Deck 19: Managing Operations

Question 1

In contrast to supply chain management, which is externally oriented, value chain management is internally oriented and focuses on the efficient flow of incoming materials to the organization.

Answer 1

False

Question 2

The need for flexibility requires a significant investment in continual and ongoing employee training.

Answer 2

True

Question 3

A value chain strategy should employ a balance between value-adding activities and non-value-adding activities.

Answer 3

False

Question 4

Value chain management is internally oriented and focuses on efficient flow of incoming materials to the organization.

Question 5

While supply chain management is efficiency oriented, value chain management is effectiveness oriented.

Question 6

Operations management oversees the transformation process that converts resources such as labour and raw materials into finished goods and services.

Question 7

Organizations with extensive and successful quality improvement programs need to have homogeneous work teams.

Question 8

Six Sigma is a quality standard that establishes a goal of no more than 3.4 defects per 1,000 units or procedures.

Question 9

It is easier to see the operations management process at work in service organizations than it is in manufacturing organizations.

Question 10

For organizations to improve productivity, they should focus on people and operations variables.

Question 11

Operations management plays a strategic role in an organization's competitive success.

Question 12

In its entirety, the value chain can encompass everything from the supplier's suppliers to the customer's customers.

Question 13

Value chain management radically changes organizational processes.

Question 14

Achieving ISO 9000 certification provides proof that a company produces the best product in the industry.

Question 15

Intellectual property is the proprietary information that is critical to an organization's efficient and effective functioning and competitiveness.

Question 16

Flexibility is the key to effective job design in a value chain organization.

Question 17

Value chain management is the process of managing the entire sequence of integrated activities and information about product flows along the entire value chain.

Question 18

Productivity is defined as the overall output of goods and services produced divided by the inputs needed to generate that output.

Question 19

Value is provided to customers through transforming raw materials and other resources into some product or service that end users need or desire when, where, and how they want it.

Question 20

Low dependence on technology is a main requirement of a successful value chain strategy.

Question 21

In its entirety, the __________ chain can encompass the supplier's suppliers to the customer's customers.

A) supply
B) profit
C) quality
D) value
E) transformation

Question 22

An organizational system takes in inputs and transforms them through various processes, procedures, work activities, and so forth into finished goods and services. Which of the following terms refers to the management of all these processes?

A) structural management
B) strategic management
C) operational management
D) resource management

Question 23

Which of the following statements about operations management is the most accurate?

A) It refers to the transformation process that converts resources into finished goods and services.
B) People and technology are inputs to an operations system whereas information is an output.
C) Operations management is more significant in manufacturing industry than services industry.
D) Radical changes are required in the business processes to establish effective operations management.

Question 24

Opening a bank account and withdrawing money from an ATM are considered _____________ and are typical in _____________.

A) products; service organizations
B) outputs; all businesses
C) physical outputs; value chain management
D) benefits; service organizations
E) nonphysical outputs; service organizations

Question 25

Identify an industry in which the transformation process of resources into products is readily evident.

A) airlines
B) health care
C) telecommunications
D) automobiles
E) hotels

Question 26

_____ organization produces nonphysical outputs.

A) manufacturing
B) service
C) organic
D) mechanistic
E) high technology

Question 27

Which of the following is not an input into an organization's operations system?

A) people
B) technology
C) capital
D) materials
E) profits

Question 28

Which of the following is an output of an organization's operations system?

A) people
B) technology
C) services
D) materials
E) equipment

Question 29

Which of the following statements concerning operations management is true?

A) It is not required in service organizations.
B) It is primarily concerned with the input stage of the transformation process.
C) It has little to do with organizational productivity.
D) It encompasses both services and manufacturing organizations.
E) It only applies to organizations that produce something.

Question 30

Productivity is a composite of __________ and operational variables.

A) capital
B) people
C) materials
D) technology
E) information

Question 31

Which of the following statements is true about organizational productivity for individual organizations?

