ch1 Student: ___________________________________________________________________________ 1. Operations managers are responsible for assessing consumer wants and needs and selling and promoting the organization's goods or services. True True False
2. Often, the collective success or failure of companies' operations functions will impact the ability of a nation to compete with other nations. True True False
. !ompanies are either producing goods or delivering services. This means that only one of the two types of operations management strategies are used. True True False
". Operations, mar#eting, and finance function independently of each other in most organizations. True True False
$. The greater the degree of customer involvement, the more challenging the design and management of operations. True True False
%. &oods producing organizations are not involved in service activities. True True False
. (ervice operations re)uire additional inventory because of the unpredictability of consumer demand. True True False
*. The value of outputs is measured by the prices customers are willing to pay for goods or services. True True False
+. The use of models will guarantee the best possible decisions. True True False
1. -eople who wor# in the field of operations should have s#ills that include both #nowledge and people s#ills. True True False
11. ssembly lines achieved productivity but at the e/pense of standard of living. True True False
12. The operations manager has primary responsibility for ma#ing operations system design decisions, such as system capacity and location of facilities. True True False
1. The word 0technology0 is used only to refer to 0information technology0. True True False
1". alue added' by definition is always a positive number since 'added' implies increases. True True False
1$. (ervice often re)uires greater labor content, whereas manufacturing is more capital intensive. True True False
1%. 3easurement of productivity in service is more straightforward than in manufacturing since it is not necessary to ta#e into account the cost of materials. True True False
1. (pecial4purpose technology is a common way of offering increased customization in manufacturing or services without ta#ing on additional labor costs. True True False
1*. One concern in the design of production systems is the degree of standardization. True True False
1+. 3ost people encounter operations only in profit4ma#ing organizations. True True False
2. (ervice involves a much higher degree of customer contact than manufacturing. True True False
21. systems approach emphasizes interrelationships among subsystems, but its main theme is that the whole is greater than the sum of its individual parts. True True False
22. The -areto phenomenon is one of the most important and pervasive concepts that can be applied at all levels of management. True True False
2. Operations managers, who usually use )uantitative approaches, are not really concerned with ethical decision4ma#ing. True True False
2". The optimal solutions produced by )uantitative techni)ues should always be evaluated in terms of the larger framewor#. True True False
2$. 3anagers should most often rely on )uantitative techni)ues for important decisions since )uantitative approaches result in more accurate decisions. True True False
2%. 3any operations management decisions can be described as tradeoffs. True False
2. systems approach means that we concentrate on efficiency within a subsystem and thereby assure overall efficiency. True False
2*. -rior to the 5ndustrial 6evolution, goods were produced primarily by craftsmen or their apprentices using custom made parts. True False
2+. 7lton 3ayo's 08awthorne 7/periment0 was the focal point of the 8uman 6elations 3ovement, which emphasized the importance of the human element in 9ob design. True False
. mong Ford's many contributions was the introduction of mass production, using the concept of interchangeable parts and division of labor. True
False
1. Operations management and mar#eting are the two functional areas that e/ist to support activities in other functions such as accounting, finance, 5T and human resources. True False
2. :ean production systems incorporate the advantages of both mass production and craft production. True False
. s an abstraction of reality, a model is a simplified version of a real phenomenon. True False
". :ean production systems use a highly s#illed wor# force and fle/ible e)uipment. True
False
$. The lean production philosophy has been slow to be adopted in service industries. True False
%. Operations 3anagement activities will be less important in the future because many firms are becoming service4oriented operations rather than goods producing operations. True False
. modern firm has two supply chain considerations 4 e/ternal lin#s with suppliers and customers, and an internal networ# of flows to and between the operations function itself. True False
*. Operations management involves continuous decision4ma#ing; hopefully most decisions made will be< . redundant =. minor in nature !. informed >. )uantitative 7. none of the above
+. 'product pac#age' consists of< . the e/terior wrapping =. the shipping container !. a combination of goods and services >. goods if a manufacturing organization 7. customer relations if a service organization
". =usiness organizations consist of three ma9or functions which, ideally< . support one another =. are mutually e/clusive !. e/ist independently of each other >. function independently of each other 7. do not interface with each other
"1. ?hich of the following is not a type of operations@ . goods production =. storageAtransportation !. entertainment >. communication 7. all the above involve operations
"2. Technology choices seldom affect< . costs. =. productivity. !. union activity. >. )uality. 7. fle/ibility.
