Test 1 Operations Management

Flashcard maker : Lily Taylor
Production
Creation of goods and services
Operations Management
Set of activities that creates value in the form of goods and services by transforming inputs into outputs
The management process
Consists of planning, organizing, staffing, leading, and controlling
Services
Including repair and maintanance, government, food and lodging, transportation, insurance, trade, financial, real estate, education, legal, medical, entertainment, and other professional occupations
Pure service
When a tangible product is not included in the service
Service sector
The segment of the economy that includes trade, financial, lodging, educational, legal, medical, and other professional occupations
Productivity
The ratio of outputs (goods and services) divided by the number of inputs (resources, such as labor and capital)
Single-factor productivity
The use of just one resource input to measure productivity
Multi-factor productivity
Includes all inputs
Productivity increases
Labor, capital, management
Knowledge societies
Those in which much of the labor force has migrated from manual work to technical and informational processing tasks requiring on-going education
Maquiladoras
Free trade zones that allow manufacturers to cut their costs of taxation by paying only on the value added by Mexican workers
World Trade Organization (WTO)
Helped reduce tariffs from 40% in 1940 to less than 3% today
North American Free Trade Agreement (NAFTA)
Seeks to phase out all trade and tariff barriers among Canada, and the U.S
European Union (EU)
Reduced trade barriers among the participating European nations through standardization and a common currency, the euro
Misson
Purpose- what will it contribute to society
Strategy
An organization’s action plan to achieve the mission
Competitive Advantage
Implies the creation of a system that has unique advantage over competitors
Differentiation
As going beyond both physical characteristics and source attributes to encompass everything about the product or service that influences the value that the customers derive from it
Experience differentiation
To engage the customer- to use people’s five senses so they become immersed, or even an active participant in the product
Low-cost leadership
Entails achieving maximum value as defined by your customer
Response
Including the entire range of values related to timely product development and delivery, as well as reliable scheduling and flexible performance
Operations decisions
Goods and services design, quality, process and capacity design, location selection, layout design, human resources and job design, supply chain management, inventory, scheduling, maintenance
PIMS (profit impact of market strategy) program
Collected nearly 100 data items from about 3,000 cooperating organizations
SWOT analysis
Strengths, weaknesses, opportunities, and threats. Evaluating internal strengths and weaknesses as well as opportunities and threats of the environment
Critical success factors (CSFs)
Activities necessary for a firm to achieve its goals
Core competencies
Set of unique skills, talents, and capabilities that a firm does at a world-class standard
Activity map
Links competitive advantage, CSFs, and supporting activities
International business
Any firm that engages in international trade or investment
Multinational corporation (MNC)
A firm with extensive international business involvement
International strategy
Uses exports and licenses to penetrate the global arena
Multi domestic strategy
Has decentralized authority with substantial autonomy at each business
Global strategy
A high degree of centralization, with headquarters coordinating the organization to seek out standardization and learning between plants, thus generating economies of scale
Transnational strategy
Exploits the economies of scale and learning, as well as pressure for responsiveness, by recognizing that core competence does not reside
Quality
The totality of features and characteristics of a product or service that bears on its ability to satisfy stated or implied needs
Cost of quality (COQ)
Prevention costs, appraisal costs, internal failure and external costs
ISO 9000
Only quality standard with international recognition
ISO 14000
An environmental management standard that contains five core elements 1) environmental management 2) auditing 3) performance evaluation 4) labeling 5) lifecycle assessment
PDCA
Invented by Walter Shewhart and is a circular model plan, do, check, act as his version of continuous improvement
Kaizen
Japanese word that describes this ongoing process of unending improvement- the setting and achieving of ever-higher goals
Six Sigma
Ina statistical sense, it describes a process, product, or service with an extremely high capability. A program designed to reduce defects to help lower costs, save time, and improve customer satisfaction
Employee empowerment
Involving employees in every step of the production process
Quality Circle
A group of employees who meet regularly to solve work-related problems
Benchmarking
Selecting a demonstrated standard of products, services, costs, or practices that represent the very best performance for processes or activities
Quality Robustness
Products are products that can be produced uniformly and consistently in adverse manufacturing and environmental conditions
Quality loss function
Identifies all costs connected with poor quality and shows how these costs increase as the product moves away from being exactly what the customer wants
Target-oriented quality
A philosophy of continuous improvement to bring the product exactly on target
Cause and effect diagram
Operations manager starts with four categories: material, machinery/equip, manpower, and methods
Pareto charts
A method of organizing errors, problems, or defects to help focus on problem-solving efforts