A) Productivity is less significant for people-oriented organizations.
B) Employees wages stagnate if the productivity is high.
C) High productivity provides a competitive cost structure to organizations.
D) High productivity would lead to increased profits and inflation.
E) Productivity only impacts manufacturing operations.

Question 32

To improve productivity, managers must focus on both __________.

A) people and operations variables
B) materials and people
C) capital and technology
D) profits and information
E) equipment and materials

Question 33

What has value is decided by the _____________.

A) supplier providing the materials
B) customer buying the product
C) owner of the business
D) shareholders
E) manufacturer making the product

Question 34

__________ management oversees the transformation process that converts resources such as labour and raw materials into finished goods and services.

A) Control
B) Operations
C) Systems
D) Planning
E) Transformation

Question 35

Mass customization is a design-to-order method that provides consumers with a product when, where, and how they want it.

Question 36

An organization wants to improve its competitive cost structure and the ability to offer more competitive prices. Which of the following actions is certain to help them achieve this goal?

A) Hire more employees in order to produce more of the product or service.
B) Increase the quality of the products by using high-quality raw materials.
C) Improve the productivity of the employees of the organization.
D) Use premium pricing strategies to create a strategic brand positioning.
E) Increase the sales and marketing budgets.

Question 37

The __________ chain is the entire series of organizational work activities that add value at each step beginning with the processing of raw materials and ending with finished product in the hands of end users.

A) supply
B) value
C) transformation
D) profit
E) quality

Question 38

It is easiest to see the operations management process at work in __________ organizations.

A) service
B) financial
C) consulting
D) manufacturing
E) retail

Question 39

Which of the following elements assumes the highest level of power in the value chain?

A) suppliers
B) employees
C) vendors
D) customers
E) managers

Question 40

All organizations produce goods or services through a(n) ________ process.

A) transformation
B) engineering
C) manufacturing
D) attenuation
E) service

Question 41

Organizational barriers are among the most difficult obstacles to handle. Which of the following is one such organizational barrier?

A) pressures from competitors
B) too much focus on system security
C) tendency to shake up the status quo
D) reluctance to share information
E) high standard of quality initiatives

Question 42

Which of the following is mentioned in our textbook as a cultural attitude that supports the successful implementation of value chain management?

A) competitiveness
B) collaborating
C) benchmarking
D) centralization
E) personal pride

Question 43

Which of the following best describes organizational processes?

A) the type of technology utilized
B) the way organizational work is done
C) organizational goals and objectives
D) strategy implementation
E) policies and procedures

Question 44

Managers should outline expectations for what's involved in the organization's pursuit of value chain management. Ideally, managers should start with ________.

A) a vision or mission statement
B) a business plan
C) a pre-defined organizational structure
D) a formal process design
E) policies and procedures

Question 45

For the value chain to achieve its goal of exceeding customers' needs, __________ must be developed.

A) collaborative relationships
B) new products and services
C) technology applications
D) policies and regulations
E) statistical controls

Question 46

System security and Internet security breaches are prominent issues in value chain management. What is the major reason for such threats?

A) In value chain management, outgoing materials get more importance than incoming materials.
B) Value chain management is internally oriented and focuses on efficient flow of incoming materials.
C) Value chain management relies heavily on a substantial information technology infrastructure.
D) Strategic positioning is used in value chain management to exploit competitive opportunities.
E) Employees misunderstand the purpose of value chain management and resort to old ways of doing things.

Question 47

The ability of a product or service to reliably do what it's supposed to do and to satisfy customer expectations is called __________.

A) satisfaction
B) quality
C) assurance
D) utility
E) value

Question 48

Which of the following is one of the main human resource requirements for value chain management?

A) formal hiring processes
B) standardized job design approaches
C) homogeneous workforce
D) ongoing training efforts
E) standardized pay and benefits

Question 49

____________ is one important benefit of value chain management for manufacturers.

A) Employee loyalty
B) Internal innovation
C) Performance standards improvement
D) Improved procurement
E) Six sigma

Question 50

__________ chain management is internally oriented and focused on efficiency.

A) Supply
B) Value
C) Profit
D) Transformation
E) Quality

Question 51

The key to effective job design in a value chain organization is _________.

