Deck 14: Operations Management: Managing Vital Operations and Processes

Question 1

The managers who are responsible for managing the organization's production system are known as ________ managers.

A)TQM
B)JIT
C)operations
D)inventory

Answer 1

C

Question 2

A ________ system is one that an organization uses to obtain inputs, convert them into outputs, and then dispose of these outputs.

A)production
B)quality control management
C)reengineering
D)line management

Answer 2

A

Question 3

"Efficiency" refers to goods and services that are reliable, dependable, and satisfying and that do the job they were designed for.

Answer 3

False

Question 4

Customer relationship management (CRM)is a technique that uses IT to develop an ongoing relationship with customers to maximize the value an organization can deliver to them over time.

Question 5

Labor productivity is equal to outputs divided by direct labor.

Question 6

The management of any aspect of production that transforms inputs into finished outputs is known as ________ management.

A)quality control
B)production system
C)operations
D)reengineering

Question 7

Managers should create an environment in which subordinates will not be afraid to report problems or recommend improvements.

Question 8

The attributes of an organization's outputs are determined by its ________ system.

A)production
B)quality control
C)efficiency
D)distribution

Question 9

Profit-seeking organizations have customers, but not-for-profit organizations do not have customers.

Question 10

Improving product quality increases the operating costs of the organization.

Question 11

The main responsibility of operations managers is to manage the three stages of production ranging from

A)acquisition of inputs to control of conversion processes.
B)acquisition of inputs to disposal of goods and services.
C)control of conversion processes to disposal of goods and services.
D)disposal of goods and services to customer relationship management.

Question 12

Generally, other things being equal, most customers prefer products with

A)good after-sales service.
B)fewer and simpler features.
C)standardized features.
D)cost-effectiveness.

Question 13

Management experts recommend that an organization define its business in terms of the products it is producing, not in terms of the customer needs that it is attempting to satisfy.

Question 14

CRM systems have two interconnected components: sales and selling, and after-sales service and support.

Question 15

Customers prefer products that are, as far as possible, customized to their unique needs.

Question 16

Management writers recommend that an organization should define its business in terms of its

A)technology.
B)company vision.
C)branding.
D)customer needs.

Question 17

"The actions taken to meet the needs of customers" refers to

A)a mission statement.
B)quality assessment.
C)quality control.
D)responsiveness.

Question 18

Goods and services that are dependable, reliable, able to do what they were designed for and satisfying characterize

A)efficiency.
B)service support.
C)responsiveness.
D)quality.

Question 19

A CRM system can be used as a comprehensive method of gathering crucial information about the way customers respond to a company's products.

Question 20

Designing a production system that creates saleable, low-cost products is the responsibility of ________ managers.

A)production
B)top-level
C)first-line
D)operations

Question 21

What is one way in which a reputation for offering high quality products benefits a company?

A)It allows the company to remain competitive in its market
B)It leads to the company attracting more and better investors
C)It allows the company to charge more for its products
D)It leads to a happier and more productive workforce

Question 22

What is one way a CRM system can improve marketing?

A)It allows IT employees to secretly infiltrate and target customers' social media accounts.
B)It allows marketing manager access to detailed customer profiles and purchase histories.
C)It gives managers a general idea of the changes they need to make to improve efficiency.
D)It reduces the time needed for compiling customer data, giving staff more free time.

Question 23

When setup times for complex production equipment is reduced

A)efficiency of the production unit goes down.
B)time spent in producing something will increase.
C)flexible manufacturing techniques become irrelevant.
D)employees have to be paid for nonproductive time.

Question 24

Which of the following describes the product layout?

A)It is efficient only when products are created in large quantities.
B)Workers move from workstation to workstation.
C)A conveyor belt is usually not used.
D)Assembling a product is easily achieved in this layout.

Question 25

Which of the following typically represents the impact of increased quality on organizational performance?

A)increased reliability that leads to lower prices
B)increased productivity that leads to lower costs
C)higher prices that lead to lower profits
D)higher costs that lead to higher profits

Question 26

Higher product quality can increase efficiency, increase profits, and decrease

A)production time.
B)employee turnover.
C)production costs.
D)customer complaints.

Question 27

What is one way that CRM can maximize the value delivered to customers over time?