Flowcharts
Graphically present a process or system using annotated boxes and interconnected lines
Statistical process control
Monitors standards, makes measurements, and takes corrective action as a product or service is being produced
Control charts
Graphic presentations of data over time that show upper and lower limits for the process we want to control
Inspection
Involves measurement, tasting, touching, weighing, testing of the product
Source inspection
Just doing the job properly with the operator ensuring that this is so
Poka-Yoke
A foolproof device or technique that ensures production of good units every time
Attribute inspection
Classifies gems as being good or defective
Variable inspection
Measures such dimensions as weight, speed, height, or strength to see if an item falls within an acceptable range
Service quality
They train and empower frontline employees to immediately solve a problem
Statistical process control
The application of statistical techniques to the control of processes
Control chart
A graphical presentation of process data over time
Natural variations
The many sources of variation that occur within a process that is in statistical control
Assignable variation
Can be traced to a specific reason
X bar chart
Tells us whether changes have occurred in the central tendency of a process
R chart
Indicate that a gain or loss in dispersion have occured
Central limit theorem
Regardless of the distribution of the population, the distribution of X bars will tend to follow a normal curve as the number of samples increase
Run test
Is available to help identify the kind of abnormalities in a process
Process capability
The ability of a process to meet design specifications, which are set by engineering design or customer requirements
Acceptance sampling
A form of testing that involves taking random samples of “lots” or batches, of finished products and measured them against predetermined standards
Operating characteristic (OC) curve
Describes how well an acceptance plan discriminates between good and bad lots
Producer’s risk
Wants to avoid the mistake of having a good lot rejected
Consumer’s risk
Wants to avoid the mistake of accepting a bad lot because defects found in a lot that has already been accepted are usually the responsibility of the customer
Acceptable quality level (AQL)
The poorest level of quality that we are willing to accept
Lot tolerance percent defective (LTPD)
The quality level of a lot that we consider bad
Type 1 error
The probability of rejecting a good lot
Type 2 error
The probability of accepting a bad lot
Average outgoing quality (AOQ)
In percent defective
P charts
Controls attributes.
C charts
Control the number of defects per unit of output
12 covers/hr
A foundry produces circular utility access hatches (manhole covers). If 120 covers are produced in a 10-hour shift, the productivity of the line is
1.2 covers/hr
2 covers/ hr
12 covers/ hr
1200 covers/ hr
None of these
Statistical quality control
Walter Shewhart is listed among the important people of operations management because of his contributions to
Assembly line production
Measuring the productivity in the service sector
Just-in-time inventory methods
Statistical quality control
All of these
True
All organizations, including service firms such as banks and hospitals, have a production function
True
False
All of these
Reasons to study Operations Management include learning about
Why people organize themselves for productive enterprise
How goods and services are produced
What operation managers do
A costly part of the enterprise
All of these
All of these are current trends
Current trends in operations management include all the following except
Just-in-time performance
Rapid product development
Mass customization
Empowered employees
All of these are current trends
Frederick W. Taylor
The “Father of Scientific Management” is
Henry Ford
Frederick W. Taylor
W. Edwards Deming
Frank Gilbreth
Just a figure of speech, not a reference to a person
Service sector productivity is hard to measure
The service sector has lower productivity improvements than the manufacturing sector because
The service sector uses less skilled labor than manufacturing
The quality of output is lower in services than manufacturing
Services usually are labor-intensive
Service sector productivity is hard to measure
None of these
Almost all services and almost all goods are a mixture of a service and a tangible product
Which of the following statements are true?
Almost all services and almost all goods are a mixture of a service and a tangible product
A pure good has no tangible product component
A pure service has only a tangible product component
There is no such thing as a pure good
None of these is a true statement
Decreasing inputs while holding outputs steady
Productivity can be improved by
Increasing inputs while holding outputs steady
Increasing inputs and outputs in the same proportion
Decreasing inputs while holding outputs steady
None of these
To all firms, whether manufacturing and service
Operations management is applicable to
Mostly to the service sector
To services exclusively
Mostly to the manufacturing sector
To all firms, whether manufacturing and service
To the manufacturing exclusively
False
In order to have a career in operations management, one must have a degree in statistics or quantitative methods
True
False
Increasing executive pay
Which of the following is not among the ethical and social challenges facing operations managers
Honoring community commitments
Maintaining a clean environment
Efficiently developing and producing safe quality products
Increasing executive pay
Providing a safe workplace
20%
Illiteracy and poor diets have been known to cost countries up to what percent of their productivity?
