "fitness for use," which is a measure of how well a product or service performs its intended purpose.





5) Total quality management (TQM) encompasses a commitment from employees at all levels to continually strive to make improvements and satisfy customers.





6) Total quality management (TQM) requires the use of a separate team of experts to inspect products or services for defects or errors after completion.



7) TQM emphasizes "quality at the source," that is, quality inspection at all stages of production or service output.




8) Statistical process control is a TQM employee empowerment tool.




9) TQM uses only quantitative methods to promote "quality at the source."




10) The fundamental notion of process reengineering is that form influences function.




11) Continuous process improvement in an organization involves both incremental and breakthrough improvements in the way it does business.






12) The Six Sigma approach mainly focuses on hitting a target average for eliminating defects and enhancing quality.



13) Capacity planning involves determining how much of a product or service a firm should be able to produce.




14) Capacity planning for operations managers is a routine activity with little risk.





15) Most organizations should operate at maximum capacity at all times.




16) A materials requirement planning (MRP) system produces schedules that identify raw materials, parts, and assemblies needed during specified time periods.



17) Managers use the economic order quantity (EOQ) model to minimize total inventory costs.





18) The ABC analysis model helps managers decide when to order a product and how much of it to order.



19) In today's business world, most companies plan on carrying excess inventory in order to meet unexpected upswings in consumer demand.




20) Just-in-time (JIT) systems are used to manage and control inventory systems in order to ensure the timely delivery of products or services and all related inputs.



21) A JIT system works best for organizations that make customized, one-of-a-kind products or services.




22) Gantt charts are mathematical representations of projects.




23) Gantt charts and PERT/CPM tools perform identical functions.





24) The "critical path" through a network of activities represents the shortest time path for the project.



25) Productivity is a measurement of how well an organization is using its resources to produce goods and services.




26) The supply chain refers to the coordinated system of resources, information, activities, people, and organizations involved in moving a product or service from raw materials to components and into a finished product or service delivered to the end customer.




27) As the complexity of managing supply chains has increased, its potential strategic importance has decreased.




28) ________ is a specialized field of management associated with the conversion or transformation of resources into products and services.

A) Strategic management

B) Operations management

C) Production management

D) Supply-chain management





29) Which of the following is true of operations managers?

A) Their objectives have no direct cost implications.

B) They use a single technique to ensure timely delivery.

C) They are in charge of product quantity not quality.

D) They perform their duties while minimizing costs.



30) Which of the following statements is true of the quality of a product?

A) Quality consists of both efficiency and effectiveness.

B) Quality is not related to reliability.

C) Quality definitions are different for products and services.

D) Quality enhancements affect future, not current, revenues.




31) ________ is a management philosophy that involves a commitment from all levels of employees to continually strive to make improvements and satisfy customers.

A) Capacity planning

B) Total quality management

C) Statistical process control

D) Just-in-time systemization




32) Which of the following is true of TQM?

A) It is not a part of any organizational culture.

B) It requires only the managers of an organization to commit to it.

C) It uses both quantitative and nonquantitative techniques.

D) It checks for quality control post-production.





33) The TQM concept of "quality at the source" involves ________.

A) cost controls and statistical analysis

B) computer-aided design and work standardization

C) capacity planning and operational protraction

D) quantitative techniques and employee empowerment



34) ________ is a quantitative tool to aid in making decisions concerning how well a process is performing.

A) Employee empowerment

B) Statistical process control

C) Total quantity management

D) Electronic data interchange




35) The term ________ refers to the incremental and breakthrough improvements in the way an organization does business.

A) computer-aided engineering

B) electronic data interchange

C) statistical process control

D) continuous process improvement





36) The fundamental notion of process reengineering is that ________.

A) function influences form

B) form influences function

C) form and function exist independently

D) form and function are irrelevant to the process





37) Which of the elements of continuous process improvement examines the critical sequences and seeks to maximize the objective.

A) design

B) objectives

C) capabilities

D) metrics



38) Top executives at McCain Ericsson Bank have taken up business process reengineering to improve the standards of the organization. They are unsure if their current loan application process is an adequate measure of determining whether or not a loan should be given to an individual. Which of the following elements are they considering?