". 3easurements ta#en at various points in the transformation process for control purposes are called< . plans =. directions !. controls >. feedbac# 7. budgets
"". =udgeting, analysis of investment proposals, and provision of funds are activities associated with the BBBBBBB function. . operation =. mar#eting !. purchasing >. finance 7. internal audit
"$. ?hich one of the following would not generally be classified under the heading of transformation@ . assembling =. teaching !. staffing >. farming 7. consulting
"%. 3anufacturing wor# sent to other countries is called< . downsized =. outsourced !. internationalization >. vertical integration 7. entrepreneurial ship
". -roduct design and process selection are e/amples of BBBBBBB decisions. . financial =. tactical !. system design >. system operation 7. forecasting
"*. The responsibilities of the operations manager are< . planning, organizing, staffing, procuring, and reviewing =. planning, organizing, staffing, directing, and controlling !. forecasting, designing, planning, organizing, and controlling >. forecasting, designing, operating, procuring, and reviewing 7. designing and operating
"+. Cnowledge s#ills usually don't include< . process #nowledge =. accounting s#ills !. communication s#ills >. global #nowledge 7. all of the above
$. ?hich of the following is not true about systems approach@ . systems viewpoint is almost always beneficial in decision ma#ing. =. systems approach emphasizes interrelationships among subsystems. !. systems approach concentrates on efficiency within subsystems. >. systems approach is essential whenever something is being redesigned or improved. 7. ll of the above are true.
$1. ?hat is credited with gains in industrial productivity, increased standards of living and affordable products@ . personal computers =. the internet !. mass transportation >. assembly lines 7. multi4level mar#eting
$2. -roduction systems with customized outputs typically have relatively< . high volumes of output =. low unit costs !. high amount of specialized e)uipment >. fast wor# movement 7. s#illed wor#ers
$. ?hich is not a significant difference between manufacturing and service operations@ . cost per unit =. uniformity of output !. labor content of 9obs >. customer contact 7. measurement of productivity
$". ?hich of the following is not a characteristic of service operations@ . intangible output =. high customer contact !. high labor content >. easy measurement of productivity 7. low uniformity of output
$$. ?hich of the following is a recent trend in business@ . pollution control =. total )uality management !. supply chain management >. competition from foreign manufacturers 7. technological change
$%. Farming is an e/ample of< . an obsolete activity =. a virtual organization !. non4manufactured goods >. a growth industry 7. customized manufacturing
$. >ealing with the fact that certain aspects of any management situation are more important than others is called< . analysis of tradeoffs =. sensitivity analysis !. recognition of priorities >. analysis of variance 7. decision table analysis
$*. The fact that a few improvements in a few #ey areas of operations will have more impact than many improvements in many other areas is consistent with the< . 5rwin phenomenon =. -areto phenomenon !. (tevenson phenomenon >. Tellier phenomenon 7. dam (mith phenomenon
$+. The process of comparing outputs to previously established standards to determine if corrective action is needed is called< . planning =. directing !. controlling >. budgeting 7. disciplining
%. ?hich of the following does not relate to system design@ . altering the system capacity =. location of facilities !. inventory management >. selection and ac)uisition of e)uipment 7. physical arrangement of departments
%1. Ta#ing a systems viewpoint with regard to operations in today's environment increasingly leads decision4ma#ers to consider BBBBBBBBBBBBBB in response to the BBBBBBBBBBB. . fle/ibility; pressure to be more efficient =. offshoring; need to promote domestic production !. sustainability; threat of global warming >. technology; impact of random variation 7. forecasting; stabilization of demand
%2. (ome companies attempt to ma/imize the revenue they receive from fi/ed operating capacity by influencing demands through price manipulation. This is an e/ample of BBBBBBBBBBBBBBBBBB< . 5llegal price discrimination =. !ollusion !. olume analysis >. 6evenue management 7. Outsourcing
%. ?hich of the following is not an ongoing trend in manufacturing@ . globalization =. )uality improvement !. fle/ibility and agility >. mass production for greater economies of scale 7. technological advances
%". ?hich of the following is not a benefit of using models in decision ma#ing@ . They provide a standardized format for analyzing a problem. =. They serve as a consistent tool for evaluation. !. They are easy to use and less e/pensive than dealing with the actual situation. >. ll of the above are benefits. 7. Done of the above is a benefit.