2%
5%
10%
20%
50%
Finance/accounting function
Budgeting, paying bills, and collection of funds are activities associated with the
Management function
Control function
Finance/accounting function
Production/operations function
Staffing function
40.6 boxes/hr
The Dulac Box plant works two 8-hour shifts each day. In the past, 500 cypress packing boxes were produced by the end of each day. The new technology has enabled them to increase productivity by 30%. Productivity is now approximately
32.5 boxes/hr
40.6 boxes/hr
62.5 boxes/hr
81.25 boxes/hr
300 boxes/hr
Process and capacity design
The Ten Critical Decisions of Operations Management include
Finance/accounting
Advertising
Process and capacity design
Pricing
All of these
Environmentally sensitive production is giving way to low-cost focus
Which of the following statements about trends in operations management is false?
Job specialization is giving way to empowered employees
Local or national focus is giving way to global focus
Environmentally sensitive production is giving way to low-cost focus
Rapid product development is partly the result of shorter product cycles
All these statements are true
All of these
A business’s stakeholders, whose conflicting perspectives cause ethical and social dilemmas, include
Lenders
Suppliers
Owners
Employees
All of these
True
Productivity is more difficult to improve in the service sector
True
False
Learn about a consult part of the enterprise
Reasons to study Operations Management include
studying why people organize themselves for free enterprise
knowing how goods and services are consumed
understanding what human resource managers do
learning about a costly part of the enterprise
all of these
False
The production process at Hard Rock Café is limited to meal preparation and serving customers.
True
False
False
Customer interaction is often high for manufacturing processes, but low for services.
True
False
All of these
The Ten Critical Decisions of Operations Management include
Layout strategy
Maintenance
Process and capacity design
Managing quality
all of these
Mass customization
Which of the following is not one of The Ten Critical Decisions of Operations Management?
Layout strategy
Maintenance
Process and capacity design
Mass customization
Supply chain management
All of these are current trends
Which of the following is not a current trend in operations management?
just-in-time performance
global focus
supply chain partnering
mass customization
all of these are current trends.
the fact that precise units of measure are often unavailable
Productivity measurement is complicated by
the competition’s output
the fact that precise units of measure are often unavailable
stable quality
the workforce size
the type of equipment used
True
An example of a “hidden” production function is money transfers at banks.
True
False
Assembly line operations
Henry Ford is noted for his contributions to
standardization of parts
statistical quality control
assembly line operations
scientific management
time and motion studies
False
In order to have a career in operations management, one must have a degree in statistics or quantitative methods
True
False
200 valves/hr
Gibson Valves produces cast bronze valves on an assembly line. If 1600 valves are produced in an 8-hour shift, the productivity of the line is
2 valves/hr
40 valves/hr
200 valves/hr
1600 valves/hr
14.4 covers/hr
A foundry produces circular utility access hatches (manhole covers). Currently, 120 covers are produced in a 10-hour shift. If labor productivity can be increased by 20%, it would then be
14.4 covers/hr
24 covers/hr
240 valves/hr
1200 covers/hr
none of these
Service operations are typically capital intensive
Which of the following is not true when explaining why productivity tends to be lower in the service sector than in the manufacturing sector?
Services are typically labor-intensive
Services are often difficult to evaluate for quality.
Services are often an intellectual task performed by professionals
Services are difficult to automate
Service operations are typically capital intensive
All of these
The field of operations management is shaped by advances in which of the following fields?
chemistry and physics
industrial engineering and management science
biology and anatomy
information technology
all of these
Frederick W. Taylor
The “Father of Scientific Management” is
Henry Ford
Frederick W. Taylor
W. Edwards Deming
Frank Gilbreth
just a figure of speech, not a reference to a person
all of these
A business’s stakeholders, whose conflicting perspectives cause ethical and social dilemmas, include
lenders
suppliers
owners
employees
all of these
increasing executive pay
Which of the following is not the ethical and social challenges facing operations managers?
honoring community commitments
maintaining a clean environment
efficiently developing and producing safe quality products
increasing executive pay
providing a safe workplace
all of these
Reasons to study Operations Management include learning about
why people organize themselves for productive enterprise
how goods and services are produced
what operations managers do
a costly part of the enterprise
all of these
nineteenth century; interchangeable parts
Eli Whitney, in the _________, provided the foundations for _________ in operations management.
