Deck 18: Operations Management

Question 1

When inputs are turned into goods and services, value is created.

Answer 1

True
Explanation: By definition, the transformation process creates value when it transforms inputs into goods and services that customers want to buy.

Question 2

The majority of U.S. companies still produce goods rather than services.

Answer 2

False
Explanation: Currently, 77 percent of U.S. economic activity is directed toward producing services.

Question 3

Beginning in the 1950s, U.S. firms began to focus on manufacturing rather than finance and marketing.

Answer 3

False
Explanation: The opposite is true-after World War II, U.S. managers felt that they had solved all production problems and began to focus on finance and marketing rather than manufacturing.

Question 4

Value in a value chain management system is determined by managers.

Question 5

Operations management includes service industries but not manufacturing firms.

Question 6

For most U.S. companies, high productivity is a matter of survival.

Question 7

In the 1960s and 1970s, companies in Japan and Germany began to catch up with U.S. firms by focusing on quality.

Question 8

Productivity goals, according to Deming, should be strictly numerical to avoid ambiguity.

Question 9

Value chain management is externally oriented.

Question 10

The three inputs in the transformation process are people, equipment, and materials.

Question 11

Productivity is not important to value chain management.

Question 12

Manufacturing organizations produce both physical and nonphysical outputs.

Question 13

Each link in a value chain adds an equal amount of value to a product.

Question 14

Deming's 14 points were useful in their time but are now largely considered to be obsolete.

Question 15

Operations management is part of the transformation process.

Question 16

Value chain management is efficiency oriented.

Question 17

The goal of operations management is to manage the process of turning labor and raw materials into goods and services of some type.

Question 18

Operations management is likely to play a key role in American firms regaining their preeminence among world companies.

Question 19

According to W. Edwards Deming, managers should emphasize short-term rather than long-term planning.

Question 20

Deming advocated an approach in which managers never get complacent about the quality of their product.

Question 21

Customers played a role in IKEA's success by being willing to pay higher prices for high-quality furniture.

Question 22

The goal of value chain management is to meet, but never to exceed, the needs and desires of customers.

Question 23

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

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

Question 24

The critical path in a PERT network is the least time-consuming sequence required to complete a project in the shortest period of time.

Question 25

In the Six Sigma system, the higher the sigma value, the greater the number of defects you would expect from a product.

Question 26

One place in which technology has little impact is the fast-food restaurant business.

Question 27

The customer is part of the value chain in value chain management.

Question 28

Trust is so important in value chain management that proponents of the system say you can never have too much trust.

Question 29

Partners in a value chain management system need to be able to both learn from and educate other partners in the value chain.

Question 30

In value chain management, activities are eliminated from the organizational process if they do not add value to the process.

Question 31

Value in value chain management is driven exclusively from the top down.

Question 32

ISO 9000 certification provides proof that a quality operations system is in place in a facility.

Question 33

Many experts believe that for firms to compete globally they must focus solely on the quantity of production and reducing costs.

Question 34

Sharing information is part of the coordination and collaboration requirement for successful value chain management.

Question 35

To find the planned duration of a project on a Gantt chart, simply look at the width of the bar that represents actual progress.

Question 36

A load chart can tell you how many workers are busy at a given point in time.

Question 37

Employees in a value chain management organization must be flexible.

Question 38

Being rigorous about expectations is a key part of leadership in value chain management.

Question 39

Organizational processes in value chain management refer to how work is done.

Question 40

Product quality and service quality are two different things.

Question 41

You would expect a highly developed country like ________ to have a predominantly ________ economy.

A) France; manufacturing
B) France; service
C) Vietnam; service
D) United Kingdom; manufacturing

Question 42

Service organizations ________.

A) produce physical and nonphysical outputs
B) produce physical outputs only
C) require nonphysical inputs only
D) produce nonphysical outputs only

Question 43

You would expect an undeveloped country like ________ to have a predominately ________ economy.

A) Laos; nonservice
B) Laos; service
C) Australia; manufacturing
D) Belgium; nonservice

Question 44

Value is created during the process of ________.

A) inputs being converted into outputs
B) inputs being stored
C) outputs being measured
D) operations being controlled

Question 45

In a transformation process, people are considered to be inputs because they ________.

A) are material beings
B) are costly
C) perform tasks that are needed to create outputs
D) have knowledge and information

Question 46

Manufacturing organizations ________.

A) produce physical outputs only
B) produce nonphysical outputs only
C) require nonphysical inputs only
D) require physical inputs only

Question 47

All organizations produce goods or services through the ________ process.

A) transformation
B) service
C) manufacturing
D) operations

Question 48

Most countries in today's global business climate see ________ as the key to success.

A) maintaining productivity
B) increasing productivity
C) higher wages
D) shorter working hours

Question 49

In the ever more difficult struggle to survive in a competitive world, Evans Findings Company has a work shift with ________.

A) extra employees to increase productivity
B) no employees to allow workers to rest
C) no employees to punish unproductive workers
D) no employees to increase productivity

Question 50

The transformation process transforms ________.

A) goods and services into products
B) inputs into services only
C) materials into goods only
D) inputs into goods and services

Question 51

It is easier to see the transformation process at work in manufacturing organizations than in service organizations because manufacturing organizations ________.

