Choose The Correct Option For The Following Operation Management Flashcards

. Some of the operations-related activities of Hard Rock Café include designing meals and analyzing

them for ingredient cost and labor requirements.

The production process at Hard Rock Café is limited to meal preparation and serving customers.

One reason to study operations management is to learn how people organize themselves for

productive enterprise.

Shewhart’s contributions to operations management came during the Scientific Management Era.

Productivity is the total value of all inputs to the transformation process divided by the total value

of the outputs produced.

Measuring the impact of a capital acquisition on productivity is an example of multi-factor

productivity.

Budgeting, paying the bills, and collection of funds are activities associated with the

a. management function

b. control function

c. finance/accounting function

d. production/operations function

e. staffing function

Which of the following would not be an operations function in a fast-food restaurant?

a. advertising and promotion

b. designing the layout of the facility

c. maintaining equipment

d. making hamburgers and fries

e. purchasing ingredients

Reasons to study Operations Management include

a. studying why people organize themselves for free enterprise

b. knowing how goods and services are consumed

c. understanding what human resource managers do

d. learning about a costly part of the enterprise e. all of the above

The five elements in the management process are

a. plan, direct, update, lead, and supervise

b. accounting/finance, marketing, operations, and management

c. organize, plan, control, staff, and manage

d. plan, organize, staff, lead, and control

e. plan, lead, organize, manage, and control

All of the following decisions fall within the scope of operations management except for

a. financial analysis

b. design of goods and processes

c. location of facilities

d. managing quality

e. All of the above fall within the scope of operations management.

The Ten Critical Decisions of Operations Management include

a. Finance/accounting

b. Advertising

c. Process and capacity design

d. Pricing

e. all of the above

Walter Shewhart is listed among the important people of operations management because of his

contributions to

a. assembly line production

b. measuring the productivity in the service sector

c. just-in-time inventory methods

d. statistical quality control

e. all of the above

The service industry makes up approximately what percentage of all jobs in the United States?

a. 12%

b. 40%

c. 66%

d. 79%

e. 90%

Typical differences between goods and services do not include

a. cost per unit

b. ability to inventory items

c. timing of production and consumption

d. customer interaction

e. knowledge content

Which of the following is not a typical service attribute?

a. intangible product

b. easy to store

c. customer interaction is high

d. simultaneous production and consumption

e. difficult to resell

Which of the following is not a current trend in operations management?

a. just-in-time performance

b. global focus

c. supply chain partnering

d. mass customization

e. All of the above are current trends.

Which of the following statements about trends in operations management is false?

a. Job specialization is giving way to empowered employees.

b. Local or national focus is giving way to global focus.

c. Environmentally-sensitive production is giving way to low-cost focus.

d. Rapid product development is partly the result of shorter product cycles.

e. All of the above statements are true.

The Dulac Box plant produces 500 cypress packing boxes in two 10-hour shifts. What is the

productivity of the plant?

a. 25 boxes/hr

b. 50 boxes/hr

c. 5000 boxes/hr

d. none of the above

e. not enough data to determine productivity

The Dulac Box plant produces 500 cypress packing boxes in two 10-hour shifts. Due to higher

demand, they have decided to operate three 8-hour shifts instead. They are now able to produce

600 boxes per day. What has happened to production?

a. It has increased by 50 sets/shift.

b. It has increased by 37.5 sets/hr.

c. It has increased by 20%.

d. It has decreased by 8.3%.

e. It has decreased by 9.1%.

The total of all outputs produced by the transformation process divided by the total of the inputs is

a. utilization

b. greater in manufacturing than in services

c. defined only for manufacturing firms

d. multifactor productivity

e. none of the above

Which of the following is not true when explaining why productivity tends to be lower in the

service sector than in the manufacturing sector?

a. Services are typically labor-intensive.

b. Services are often difficult to evaluate for quality.

c. Services are often an intellectual task performed by professionals.

d. Services are difficult to automate.

e. Service operations are typically capital intensive.