1920s; statistical sampling
United Kingdom; mass production
U.S. Army; logistics
nineteenth century; interchangeable parts
none of these
labor, capital, and management
Three commonly used productivity variables are
quality, external elements, and precise units of measure
labor, capital, and management
technology, raw materials, and labor
education, diet, and social overhead
quality, efficiency, and low cost
learning about a costly part of the enterprise
Reasons to study Operations Management include
studying why people organize themselves for free enterprise
knowing how goods and services are consumed
understanding what human resource managers do
learning about a costly part of the enterprise
all of these
True
An example of a “hidden” production function is money transfers at banks
True
False
management; over one-half
The largest contributor to productivity increases is ________, estimated to be responsible for _________ of the annual increase
management; over one-half
Mr. Deming; one-half
labor; two-thrids
capital; 90%
technology; over one-half
management
The factor responsible for the largest portion of productivity increase in the United States is
labor
management
capital
all three combined; it is impossible to determine the contribution of individual factors
none of these; most productivity increases come form investment spending
advertising and promotion
Which of the following would not be an operations function in a fast-food restaurant?
advertising and promotion
designing the layout of the facility
maintaining equipment
making hamburgers and fries
purchasing ingredients
False
Manufacturing now constitutes the largest economic sector in postindustrial societies
True
False
79%
The service industry makes up approximately what percentage of all jobs in the United States?
12%
40%
66%
79%
90%
management
Which of the following inputs has the greatest potential to increase productivity?
labor
globalization
management
capital
none of these
220 valves/hr
Gibson Valves produces cast bronze valves on an assembly line, currently producing 1600 valves each 8-hour shift. If the productivity is increased by 10%, it would then be
180 valves/hr
200 valves/hr
220 valves/hr
880 valves/hr
1760 valves/hr
False
Measuring the impact of a capital acquisition on productivity is an example of multi-factor productivity
True
False
process and capacity design
The Ten Critical Decisions of Operations Management include
Layout strategy
Maintenance
Process and capacity design
managing quality
all of these
It has increased by 20%
The Dulac Box plant produces 500 cypress packing boxes in two 10-hour shifts. Due to higher demand, they have decided to operate three 8-hour shifts instead. They are now able to produce 600 boxes per day. What has happened to production?
It has increased by 50 sets/shift
It has increased 37.5 sets/hr
It has increased 20%
It has decreased by 8.3%
It has decreased by 9.1%
False
“How much inventory of this item should we have?” is within the critical decision area of managing quality.
True
False
elementary education
Which of the following services is least likely to be unique, i.e., customized to a particular individual’s needs?
dental care
hairdresssing
legal services
elementary education
computer consulting
W. Edwards Deming
Who among the following is associated with contributions to quality control in operations management?
Charles Babbage
Henry Ford
Frank Gilbreth
W. Edwards Deming
Henri Fayol
True
One reason to study operations management is to learn how people organize themselves for productive enterprise
True
False
False
A knowledge society is one that has migrated from work based on knowledge to one based on manual work
True
False
Services now constitute the largest economic sector in postindustrial societies
Which of the following statements concerning growth of services is true?
Services now constitute the largest economic sector in postindustrial societies
the number of people employed in manufacturing has more or less held steady since 1950
Each manufacturing employee now produces about 20 times more than in 1950
all of these are true
none of these is true
False
Productivity is the total value of all inputs to the transformation process divided by the total value of the outputs produced
True
False
plan, organize, staff, lead, and control
The five elements in the management process are
plan, direct, update, lead, and supervise
accounting/finance, marketing, operations, and management
organize, plan, control, staff, and manage
plan, organize, staff, lead, and control
plan, lead, organize, manage, and control
multifactor productivity
The total of all outputs produced by the transformation process divided by the total of the input is
utilization
greater in manufacturing than in services
defined only for manufacturing firms
multifactor productivity
none of these
True
The operations manager performs the management activities of planning, organizing, staffing, leading, and controlling of the OM function
True
False
aspects of quality difficult to measure
Which of the following is not a typical attribute of goods?
output can be inventoried
often easy to automate
aspects of quality difficult to measure
output can be resold
production and consumption are seperate
True
In the past half-century, the number of people employed in manufacturing has more or less held steady. but each manufacturing employee is manufacturing about 20 times as much
True
False
1920s; statistical sampling
Walter Shewhart, in the ________, provided the foundations for __________in operations management
1920s; statistical sampling
United Kingdom; mass production
U.S. Army; logistics
nineteenth century; interchangeable parts
none of these
all of these are current trends
Which of the following is not a current trend in operations management?
just-in-time performance
global focus
supply chain partnering
mass customization
all of these are current trends
preparing employee schedules
An operations task performed at Hard Rock Cafe is
borrowing funds to build a new restaurant
advertising changes in the restaurant menu
calculating restaurant profit and loss
preparing employee schedules
all of these
Goods tend to have higher customer interaction than services
Which is not ture regarding differences between goods and services?
