Deck 17: Operations Management: Putting It All Together

Question 1

The machinery used in a product layout is often highly specialized, designed to perform one specific task very efficiently.

Answer 1

True

Question 2

In process layouts, equipment is arranged according to the type of task performed.

Answer 2

True

Question 3

Outsourcing allows a firm to shed functions it does not perform well.

Answer 3

True

Question 4

In a servicescape, functionality refers to factors such as decor, background music, lighting, noise levels, and even scents.

Question 5

In a cellular layout, cells are designed to be operated by a few workers who perform a wider array of tasks than assembly-line workers.

Question 6

One of the advantages of holding large inventories is that it protects a firm against the risk of losses due to depreciation in the prices of products.

Question 7

Holding large inventories provides protection against stock-outs and lost sales.

Question 8

Unlike in the 1960s, most operations managers today view the natural environment as something to exploit.

Question 9

Over the last five decades, operations management has experienced a shift in focus from effectiveness to efficiency.

Question 10

In the context of operations management, effectiveness means finding ways to give customers more for their money while still making a profit.

Question 11

Dennis, a manager at Luis Bryan Inc., oversees the activities involved in creating the right products and services in the right quantities and distributing them to the right customers. His decisions have a major impact on the company's financial success. The given scenario illustrates operations management.

Question 12

Unlike a product layout, a process layout requires equipment to be arranged in a specific sequence.

Question 13

A product layout is used by firms that need to produce small batches of goods that require a degree of customization.

Question 14

An advantage of foreign outsourcing is that it simplifies value chains.

Question 15

Kitchen appliances, such as refrigerators and ovens, are examples of durable goods.

Question 16

Retail firms normally hold work in process or raw materials.

Question 17

Services such as concerts or sporting events require a fixed position layout.

Question 18

The features that a product should include to appeal to its target customers are typically determined by marketing research.

Question 19

An assembly line is an example of a product layout.

Question 20

In the context of operations management, a product does not include intangible features.

Question 21

Dazzling Inc., a cosmetics manufacturing company, introduces a moisturizer that is more expensive than similar products available in the market. The customers love its anti-ageing and anti-tanning features and do not mind spending more as they believe that the product is worth its price. As a result, the company makes a large profit from the sale of the new product. In this scenario, Dazzling has incorporated _____ in its business.

A) effectiveness
B) efficiency
C) undifferentiated marketing
D) vertical integration

Question 22

In the context of operations management, for the first 25 years after World War II, which of the following was true of the United States?

A) It had a severely damaged infrastructure.
B) It lacked natural resources.
C) It had a socialist economy.
D) It had an increasingly well-educated labor force.

Question 23

In the context of American business, which of the following statements is true of the changing scenario of operations management over the last five decades?

A) The nonfarm labor force is increasingly joining the goods-producing sector.
B) The current trend in value chain design is to rely more on vertical integration and less on outsourcing and offshoring.
C) There has been a shift from mass customization to mass production.
D) There has been a fundamental shift away from the production of goods and toward the provision of services.

Question 24

Marie, an operations manager at Clagox Systems, spends a lot of time in figuring out ways to achieve the established goals of the company at minimal costs. She conducts meetings and asks for suggestions from her teammates to reach the targets at the lowest possible expense. In this scenario, Marie is focusing on _____.

A) effectiveness
B) efficiency
C) undifferentiated marketing
D) immediate predecessors

Question 25

Foodies Bakery is popular for the variety of bread and cookies it offers. Pistachio cookies are its best-selling product. In this scenario, pistachio cookies are an example of a(n) _____.

A) intangible product
B) nondurable good
C) complementary product
D) durable good

Question 26

Computer-aided design/computer-aided manufacturing (CAD/CAM) is a combination of software that can be used to design output and send instructions to automated equipment to perform the steps needed to produce this output.

Question 27

In operations management, _____ means using resources to create value by providing customers with goods and services that offer a better relationship between price and perceived benefits.

A) effectiveness
B) efficiency
C) throughput
D) productivity

Question 28

Mass production strategy:

A) focuses on meeting the needs of specific customers.
B) is based on the pull system of process flow.
C) facilitates mass customization.
D) keeps costs low by making efficient use of capital.

Question 29

Robots maintain a consistently high level of performance.