%$. 3odern firms increasingly rely on other firms to supply goods and services instead of doing these tas#s themselves. This increased level of BBBBBBBBBBBBB is leading to increased emphasis on BBBBBBBBBBBB management. . outsourcing; supply chain =. offshoring; lean !. downsizing; total )uality >. optimizing; inventory 7. internationalization; intercultural
%%. Operations and sales are the two BBBBBBBB functions in businesses. . strategic =. tactical !. support >. value4adding 7. line
%. 3ar#eting depends on operations for information regarding BBBBBBBBBBB. . productivity =. lead time !. cash flow >. budgeting 7. corporate intelligence
%*. Two widely used metrics of variation are the BBBBBBBBBB and the BBBBBBBBB. . mean; standard deviation =. productivity ratio; correlation !. standardized mean; assignable deviation >. randomized mean; standardized deviation 7. normal distribution; random variation
%+. ?hich of the following statements about variation is F:(7@ . ariation prevents a production process from being as efficient as it can be. =. (ome variation can be prevented. !. ariation can either be assignable or random. >. ny variation ma#es a production process less productive. 7. 6andom variation generally cannot be influenced by managers.
. ?hich of the following is essential to consider with respect to managing a process to meet demand@ . strategy =. demand forecasts !. capacity >. random variability 7. all of the above
ch1 Cey
1. Operations managers are responsible for assessing consumer wants and needs and selling and promoting the organization's goods or services. FALSE
Operation managers are not responsible for promoting goodsAservices.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )$ To'ic Area: The Sco'e of !'erations *anagement
2. Often, the collective success or failure of companies' operations functions will impact the ability of a nation to compete with other nations. TRUE
nation is often only as competitive as its companies.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#$ Define the term o'erations management( Stevenson % Cha'ter #$ )+ To'ic Area: !'erations Today
. !ompanies are either producing goods or delivering services. This means that only one of the two types of operations management strategies are used. FALSE
3ost systems involve a blend of goods and services.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#- .dentify similarities and differences bet/ een 'roduction and service o'erations( Stevenson % Cha'ter #$ )To'ic Area: .ntroduction
". Operations, mar#eting, and finance function independently of each other in most organizations. FALSE
Operations, mar#eting and finance are naturally dependent upon one another.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#+ .dentify the three ma"or functional areas of organi0ations and describe ho/ they interrelate( Stevenson % Cha'ter #$ )& To'ic Area: .ntroduction
$. The greater the degree of customer involvement, the more challenging the design and management of operations. TRUE
&reater customer involvement leads to more comple/ity in the design and management of operations.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )1 To'ic Area: .ntroduction
%. &oods producing organizations are not involved in service activities. FALSE
3ost systems involve a blend of goods and services.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#- .dentify similarities and differences bet/ een 'roduction and service o'erations( Stevenson % Cha'ter #$ )2 To'ic Area: .ntroduction
. (ervice operations re)uire additional inventory because of the unpredictability of consumer demand. FALSE
(ervice operations cannot use inventory as a hedge against unpredictable demand.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: Easy earning !b"ective: #$%#- .dentify similarities and differences bet/ een 'roduction and service o'erations( Stevenson % Cha'ter #$ )3 To'ic Area: .ntroduction
*. The value of outputs is measured by the prices customers are willing to pay for goods or services. TRUE
!ustomers' willingness to pay for goods or services sets the value of these outputs.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )4 To'ic Area: .ntroduction
+. The use of models will guarantee the best possible decisions. FALSE
3odels are useful, but their use does not guarantee the best decisions.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )6 To'ic Area: !'erations *anagement and Decision *aking
1. -eople who wor# in the field of operations should have s#ills that include both #nowledge and people s#ills. TRUE
Operations management re)uires a blend of #nowledge and people s#ills.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )$# To'ic Area: The Sco'e of !'erations *anagement
11. ssembly lines achieved productivity but at the e/pense of standard of living. FALSE
-roductivity and standard of living go hand in hand.