Three commonly used productivity variables are

a. quality, external elements, and precise units of measure

b. labor, capital, and management

c. technology, raw materials, and labor

d. education, diet, and social overhead

e. quality, efficiency, and low cost

Among the ethical and social challenges facing operations managers are

a. honoring financial commitments

b. maintaining a clean environment

c. developing low-cost products

d. providing an efficient workplace

e. all of the above

The World Trade Organization helps provide governments and industries around the world with protection from firms that engage in unethical conduct.

The relative importance of each of the ten operations decisions depends on the ratio of goods and

services in an organization.

Decisions that involve what is to be made and what is to be purchased fall under the heading of supply chain management.

The multidomestic OM strategy maximizes local responsiveness while achieving a significant cost

advantage.

Boeing's new 787 Dreamliner

a. is assembled in Washington, D.C.

b. uses engines from Japan

c. has its fuselage sections built in Australia

d. has increased efficiency from new engine technology

e. results from a partnership of about a dozen companies

Which of the following is an example of globalization of operations strategy?

a. Boeing's Dreamliner has engines with higher fuel/payload efficiency.

b. Ford's new auto models have dent-resistant panels.

c. A Chinese manufacturer, Haier, now operates plants in the United States.

d. Hard Rock Café provides an "experience differentiation" at its restaurants.

e. All of the above are examples.

Which of the following did the authors not suggest as a reason for globalizing operations?

a. reduce costs

b. improve the supply chain

c. stockholder approval ratings

d. attract new markets

e. All of the above were suggested.

With reference to cultural and ethical issues, the World Trade Organization has

a. succeeded in providing equal protection of intellectual property among nations

b. made progress in providing equal protection of intellectual property among nations

c. phased out all trade and tariff barriers between the United States and Mexico

d. eliminated slave labor and child labor

e. played little role in addressing cultural and ethical issues among nations

Which of the following statements about organizational missions is false?

a. They reflect a company's purpose.

b. They indicate what a company intends to contribute to society.

c. They are formulated after strategies are known.

d. They define a company's reason for existence.

e. They provide guidance for functional area missions.

The impact of strategies on the general direction and basic character of a company is

a. short range

b. medium range

c. long range

d. temporal

e. minimal

The fundamental purpose of an organization's mission statement is to

a. create a good human relations climate in the organization

b. define the organization's purpose in society

c. define the operational structure of the organization

d. generate good public relations for the organization

e. define the functional areas required by the organization

A firm can effectively use its operations function to yield competitive advantage via all of the

following except

a. customization of the product

b. setting equipment utilization goals below the industry average

c. speed of delivery

d. constant innovation of new products

e. maintain a variety of product options

Franz Colruyt has achieved low-cost leadership through

a. Spartan headquarters

b. absence of voice mail

c. low-cost facilities

d. no background music

e. all of the above

Franz Colruyt has achieved low-cost leadership through

a. effective use of voice mail

b. plastic, not paper, shopping bags

c. background music that subtly encourages shoppers to buy more

d. converting factories, garages, and theaters into retail outlets

e. use of the Euro, not the currency of each European country

Costs, quality, and human resource decisions interact strongly with the _______ decision.

a. layout design

b. process and capacity design

c. supply chain management

d. goods and service design

e. All of the above are correct.

Which of the following influences layout design?

a. inventory requirements

b. capacity needs

c. personnel levels

d. technology decisions

e. All of the above influence layout decisions.

Response-based competitive advantage can be

a. flexible response

b. reliable response

c. quick response

d. all of the above

e. none of the above

Which of the following is not an operations strategic decision?

a. maintenance

b. price

c. layout design

d. quality

e. inventory

Which of the following OM strategic decisions pertains to sensible location of processes and

materials in relation to each other?

a. layout design

b. goods and service design

c. supply chain management

d. inventory

e. scheduling

Which of the following statements concerning the operations management decision is relevant to

services?

a. There are many objective quality standards.

b. The customer is not involved in most of the process.

c. The work force's technical skills are very important.

d. Labor standards vary depending on customer requirements.

e. Ability to inventory may allow the leveling of the output rates.