Services are generally produced and consumed simultaneously; tangible goods are not
Services tend to be more knowledge-based than products.
Services tend to have a more inconsistent product definition than goods
Goods tend to have higher customer interaction than services
none of these is true
200 valves/hr
Gibson Valves produces cast bronze valves on an assembly line. If 1600 valvues are produced in an 8-hour shift, the productivity of the line is
2 valves/hr
40 valves/hr
80 valves/hr
200 valves/hr
1600 valves/hr
generating the demand for the organization’s products or services
The marketing function’s main concern is with
producting goods or providing services
procuring materials, supplies, and equipment
building and maintaining a positive image
generating the demand for the organization’s products or services
securing monetary resources
financial analysis
All of the following decisions fall within the scope of operations management except for
financial analysis
design of goods and processes
location of facilities
managing quality
all of these fall within the scope of operations management
Eli Whitney
The person most responsible for popularizing interchangeable parts in manufacturing was
Frederick Winslow Taylor
Henry Ford
Eli Whitney
Whitney Houston
Lillian Gilbreath
the fact that precise units of measure are often unavailable
Productivity measurement is complicated by
the competition’s output
the fact that precise units of measure are often unavailable
stable quality
the workforce size
the type of equipment used
True
Operations management is the set of activities that create value in the form of goods and services by transforming inputs into outputs
True
False
False
Customer interaction is often high for manufacturing processes, but low for services.
True
False
Mass customization
Which of the following is not one of The Ten Critical Decisions of Operations Management?
Layout strategy
Maintenance
Process and capacity design
Mass customization
Supply chain management
True
Some of the operations-related activities of Hard Rock Cafe include designing meals and analyzing them for ingredient cost and labor requirements
True
False
all of these
Among the ethical and social challenges facing operations managers are
honoring financial commitments
maintaining a clean environment
developing low-cost products
providing an efficient workplace
all of these
Pricing
Which of the following is not an element of the management process?
Controlling
leading
planning
pricing
staffing
True
Ethical and social dilemmas arise because stakeholders of a business have conflicting perspectives
True
False
True
Students wanting to pursue a career in operations management will find multidisciplinary knowledge beneficial
True
False
False
Shewhart’s contributions to operations management came during the Scientific Management Era
True
False
The person most responsible for initiating use of interchangeable parts in manufacturing was Eli Whiney
Which of the following statements is true?
The person most responsible for initiating use of interchangeable parts in manufacturing was Eli Whitney
The originas of management by exception are generally credited to Frederick W. Taylor
The person most responsible for initiating use of interchangeable parts in manufacturing was Walter Shewhart
The origins of the scientific management movement are generally credited to Henry Ford
The person most responsible for initiating use of interchangeable parts in manufacturing was Henry Ford
all of these
the field of operations management is shaped by advances in which of the following fields?
chemistry and physics
industrial engineering and management science
biology and anatomy
information technology
all of these
labor, capital, and management
Three commonly used productivity variables are
quality, external elements, and precise units of measure
labor, capital, and management
technology, raw materials, and labor
education, diet, and social overhead
quality, efficiency, and low cost
False
Henry Ford is known as the Father of Scientific Management
True
False
all of these are new trends in operations management
One new trend in operations management is
global focus
mass customization
empowered employees
rapid product development
all of these are new trends in operations management
all of these
Productivity tends to be more difficult to improve in the service sector because the work is
often difficult to automate
typically labor-intensive
frequently processed individually
often an intellectual task performed by professionals
all of these
nineteenth century; interchangeable parts
Eli Whitney, in the ________, provided the foundations for ___________ in operations management
1920s; statistical sampling
United Kingdom; mass production
U.S. Army; logistics
nineteenth century; interchangeable parts
none of these
25%
Gibson Valves produces cast bronze valves on an assembly line, currently producing 1600 valves per shift. If the production increased to 2000 valves per shift, labor productivity will increase by
10%
20%
25%
40%
50%
marketing, operations, and finance/accounting
Which of the following are the primary functions of all organizations?