AACSB: Reflective Thinking Blooms: Remember Difficulty: 7ard earning !b"ective: #$%#3 Briefly describe the historical evolution of o'erations management( Stevenson % Cha'ter #$ )$$ To'ic Area: The 7istorical Evolution of !'erations *anagement
12. The operations manager has primary responsibility for ma#ing operations system design decisions, such as system capacity and location of facilities. FALSE
The operations manager plays a role in these decisions but is not primarily responsible for them.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: 7ard earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )$+ To'ic Area: The Sco'e of !'erations *anagement
1. The word 0technology0 is used only to refer to 0information technology0. FALSE
Technology also refers to the technology involved in resource transformations.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )$To'ic Area: !'erations Today
1". alue added' by definition is always a positive number since 'added' implies increases. FALSE
(ome transformations result in the output being worth less than the inputs.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )$& To'ic Area: .ntroduction
1$. (ervice often re)uires greater labor content, whereas manufacturing is more capital intensive. TRUE
(ervice operations tend to be more labor4intensive than manufacturing.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#- .dentify similarities and differences bet/ een 'roduction and service o'erations( Stevenson % Cha'ter #$ )$1 To'ic Area: .ntroduction
1%. 3easurement of productivity in service is more straightforward than in manufacturing since it is not necessary to ta#e into account the cost of materials. FALSE
3aterials cost must be considered in services as well.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#- .dentify similarities and differences bet/ een 'roduction and service o'erations( Stevenson % Cha'ter #$ )$2 To'ic Area: .ntroduction
1. (pecial4purpose technology is a common way of offering increased customization in manufacturing or services without ta#ing on additional labor costs. FALSE
(pecial4purpose technology typically reduces costs through standardization.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: 7ard earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )$3 To'ic Area: !'erations Today
1*. One concern in the design of production systems is the degree of standardization. TRUE
8ow standardized outputs will be is a critical consideration in the system design )uestion.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )$4 To'ic Area: !'erations *anagement and Decision *aking
1+. 3ost people encounter operations only in profit4ma#ing organizations. FALSE
Operations are also relevant to not4for4profit organizations such as the 6ed !ross.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )$6 To'ic Area: .ntroduction
2. (ervice involves a much higher degree of customer contact than manufacturing. TRUE
!ustomer contact tends to be much higher in services.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#- .dentify similarities and differences bet/ een 'roduction and service o'erations( Stevenson % Cha'ter #$ )+# To'ic Area: .ntroduction
21. systems approach emphasizes interrelationships among subsystems, but its main theme is that the whole is greater than the sum of its individual parts. TRUE
Optimizing the performance of individual subsystems does not guarantee optimal performance from the overall system.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )+$ To'ic Area: !'erations *anagement and Decision *aking
22. The -areto phenomenon is one of the most important and pervasive concepts that can be applied at all levels of management. TRUE
-areto phenomena can be observed in a wide variety of organization situations.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )++ To'ic Area: !'erations *anagement and Decision *aking
2. Operations managers, who usually use )uantitative approaches, are not really concerned with ethical decision4ma#ing. FALSE
7thics issues are touching on all areas of management, including operations.
