Deck 7: Process Strategy

Question 1

Frito-Lay is to ________ focus as Harley Davidson is to ________ focus.

A)process,repetitive
B)product,repetitive
C)repetitive,product
D)process,product
E)product,mass customization

Answer 1

B

Question 2

Harley-Davidson,because it has so many possible combinations of products,utilizes the process strategy of mass customization.

Answer 2

False

Question 3

Arnold Palmer Hospital uses which focus?

A)process
B)repetitive
C)product
D)mass customization
E)A and D

Answer 3

A

Question 4

The typical full-service restaurant uses a product-focused process.

Question 5

High fixed costs and low variable costs are typical of which approach?

A)product
B)process
C)mass customization
D)repetitive
E)A and C

Question 6

The tool that calculates which process has the lowest cost at any specified production volume is a crossover chart.

Question 7

Goods made to order are typical of ________ and ________ approaches while goods made to forecast are typical of ________ and ________ approaches.

A)process,mass customization;repetitive,product
B)product,mass customization;repetitive,process
C)product,process;repetitive,mass customization
D)repetitive,product;mass customization,process
E)repetitive,process;mass customization,product

Question 8

The assembly line is a classic example of a repetitive process.

Question 9

One of the similarities between process focus and mass-customization is:

A)the volume of outputs.
B)the use of modules.
C)many departments and many routings.
D)the variety of outputs.
E)All of the above are similarities.

Question 10

A product-focused process is commonly used to produce:

A)high-volume,high-variety products.
B)low-volume,high-variety products.
C)high-volume,low-variety products.
D)low-variety products at either high- or low-volume.
E)high-volume products of either high- or low-variety.

Question 11

The term focused processes refers to the quest for increased efficiency,whether in goods or services,that results from specialization.

Question 12

A job shop is an example of a(n):

A)repetitive process.
B)continuous process.
C)line process.
D)intermittent process.
E)specialized process.

Question 13

Which one of the following products is most likely made in a job shop environment?

A)rolls of newsprint
B)paper forms
C)television sets
D)cigarettes
E)canned vegetables

Question 14

Intermittent processes are organized around processes.

Question 15

Which of the following products is likely to be assembled on a repetitive process line?

A)automobiles
B)custom personal computers
C)custom cakes
D)steel
E)beer

Question 16

Three of the four types of processes are:

A)goods,services,and hybrids.
B)manual,automated,and service.
C)process focus,repetitive focus,and product focus.
D)modular,continuous,and technological.
E)input,transformation,and output.

Question 17

In process-focused facilities,utilization of facilities is low.

Question 18

A firm's process strategy is its approach to transforming resources into goods and services.

Question 19

Which of the following industries is most likely to have low equipment utilization?

A)auto manufacturing
B)commercial baking
C)television manufacturing
D)steel manufacturing
E)restaurants

Question 20

An assembly line is an example of a:

A)product-focused process.
B)process-focused process.
C)repetitive process.
D)line process.
E)specialized process.

Question 21

________ is a rapid,low-cost production process that caters to constantly changing unique customer desires.

Question 22

Process A has fixed costs of $1000 and variable costs of $5 per unit.Process B has fixed costs of $500 and variable costs of $15 per unit.What is the crossover point between process A and process B?

A)50 units
B)200 units
C)$2,500
D)$5,000
E)$9,500

Question 23

The crossover point is that production quantity where:

A)variable costs of one process equal the variable costs of another process.
B)fixed costs of a process are equal to its variable costs.
C)total costs equal total revenues for a process.
D)total costs for one process equal total costs for another process.
E)the process no longer loses money.

Question 24

A quasi-custom product:

A)gets its apparent customization from the combinations available from a small number of modules.
B)is often the output of repetitive focus facilities.
C)is a valid description of a fast food sandwich.
D)only applies in services.
E)All but D are true.

Question 25

Which of the following is FALSE regarding repetitive processes?

A)They use modules.
B)They allow easy switching from one product to the other.
C)They are the classic assembly lines.
D)They have more structure and less flexibility than a job shop layout.
E)They include the assembly of basically all automobiles.

Question 26

Harley Davidson:

A)utilizes job shops to make each of its modules.
B)uses product focused manufacturing.
C)uses a large number of modules to build a small number of different bikes.
D)uses work cells to feed its assembly line.
E)All of the above are true.

Question 27

Which of the following characteristics best describes repetitive focus?

A)It uses sophisticated scheduling to accommodate custom orders.
B)Its output is a standardized product produced from modules.
C)Operators are broadly skilled.
D)It is widely used for the manufacture of steel.
E)low volume,high variety

Question 28

Product focused processes:

A)allow more customization,but are not very efficient.
B)are desirable because resource needs increase slowly with the complexity of a process.
C)are processes that are specialized for relatively few products or customer groups.
D)apply only to service firms,not to manufacturers.
E)are profitable because customers demand flexibility,not specialization.

Question 29

The process strategy that is organized around processes to facilitate low-volume,high-variety processes is called a(n)________.

Question 30

Which of the following companies use a mass customization approach?

