Exam 17: Managing Service and Manufacturing Operations

What kind of cost is associated with maintaining an inventory?

Extrinsic productivity indicates how much labour,capital,materials,and energy it takes to produce an output.

One key assumption in the service business is that success depends on how well employees deliver their services to customers. However,which of the following does the service-profit chain assume success depends on?

Which of the following is the best example of a discrete production process?

Studies clearly show that customers care more about responsiveness than anything else when buying services.

Connie is the president of a gift baskets company. She is quite happy with the sales manager she hired earlier in the year. Connie has noticed more customers calling to say how happy they are with the baskets prepared for them. She has also noticed many customers placing subsequent orders. What has the new sales manager brought to Connie's company?

At their core,companies are systems that combine inputs,such as labour,raw materials,capital,and knowledge,to produce finished products and other types of outputs. Which term best describes the type of system a company is?

What types of companies can apply for ISO 9000 certification?

Two basic measures of inventory are inventory turnover and average aggregate inventory. What is the third?

Total quality management (TQM)is an integrated organization-wide strategy for improving product and service quality.

Narrative 17-1 In recent years,Japanese companies such as Mitsubishi,NEC,Fujitsu,and Sony began turning to North America to manufacture Japanese products. While Sony,Panasonic,and other Japanese giants still excel at cranking out high-quality consumer electronics products-such as camcorders and TVs-by the millions,it's a different story in industries with short product cycles and factories that must build what customers order instead of churning out products in anticipation of demand. Japan's great strength-repetitive manufacturing-is becoming its greatest weakness. This production-on-demand form of management cannot depend on JIT. Instead,the North American companies rely on raw-in-process inventory,or RIP. RIP calls for keeping a reasonable quantity of varied raw materials or components on hand to meet changing customer demand. -Refer to Narrative 17-1. Which type of manufacturing operation are North Americans who manufacture NEC,Fujitsu,and Sony products using?

What is inventory? Explain the potential costs associated with it. Briefly describe the systems of inventory management that are available to managers to control these costs,and specify which method of inventory management is best.

What types of public recognition are given to companies that demonstrate the highest probability that they are consistent producers of high-quality goods or services,and what is the process of receiving and maintaining that recognition?

What is a difference between goods and services?

Total quality management (TQM)saved Xerox from bankruptcy when it was badly beleaguered by its Japanese rivals. What would TQM have brought to Xerox to save it from bankruptcy?

What is ISO 14000?

Narrative 17-2 Because of the poor quality of its cars,Hyundai watched its U.S. sales drop from 264,000 cars to 90,000 cars in just two years. Hyundai cars ranked 26th out of 35 car brands in terms of initial car quality as measured by the influential J.D. Power initial car quality survey. With $6.6 billion in debt,a $1 billion investment for a new manufacturing plant in Alabama,and the company's first-ever loss,Hyundai's new chairman,Chung Mong Koo,declared that improving quality was the only way to fix the company. The challenge for Chung was to get his managers to put quality,not costs,first. So he sent a visible,meaningful message that poor quality would no longer be tolerated. During one plant visit,Chung demanded to see under the hood of a car on the production line. He was furious when he saw loose wires,tangled hoses,bolts painted four different colours-a tremendous deviation from what the engine compartment was supposed to look like. On the spot,he instructed the plant chief to paint all bolts and screws black and ordered workers not to release any car unless all was orderly under the hood. He then publicly declared that Hyundai would produce higher-quality cars than Toyota by 2008,and that Hyundai would produce the best quality cars in the auto industry. Today,each workweek starts with a demanding three-hour meeting attended by managers,engineers,designers,and suppliers. In his large boardroom,Chung displays Hyundai cars on rotating turntables or mechanical lifts-whatever is required for those in attendance to see up close what problems need to be fixed. Hyundai managers now measure everything. Hundreds of charts on the walls of every Hyundai factory measure the number of times and the degree to which a process has produced parts that differ meaningfully from the quality standards for those parts. The quality department at Hyundai has grown from 100 to 1,000 people,who now report directly to CEO Chung. All employees share their ideas about how to improve quality because Chung communicated to workers that their ideas were critical and welcomed. To prove it,he rewarded them with bonuses averaging $150 per employee. At one Hyundai factory,workers have suggested 25,000 ideas for improving quality,30 percent of which have been implemented in the factory. For instance,a worker noticed that the Hyundai Sonata and SG 350 sedans had identically sized spare tires,but different-sized spare tire covers. Though it may sound trivial,using the same spare tire cover for both cars saves Hyundai $100,000 a year. Hyundai addresses customer complaints as quickly as possible,and these quick responses to customer complaints have had dramatic results,such as reducing Hyundai Santa Fe's score in J.D. Power's initial car quality survey from 149 problems per 100 cars to 93 problems per 100 cars in just one year. Finally,if the greatly improved quality isn't enough to convince prospective buyers to buy a Hyundai,the company believes that its 5-year/100,000 km warranty may be enough. The longest,most comprehensive warranty in the auto industry shows the confidence the company has in its cars. And those extensive warranties probably won't cost Hyundai much either,as the improved quality of its cars has cut the cost of warranty repairs,which are paid for by headquarters,by 35 percent over the last three years. -Refer to Narrative 17-2. In every Hyundai factory,hundreds of wall charts track the number of times and the degree to which a process has produced parts that differ meaningfully from the quality standards for those parts. What is the company measuring to maintain quality?

According to the TQM strategy,what should be a company's primary goal?

A production process that purifies water for bottling is an example of which type of manufacturing operation?

Canadian magazine publishers have seen significant newsstand sales declines in the past few years,with weekly celebrity-focused and women's magazines seeing the biggest declines. Which type of operation did the celebrity-focused and women's magazine publishers use,in terms of the amount of processing?