A)by increasing productivity and decreasing costs throughout the company
B)by monitoring the number of products that are returned or exchanged
C)by breaking down how much revenue came from sales to existing customers
D)by ensuring greater accountability of support staff through quantifiable measures

Question 28

A technique that uses IT to develop an ongoing relationship with buyers to maximize the value an organization can deliver to them over time is

A)customer relationship management.
B)total quantity management.
C)customer database management.
D)customer-technology interface.

Question 29

Sundeep is the owner of Celebration Florists, a chain of flower shops, and has been in business for five years. While Celebration is known for its quality arrangements and low prices, an older chain, Ruth's Flowers, consistently outperforms them on customer satisfaction measures. Celebration has a great website and a robust social media presence. The marketing department frequently sends out discount offers, generic follow-up letters, and conducts customer surveys by mail, but the business still receives only average customer service ratings. Meanwhile, Ruth's is known for having a loyal base of long-time, repeat customers. After using a new automated CRM system to collect customer data, Celebration's marketing manager, Celia, discovers that customers feel Celebration's service is a little "cold" and "by the numbers." What should Celebration do to improve its customer relationships?

A)offer personalized service to existing customers, such as specially designed arrangements and discounts
B)run more ads on the local television stations so customers can see how beautiful Celebration's flowers are
C)reduce employee hours so that Celebration can offer even lower prices than Ruth's
D)focus on targeting corporate customers who are more likely to order multiple arrangements at once

Question 30

How might a service organization best increase the quality of its products or services?

A)by cutting services in order to reduce the cost to consumers
B)by following up after purchase with a personal phone call
C)by focusing on the speed with which service is delivered
D)by outspending competitors on advertising and branding

Question 31

Which of the following will typically lead to making the highest profits?

A)higher prices and higher costs
B)lower prices and lower costs
C)higher prices and lower costs
D)lower prices and higher costs

Question 32

For the last decade, KayJay Toys has been using an overseas factory to make their hard plastic toys. However, the quality of the products has been in decline for the last several years. In addition to using cheaper materials, the factory uses an assembly process that is very quick but often results in uneven quality, with retailers returning 5 out of every 100 units as detective. The decreased quality is beginning to negatively impact KayJay's bottom line. What is KayJay's best course of action in order to save money and increase their profits?

A)KayJay should keep the manufacturer, but use a different method of packaging and shipping the toys.
B)KayJay should switch to a different factory that uses better materials and processes, improving quality.
C)KayJay should close their brick and mortar shops and switch to an online-only shopping model.
D)KayJay should consult with the factory about using a different assembly method for the products.

Question 33

A plastic toy manufacturer gets orders from customers with different size, material, and thickness requirements, forcing the workers to frequently change the equipment. Flexible manufacturing will be ideal in this case because

A)large numbers of the same type may be produced.
B)cheaper raw material may now be used.
C)the time required to set up equipment is reduced.
D)customers will now agree to use caps of the same size.

Question 34

Lambretti and Sons is an international manufacturer and retailer of luxury pens and writing instruments based in Rome, Italy. The company has been in business for 100 years and has a reputation as being "the best of the best." Their pens are status symbols used by high-profile businessmen and celebrities. In recent years, several other luxury pen manufacturers have entered the market. SwissPen's goods are less expensive and are of a quality equivalent to that of Lambretti and Sons. Should Lambretti be overly worried about competition from SwissPen?

A)No, because price is not a factor that affects the buying choices and preferences of Lambretti's clients.
B)Yes, because regardless of prestige, customers will always go with a company that offers products for a lower price.
C)No, because the brand's long history and singular reputation allow it charge higher prices for its products.
D)Yes, because brand loyalty only goes so far, and SwissPen offers novelty, a very desirable attribute.

Question 35

A fixed-position production layout would be particularly recommended if

A)there are no self-managed teams.
B)the product is easily moved on a conveyor belt.
C)you are making jet airlines or gas turbines.
D)products have simple, lightweight parts.

Question 36

CustomCraft, an industrial fabricator, wants to measure the efficiency of the energy inputs at its factory. It needs to use a formula to calculate ________ productivity.

A)employee
B)partial
C)total factor
D)labor

Question 37

At a manufacturing unit for leather handbags, there are many stations located in a row. At the first station, the pattern pieces are cut; at the second, the bag body is sewn together; at the third, the straps and fasteners are attached; at the fourth, seams are checked; and at the fifth, the product is packed. This unit is an example of ________ layout.