A) objective

B) design

C) capabilities

D) infrastructure




39) ________ is a disciplined, data-driven approach for eliminating defects and enhancing quality, with an orientation toward the impact such improvements will have on the customer.

A) Six Sigma

B) ABC analysis

C) PERT analysis






40) The total quality management philosophy emphasizes that ________.

A) separate teams of experts should inspect products or services for defects or errors after completion

B) empowered employees will take responsibility for their individual output as well as that of the whole organization

C) operations management is a specialized function without organizational or strategic importance

D) organizations should operate at the maximum capacities at all times




41) Managers use capacity planning to ________.

A) ensure that total inventory costs are minimized

B) make decisions concerning how well a process is performing

C) categorize items to produce a list of items that require the most control

D) determine how much of a product or service a firm should be able to produce



42) The ________ is the maximum capacity at which a facility can run under ideal conditions.

A) design capacity

B) effective capacity

C) optimal capacity

D) supply capacity





43) Blue Springs is a company that produces bottled water. It has received a huge order to supply water for a five-day convention that is taking place in the city. There are about half a million guests expected to attend each day. The company must operate at its ________ to meet this demand.

A) optimal capacity

B) effective capacity

C) supply capacity

D) design capacity




44) ________ is the percent of design capacity a facility is actually expected to maintain.

A) Expected capacity

B) Effective capacity

C) Projected capacity

D) Extended capacity



45) Dr. Magorium's Toy Co. managers hold a meeting every July to decide on the Christmas season offerings to be made that year in order to make good revenues for the organization. Which of the following scenarios best parallels this?

A) A manager in a chemical plant is in the process of deciding whether there is need for another new ethanol-refining machine or whether he can meet the demand with existing ones.

B) A hotdog seller calculates how many buns he must buy as the next day he plans to be outside the Superbowl stadium.

C) A university decides to discontinue a philosophy course due to lack of students signing up for it.

D) A Hollywood producer promotes his latest action feature with emphasis on areas where action films traditionally do well.





46) ________ is a system of getting the right materials to the right place at the right time.

A) Flexible manufacturing

B) Total quality management

C) Computer-assisted delivery

D) Materials requirement planning




47) Sandra, the operations manager of the Zara clothing chain, is informed that the summer line requires certain materials that are not available locally. She recalls having used the same raw materials two summers ago from a niche supplier. Which of the following should she use to solve this issue?







48) Which of the following is true of firms that implement a MRP system?

A) They can often increase their inventory.

B) They are not efficient in responding to customer demands.

C) They can price their products competitively.

D) They use TQM as a subapproach to MRP.





49) Since the two major costs of a company, annual carrying costs and ________, vary inversely, there are always tradeoffs to make.

A) overhead costs

B) holding costs

C) variable costs

D) ordering costs




50) What are stock outs?

A) carrying of excess inventories that increase holding costs and therefore total costs

B) not getting products and services to customers when they want them

C) guarantee of product quality and quantity together with timely delivery

D) It is a term that refers to goods that have never been purchased by a customer.




51) Retail managers can use ________ to determine which inventory items require the most attention.

A) EOQ modeling

B) CSI factoring

C) ABC analysis

D) LIFO analysis




52) The profits of Dunkin' Donuts are down by a quarter. The management believes this is because of the high cost of the raw materials being used. Matt, the operations manager, should use the ________ model so that total inventory costs are minimized.








53) Which of the following is as costly as having excess unused inventory?

A) not being able to reach products to customers when required

B) holding parts in a static industry

C) holding just enough inventory for adequate supply

D) not having enough storage space for inventory




54) Which of the following is an advantage of using the EOQ model?

A) helps managers make decisions about when and how much of a product to order

B) improving productivity and quality by reducing labor and equipment time

C) provides information about which inventory items require the most attention

D) increasing customer satisfaction by decreasing the time required to make and deliver the product or service




55) Holding parts in dynamic industries ________.

