Deck 14: Operations Management: Managing Vital Operations and Processes

Question 1

Attributes of an organization's outputs-their quality,cost,and features-are determined by the organization's production system.

Answer 1

True
Explanation: Because satisfying customers is so important, managers try to design production systems that can produce the outputs that have the attributes a customer desires. The attributes of an organization's outputs-their quality, cost, and features-are determined by the organization's production system.

Question 2

Higher quality translates into higher employee productivity,which means lower costs for the organization.

Answer 2

True
Explanation: Achieving high product quality lowers operating costs because of the effect of quality on employee productivity: Higher product quality means less employee time is wasted in making defective products that must be discarded or in providing substandard services, and thus less time has to be spent fixing mistakes. This translates into higher employee productivity, which means lower costs.

Question 3

Improving product quality increases the operating costs of the organization.

Answer 3

False
Explanation: Achieving high product quality lowers operating costs because of the effect of quality on employee productivity. Higher product quality means less employee time is wasted in making defective products that must be discarded or in providing substandard services, and thus less time has to be spent fixing mistakes.

Question 4

To increase quality,managers should embrace the philosophy that mistakes,defects,and poor-quality materials should be limited to 0.5 percent of total production.

Question 5

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 6

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

Question 7

Responsiveness to customers refers to actions taken to meet the demands and needs of customers.

Question 8

An organization's employees can be a major source of information about the sources of poor quality products produced by the organization.

Question 9

Operations managers are managers who are responsible for managing an organization's production system.

Question 10

A production system is the system that an organization uses to acquire inputs,convert inputs into outputs,and dispose of the outputs.

Question 11

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

Question 12

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

Question 13

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 14

Most organizations focus on partial productivity to measure the efficiency of an individual unit.

Question 15

Quality refers to the amount of inputs that are required to produce a given output.

Question 16

The major advantage of total factor productivity is that each input is typically measured in the same units.

Question 17

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

Question 18

Total factor productivity isolates the exact contribution of an input to the production of a given output.

Question 19

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

Question 20

The concept of "quality" can be applied only to manufacturing organizations,but not to service organizations.

Question 21

In a process layout,machines are organized so that each operation needed is performed at workstations arranged in a fixed sequence.

Question 22

The fundamental rethinking and radical redesign of business processes is known as "continuous improvement".

Question 23

Although buffer stocks of inventory can be expensive to store,they can help an organization when it is affected by shortages of inputs brought about by a disruption among suppliers.

Question 24

It follows that if setup times for complex production equipment can be reduced,efficiency will rise.

Question 25

An advantage of JIT systems is that they leave a buffer stock of inventory available to the organization.

Question 26

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

Question 27

Facilities layout is the operations management technique that pays minimal attention to design the machine-worker interface.

Question 28

Flexible manufacturing systems attempt to increase the time required to set up production machinery.

Question 29

Buffer stocks can help an organization respond quickly to increases in customer demand.

Question 30

In a fixed-position production layout,each workstation is relatively self-contained.

Question 31

In "process reengineering",managers rethink the organization's basic business strategy.

Question 32

A disadvantage of flexible manufacturing is that a company is unable to produce many more varieties of a product than before in the same amount of time.

Question 33

Continually increasing the demands placed on employees,regardless of job stress,is ethical.

Question 34

The "just-in-time" concept of inventory states that the organization should stockpile excess inputs in the event that it needs them to meet a sudden increase in customer demand.

Question 35

Process reengineering can boost efficiency because it eliminates the time devoted to activities that do not add value.

Question 36

An inventory system in which parts and supplies arrive at the organization when they are needed and not before is called a TQM system.

Question 37

The effect of introducing self-managed teams is often an increase in efficiency of 30 percent or more.

Question 38

"Labor productivity" is frequently used to compare organizations in their efficiency.

Question 39

Flexible manufacturing is the set of operations management techniques that attempt to reduce the setup costs associated with a production system.