A)Dell
B)Align Technology
C)Frito-Lay
D)Arnold Palmer hospital
E)A and B

Question 31

Process X has fixed costs of $10,000 and variable costs of $2.40 per unit.Process Y has fixed costs of $9,000 and variable costs of $2.25 per unit.Which of the following statements is TRUE?

A)The crossover point is approximately 6667 units.
B)It is impossible for one process to have both of its costs lower than those of another process.
C)Process Y is cheaper than process X at all volumes.
D)Process X should be selected for very large production volumes.
E)Process X is more profitable than process Y and should be selected.

Question 32

An organization's approach to transforming resources into goods and services is called its ________.

Question 33

________ is a process strategy based on a product-oriented production process that uses modules.

Question 34

Why is Harley-Davidson identified as a repetitive manufacturer,not a mass customizer?

Question 35

________ represent an organization's attempt to gain increased efficiency through specialization,which can include,for example,concentrating on certain classes of customers.

Question 36

What is the link between focused processes and specialization? What kinds of focus are possible?

Question 37

How are modules useful in manufacturing processes?

Question 38

Which of the following phrases best describes product focus?

A)low volume,high variety
B)Finished goods are usually made to order.
C)Processes are designed to perform a wide variety of activities.
D)high fixed costs,low variable costs
E)high inventory

Question 39

Which of the following phrases best describes process focus?

A)low volume,high variety
B)Finished goods are usually made to a forecast and stored.
C)Operators are less broadly skilled.
D)high fixed costs,low variable costs
E)low inventory

Question 40

Align Technology uses a ________ approach to produce clear plastic removable aligners.

A)mass customization
B)product focus
C)process focus
D)repetitive focus
E)crossover

Question 41

Bridget is considering how to get to work over the summer.She has two options.Option A is to buy a seasonal bus pass for $100.Option B is to pay $.25 for each ride.Identify the fixed and variable costs for each option.If she has to ride both to and from work,how many days of work would it take for the seasonal pass to cost the same amount as Option B?

Question 42

Why do modern operations managers look for flexibility in their equipment?

Question 43

A firm is about to undertake the manufacture of a product,and it is weighing the process configuration options.There are two intermittent processes under consideration,as well as a repetitive focus.The smaller intermittent process has fixed costs of $3,000 per month and variable costs of $10 per unit.The larger intermittent process has fixed costs of $12,000 per month and variable costs of $2 per unit.A repetitive focus plant has fixed costs of $50,000 per month and variable costs of $1 per unit.
a.At what output does the large intermittent process become cheaper than the small one?
b.At what output does the repetitive process become cheaper than the larger intermittent process?

Question 44

An organization is considering three process configuration options.There are two different intermittent processes,as well as a repetitive focus.The smaller intermittent process has fixed costs of $3,000 per month and variable costs of $10 per unit.The larger intermittent process has fixed costs of $12,000 per month and variable costs of $2 per unit.A repetitive focus plant has fixed costs of $50,000 per month and variable costs of $1 per unit.
a.If the company produced 20,000 units,what would be its cost under each of the three choices?
b.Which process offers the lowest cost to produce 40,000 units? What is that cost?

Question 45

In an affluent society,how do we produce a wide number of options for products at low cost? Hint: Focus on how to address some of the major challenges of mass customization.

Question 46

A product is currently made in a process-focused shop,where fixed costs are $8,000 per year and variable cost is $40 per unit.The firm currently sells 200 units of the product at $200 per unit.A manager is considering a repetitive focus to lower costs (and lower prices,thus raising demand).The costs of this proposed shop are fixed costs = $24,000 per year and variable cost = $10 per unit.If a price of $80 will allow 400 units to be sold,what profit (or loss)can this proposed new process expect? Do you anticipate that the manager will want to change the process? Explain.

Question 47

What is mass customization?

Question 48

Which of the following is true regarding the concept of flexibility?

A)It is the ability to respond with little penalty in time,cost,or customer value.
B)It may be accomplished with digitally controlled equipment.
C)It may involve modular or movable equipment.
D)All of the above are true.
E)None of the above is true.

Question 49

The local convenience store makes personal pan pizzas.Currently,its process makes complete pizzas,fully cooked,for the customer.This process has a fixed cost of $20,000,and a variable cost of $1.75 per pizza.The owner is considering a different process that can make pizzas in two ways: completely cooked (as before),or partially cooked and then flash frozen for the customer to finish heating at home.This alternate process has a fixed cost of $24,000,but a lower variable cost (because much less energy is used in baking)of $1.25 per pizza.
a.What is the crossover point between the existing process and the proposed process?
b.If the owner expects to sell 9,000 pizzas,should he get the new oven?

Question 50

Karla's candle factory is considering two different manufacturing options.Option A is highly automated with fixed costs of $25,000 and variable costs of $.1/candle.Option B uses hand labor with fixed costs of $10,000 and variable costs of $.5/candle.If demand for Karla's candles is 25,000,which option should she pick?

Question 51

Brandon's computer shop is considering two different configuration options.The first one is to have each computer built by the sales associates when they have free time.The second option is to hire a dedicated assembly technician.Option A has variable costs of $50 per computer and no fixed costs.Option B has a fixed cost of $1,000 but variable costs of only $5 per computer.What is the cross-over point?