Question 30

In today's highly competitive global markets, operations managers:

A) realize that a product that offers better features attracts more customers than one that has a lower price.
B) recognize that achieving efficiency is more important than achieving effectiveness.
C) focus primarily on keeping costs low to make a profit while keeping prices competitive.
D) focus solely on the benefits of products, while completely ignoring the costs of manufacturing those products.

Question 31

The only standard in the ISO 9000 family for which organizations can be certified is ISO 9011.

Question 32

Greg owns a furniture business and produces only enough goods to meet the current demand. This helps him save inventory-holding costs. In the given scenario, Greg uses just-in-time (JIT) production.

Question 33

Unlike goods, services are _____.

A) tangible
B) consumed
C) experienced
D) palpable

Question 34

Ursula Corp., a manufacturer of notebooks, makes small batches of different kinds of notebooks according to the customer demand. In this way, it caters to the needs of various customers without significantly increasing the manufacturing cost. In this scenario, which of the following techniques does Ursula employ?

A) Computer-aided engineering
B) Mass production
C) Adjustable manufacturing
D) Mass customization

Question 35

David works in a small manufacturing firm that makes customized office furniture. He feels it is important to work directly with customers to design high-quality furniture that meets their needs. He believes that doing so would create more value for customers and provide a better relationship between the price of the product and its benefits. In the context of operations management, David most likely focuses on _____.

A) mass production
B) efficiency
C) effectiveness
D) undifferentiated marketing

Question 36

Nondurable goods are often _____.

A) perishable
B) non-consumable
C) hard goods
D) long-lasting

Question 37

VRM Cars is a custom car shop that buys and sells modified cars. It also provides customers with the option of adding more features to the models available in the market. In this scenario, VRM Cars deals in _____.

A) intangible goods
B) nondurable goods
C) complementary goods
D) durable goods

Question 38

ISO 14000 standards establish specific goals for environmental performance.

Question 39

Harry's Inc., a manufacturer of men's apparel, manufactures large quantities of the company's basic clothing lines to keep the manufacturing costs low. Given this information, it can be inferred that Harry's Inc. pursues:

A) just-in-time production.
B) mass production.
C) mass customization.
D) lean production.

Question 40

Krest Bank has installed over 50 ATMs across the city. Its customers can use these ATMs to deposit cash into their bank accounts at their convenience. In this scenario, Krest Bank offers its customers a _____.

A) nondurable good
B) perishable product
C) service
D) process

Question 41

Which of the following statements is true of operations management in the 2010s?

A) It focuses on creating value rather than minimizing costs.
B) It focuses on efficiency rather than effectiveness.
C) It favors simple supply chains rather than complex value chains.
D) It focuses on mass production rather than mass customization.

Question 42

Identify a factor that has promoted change in operations management over the last five decades.

A) Recognition of quality as a source of competitive advantage
B) Adoption of a cost perspective
C) Adoption of simpler supply chains
D) Increased disregard for severe environmental problems

Question 43

In the context of operations management, which of the following statements is true of the increasingly competitive and global nature of markets?

A) There has been a significant decrease in green practices.
B) There is a higher inclination to exploit the environment.
C) There has been a shift from a cost perspective to a value perspective.
D) There is an increased preference for simplified supply chains.

Question 44

Robin, the owner of a pizzeria, follows a standard sequence of steps to make pizzas. Once an order is received, her team members prepare the base, add the sauce, add the toppings, and then bake the pizza. The workstations in the kitchen are fixed in a sequence that facilitates this process. Given this scenario, it can be inferred that Robin's pizzeria uses a _____.

A) product layout
B) process layout
C) cellular layout
D) combined layout

Question 45

A _____ doesn't require work to be performed in a specific sequence; instead, the product can be moved from one type of machinery to another in whatever sequence is necessary.

A) product layout
B) cellular layout
C) fixed position layout
D) process layout

Question 46

Which of the following statements is true of a product layout?

A) It organizes machinery, equipment, and other resources according to the specific sequence of operations that must be performed.
B) It groups different types of machinery and equipment into self-contained cells.
C) It is used for goods that must be produced at a specific site or that are so large and bulky that it is not feasible to move them from station to station.
D) It is used by firms that need to produce small batches of goods that require a degree of customization.

Question 47

When trying to ascertain the best approach to organize processes to produce a product, which of the following should be a consideration?