operations, marketing, and human resources
marketing, human resources, and finance/accounting
sales, quality control, and operations
marketing, operations, and finance/accounting
research and development, finance/accounting, and purchasing
all of these
At Hard Rock Cafe, tasks that reflect operations or operations management include
designing meals
testing meals(recipes)
analyzing meals for the cost of ingredients
preparing employee schedules
all of these
all of these
Among the ethical and social challenges facing operations managers are
honoring community commitments
maintaining a clean environment
efficiently developing and producing safe quality products
providing a safe workplace
all of these
assembly line operation
Henry Ford is noted for his contributions to
standardization of parts
statistical quality control
assembly line operations
scientific management
time and motion studies
cost per unit
Typical differences between goods and services do not include
cost per unit
ability to inventory items
timing of productions and consumption
customer interaction
knowledge content
easy to store
Which of the following is not a typical service attribute?
intangible product
easy to store
customer interaction is high
simultaneous production and consumption
difficult to resell
False
The production process at hard Rock Cafe is limited to meal preparation and serving customers
True
False
the identification of customers’ wants and needs
An operations manager is not likely to be involved in
the design of goods and services to satisy customers’ wants and needs
the quality of goods and services to satisfy
customers’ wants and needs
the identification of customers’ wants and needs
work scheduling to meet the due dates promised to customers
maintenance schedules
14.4 covers/hr
A foundry produces circular utility access hatches (manhole covers). Currently, 120 covers are produced in a 10-hour shift. If labor productivity can be increased by 20%, it would then be
14.4 covers/hr
24 covers/hr
240 valves/hr
1200 covers/hr
none of these
Service operations are typically capital intensive
Which of the following is not true when explaining why productivity tends to be lower in the service sector than in the manufacturing sector?
Services are typically labor-intensive
Services are often difficult to evaluate for quality.
Services are often an intellectual task performed by professionals.
Services are difficult o automate
Service operations are typically capital intensive
25 boxes/hr
The Dulac Boz plant produces 500 cypress packing boxes in two 10-hour shifts. What is the productivity of the plant?
25 boxes/hr
50 boxes/hr
5000 boxes/hr
none of these
not enough data to determine productivity
True
One reason to globalize is to learn to improve operations
True
False
a computer manufacturing company
Which of these organizations is likely to have the most complex inventory decisions?
a marketing research firm
a stock brokerage firm
a management consulting firm
a computer manufacturing company
a high school
all are elements of experience differentiation
Which of the following best describes “experience differentiation”?
immerses consumers in the delivery of a service
uses people’s five senses to enhance the service
complements physical elements with visual and sound elements
consumers may become active participants in the product or service
All are elements of experience differentiation
preconditions to establishing and implementing a strategy
Understanding competitor’s strengths and weaknesses, understanding current and prospective technological issues, and understanding product life cycle are examples of
what is important to the transnational strategy but not the multidomestic strategy
SWOT analysis
elements in the formulation of an organization’s mission
preconditions to establishing and implementing a strategy
the critical decisions area of supply chain analysis
maturity
The stage in the product life cycle at which it is a poor time to change quality is
introduction
growth
maturity
decline
incubation
layout design
Which of the following OM strategic decisions pertains to sensible location of processes and materials in relation to each other?
layout design
goods and service design
supply chain management
inventory
scheduling
reduce responsiveness
Which of the following does not represent reasons for globalizing operations?
reduce costs
improve supply chain
reduce responsiveness
attract and retain global talent
all of these are valid reasons for globalizing operations
competing on differentiation
The ability of an organization to produce goods or services that have some uniqueness in their characteristics is
mass production
time-based competition
competing on productivity
competing on flexibility
competing on differentiation
True
The World Trade Organization has helped to significantly reduce tariffs around the world
True
False
price
Which of the following is not an operations strategic decision?
maintenance
price
layout design
quality
inventory
Functional strategies are shaped by corporate strategy
Which of the following is true?
Corporate mission is shaped by functional strategies
Corporate strategy is shaped by functional strategies
Functional strategies are shaped by corporate strategy
External conditions are shaped by corporate mission
Functional area missions are merged to become the organizational mission
False
Manufacturing organizations have ten strategic OM decisions, while service organizations have only eight.
True
False
Well defined missions make strategy development much easier
Which of the following is true about business strategies?
An organization should stick with its strategy for the life of the business
All firms within an industry will adopt the same strategy
Well defined missions make strategy development much easier
Strategies are formulated independently of SWOT analysis
Organizational strategies depend on operations strategies
False
Critical success factors and core competencies are synonyms
True
False
all of these are true
Which of the following statements regarding the Dreamliner 787 is true?