A) structure
B) strategy
C) flexibility
D) innovation
E) specialization

Question 52

____________ can help focus attention on an objective quality standard.

A) performance
B) features
C) goals
D) durability
E) accuracy

Question 53

Giving employees ______________ is essential in order to instill enthusiasm to drive quality improvements.

A) flexibility
B) information
C) empowerment
D) standards
E) feedback

Question 54

Collaboration and cooperation throughout the value chain will be difficult to achieve if _______________.

A) standards for inventory control are not in place
B) production outputs are less than expected
C) the number of defects exceeds the acceptable standard
D) employees refuse to be flexible in their work
E) processes involve nonphysical outputs

Question 55

In managing the internal value chain, organizational leaders should clarify role expectations for ____________ as well as for ___________________.

A) departments; supervisors
B) employees; external partners
C) internal partners; suppliers
D) suppliers; investors
E) employees; departments

Question 56

Value chain management radically changes __________.

A) ethical issues
B) corporate goals and objectives
C) mission statements
D) organizational processes
E) spans of control

Question 57

Which of the following is a main requirement if a value chain strategy is to be successful?

A) technology investment
B) strict rules and norms
C) informal work culture
D) homogeneous teams
E) loyal customers

Question 58

A cultural attitude that can be an obstacle in value chain management is the belief that when an organization collaborates with external and internal partners, it no longer __________________.

A) provides the highest expected quality output
B) controls its own destiny
C) focuses on the strategic plan
D) can meet supplier requirements
E) controls customer interactions

Question 59

Which of the following best describes value chain management?

A) internally oriented
B) focused only on the flow of incoming materials to the organization
C) efficiency oriented
D) effectiveness oriented
E) primary goal is to reduce costs

Question 60

Jack works for Synergy Today Inc. as a customer service representative. He is usually asked to take on other responsibilities such as packaging customer orders or checking the quality of the widgets that come from the factory. In order to be able to take on these additional responsibilities, he has asked his manager to ____________.

A) give him a raise
B) provide some extra training
C) allow him to share the work with another employee
D) re-work the processes to make the work easier
E) relax the productivity targets

Question 61

Refer to the scenario below to answer the following questions.
Quality or Not? (Scenario)
On Monday, the big news arrived. Top managers at Bob's company announced they would be implementing a new productivity improvement program. Their goals, they said, were to "plan for the now, impress shareholders, and use the program to increase short-term profits. Those who don't agree can begin looking for a new job." Bob, along with everyone else, grumbled under his breath. What in the world was top management thinking? Their "zero quality defects" program had failed and now they were jumping on this new bandwagon. Training was nonexistent in the company, and managers were fond of pushing responsibility for these programs down to the lowest level. Top management was not happy with the quality of the product, and now they wanted total quality concerning the employees too. At lunch, Bob read the notice board, which said, "Statistical process control classes will begin immediately, see your supervisor for a training date." Bob sighed and wondered what fad was next.
Although Bob was pleased to see the notice about the new training program, he was not sure that learning about statistical processes was the knowledge employees needed. But, he reasoned, any training would help make the employees __________.

A) more flexible
B) comply with the new goals
C) come to work on time
D) focus on minimizing waste
E) expect pay raises

Question 62

Refer to the scenario below to answer the following questions.
Importance of Operations Management (Scenario)
Melissa had been asked to attend training in operations management. Her background and training had previously been in accounting, but with the reorganization looming, it was either learn a new skill or look for another job. She was actually looking forward to the training. She felt her background with numbers should prove valuable in operations management, but she admitted that she knew little about the field. Until now, she had been in a support staff function and had little feel for how their product went from raw materials to finished product. Melissa's first class would be tonight at Canadian University, and she was excited about the opportunity.
Melissa must remember that productivity is a composite of __________ variables.