Question 40

Self-managing work teams are popular because they increase worker satisfaction and decrease turnover,but they have no effect on productivity.

Question 41

Operations managers are responsible for all of the following EXCEPT:

A) sufficient supplies of high-quality inputs.
B) sufficient supply of low-cost inputs.
C) designing the distribution system for the products.
D) designing a production system that creates high quality.
E) designing low-cost products that customers are willing to buy.

Question 42

One of the reasons to increase product quality is that higher product quality can _____ efficiency,_____ operating costs,and _____ profits.

A) increase; increase; increase
B) increase; lower; lower
C) decrease; lower; increase
D) increase; lower; increase
E) decrease; increase; decrease

Question 43

In measuring the total factor productivity of an organization,which of the following is a measure of the amount of energy consumed in output production?

A) The number of tons of iron ore required to make one ton of steel
B) The number of units produced
C) The number of hours worked
D) The number of kilowatt-hours consumed
E) The number of employees required

Question 44

The attributes of an organization's outputs are determined by its:

A) production system.
B) quality management program.
C) efficiency system.
D) distribution system.
E) flexible manufacturing system.

Question 45

A system that an organization uses to obtain inputs,convert them into outputs,and then dispose of these outputs is known as a(n):

A) production system.
B) quality control management system.
C) reengineering system.
D) line management system.
E) JIT system.

Question 46

The concept of _____ refers to goods and services that are dependable,reliable,able to do what they were designed for,and satisfying.

A) efficiency
B) timelines
C) conditioning
D) warranties
E) quality

Question 47

Which of the following organizational resources is NOT included in calculating total factor productivity?

A) Raw materials
B) Labor costs
C) Energy costs
D) Capital costs
E) Marketing costs

Question 48

The outputs of an organization,divided by all of its inputs,is called its:

A) total factor productivity.
B) total labor productivity.
C) partial productivity.
D) total capital productivity.
E) efficiency ratio.

Question 49

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

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

Question 50

Which of the following is a problem that managers face while providing high quality,quick service,and after-sales service and support,products with many features,and products that are customized?

A) Job satisfaction decreases, thus affecting productivity.
B) It raises costs and thus the price that must be charged to cover costs.
C) Defect rates could increase thus lowering customer satisfaction.
D) It loses other customers who do not desire these features.
E) These features are easily duplicated and thus they lose the competitive edge.

Question 51

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

A) TQM managers.
B) JIT managers.
C) operations managers.
D) inventory managers.
E) facilities managers.

Question 52

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

A) Customer relationship management
B) Total quantity management
C) Customer experience management
D) Customer perception measurement
E) Resource management

Question 53

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

A) technology.
B) number of employees.
C) product mix.
D) geographical locations.
E) customer needs.

Question 54

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

A) total quality management.
B) supply chain management.
C) operations management.
D) reengineering management.
E) strategic management.

Question 55

_____ refers to the actions taken to meet the needs of customers.

A) Efficiency
B) Quality
C) TQM
D) Quality control
E) Responsiveness

Question 56

Total factor productivity is a measure of an organization's:

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

Question 57

The measure of the efficiency of a specific unit of an organization is called its:

A) efficiency ratio.
B) partial productivity.
C) total factor productivity.
D) labor productivity.
E) sales productivity.

Question 58

The engineers at Compaq Computer redesigned the ProLinea desktop computer so that its assembly time was reduced from 20.9 minutes to 10.5 minutes.This was a significant:

A) decrease in productivity.
B) increase in quality.
C) decrease in quality.
D) increase in efficiency.
E) decrease in total factor productivity.

Question 59

An operations manager is responsible for all of the following in an organization's production system EXCEPT:

A) acquiring inputs.
B) converting inputs into outputs.
C) disposing of outputs.
D) increasing quality of outputs.
E) reducing responsiveness to consumers.

Question 60

_____ refers to the amount of input that is required to produce a given level of output.

A) Quality
B) Responsiveness to customers
C) Efficiency
D) Quality control
E) TQM

Question 61

A process layout often _____ efficiency and is well suited for _____ products.