Boeing has found partners in over a dozen countries
The new aircraft incorporates a wide range of aerospace technologies
The new aircraft uses engines from not one, but two manufacturers
Boeing will add only 20 to 30 percent of the aircraft’s value
all of these are true
a medical clinic
Which of the following will more likely locate near their customers?
an automobile manufacturer
an aluminum manufacturer
an insurance company headquarters
a medical clinic
all of these will tend to locate near their customers
stockholder approval ratings
Which of the following did the authors not suggest as a reason for globalizing operations?
reduce costs
improve the supply chain
stockholder approval ratings
attract new markets
all of these were suggested
True
NAFTA seeks to phase out all trade and tariff barriers among Canada, Mexico, and the United States
True
False
False
An organization’s strategy is its purpose or rationale for an organization’s existence
True
False
multidomestic strategy
Which of the international operations strategies uses the existing domestic model globally?
international strategy
global strategy
transnational strategy
multidomestic strategy
none of these
a user-based definition of quality
“Quality is defined by the customer” is
an unrealistic definition of quality
a user-based definition of quality
a manufacturing-based definition of quality
a product-based definition of quality
the definition proposed by the American Society for Quality
False
The Japanese use the term “poka-yoke” to refer to continuous improvement
True
False
False
Deming’s writings on quality tend to focus on the customer and on fitness for use, unlike Juran’s work that is oriented toward meeting specifications
True
False
False
Conforming to standards is the focus of the product-based definition of quality
True
False
False
Source inspection is inferior to inspection before costly operations
True
False
Taguchi concepts
A manager tells her production employees, “it’s no longer good enough that your work fall anywhere within the specification limits. I need your work to be as close to the target value as possible.” Her thinking is reflective of
internal benchmarking
Six Sigma
ISO 9000
Taguchi concepts
Process control charts
stockholders, employees, and customers
Stakeholders who are affected by the production and marketing of poor quality products include
stockholders, employees, and customers
suppliers and creditor, but not distributors
only stockholders, creditors, and owners
suppliers and distributor, but not customers
only stockholders and organizational executives and managers
determine whether any of the organization’s stakeholders are violated by poor quality products
Regarding the quality of design, production, and distriution of products, an ethical requirement for managements is to
determine whether any of the organization’s stakeholders are violated by poor quality products
gain ISO 14000 certification for the organization
obtain a product safety certificate from the Consumer Product Safety Commission
have the organization’s legal staff write disclaimers in the product instruction booklets
compare the cost of product liability to the external failure cost
Values above the upper control limits always imply that the product’s quality is exceeding expectations
Which of the following is false regarding control charts?
Values above the upper control limits always imply that the product’s quality is exceeding expectations
Control charts are built so that new data can be quickly compared to past performance data
Control charts graphically present data
Control charts plot data over time
none of these is false
Maintenance costs
All of the following costs are likely to decrease as a result of better quality except
customer dissatisfaction costs
inspection costs
scrap costs
warranty and service costs
maintenance costs
all of these
To become ISO 9000 certified, organizations must
document quality procedures
have an onsite assessment
have an ongoing series of audits of their products or service
all of these
none of these
centralized decision-making authority
A successful TQM program incorporates all of the following except
continuous improvement
employee involvement
benchmarking
centralized decision-making authority
none of these; a successful TQM program incorporates all of these
The hospital uses all of these techniques
Arnold Palmer Hospital uses which of the following quality management techniques?
Pareto charts
flow charts
benchmarking
Just-in-time
The hospital uses all of these techniques
Ishikawa diagram
A quality circle holds a brainstorming session and attempts to identify the factor responsible for flaws in a product. Which tool do you suggest they use to organize their findings?
Ishikawa diagram
Pareto chart
process chart
control charts
activity chart
The hospital’s high quality is measured by low readmission rates, not patient satisfaction
Which of the following statements regarding Arnold Palmer Hospital is false?
The hospital uses a wide range of quality management techniques
The culture of quality at the hospital includes employees at all levels
The hospital scores very highly in national studies of patient satisfaction
The hospital’s high quality is measured by low readmission rates, not patient satisfaction
The design of patient rooms, even wall colors, reflects the hospital’s culture of quality
False
Of the several determinants of service quality, access is the one that relates to keeping customers informed in language they can understand
True
False
False
Managers at Arnold Palmer Hospital take quality so seriously that the hospital typically is a national leader in several quality areas-so that continuous improvement is no longer necessary
True
False
material, machinery/equipment, manpower, and methods
The “four Ms” of cause-and-effect diagrams are
material, machinery/equipment, manpower, and methods
material, methods, men, and mental attitude
named after four quality experts
material, management, manpower, and motivation
none of these
True
High-quality products and services are the most profitable
True
False
3.4
If 1 million passengers pass through the St. Louis Airport with checked baggage each month, a successful Six Sigma program for baggage handling would result in how many passengers with misplaced luggage?