A) people and operations
B) task and relationship
C) structural and procedural
D) predictable and unpredictable
E) internal and market-based

Question 63

Which of the following companies popularized the use of stringent quality standards more than 30 years ago through a trademarked quality improvement program called Six Sigma?

A) IBM
B) General Electric
C) Motorola
D) Mitsubishi
E) Sony

Question 64

Organizations with successful quality improvement programs rely on ________.

A) customer feedback
B) marketing for profitability
C) highly paid workforce
D) employee centered approaches
E) perceived quality initiatives

Question 65

Lean organizations adopt a philosophy of __________ by striving for perfection through continuous learning, creativity, and teamwork.

A) maximizing quality
B) customer first
C) six sigma
D) minimizing waste
E) maximizing profits

Question 66

Which of the following is not related to mass customization?

A) design-to-order
B) flexible manufacturing techniques
C) computer-controlled factory equipment
D) logistics software
E) mass marketing

Question 67

An organization that optimizes its entire production process from the customer's perspective is a(n)____________.

A) lean organization
B) manufacturing organization
C) service organization
D) global organization
E) quality organization

Question 68

Six Sigma is a quality standard that establishes a goal of no more than 3.4 defects per __________ units or procedures.

A) 100
B) 1000
C) 10,000
D) 100,000
E) 1,000,000

Question 69

Refer to the scenario below to answer the following questions.
Quality or Not? (Scenario)
On Monday, the big news arrived. Top managers at Bob's company announced they would be implementing a new productivity improvement program. Their goals, they said, were to "plan for the now, impress shareholders, and use the program to increase short-term profits. Those who don't agree can begin looking for a new job." Bob, along with everyone else, grumbled under his breath. What in the world was top management thinking? Their "zero quality defects" program had failed and now they were jumping on this new bandwagon. Training was nonexistent in the company, and managers were fond of pushing responsibility for these programs down to the lowest level. Top management was not happy with the quality of the product, and now they wanted total quality concerning the employees too. At lunch, Bob read the notice board, which said, "Statistical process control classes will begin immediately, see your supervisor for a training date." Bob sighed and wondered what fad was next.
Bob noticed that goals stated by the management focused on the shareholders and profits. In his opinion and limited knowledge of quality improvement programs, Bob recognizes that the most important focus should be on______________.

A) Implementing new technology
B) meeting the customers' needs
C) finding out what the employees want
D) changing the corporate culture
E) mass customization

Question 70

Refer to the scenario below to answer the following questions.
Importance of Operations Management (Scenario)
Melissa had been asked to attend training in operations management. Her background and training had previously been in accounting, but with the reorganization looming, it was either learn a new skill or look for another job. She was actually looking forward to the training. She felt her background with numbers should prove valuable in operations management, but she admitted that she knew little about the field. Until now, she had been in a support staff function and had little feel for how their product went from raw materials to finished product. Melissa's first class would be tonight at Canadian University, and she was excited about the opportunity.
Melissa had to remember which factors were considered inputs and which were considered outputs. Inputs included all but which of the following?

A) materials
B) information
C) technology
D) finished goods
E) people

Question 71

Refer to the scenario below to answer the following questions.
Importance of Operations Management (Scenario)
Melissa had been asked to attend training in operations management. Her background and training had previously been in accounting, but with the reorganization looming, it was either learn a new skill or look for another job. She was actually looking forward to the training. She felt her background with numbers should prove valuable in operations management, but she admitted that she knew little about the field. Until now, she had been in a support staff function and had little feel for how their product went from raw materials to finished product. Melissa's first class would be tonight at Canadian University, and she was excited about the opportunity.
Until now, Melissa had thought more about "profitability" than "productivity." She found it hard to remember that the formula for productivity was "the overall output of goods and services produced __________ the inputs needed to generate that output."

A) squared with
B) added to
C) subtracted from
D) divided by
E) multiplied by

Question 72

Quality improvement initiatives are not possible without _____________.