A) reduces; custom-made
B) increases; custom-made
C) reduces; mass-produced
D) increases; mass-produced
E) increases; all

Question 62

Organizing machines in the production process so that each operation is performed at workstations in a fixed sequence is known as a(n):

A) fixed-position layout.
B) hybrid layout.
C) cellular layout.
D) product layout.
E) process layout.

Question 63

James calculates the average number of hours it takes an employee in his plant to produce a product.He is calculating the:

A) total factor productivity.
B) labor productivity.
C) labor cost.
D) product efficiency.
E) product cost.

Question 64

Labor productivity is most commonly used to:

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

Question 65

In the production process,when 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,this is known as:

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

Question 66

Which operations management technique has as its goal to design the machine-worker interface to increase production efficiency?

A) Facilities layout
B) Quality circles
C) Inventory management
D) Production system improvement
E) JIT

Question 67

Labor productivity is calculated by:

A) outputs/direct labor.
B) outputs minus direct labor.
C) inputs/direct labor.
D) outputs x direct labor/inputs.
E) direct labor/outputs.

Question 68

In the production process,when the product goes to whichever workstation is needed to perform the next operation to complete the product and the workstations are relatively self-contained,this is known as a(n):

A) process layout.
B) fixed-position layout.
C) hybrid layout.
D) product layout.
E) cellular layout.

Question 69

Shawn,an executive with The Connoisseur's Brewery,wants to compare his firm's efficiency against its competitors.To do so,he should:

A) assess the financial ratios of the firm versus the competition.
B) compute the partial productivity of energy for the firm and compare it with that of the competition.
C) compare the firm's labor productivity to that of the competition.
D) compare the amount of materials used to that of the competition.
E) conduct a survey of customers' opinions about the firm's efficiency.

Question 70

In the typical organization,increased efficiency leads to:

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

Question 71

All of the following are problems associated with total factor productivity EXCEPT:

A) it is a useful tool to measure efficiency.
B) managers find the calculation complex.
C) it converts all factors into dollar factors.
D) it does not consider the exact contribution of an input to an output.
E) each input is typically measured in different units.

Question 72

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

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

Question 73

In measuring the total factor productivity of an organization,which of the following is a measure of labor's contribution to output production?

A) The amount of raw materials consumed
B) The number of units of energy consumed
C) The number of hours worked
D) The number of kilowatt-hours consumed
E) The number of machineries used

Question 74

In the production process,a jet airplane assembly line would be an example of which type of facilities layout?

A) Product layout
B) Process layout
C) Fixed-position layout
D) Flexible manufacturing layout
E) Hybrid layout

Question 75

A process layout provides the flexibility needed to change the product.Such flexibility,however,often reduces efficiency because:

A) constant changes challenge worker efficiency.
B) employees find it difficult to learn.
C) it is expensive.
D) standardization is impossible.
E) it requires a long time to install.

Question 76

For which product is a fixed-position layout most likely to be used?

A) Tractors
B) Aircraft carrier
C) Custom furniture
D) Beer bottling
E) Clothing

Question 77

In the production process,a mainframe computer assembly line is an example of which type of facilities layout?

A) Product layout
B) Process layout
C) Fixed-position layout
D) Flexible manufacturing layout
E) Hybrid layout

Question 78

For which of the following is a product layout most likely to be used?

A) Jet aircraft assembly
B) Automobile assembly
C) Gas turbine assembly
D) Custom furniture assembly
E) Mainframe computer assembly

Question 79

The efficiency of an organization's labor inputs with reference to a particular unit is known as the:

A) total factor productivity.
B) cumulative productivity.
C) facilities index.
D) partial productivity.
E) unit productivity.

Question 80

In the production process,when component parts are produced throughout the factory and then brought to the production area for final assembly,this is known as a:

A) process layout.
B) product layout.
C) fixed-position layout.
D) JIT layout.
E) kanban layout.