A)process
B)product
C)fixed-position
D)flexible

Question 38

The management of efficiency is an extremely important issue in most organizations, because increased efficiency generally helps

A)decrease employee turnover.
B)decrease production costs.
C)increase customer satisfaction.
D)decrease total labor costs.

Question 39

When a company implements after-sales service and support CRM software, salespeople

A)have more time to focus on increasing sales because the system does customer support for them.
B)have instant access to a record of everything that occurred during online customer interactions.
C)are required to manually track and document every customer's case history and preferences.
D)are in a much better position to respond to customers' needs and build customer loyalty.

Question 40

In a fixed-position production layout

A)different teams assemble different component parts.
B)the product is moved from one workstation to the next.
C)component parts are made in the assembling area.
D)products that are heavy are more difficult to make.

Question 41

A problem associated with total factor productivity is that

A)some inputs cannot be factored in.
B)the calculation is too cumbersome.
C)it focuses on specific inputs.
D)each input is measured in different units.

Question 42

Shoe Zoo, Inc., is a company that has chosen to use a JIT system. Their productivity will improve because the company can now

A)give quick feedback to suppliers of defective goods.
B)respond quickly to increased customer demand.
C)have a buffer stock of inventory available.
D)store more raw material in less space.

Question 43

The efficiency of an organization with reference to the contribution of an individual input is known as (the)________ productivity.

A)total factor
B)cumulative
C)partial
D)unit

Question 44

Which of the following calculates labor productivity?

A)outputs divided by direct labor
B)inputs divided by total outputs
C)direct labor times total inputs
D)direct labor times specific outputs

Question 45

Partial productivity measures the efficiency of ________in the production of a given output

A)an input ratio
B)a specific input
C)a production unit
D)total labor cost

Question 46

The outputs of an organization divided by all of its inputs is called its ________ productivity.

A)total factor
B)total labor
C)partial
D)total capital

Question 47

Ramelle, an executive with AmericaMoves Mini-Storage, wants to compare her firm's efficiency to that of its competitors. To do so, she should

A)assess the financial ratios of the firm versus the competition.
B)compare the firm's labor productivity to that of the competition.
C)compare the amount of materials used to that of the competition.
D)conduct a survey of customers' opinions about the firm's efficiency.

Question 48

The way in which machines, robots, and people are grouped together in the production process is known as

A)kanban.
B)facilities layout.
C)kaizen.
D)TQM.

Question 49

Total factor productivity is a measure of an organization's

A)responsiveness.
B)process design standard.
C)efficiency.
D)raw material usage.

Question 50

The operations management technique that has a goal of designing the machine-worker interface to increase production efficiency is

A)the facilities layout.
B)quality circles.
C)flexible manufacturing.
D)production system improvement.

Question 51

What is the advantage of maintaining buffer stocks of inventory?

A)It brings down storage costs.
B)It supports a JIT inventory system.
C)It helps deal with unpredictable supplies.
D)It helps quickly identify defective stocks.

Question 52

Total factor productivity equals

A)raw materials divided by labor costs.
B)all inputs times all outputs.
C)outputs divided by all inputs.
D)capital expenditures divided by all inputs.

Question 53

Much time is lost when a washer ring manufacturer changes the settings in the equipment from those for cars to those for trucks. Which of the following will help it save time?

A)flexible manufacturing
B)self-managed teams
C)process layout
D)product layout

Question 54

The total amount of raw materials and component parts that an organization has on hand is known as

A)material supply.
B)in-stock goods.
C)inventory.
D)raw stock.

Question 55

In measuring the total factor productivity of an organization, an example of a measure of the amount of energy consumed in output production is the number of

A)units produced.
B)hours worked.
C)kilowatt-hours consumed.
D)employees required.

Question 56

Labor productivity is most commonly used to

A)calculate the total cost of production.
B)set wage standards per unit of production.
C)draw efficiency comparisons between different organizations.
D)define recruiting parameters for new candidates.

Question 57

Which of the following describes self-managing work teams?

A)Members are too specialized to fill in for absent coworkers.
B)Each member reports to two first-line managers.
C)Cost savings arise from eliminating supervisors.
D)Members misuse the greater autonomy given to them.

Question 58

In the typical organization, increased efficiency leads to

A)higher operating costs.
B)lower production costs.
C)lower partial productivity.
D)higher maintenance costs.

Question 59

In measuring the total factor productivity of an organization, which of the following is an example of the contribution of the raw materials to output production?