AACSB: Ethics Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )+To'ic Area: 8ey .ssues for Todays Business !'erations
2". The optimal solutions produced by )uantitative techni)ues should always be evaluated in terms of the larger framewor#. TRUE
Euantitative techni)ues have limitations that must be considered.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )+& To'ic Area: !'erations *anagement and Decision *aking
2$. 3anagers should most often rely on )uantitative techni)ues for important decisions since )uantitative approaches result in more accurate decisions. FALSE
ust as other techni)ues do, )uantitative techni)ues have limitations.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: 7ard earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )+1 To'ic Area: !'erations *anagement and Decision *aking
2%. 3any operations management decisions can be described as tradeoffs. TRUE
3anaging tradeoffs is the essence of operations management.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )+2 To'ic Area: !'erations *anagement and Decision *aking
2. systems approach means that we concentrate on efficiency within a subsystem and thereby assure overall efficiency. FALSE
(ubsystem efficiency doesn't necessarily translate into overall efficiency.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )+3 To'ic Area: !'erations *anagement and Decision *aking
2*. -rior to the 5ndustrial 6evolution, goods were produced primarily by craftsmen or their apprentices using custom made parts. TRUE
fter the 5ndustrial 6evolution, more standardized approaches became common.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#3 Briefly describe the historical evolution of o'erations management( Stevenson % Cha'ter #$ )+4 To'ic Area: The 7istorical Evolution of !'erations *anagement
2+. 7lton 3ayo's 08awthorne 7/periment0 was the focal point of the 8uman 6elations 3ovement, which emphasized the importance of the human element in 9ob design. TRUE
The 8awthorne 7/periments were the beginning of the 8uman 6elations 3ovement.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#3 Briefly describe the historical evolution of o'erations management( Stevenson % Cha'ter #$ )+6 To'ic Area: The 7istorical Evolution of !'erations *anagement
. mong Ford's many contributions was the introduction of mass production, using the concept of interchangeable parts and division of labor. TRUE
Ford made mass production a practical success.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#3 Briefly describe the historical evolution of o'erations management( Stevenson % Cha'ter #$ )-# To'ic Area: The 7istorical Evolution of !'erations *anagement
1. Operations management and mar#eting are the two functional areas that e/ist to support activities in other functions such as accounting, finance, 5T and human resources. FALSE
Operations management and mar#eting are supported by these functions.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#+ .dentify the three ma"or functional areas of organi0ations and describe ho/ they interrelate( Stevenson % Cha'ter #$ )-$ To'ic Area: .ntroduction
2. :ean production systems incorporate the advantages of both mass production and craft production. TRUE
:ean production blends the best of both worlds.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )-+ To'ic Area: The 7istorical Evolution of !'erations *anagement
. s an abstraction of reality, a model is a simplified version of a real phenomenon. TRUE
3odels are valuable abstractions and simplifications of real, comple/ phenomena.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )-To'ic Area: !'erations *anagement and Decision *aking
". :ean production systems use a highly s#illed wor# force and fle/ible e)uipment. TRUE
:ean depends on a s#illed wor#force.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )-& To'ic Area: The 7istorical Evolution of !'erations *anagement
$. The lean production philosophy has been slow to be adopted in service industries. FALSE
:ean concepts apply very well in service industries.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )-1 To'ic Area: The 7istorical Evolution of !'erations *anagement
%. Operations 3anagement activities will be less important in the future because many firms are becoming service4oriented operations rather than goods producing operations. FALSE
Operations management is 9ust as important for service firms.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )-2 To'ic Area: 8ey .ssues for Todays Business !'erations
. modern firm has two supply chain considerations 4 e/ternal lin#s with suppliers and customers, and an internal networ# of flows to and between the operations function itself. TRUE
(upply chain considerations are at play both in and beyond the modern firm.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )-3 To'ic Area: 8ey .ssues for Todays Business !'erations
*. Operations management involves continuous decision4ma#ing; hopefully most decisions made will be< . redundant =. minor in nature C. informed >. )uantitative 7. none of the above 5nformed decisions incorporate all relevant issues.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )-4 To'ic Area: !'erations *anagement and Decision *aking
+. 'product pac#age' consists of< . the e/terior wrapping =. the shipping container C. a combination of goods and services >. goods if a manufacturing organization 7. customer relations if a service organization 3ost firms are not pure service or manufacturing firms; they produce combinations of goods and services.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#- .dentify similarities and differences bet/ een 'roduction and service o'erations( Stevenson % Cha'ter #$ )-6 To'ic Area: .ntroduction
". =usiness organizations consist of three ma9or functions which, ideally< A. support one another =. are mutually e/clusive !. e/ist independently of each other >. function independently of each other 7. do not interface with each other Finance, 3ar#eting and Operations are these ma9or functions.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#+ .dentify the three ma"or functional areas of organi0ations and describe ho/ they interrelate( Stevenson % Cha'ter #$ )&# To'ic Area: .ntroduction
"1. ?hich of the following is not a type of operations@ . goods production =. storageAtransportation !. entertainment >. communication E. all the above involve operations ll of these involve ta#ing inputs and transforming them.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#$ Define the term o'erations management( Stevenson % Cha'ter #$ )&$ To'ic Area: .ntroduction
"2. Technology choices seldom affect< . costs. =. productivity. C. union activity. >. )uality. 7. fle/ibility. Gnion activity can affect a firm's technology choices, but not the other way around.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )&+ To'ic Area: !'erations Today
". 3easurements ta#en at various points in the transformation process for control purposes are called< . plans =. directions !. controls D. feedbac# 7. budgets Feedbac# is used to monitor and improve processes.