Question 52

When selecting new equipment and technology,decision makers look for flexibility-the ability to respond with little penalty in time,cost,or customer value.

Question 53

Big John's Manufacturing currently produces its lead product on a machine that has a variable cost of $0.32 per unit,and fixed costs of $75,000.Big John is considering purchasing a new machine that would drop the variable cost to $.28 per unit,but has fixed costs of $150,000.What is the cross-over point between the two machines?

Question 54

Kirstin is thinking about opening a Chinese restaurant and needs to buy a rice cooker.Machine A has fixed costs of $100 and variable costs of $1/pound.Machine B has fixed costs of $500 and variable costs of $.1/pound.If Kirstin plans to sell 100 pounds of rice,which machine should she choose? What is the cross-over point?

Question 55

Identify the four basic process strategies,and describe them in a complete sentence or two each.

Question 56

A non-profit organization is planning a raffle to raise money.It has two options for tickets.The first option is to do the tickets by hand,with fixed costs of $50 and variable costs of $.05 per ticket.The second option is to outsource production.This would result in fixed costs of $500 and variable costs of $.01.If the organization plans to sell 10,000 tickets which option should it choose?

Question 57

A product is currently made in a process-focused shop,where fixed costs are $9,000 per year and variable costs are $50 per unit.The firm is considering a fundamental shift in process,to repetitive manufacturing.The new process would have fixed costs of $90,000,and variable costs of $5.What is the crossover point for these processes? For what range of outputs is each process appropriate?

Question 58

Mary is considering purchasing a machine from one of two suppliers.Supplier A's machine has an annual fixed cost of $10,000 and a unit variable cost of $2.10.Supplier B's machine has an annual fixed cost of $16,000 and a unit variable cost of $3.00.How large should Mary's annual demand be in order to make Supplier B's machine the better choice?

Question 59

What have restaurants such as Steakhouses and Stacked Restaurants replaced their traditional paper menus with?

A)spoken descriptions
B)singing descriptions
C)menus painted on the walls
D)index cards containing a picture of each item
E)iPad menus

Question 60

________ involves the ability to respond with little penalty in time,cost,or customer value.

Question 61

A flowchart with the addition of a time axis becomes a process chart.

Question 62

Value-stream mapping:

A)is a variation of time-function mapping.
B)examines the supply chain to determine where value is added.
C)extends time function mapping back to the supplier.
D)starts with the customer and works backwards.
E)All of the above are true.

Question 63

Activity times should not be included in a service blueprint.

Question 64

Identify the five major tools of process analysis and design.Describe them in a sentence or two each.

Question 65

Flowcharts use distance,but not time,to show the movement of material,product,or people through a process.

Question 66

________ is a process analysis technique that focuses on the customer and the producer's interaction with the customer.

Question 67

A(n)________ uses symbols to analyze the movement of people or material.

Question 68

Time-function mapping is a flowchart with time added to the horizontal axis.

Question 69

In mass service and professional service,the operations manager should focus extensively on:

A)automation.
B)equipment maintenance.
C)sophisticated scheduling.
D)human resources.
E)cost-cutting initiatives.

Question 70

A value-stream map includes both (1)inventory quantities,and (2)symbols for customers and suppliers.

Question 71

Service blueprinting is a process analysis technique that focuses on the customer and the provider's interaction with the customer.

Question 72

One fundamental difference between a process chart and a flowchart is that:

A)the process chart adds a time dimension to the horizontal axis,while a flowchart is not time-oriented.
B)the process chart includes the supply chain,while the flowchart stays within an organization.
C)the process chart is more like a table,while the flowchart is more like a schematic diagram.
D)the process chart focuses on the customer and on the provider's interaction with the customer,while the flowchart does not deal directly with the customer.
E)None of these is true,because a process chart and a flowchart are the same thing.

Question 73

An example of the postponement strategy for improving service productivity is having the customer wait until you have sufficient time to serve the customer.

Question 74

Which of the following is not one of the strategies for improving service productivity?

A)self-service
B)automation
C)scheduling
D)separation
E)mass customization

Question 75

A special form of time-function mapping,which goes beyond the organization into its supply chain,is ________.

Question 76

Professional services typically require low levels of labor intensity.

Question 77

Describe Value-stream mapping.Explain how it is different from process mapping.

Question 78

Which of the following are all strategies for improving productivity in services?

A)separation,self-service,automation,and scheduling
B)lean production,strategy-driven investments,automation,and process focus
C)reduce inventory,reduce waste,reduce inspection,and reduce rework
D)high interaction,mass customization,service factory,and just-in-time
E)process focus,repetitive focus,product focus,and mass customization focus

Question 79

What is a drawing of the movement of material,product,or people?

A)flowchart
B)process chart
C)service blueprint
D)process map
E)vision system

Question 80

Service blueprinting:

A)provides the basis to negotiate prices with suppliers.
B)mimics the way people communicate.
C)determines the best time for each step in the process.
D)focuses on the provider's interaction with the customer.
E)uses the schematic of a house to diagram a service process.