A) focus on profitability
B) new vision and mission statements
C) revised human resources policies
D) high investment in new technology
E) continual quality assurance training

Question 73

__________ is one that identifies customer value by analyzing all activities required to produce products or services that customers want.

A) ISO 9000 organization
B) quality organization
C) lean organization
D) process-oriented organization
E) profitable organization

Question 74

The __________ standards have become the internationally recognized standard for evaluating and comparing companies in the global marketplace.

A) ISO 250
B) ISO 9000
C) Six Sigma
D) Seven Beta
E) Alpha 9000

Question 75

Refer to the scenario below to answer the following questions.
Value Chain Management (Scenario)
Randy is the new strategic manager for Solutions Tech Inc., a management consulting firm dedicated to assisting small businesses in the pursuit of success. He is currently in a meeting with Rob, who is the owner of a successful small business that creates computer displays for large-scale production facilities. Randy is reviewing the business strategy at Rob's business and has some recommendations.
Rob seemed to understand the theory behind value chain management, but was curious about the requirements for a successful value chain. Randy informed Rob that the main requirements for successful value chain management include all of the following except __________.

A) collaboration with suppliers and customers
B) committed leadership
C) technology investment
D) competition
E) supportive organizational culture

Question 76

Mass customization requires flexible manufacturing techniques and _________.

A) managerial flexibility
B) continual dialogue with customers
C) a strong Internet presence
D) a reputation for high quality products
E) a sustainable competitive advantage

Question 77

According to our textbook, __________ is a good example of a company that uses flexible manufacturing techniques to custom-build computers to their customers' specifications.

A) Motorola
B) Gateway
C) HP
D) Dell
E) IBM

Question 78

Refer to the scenario below to answer the following questions.
Value Chain Management (Scenario)
Randy is the new strategic manager for Solutions Tech Inc., a management consulting firm dedicated to assisting small businesses in the pursuit of success. He is currently in a meeting with Rob, who is the owner of a successful small business that creates computer displays for large-scale production facilities. Randy is reviewing the business strategy at Rob's business and has some recommendations.
Before making any recommendations, Randy informed Rob that a __________ chain is the entire series of organizational work activities that add value at each step beginning with the processing of raw materials and ending with finished product in the hands of end users.

A) supply
B) value
C) transformation
D) profit
E) quality

Question 79

Refer to the scenario below to answer the following questions.
Quality or Not? (Scenario)
On Monday, the big news arrived. Top managers at Bob's company announced they would be implementing a new productivity improvement program. Their goals, they said, were to "plan for the now, impress shareholders, and use the program to increase short-term profits. Those who don't agree can begin looking for a new job." Bob, along with everyone else, grumbled under his breath. What in the world was top management thinking? Their "zero quality defects" program had failed and now they were jumping on this new bandwagon. Training was nonexistent in the company, and managers were fond of pushing responsibility for these programs down to the lowest level. Top management was not happy with the quality of the product, and now they wanted total quality concerning the employees too. At lunch, Bob read the notice board, which said, "Statistical process control classes will begin immediately, see your supervisor for a training date." Bob sighed and wondered what fad was next.
Bob knows something about quality in successful organizations. He understands that the success of any effort to implement new productivity improvement program has to start with ____________ which seems to be lacking in this company.

A) establishing proper standards
B) hiring more employees
C) committed leadership
D) quality oriented company culture
E) proper marketing efforts

Question 80

Refer to the scenario below to answer the following questions.
Importance of Operations Management (Scenario)
Melissa had been asked to attend training in operations management. Her background and training had previously been in accounting, but with the reorganization looming, it was either learn a new skill or look for another job. She was actually looking forward to the training. She felt her background with numbers should prove valuable in operations management, but she admitted that she knew little about the field. Until now, she had been in a support staff function and had little feel for how their product went from raw materials to finished product. Melissa's first class would be tonight at Canadian University, and she was excited about the opportunity.
At the first class, Melissa learned that the term operations management referred to the design, operation, and control of the __________ process that converts inputs into outputs.

A) production
B) transaction
C) transformation
D) innovation
E) operations