AACSB: Reflective Thinking Blooms: Remember Difficulty: 7ard earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )&To'ic Area: .ntroduction
"". =udgeting, analysis of investment proposals, and provision of funds are activities associated with the BBBBBBB function. . operation =. mar#eting !. purchasing D. finance 7. internal audit These are the primary tas#s for the finance function.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#+ .dentify the three ma"or functional areas of organi0ations and describe ho/ they interrelate( Stevenson % Cha'ter #$ )&& To'ic Area: .ntroduction
"$. ?hich one of the following would not generally be classified under the heading of transformation@ . assembling =. teaching C. staffing >. farming 7. consulting (taffing doesn't involve transforming resources so much as it involves ac)uiring them.
AACSB: Reflective Thinking Blooms: Remember Difficulty: 7ard earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )&1 To'ic Area: 9rocess *anagement
"%. 3anufacturing wor# sent to other countries is called< . downsized B. outsourced !. internationalization >. vertical integration 7. entrepreneurial ship Outsourcing is increasingly a part of operations management.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )&2 To'ic Area: The Sco'e of !'erations *anagement
". -roduct design and process selection are e/amples of BBBBBBB decisions. . financial =. tactical C. system design >. system operation 7. forecasting These ma9or decisions affect decisions made at lower levels.
AACSB: Reflective Thinking Blooms: Remember Difficulty: 7ard earning !b"ective: #$%#1 Summari0e the t/o ma"or as'ects of 'rocess management( Stevenson % Cha'ter #$ )&3 To'ic Area: The Sco'e of !'erations *anagement
"*. The responsibilities of the operations manager are< . planning, organizing, staffing, procuring, and reviewing B. planning, organizing, staffing, directing, and controlling !. forecasting, designing, planning, organizing, and controlling >. forecasting, designing, operating, procuring, and reviewing 7. designing and operating The scope of operations management ranges across the organization.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )&4 To'ic Area: The Sco'e of !'erations *anagement
"+. Cnowledge s#ills usually don't include< . process #nowledge =. accounting s#ills C. communication s#ills >. global #nowledge 7. all of the above !ommunication s#ills generally are considered to be people s#ills.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )&6 To'ic Area: The Sco'e of !'erations *anagement
$. ?hich of the following is not true about systems approach@ . systems viewpoint is almost always beneficial in decision ma#ing. =. systems approach emphasizes interrelationships among subsystems. C. systems approach concentrates on efficiency within subsystems. >. systems approach is essential whenever something is being redesigned or improved. 7. ll of the above are true. (ubsystem efficiency doesn't necessarily translate into overall system efficiency.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )1# To'ic Area: !'erations *anagement and Decision *aking
$1. ?hat is credited with gains in industrial productivity, increased standards of living and affordable products@ . personal computers =. the internet !. mass transportation D. assembly lines 7. multi4level mar#eting 3ass production has played a prominent role in increasing standards of living.