A) produce goods and services
B) turn inputs into outputs
C) turn inputs into physical and nonphysical products
D) produce physical goods

Question 52

A laptop computer company is a ________ organization because its product is ________.

A) service; electronic
B) manufacturing; electronic
C) service; a computer
D) manufacturing; a computer

Question 53

Which of the following is NOT a way to increase productivity?

A) increase inputs
B) decrease costs
C) increase outputs
D) increase efficiency

Question 54

As a product, piano lessons are ________.

A) a good because you can purchase them
B) a service because they are nonmaterial
C) a good because they can be divided into discrete lessons
D) a service because someone needs to give them

Question 55

Which of the following is NOT an example of a service organization?

A) a military force
B) a university
C) a lens maker
D) a hospital

Question 56

McDonald's recently made productivity gains by cutting the ________.

A) wages of workers
B) weight of an order of French fries
C) time workers were trained
D) time it takes to make French fries

Question 57

A bus company is a ________ organization because its product is ________.

A) service; buses
B) manufacturing; transportation
C) service; transportation
D) manufacturing; buses

Question 58

It is estimated that in the United States, about ________ of all economic output is toward making tangible, physical objects.

A) 10 percent
B) 20 percent
C) 40 percent
D) 80 percent

Question 59

Inputs in the transformation process include ________.

A) physical, material substances only
B) both material and nonmaterial items
C) nonmaterial items only
D) equipment and materials only

Question 60

The purpose of operations management is to manage ________.

A) inputs
B) outputs
C) the transformation process
D) the manufacturing process

Question 61

The durability an expensive pair of shoes provides has value since ________ are willing to ________ it.

A) suppliers; provide
B) customers; pay for
C) manufacturers; make
D) managers; plan for

Question 62

Value is any aspect of a product that customers ________ in the product.

A) like or admire
B) want to see
C) will pay for
D) notice

Question 63

________ is the process of managing the sequence of activities and information along the entire value chain for a product.

A) Supply chain management
B) Value chain management
C) Supply management
D) Customer management

Question 64

Deming was a strong believer in keeping accurate statistics and advocated ________ goals.

A) strictly nonnumerical
B) strictly numerical
C) both numerical and nonnumerical
D) both numerical and statistical

Question 65

Managers in the United States today see this as the path to establishing and maintaining global leadership.

A) reducing costs
B) increasing production
C) operations management
D) scientific management

Question 66

Of all the emotions that affect a workplace, Deming felt that ________ was most important for increasing productivity.

A) making workers fear failure
B) eliminating fear
C) making employees happy
D) eliminating anger

Question 67

When the New York Times experimented with charging money for its online news source, its popularity on the Internet plummeted. This shows that online news, at least as it is defined in this market, has ________.

A) enormous value
B) no value
C) no appeal
D) little value

Question 68

Deming felt that any new skills that employees needed should be acquired ________.

A) when they are hired and trained
B) by the employees on their own
C) when the need arises
D) years ahead of time

Question 69

In the 1960s and 1970s, many U.S. manufacturers fell behind because they ignored production issues and focused on ________.

A) quality and efficiency
B) marketing and finance
C) efficiency and customers
D) finance and quality

Question 70

With respect to product quality, Deming believed that a company should never ________.

A) pay more attention to quality than to price
B) be satisfied with its current level of quality
C) try to fix a product if it "ain't broke"
D) put quality ahead of profits

Question 71

Deming felt that ________ with statistics.

A) employees should be capable of dealing
B) employees should not be asked to deal
C) managers only should deal
D) employees only should deal

Question 72

On eBay, brand-new red espresso machines from Francis Francis routinely sell for $50 more than identical white machines. What can you conclude?

A) The color white has no value.
B) The color red has value.
C) Color has no value since it does not add to the function of the machine.
D) There is something different about the red machines.

Question 73

Deming felt that doing quality work was this.

A) a job requirement
B) a goal
C) a standard to strive toward
D) optional for most jobs

Question 74

Since Deming first proposed his 14 points for improving productivity, his prescriptions have ________.

A) been largely discredited
B) fallen into disuse
C) been confirmed repeatedly
D) been confirmed for U.S. workers only

Question 75

The ________ is the series of work actions that add value to a product as it is being transformed from inputs to finished product.

A) supply chain
B) value chain
C) output chain
D) input chain

Question 76

Where did the modern era of manufacturing primarily begin?

A) the coal industry
B) Detroit automobile factories
C) southern cotton plantations
D) northeastern textile mills

Question 77

W. Edwards Deming thought that ________ the key to productivity.

A) workers were
B) controlling costs was
C) managers were
D) both managers and workers were

Question 78

With respect to planning, Deming believed that ________ was most important for productivity.

A) short-term planning
B) long-term planning
C) medium-term planning
D) flexible planning

Question 79

In its entirety, the value chain can encompass the supplier's ________ to the customer's ________.

A) customers; suppliers
B) customers; customers
C) suppliers; suppliers
D) suppliers; customer

Question 80

After World War II, U.S. managers made the mistake of thinking that ________.

A) production problems were solved
B) marketing problems were solved
C) finance problems were solved
D) marketing problems were not solved