3.4
6.0
34
2700
6 times the monthly standard deviation of passengers
all of these are false
A lot that is accepted by acceptance sampling
has more defects than existing before the sampling
has had all its defects removed by 100% inspection
will have the same defect percentage as the LTPD
has no defects present
all of these are false
an operating characteristics curve
An Acceptance sampling plan’s ability to discriminate between low quality lots and high quality lots is described by
a Gantt chart
the Central Limit Theorem
a process control chart
an operating characteristics curve
a range chart
is to be identified and eliminated
Assignable variation
is a sign that a process is under control
is to be identified and eliminated
is the same as random variation
is variation that cannot be traced to a specific cause
leads to a steep OC curve
a good lot is rejected
A Type 1 error occurs when
a good lot is rejected
a bad lot is accepted
the number of defectives is very large
the population is worse than the AQL
none of these
is used to determine whether to accept or reject a lot of material based on the evaluation of a sample
Acceptance sampling
is the application of statistical techniques to the control of processes
was developed by Walter Shewhart of Bell Laboratories
is used to determine whether to accept or reject a lot of material based on the evaluation of a sample
seperates the natural and assignable causes of variation
all of these
lead to occasional false findings that processes are out of control
Natural variations
are variations that are to be identified and eliminated
are variations that can be traced to a specific cause
are the same as assignable variations
lead to occasional false findings that processes are out of control
play no role in statistical process control
to examine points in a control chart to check for nonrandom variability
A run test is used
to examine variability in Acceptance sampling plans
in Acceptance sampling to establish control
to examine points in a control chart to check for natural variability
to examine points in a control chart to check for nonrandom variability
none of these
s must be less than one-third of the difference between the specification and the process mean
If the Cpk index exceeds 1
the AQL must be smaller than the LTPD
s must be less than one-third of the difference between the specification and the process mean
the x-bar chart must indicate that the process is in control
the process is capable of Six Sigma quality
the process is characterized as “not capable”
c-chart
The local newspaper receives several complaints per day about typographical errors. over a seven-day period, the publisher has received calls from readers reporting the following number of errors: 4, 3, 2, 6, 7, 3, and 9. Based on these data alone, what type of control chart(s) should the publisher use?
p-chart
c-chart
R-chart
The larger the Cpk, the more units meet specifications
Which of the following is true regarding the Process capability index Cpk?
A cpk index calue of 1 is ideal, meaning all units meet specifications
The larger the Cpk, the more units meet specifications
The Cpk index can only be used when the process centerline is also the specification centerline
Positive values of the Cpk index are good; negative values are bad
none of these are true
change in the number of defects per unit
The c-chart signals whether there has been a
gain or loss in uniformity
change in the number of defects per unit
change in the central tendency of the process output
change in the percent defective in a sample
change in the AOQ
False
The x-bar chart. like the c-chart, is based on the exponential distribution
True
False
out of control and the cause should be established
If a sample of items is taken and the mean of the sample is outside the control limits the process is
out of control and the cause should be established
in control, but not capable of producing within the established control limits
within the established control limits with only natural causes of variation
monitored closely to see if the next sample mean will also fall outside of the control limits
producing high quality products
AOQ is very low(very good) for extremely poor quality lots
Which of the following is true regarding the average outgoing quality level?
An AOQ value of 1 is ideal, because all defects have been removed.
AOQ is always greater than AQL but less than LTPD
AOQ rises (worsens) following inspection of failed lots
AOQ is very low(very good) for extremely poor quality lots
none of these is true
display upper and lower limits for process variables or attributes, and signal when a process is no longer in control
Statistical process control charts
display the measurements on every item being produced
display upper and lower limits for process variables or attributes, and signal when a process is not longer in control
indicate to the process operator the average outgoing quality of each lot
indicate to the operator the true quality of material leaving the process
none of these
process sampling by attributes
the normal application of a p-chart is in
process sampling by variables
Acceptance sampling by variables
process sampling by attributes
Acceptance sampling by attributes
none of these
natural variation
Up to three standard deviations above or below the centerline is the amount of variation that statistical process control allows for
Type 1 errors
about 95.5% variation
natural variation
all types of variation
assignable variation
how well an Acceptance sampling plan discriminates between good and bad lots
An operating characteristic (OC) curve describes
how many defects per unit are permitted before rejection occurs
the sample size necessary to distinguish between good and bad lots
the most appropriate sampling plan for a given incoming product quality level
how well an Acceptance sampling plan discriminates between good and bad lots
none of these

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