AACSB: Reflective Thinking Blooms: Remember Difficulty: 7ard earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )1$ To'ic Area: The 7istorical Evolution of !'erations *anagement
$2. -roduction systems with customized outputs typically have relatively< . high volumes of output =. low unit costs !. high amount of specialized e)uipment >. fast wor# movement E. s#illed wor#ers (#illed wor#ers are necessary to accommodate the variation inherent in customized outputs.
AACSB: Reflective Thinking Blooms: Remember Difficulty: 7ard earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )1+ To'ic Area: !'erations *anagement and Decision *aking
$. ?hich is not a significant difference between manufacturing and service operations@ A. cost per unit =. uniformity of output !. labor content of 9obs >. customer contact 7. measurement of productivity 3anufacturing operations aren't necessarily more or less efficient than service operations.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: 7ard earning !b"ective: #$%#- .dentify similarities and differences bet/ een 'roduction and service o'erations( Stevenson % Cha'ter #$ )1To'ic Area: .ntroduction
$". ?hich of the following is not a characteristic of service operations@ . intangible output =. high customer contact !. high labor content D. easy measurement of productivity 7. low uniformity of output The productivity of service operations is often hard to measure.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#- .dentify similarities and differences bet/ een 'roduction and service o'erations( Stevenson % Cha'ter #$ )1& To'ic Area: .ntroduction
$$. ?hich of the following is a recent trend in business@ . pollution control =. total )uality management C. supply chain management >. competition from foreign manufacturers 7. technological change (upply chain management involves a broader systemic view of operations.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )11 To'ic Area: 8ey .ssues for Todays Business !'erations
$%. Farming is an e/ample of< . an obsolete activity =. a virtual organization C. non4manufactured goods >. a growth industry 7. customized manufacturing Farm operations are not manufacturing operations.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#- .dentify similarities and differences bet/ een 'roduction and service o'erations( Stevenson % Cha'ter #$ )12 To'ic Area: .ntroduction
$. >ealing with the fact that certain aspects of any management situation are more important than others is called< . analysis of tradeoffs =. sensitivity analysis C. recognition of priorities >. analysis of variance 7. decision table analysis (olutions tend to be targeted toward higher priority aspects of a situation.
AACSB: Reflective Thinking Blooms: Remember Difficulty: 7ard earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )13 To'ic Area: !'erations *anagement and Decision *aking
$*. The fact that a few improvements in a few #ey areas of operations will have more impact than many improvements in many other areas is consistent with the< . 5rwin phenomenon B. -areto phenomenon !. (tevenson phenomenon >. Tellier phenomenon 7. dam (mith phenomenon -areto phenomena direct our attention to the difference between the 0important few0 and the 0trivial many.0
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )14 To'ic Area: !'erations *anagement and Decision *aking
$+. The process of comparing outputs to previously established standards to determine if corrective action is needed is called< . planning =. directing C. controlling >. budgeting 7. disciplining !ontrols are used to maintain performance.
AACSB: Reflective Thinking Blooms: Remember Difficulty: 7ard earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )16 To'ic Area: The Sco'e of !'erations *anagement
%. ?hich of the following does not relate to system design@ . altering the system capacity =. location of facilities C. inventory management >. selection and ac)uisition of e)uipment 7. physical arrangement of departments 5nventory management is a system operation decision area.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#1 Summari0e the t/o ma"or as'ects of 'rocess management( Stevenson % Cha'ter #$ )2# To'ic Area: The Sco'e of !'erations *anagement
%1. Ta#ing a systems viewpoint with regard to operations in today's environment increasingly leads decision4ma#ers to consider BBBBBBBBBBBBBB in response to the BBBBBBBBBBB. . fle/ibility; pressure to be more efficient =. offshoring; need to promote domestic production C. sustainability; threat of global warming >. technology; impact of random variation 7. forecasting; stabilization of demand (ustainability is a relatively recent operations management consideration.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: 7ard earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )2$ To'ic Area: !'erations *anagement and Decision *aking
%2. (ome companies attempt to ma/imize the revenue they receive from fi/ed operating capacity by influencing demands through price manipulation. This is an e/ample of BBBBBBBBBBBBBBBBBB< . 5llegal price discrimination =. !ollusion !. olume analysis D. 6evenue management 7. Outsourcing 6evenue management is used to ensure that as much perishable capacity as possible is sold.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )2+ To'ic Area: !'erations Today
%. ?hich of the following is not an ongoing trend in manufacturing@ . globalization =. )uality improvement !. fle/ibility and agility D. mass production for greater economies of scale 7. technological advances 3anufacturers are moving away from mass production for economies of scale.