A)number of tons of iron ore required to make one ton of steel
B)total number of units of energy consumed
C)number of man hours required to process raw materials
D)total number of employees required to operate the machinery

Question 60

SmokeMaster Grills, a maker of home and commercial outdoor grills, shrank its ordering and delivery team by taking most of its operations online and increased its fleet of trucks to decrease delivery time. These actions can be described as

A)a JIT system.
B)process reengineering.
C)flexible manufacturing.
D)total factor productivity.

Question 61

Organizing machines in the production process so that each operation is performed at workstations in a fixed sequence is known as a ________ layout.

A)process
B)circular
C)product
D)flexible

Question 62

Although a process layout often reduces efficiency, it is preferred for manufacturing custom products because

A)it is more cost effective.
B)it provides increased flexibility.
C)standardization is impossible.
D)it reduces mistakes made by workers.

Question 63

Under a JIT inventory system, parts and supplies arrive at the organization

A)prior to work-scheduling.
B)two weeks prior to being needed.
C)when needed.
D)twice a week.

Question 64

Reduced setup times lead to reduced

A)setup costs and increased efficiency.
B)efficiency and increased labor costs.
C)inventory costs and increased setup costs.
D)efficiency and increased inventory costs.

Question 65

A product layout is most likely to be used in making

A)custom furniture.
B)cars.
C)jet engines
D)mining equipment.

Question 66

In production process, a mainframe computer assembly line is an example of a ________ facilities layout.

A)product
B)process
C)fixed-position
D)flexible manufacturing

Question 67

Which type of layout is best suited for custom-made products?

A)process layout
B)product layout
C)fixed-position layout
D)batch layout

Question 68

One of the major advantages of a JIT system is that it

A)helps identify sources of defects in outputs.
B)ensures production lines have required inputs.
C)lets organizations spot defective inputs quickly.
D)eliminates inventory holding costs.

Question 69

The idea of flexible manufacturing systems is chiefly based on reducing

A)inventory costs.
B)setup time.
C)employee fatigue.
D)machine-worker interface.

Question 70

A production process in which the product goes to whichever workstation is needed to perform the next operation is known as a ________ layout.

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

Question 71

A manufacturing organization using a JIT system can achieve major cost savings as a result of ________ inventory holding costs.

A)decreasing inventory turnover and decreasing
B)increasing inventory turnover and increasing
C)increasing inventory turnover and decreasing
D)decreasing inventory turnover and increasing

Question 72

Praxis Technologies' supplier is in a country that was recently affected by a natural disaster, with the result that production was completely halted for several weeks. However, their competitor, Burnham, was much more adversely affected because of the fact that, unlike Praxis, Burnham uses a system in which they receive supplies only as they need them. What was Praxis able to do in response to the crisis that Burnham was not?

A)They were able to use their buffer stock of inventory to fulfill back orders until production resumed.
B)They were able to use CRM technology to let their customers know that orders would be delayed.
C)They were able to quickly farm out production of their stock to several smaller, local factories.
D)They were able to hire a factory manufacturing generic components to produce them using the Praxis brand.

Question 73

A production process where component parts are produced throughout the factory and then brought to the production area for final assembly is known as a ________ layout.

A)process
B)product
C)fixed-position
D)kanban

Question 74

A fixed-position layout is most likely to be used in production of

A)prefab homes.
B)patio furniture.
C)food packaging.
D)soft home goods.

Question 75

Parts arrive at the stage of the production process just when they are needed with a ________ inventory system.

A)raw materials
B)work-in-process
C)finished goods
D)JIT

Question 76

In the production process, assembly of a mainframe computer would most likely use a ________ layout.

A)flexible
B)process
C)fixed-position
D)product

Question 77

A JIT inventory system is likely to result in

A)a buffer stock of inventory.
B)additional inventory holding costs.
C)increased inventory turnover.
D)decreased service levels.

Question 78

A production process where the workers are stationary and a moving conveyor belt takes the product on to the next workstation so that it is assembled in a fixed sequence is known as

A)pull production.
B)mass production.
C)batch production.
D)lean manufacturing.

Question 79

The stock of materials, inputs, and parts an organization has on hand at a particular time is called its

A)total assets.
B)intangible assets.
C)inventory.
D)material assets.

Question 80

Flexible manufacturing is a technique that attempts to reduce ________ in the production system.

A)total manufacturing time
B)number of workers needed
C)production-line errors
D)machine setup costs