A) is best because the parts do not depreciate in value

B) does not just increase holding cost but has to be written off

C) causes many companies to incur increased profits

D) does not make any difference to the industry



56) ________ refer to inventory management and control systems that ensure the timely delivery of a product or service and related inputs.

A) Just-in-time systems

B) Supply-chain systems

C) Continuous improvement mechanisms

D) Statistical process control techniques




57) A(n) ________ is a nonmathematical graphical representation of projects used by managers to help monitor the progress of projects.

A) ABC analysis

B) Gantt chart

C) EOQ system

D) JIT system





58) Production of Sliver's latest small car, the Beetle, has been a dramatic improvement compared to its previous product, Quiver. The production target of 2,000 Beetle cars per day has been reached only within 10 weeks since the launch date, which was less than the time they needed for Quiver. Which of the following, if true, would suggest that Sliver adopted a JIT strategy for the Beetle?

A) Sliver acquired one of its major distributors before the production of the Beetle.

B) Sliver has recently made a substantial investment in acquiring warehouses close to its production facilities.

C) Sliver acquired a fleet of airplanes to ensure that all the components it sourced from across the world were unaffected by supply bottlenecks in other countries.

D) All of Sliver's production factories have their own purchase departments that help the company achieve benefits of scale discounting.



59) Typically, the ________ would be the most useful tools for scheduling, monitoring, and controlling the timing of a bridge construction.

A) ABC/EOQ models

B) CAD/CAE approaches

C) PERT/CPM techniques

D) TQM and CPI programs




60) The PERT/CPM technique requires the project manager to determine ________.

A) the most economical quantity of products to order

B) which activities must precede others and which must follow

C) timely delivery of a product or service and related inputs

D) how to minimize total inventory costs






61) Globalization of business leads to ________.

A) increase in cost of production

B) lower profit margins

C) high pricing power for companies

D) more choices for customers



62) ________ is the measure of how well an organization is using its resources (inputs) to produce goods and services (outputs).

A) Profit

B) Turnover

C) Productivity

D) Work standardization



63) Which of the following leads to cost reduction?

A) productivity

B) excess inventory

C) customer satisfaction

D) high demand




64) A ________ is the amount of time it takes a trained employee to complete a specific activity or process.

A) unit of labor

B) work standard

C) work-sample index

D) level of effort measurement





65) ________ are commonly used for setting standards for repetitive, well-defined jobs.

A) Just-in-time systems

B) Time and motion studies

C) Work sampling techniques

D) Critical path methodologies




66) Which of the following is true of time and motion studies?

A) It does not involve reviewing any activity done in the organization.

B) It is less accurate than work sampling techniques as a method to determine time standards.

C) It follows the motto of working smart but not hard.

D) It is a popular way of determining the percentage of time spent on each activity during a working day.




67) ________ involves sampling the activities performed by an employee or group of employees at random times throughout a work shift.

A) Work sampling

B) Random sampling

C) Productivity analysis

D) Studying time and motion




68) Which of the following is true of work sampling methods?

A) They work best with repetitive, well-defined jobs.

B) They are more accurate than time and motion studies.

C) They cannot identify areas that require improvement.

D) They use observation sheets and trained observers.





69) ________ are achieved when the per-unit allocation of fixed costs and, therefore, the total cost per unit go down as more units are produced.

A) Economies of scale

B) Econometrics

C) Quality installments

D) Utilization increments




70) Economies of scale occur when the per-unit cost of production falls as a firm's output increases. How is this commonly achieved?

A) when the company suffers from a dip in the demand for its products or services

B) when the company has certain fixed costs that do not change with the rise or fall in units produced

C) when the company has a predetermined order of tasks to be completed

D) when the managers of a company have an autocratic approach to leadership




71) Which of the following production processes is the most flexible?

A) job shop

B) small batch

C) assembly line

D) continuous flow





72) Orange County Choppers (OCC) is a production motorcycle manufacturer based in Orange County. Orange County Choppers has garnered worldwide praise and recognition for their custom motorcycles. Which of the following production processes do they use?

A) small batch

B) job shop

C) assembly line

D) continuous flow




73) The ________ allows a company to capture the highest economies of scale.

