Deck 6: The Voice of the Market

Question 1

Toyota developed the world-class production system known as ________.

A)business process reengineering
B)just-in-time
C)total quality management
D)benchmarking
E)statistical process control

Answer 1

B

Question 2

What is the first step in Xerox's 10-step process to benchmarking?

A)determine the current performance gap
B)identify whom to benchmark
C)decide what to benchmark
D)develop action plans
E)project future performance levels

Answer 2

C

Question 3

Toyota developed the world-class production system known as business process reengineering.

Answer 3

False

Question 4

Which of the following steps in Xerox's 10-step process to benchmarking helps companies prioritize which areas are the first candidates for change and improvement?

A)determine the current performance gap
B)plan and conduct the investigation
C)identify whom to benchmark
D)decide what to benchmark
E)develop action plans

Question 5

The ________ process of business process benchmarking results in outputs that are eventually sold to customers.

A)transformation
B)conversion
C)control
D)reconstruction
E)reengineering

Question 6

________ benchmarking often includes reverse engineering in order to develop new design ideas.

A)Product
B)Strategic
C)Process
D)Financial
E)Functional

Question 7

A benchmarking effort that is limited to studying the purchasing department of another firm is referred to as ________ benchmarking.

A)functional
B)performance
C)process
D)strategic
E)product

Question 8

Which of the following is not one of the purposes of benchmarking?

A)learning from success
B)national leadership
C)stealing ideas
D)beating industry standards
E)best-in-world

Question 9

A benchmark is an organization recognized for its exemplary operational performance.

Question 10

The goal of ________ benchmarking is to identify and to observe the best practices from one or more benchmark firms.

A)product
B)strategic
C)process
D)financial
E)functional

Question 11

The sharing of information between companies so that both can improve is called ________.

A)reengineering
B)baselining
C)benchmarking
D)interfacing
E)data mining

Question 12

________ benchmarking allows initiator firms to assess their competitive position by comparing products and services with those of target firms.

A)Functional
B)Strategic
C)Product
D)Performance
E)Process

Question 13

Which of the following types of benchmarking does not require direct interaction between the initiator firm and the target firm?

A)functional
B)product
C)performance
D)financial
E)process

Question 14

________ benchmarking involves observing how others compete.

A)Strategic
B)Product
C)Performance
D)Functional
E)Process

Question 15

In the conversion process, the feedback loop that involves gathering, analyzing, and using the data to adjust the process is called the ________ process.

A)control
B)reengineering
C)reconstruction
D)development
E)transformation

Question 16

In the ________ process of business process benchmarking, the inputs are aligned together to form the product or service.

A)reconstruction
B)control
C)reengineering
D)transformation
E)conversion

Question 17

________ is based on the concept of 5w2h.

A)Business process benchmarking
B)Statistical process control
C)Total quality management
D)Business process reengineering
E)Reverse engineering

Question 18

Which of the following steps in Xerox's 10-step process to benchmarking involves predicting whether the performance gap for the benchmarked processes will narrow or widen in the coming years?

A)develop action plans
B)determine the current performance gap
C)plan and conduct the investigation
D)project future performance levels
E)implement specific actions and monitor progress

Question 19

________ benchmarking to assess overall competitiveness can be accomplished by gathering and comparing business results using online databases such as Lexis/Nexis.

A)Functional
B)Strategic
C)Product
D)Financial
E)Process

Question 20

The process of dismantling competitors' products to understand the strengths and weaknesses of their designs is referred to as ________.

A)benchmarking
B)reengineering
C)baselining
D)inverse production
E)reverse engineering

Question 21

Describe the concept of 5w2h.

Question 22

The first step a benchmarking firm must take is to document current performance.

Question 23

In performance benchmarking, the initiator firm focuses its observation and investigation on business processes.

Question 24

The first step in Xerox's 10-step process to benchmarking is identifying whom to benchmark.

Question 25

Describe the concept of performance benchmarking.

Question 26

Openness can create a competitive advantage through creating psychological barriers to competition.

Question 27

In a benchmarking relationship, the initiator firm is the firm that is being studied.

Question 28

The 5w2h concept is labeled as such because a business process benchmarking project should result in the answers to five questions.

Question 29

Describe the concept of functional benchmarking.

Question 30

The conversion process results in outputs that are eventually sold to customers.

Question 31

Differentiate between an initiator firm and a target firm. Are these static roles?

Question 32

Explain the process of benchmarking.

Question 33

Dismantling competitors' products to understand the strengths and weaknesses of their designs is called reverse engineering.

Question 34

In the control process, the inputs are aligned together to form the product or service.

Question 35

In functional benchmarking, a company focuses its benchmarking efforts on a single function to improve the operation of that function.

Question 36

Strategic benchmarking involves observing how others compete.

Question 37

Describe the conversion process and the control process in business process benchmarking.

Question 38

The 5w2h questions should be viewed in the context of a process.

Question 39

Determining the current performance gap helps the company prioritize which areas are the first candidates for change and improvement.

Question 40

Financial benchmarking involves direct interaction between the initiator firm and the target firms.

Question 41

________ include objectives, policies, and procedures followed by a firm.

A)Productivity ratios
B)Quality measures
C)Market share data
D)Structural measures
E)Operating results

Question 42

It is best to obtain training from organizations that are experienced with benchmarking and its potential legal liabilities.

Question 43

State Xerox's formal 10-step process to benchmarking.