AACSB: Reflective Thinking Blooms: Remember Difficulty: *edium earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )2To'ic Area: 8ey .ssues for Todays Business !'erations
%". ?hich of the following is not a benefit of using models in decision ma#ing@ . They provide a standardized format for analyzing a problem. =. They serve as a consistent tool for evaluation. !. They are easy to use and less e/pensive than dealing with the actual situation. D. ll of the above are benefits. 7. Done of the above is a benefit. 3odels are useful tools for ma#ing decisions without confronting the actual situation with all of its comple/ity.
AACSB: Reflective Thinking Blooms: Remember Difficulty: 7ard earning !b"ective: #$%#2 E5'lain the key as'ects of o'erations management decision making( Stevenson % Cha'ter #$ )2& To'ic Area: !'erations *anagement and Decision *aking
%$. 3odern firms increasingly rely on other firms to supply goods and services instead of doing these tas#s themselves. This increased level of BBBBBBBBBBBBB is leading to increased emphasis on BBBBBBBBBBBB management. A. outsourcing; supply chain =. offshoring; lean !. downsizing; total )uality >. optimizing; inventory 7. internationalization; intercultural (upply chain management ta#es a more systemic view of the firm, its operations, and its suppliers.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#4 Characteri0e current trends in business that im'act o'erations management( Stevenson % Cha'ter #$ )21 To'ic Area: 8ey .ssues for Todays Business !'erations
%%. Operations and sales are the two BBBBBBBB functions in businesses. . strategic =. tactical !. support >. value4adding E. line Others are support functions.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#+ .dentify the three ma"or functional areas of organi0ations and describe ho/ they interrelate( Stevenson % Cha'ter #$ )22 To'ic Area: hy earn about !'erations *anagement;
%. 3ar#eting depends on operations for information regarding BBBBBBBBBBB. . productivity B. lead time !. cash flow >. budgeting 7. corporate intelligence 3ar#eting uses lead time information to ma#e promises to customers.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )23 To'ic Area: hy earn about !'erations *anagement;
%*. Two widely used metrics of variation are the BBBBBBBBBB and the BBBBBBBBB. A. mean; standard deviation =. productivity ratio; correlation !. standardized mean; assignable deviation >. randomized mean; standardized deviation 7. normal distribution; random variation The mean and standard deviation summarize important facets regarding the variation in a process.
AACSB: Reflective Thinking Blooms: Remember Difficulty: Easy earning !b"ective: #$%#& Describe the o'erations function and the nature of the o'erations managers "ob( Stevenson % Cha'ter #$ )24 To'ic Area: 9rocess *anagement
%+. ?hich of the following statements about variation is F:(7@ . ariation prevents a production process from being as efficient as it can be. =. (ome variation can be prevented. !. ariation can either be assignable or random. D. ny variation ma#es a production process less productive. 7. 6andom variation generally cannot be influenced by managers. The choice to offer customers greater variety might increase variation but increase productivity even more.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: 7ard earning !b"ective: #$%#1 Summari0e the t/o ma"or as'ects of 'rocess management( Stevenson % Cha'ter #$ )26 To'ic Area: 9rocess *anagement
. ?hich of the following is essential to consider with respect to managing a process to meet demand@ . strategy =. demand forecasts !. capacity >. random variability E. all of the above ll of these play a role in determining whether a process can meet demand.
AACSB: Reflective Thinking Blooms: ,nderstand Difficulty: *edium earning !b"ective: #$%#1 Summari0e the t/o ma"or as'ects of 'rocess management( Stevenson % Cha'ter #$ )3# To'ic Area: 9rocess *anagement