A) job shop production process

B) small batch production process

C) assembly-line production process

D) continuous flow production process



74) Cars, computers, and cameras are all examples of products that are typically made via ________.

A) job shop processes

B) small batch processes

C) assembly-line processes

D) continuous flow processes




75) ________ occur when a firm gets more experienced at making a product and develops greater insight about how to do the task more efficiently.

A) Learning effects

B) Economies of scale

C) Work standards

D) Capacity expansions




76) A group of 30 students attends a particular class for a predetermined amount of time and gain knowledge inputs. This is an example of which of the following?

A) learning effects

B) small batch processes

C) job shops

D) assembly-line processes




77) Hot Oven Bakery has an order for 1000 boxes of chocolate chip cookies from Shoprite supermarkets. They also have an order for 300 boxes of gingersnaps. Which of the production processes is Hot Oven Bakery most likely to follow?

A) continuous flow production

B) small batch processes

C) job shops

D) assembly-line processes





78) Scott Refinery, based in Washington, processes approximately three hundred thousand barrels of crude oil a day. Which production process does it follow?

A) job shops

B) continuous flow production

C) small batch processes

D) assembly-line processes



79) Lotus Cars uses a manufacturing process in which individual steps in the assembly of the product are carried out by workers or machines as the product is moved along. Which manufacturing process is Lotus Cars using?

A) continuous flow production

B) assembly-line processes

C) job shops

D) small batch processes




80) In a ________, automation of a production line is achieved by controlling and guiding all machinery with computers.

A) continuous process system (CPS)

B) flexible manufacturing system (FMS)

C) manufacturing monitoring system (MMS)

D) manufacturing integration system (MIS)





81) In a flexible manufacturing system, ________ is the overall system's ability to absorb large-scale changes in volume, capacity, or capabilities.

A) station flexibility

B) routing flexibility

C) processing flexibility

D) input-output flexibility




82) Pioneer Motors has a large production unit in Dakota that can produce 50 different car models depending on the demand. This organization has ________.

A) statistical process control

B) design capacity

C) work sampling

D) flexible manufacturing system



83) Which of the following organizations has the least economies of scale?

A) an oil refinery

B) a unit making cameras

C) a bespoke tailor

D) a university class




84) ________ involves the use of computers to direct manufacturing processes.

A) Computer-aided design

B) Computer-aided engineering

C) Computer-aided automation

D) Computer-aided manufacturing



85) ________ refers to the process of designing products to maximize their functionality and ease of production and to minimize their associated costs.

A) Just-in-time utilization

B) Flexible manufacturing

C) Designing for manufacturing

D) Computer-aided manufacturing





86) ________ expedites the management of complicated supply chain relationships and processes.

A) Internet relay chat

B) Electronic data interchange

C) Computer-aided manufacturing

D) Flexible manufacturing protocol



87) The ________ relates to the activities needed to retrieve a used product from a customer and either reuse it or dispose of it.

A) trade-in program

B) after-market linkage

C) reverse supply chain

D) materials requirement plan





88) As per legislation, tire companies in Europe have to recycle one used tire for every tire they sell. This means that these companies have to use ________.

A) computer aided manufacturing

B) reverse supply chain

C) ABC analysis

D) statistical process control




89) What are the typical objectives of managers working in operations?



90) Discuss the term quality and explain how improving quality can lower costs and boost revenues.



91) How does the concept of continuous process improvement relate to process reengineering? Identify and discuss the five key elements or steps involved in process reengineering.





92) How does the concept of quality apply to this scenario?



93) Could the philosophy of Total Quality Management (TQM) be applied in this scenario?






94) Could continuous process improvement be used in this scenario?


95) Could capacity planning play a role in this scenario?



96) What is a just-in-time (JIT) inventory system?



97) Compare and contrast the following methods of monitoring the progress of projects: Gantt charts, program evaluation and review technique (PERT), and the critical path method (CPM).




98) What is meant by the term productivity? How are productivity measures being used?



99) Identify and discuss the major classifications of production processes.



100) Discuss the nature of the relationship between customers and suppliers along a supply chain.



101) What is a "reverse supply chain"?


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