Question 44

The ________ process involves identifying measures, establishing time frames for future data collection, gathering data, and analyzing data on an ongoing basis to identify performance trends and changes.

A)restructuring
B)baselining
C)reengineering
D)reverse engineering
E)benchmarking

Question 45

________ dictates that decisions are made based on the sound collection and analysis of data.

A)Strategic benchmarking
B)Baselining
C)Business process reengineering
D)Management by fact
E)Reverse engineering

Question 46

Reject rates, capability analysis, and performance information are examples of ________.

A)structural measures
B)market share data
C)productivity ratios
D)financial ratios
E)quality measures

Question 47

________ are useful in measuring the extent to which a firm effectively uses the scarce resources that are available to the firm.

A)Quality measures
B)Financial ratios
C)Productivity ratios
D)Market share data
E)Structural measures

Question 48

Customer satisfaction measures are poor indicators of financial performance.

Question 49

________ is defined as the fundamental rethinking and redesign of business processes.

A)Process redesign
B)Benchmarking
C)Baselining
D)Reverse engineering
E)Restructuring

Question 50

Which of the following best defines the breadth factor of process redesign?

A)It refers to organizational elements such as responsibilities, measurements, information technology, and skills.
B)It refers to the monitoring of key internal firm performance measures over time to identify trends such as improvement in managerial decision making.
C)It refers to the impact of the process redesign to the entire organization.
D)It refers to the dismantling of competitors' products to understand the strengths and weaknesses of their designs.
E)It refers to the sharing of information between companies so that both can improve.

Question 51

________ requires the monitoring of key internal firm performance measures over time to identify trends such as improvement to inform managerial decision making.

A)Baselining
B)Benchmarking
C)Process redesign
D)Reverse engineering
E)Restructuring

Question 52

Management by fact dictates that decisions are made based on the sound collection and analysis of data.

Question 53

Which of the following best defines the depth factor of process redesign?

A)It refers to organizational elements such as responsibilities, measurements, information technology, and skills.
B)It refers to the monitoring of key internal firm performance measures over time to identify trends such as improvement in managerial decision making.
C)It refers to the impact of the process redesign to the entire organization.
D)It refers to the dismantling of competitors' products to understand the strengths and weaknesses of their designs.
E)It refers to the sharing of information between companies so that both can improve.

Question 54

Quality measures include objectives, policies, and procedures followed by a firm.

Question 55

________ are important for monitoring and tracking the effectiveness of a company's cycle times, waste-reduction measures, and value-added measures.

A)Customer-related measures
B)Productivity ratios
C)Quality measures
D)Operating results
E)Structural measures

Question 56

Cycle times and waste-reduction measures are examples of operating results of benchmarking data.

Question 57

Productivity ratios are useful in measuring the extent to which a firm effectively uses the scarce resources that are available to the firm.

Question 58

The concept of ________ implies that you must have something to offer the target firm in return for sharing information.

A)reciprocity
B)baselining
C)process redesign
D)interfacing
E)restructuring

Question 59

Return on assets (ROA)and return on investments (ROI)are examples of ________.

A)structural measures
B)market share data
C)productivity ratios
D)quality measures
E)financial ratios

Question 60

To begin the management process of benchmarking, a strategy statement outlining the goals and strategies to be used is developed.

Question 61

Define process redesign. State the two factors that are critical to achieving success through process redesign.

Question 62

Explain the importance of using customer-related results as benchmarking data.

Question 63

State the four key problems with benchmarking.

Question 64

Explain the process of managing the benchmarking effort.

Question 65

The concept of interfacing implies that you must have something to offer the target firm in return for sharing information.

Question 66

Explain the use of performance measures or indicators in performance improvement.

Question 67

Baselining requires the monitoring of key internal firm performance measures over time to identify trends such as improvement to inform managerial decision making.

Question 68

Breadth refers to the impact of the process redesign to the entire organization.

Question 69

If the cost of goods sold reported by Champion Cooling Co. is equal to $600,000 and the scrap cost amounts to $50,000, what is their scrap efficiency?

A)8.33
B)30.0
C)12.0
D)18.5
E)22.8

Question 70

What is the formula used to calculate scrap efficiency?

A)scrap/cost of goods sold
B)(cost of goods sold - scrap)/scrap
C)cost of goods sold/scrap
D)(scrap - cost of goods sold/scrap
E)cost of goods sold × scrap

Question 71

Depth of the process redesign refers to organizational elements such as responsibilities, measurements, information technology, and skills.

Question 72

Restructuring is defined as a fundamental rethinking and redesigning of business processes.

Question 73

Give examples of quality measures and structural measures of benchmarking data.

Question 74

Explain the concept of baselining.

Question 75

Differentiate between financial ratios and productivity ratios of benchmarking data.

Question 76

Because process redesign affects multiple levels in a firm, abrupt organizational changes are reflected in baselining results.

Question 77

Business process maps are used to identify the exact performance measures and metrics needed from the target firm.

Question 78

Explain the importance of training in benchmarking.

Question 79

Champion Cooling Co. signed an exclusive contract with a scrap metal dealer that is willing to pay 33 cents a pound for scrap copper. If the cost of goods sold reported by Champion amounts to $100,000 and the scrap cost is equal to $20,000 for their 3030 pounds of scrap copper, what is Champion's scrap efficiency?

A)7.60
B)5.00
C)6.26
D)9.33
E)3.18

Question 80

Baselining is a methodology utilized to inform managerial decision-making by assessing process redesign impacts.