A) The intangible features associated with the customer benefit package
B) The degree of standardization of the product
C) The advertising strategy associated with the product
D) The inventory management process used in the organization

Question 48

Identify a difference between the characteristics of operations management in the 1960s and in the 2010s.

A) Operations management focused on creating value in the 1960s, whereas it focuses on minimizing costs in the 2010s.
B) Operations management favored complex supply chains in the 1960s, whereas it favors simple supply chains in the 2010s.
C) Operations management focused on mass customization in the 1960s, whereas it focuses on mass production in the 2010s.
D) Operations management exploited the environment in the 1960s, whereas it focuses on sustaining the environment in the 2010s.

Question 49

In the context of global competition, which of the following countries had adopted new techniques that focused on improving the quality of products as early as the 1970s?

A) India
B) Russia
C) China
D) Japan

Question 50

During the 1970s, which of the following statements was true of global competition?

A) European firms dominated key markets because of an excellent infrastructure.
B) Many Japanese and German firms began to take market share from American firms.
C) American firms dominated key markets despite having a poor infrastructure.
D) Countries such as India and China became world leaders in quality management.

Question 51

In the 1960s, operations management focused on:

A) having complex value chains.
B) the production of goods.
C) mass customization.
D) environmental conservation.

Question 52

Firms often use a _____ when they manufacture goods that are relatively standardized and manufactured in large volumes.

A) process layout
B) product layout
C) functional layout
D) fixed position layout

Question 53

Which of the following factors has promoted change in operations management over the last five decades?

A) Recognition of productivity as a source of competitive advantage
B) Adoption of a cost perspective
C) Rise of global opportunities
D) Increased inclination to exploit the environment

Question 54

Ravina is the owner of a large bakery that specializes in customized cupcakes for special occasions. When she refurnishes her kitchen, she finalizes a layout that groups various kitchen appliances and equipment according to the type of task they perform. According to Ravina, such a layout will help her in customizing small orders. Given this information, it can be inferred that Ravina has chosen a _____ for her kitchen.

A) fixed position layout
B) process layout
C) product layout
D) cellular layout

Question 55

David works at Klambunk Motors, an automobile manufacturing company. Once a new automobile has been designed by the design team, David determines and finalizes all the activities required to manufacture and deliver the new automobiles to showrooms. In this scenario, David determines the _____ needed to transform the company's inputs into outputs.

A) divestiture
B) servicescapes
C) processes
D) marketing plan

Question 56

In the context of operations management, a _____ is defined as a set of related activities that transform inputs into outputs, thus adding value.

A) divestment
B) poka-yoke
C) process
D) portfolio

Question 57

Firms that need to produce small batches of goods that require a degree of customization are most likely to use a _____.

A) line layout
B) process layout
C) product layout
D) fixed position layout

Question 58

The tangible and intangible features of a product are sometimes referred to as _____.

A) the customer benefit package
B) the product layout
C) poka-yokes
D) servicescapes

Question 59

Which of the following statements is true of operations managers?

A) They typically determine which features a product should include to appeal to its target customers.
B) They do not play any role in the product-design process.
C) They provide essential advice regarding the constraints involved in creating actual products.
D) They do not play a role in the creation of the customer benefit package.

Question 60

In the context of operations management, which of the following plays a supporting role in the process of production of goods?

A) Machining
B) Packaging
C) Marketing and advertising
D) Inventory management process

Question 61

Identify a benefit of holding larger inventories.

A) Decreased holding costs
B) Decreased risk of losses due to depreciation
C) High availability of funds
D) Smooth production schedules

Question 62

During the baseball season, the workers at Arenaz Stadium use mowing equipment to mow the baseball field. To ensure that the infield surface stays smooth and consistent, they use nail drags. The given scenario exemplifies the use of a _____.

A) fixed position layout
B) product layout
C) process layout
D) flow-shop layout

Question 63

Devon Construction Inc. is currently working on a residential construction project. Matt, the company's operations manager, is using an operations management tool that helps him see the relationships among all the activities required to complete the project. When an equipment breaks down, he realizes that certain tasks that are crucial for the overall completion of the project will not be completed on schedule. Using the operations management tool, he is able to estimate the additional time needed for the completion of the project. In the context of the given scenario, Matt is most likely using _____.

A) the cause and effect diagram
B) the critical path method
C) line balancing
D) marginal analysis

Question 64

Which of the following is a benefit of holding large inventories?

A) Reduced holding costs
B) Increased protection against losses due to depreciation
C) Increased availability of funds
D) Reduced ordering costs

Question 65

Which of the following products is most likely to require a fixed position layout?

A) An industrial washing machine
B) A supercar
C) A submarine
D) A household boiler

Question 66

Identify a disadvantage of holding larger inventories.

A) Increased ordering costs
B) Increased risk of stock-outs and lost sales
C) Tied-up funds until goods are sold
D) Irregular production schedules

Question 67

In the context of the location of facilities, the operations manager of a _____ is likely to choose a location based on the proximity to customers.

A) publishing house
B) bank
C) food packaging plant
D) coal mine

Question 68

Jorgen Inc., a ship manufacturing company, is building a cruise ship at a harbor. As the ship is extremely large, workers move the equipment and machines to various parts of the ship as and when required. In the given scenario, Jorgen Inc. is using a _____.

A) product layout
B) process layout
C) fixed position layout
D) flow-shop layout

Question 69

Identify a true statement about process layouts.

A) They can be used to produce a variety of products without the need for expensive retooling.
B) They reduce processing times but are inflexible.
C) They can be used for constructing large and bulky goods, such as ships or commercial airplanes.
D) They require highly specialized machinery that is designed to perform one specific task very efficiently.

Question 70

A _____ falls between the product layout and the process layout.

A) cellular layout
B) line layout
C) fixed position layout
D) functional layout

Question 71

Selena, a school teacher, plans the activities for the sports day of her school. She prepares a chart of all the activities planned for the day. From her chart, she figures out that some activities can be conducted independently and others must be conducted in a certain order. She also identifies the sequence of activities that will take the longest to complete. From the given information, it can be inferred that Selena is using _____ to efficiently schedule the sports day activities.

A) a SWOT matrix
B) an inventory checklist
C) the critical path method
D) the Six Sigma model

Question 72

The term _____ refers to stocks of goods or other items held by an organization.

A) Kanban
B) Floor load
C) Inventory
D) Poke-yoke

Question 73

The _____ is a project-management tool that illustrates the relationships among all the activities involved in completing a project and identifies the sequence of activities likely to take the longest to complete.

A) critical path method
B) Six Sigma principle
C) program evaluation and review technique
D) vertical integration technique

Question 74

In the context of inventories, which of the following is a similarity between a manufacturing firm and a retail firm?

A) Both hold inventories of finished goods.
B) Both typically hold inventories of work in process.
C) Both typically hold inventories of raw materials.
D) Both hold small inventories, thereby reducing the risk of stock-outs.

Question 75

Which of the following is a disadvantage of holding large inventories?

A) Increased ordering costs
B) Lack of protection against stock-outs
C) Additional holding costs
D) Irregular production schedules

Question 76

A _____ consists of the sequence of activities in a project that is expected to take the longest to complete.

A) critical path
B) value chain
C) trade-off curve
D) servicescape

Question 77

Kidzo Inc., a toy car company, has several units in its factory. Each unit is dedicated to producing different parts of the toy cars. For example, it has a unit that makes wheels, a unit that makes steering wheels, a unit that makes the body of the cars, and a separate unit that assembles all the parts together. In this scenario, Kidzo Inc. uses a _____.

A) cellular layout
B) fixed position layout
C) line layout
D) product layout

Question 78

Lara is the owner of an event management company. For every project, Lara makes a chart to keep a track of multiple tasks that need to be accomplished simultaneously. From her chart, she finds the sequence of activities that will take the longest to complete. This helps her keep an eye on the project and address any issues that may delay the project. In this scenario, it can be inferred that Lara most likely uses _____ to execute her projects on time.

A) the critical path method
B) a business rule engine
C) rule-based machine learning
D) an expert system

Question 79

A _____ is used for goods that must be produced at a specific site or that are so large and bulky that it isn't feasible to move them from station to station.

A) process layout
B) product layout
C) fixed position layout
D) cellular layout

Question 80

Identify a key factor that operations managers consider when deciding the location of a manufacturing facility.

A) Proximity to customers
B) Access to port facilities
C) Proximity to competitors' manufacturing facilities
D) Presence of shopping avenues