The PIMS program has identified the

a. operations decisions all organizations must make

b. distinctive competencies any company needs

c. characteristics of firms with high "ROI"

d. corporate decisions any company needs to make

e. all of the above

Which of these is not one of the PIMS characteristics of high return on investment organizations?

a. high product quality

b. high capacity utilization

c. low investment intensity

d. low direct cost per unit

e. All of the above are PIMS characteristics.

Cost minimization is an appropriate strategy in which stage of the product life cycle?

a. introduction

b. growth

c. maturity

d. decline

e. retirement

Which of the following statements is most correct?

a. CSFs are often necessary, but not sufficient for competitive advantage.

b. CSFs are often sufficient, but not necessary for competitive advantage.

c. CSFs are neither necessary nor sufficient for competitive advantage.

d. CSFs are both necessary and sufficient for competitive advantage.

e. None of the above statements is correct.

Which of these organizations is likely to have the most complex inventory decisions?

a. a marketing research firm

b. a stock brokerage firm

c. a management consulting firm

d. a computer manufacturing company

e. a high school

Which of the international operations strategies involves high cost reductions and high local

responsiveness?

a. international strategy

b. global strategy

c. transnational strategy

d. multidomestic strategy

e. none of the above

Which of the international operations strategies involves low cost reductions and low local

responsiveness?

a. international strategy

b. global strategy

c. transnational strategy

d. multidomestic strategy

e. none of the above

Which of the international operations strategies uses import/export or licensing of existing

products?

a. international strategy

b. global strategy

c. transnational strategy

d. multidomestic strategy

e. none of the above

Which of the international operations strategies uses the existing domestic model globally?

a. international strategy

b. global strategy

c. transnational strategy

d. multidomestic strategy

e. none of the above

Caterpillar and Texas Instruments are two firms that have benefited from the use of

a. the multidomestic strategy option.

b. the multinational corporation strategy.

c. the transnational strategy option.

d. the maquiladora system in Europe.

e. the global strategy option.

Which of the following are examples of transnational firms?

a. Nestlé

b. Asea Brown Boveri

c. Reuters

d. Citicorp

e. All of the above are transnationals.

Work Breakdown Structure is a useful tool in project management because it addresses the timing of individual work elements.

The fundamental difference between PERT and CPM is that PERT uses the beta distribution for

crashing projects while CPM uses cost estimates.

. Slack is the amount of time an activity can be delayed without delaying the entire project.

Shortening the project's duration by deleting unnecessary activities is called "project crashing."

Which of the following statements regarding Bechtel is true?

a. Its competitive advantage is project management.

b. Bechtel was the construction contractor for the Hoover Dam.

c. While helping to rebuild Iraq, Bechtel’s crews had to travel under armed escort.

d. Bechtel's procurement program is global in nature.

e. All of the above are true.

Which of the following statements about Bechtel is true?

a. Even though Bechtel is over 100 years old, the Kuwaiti oil fields was its first "project."

b. Bechtel is the world's premier manager of massive construction and engineering projects.

c. Bechtel's competitive advantage is supply chain management.

d. While its projects are worldwide, its network of suppliers is largely in the U.S.

e. All of the above are true.

The phases of project management are

a. planning, scheduling, and controlling

b. planning, programming, and budgeting

c. planning, organizing, staffing, leading, and controlling

d. different for manufacturing projects than for service projects

e. GANTT, CPM, and PERT

Which of the following statements regarding project management is false?

a. Gantt charts give a timeline for each of a project's activities, but do not adequately show the

interrelationships of activities.

b. A project organization works best for a project that is temporary but critical to the organization.

c. Project organization works well when the work contains simple, independent tasks.

d. Gantt charts and PERT/CPM are never used together.

e. None of the above is true.

Which of the following statements regarding Gantt charts is true?

a. Gantt charts give a timeline and precedence relationships for each activity of a project.

b. Gantt charts use the four standard spines of Methods, Materials, Manpower, and Machinery.

c. Gantt charts are visual devices that show the duration of activities in a project.

d. Gantt charts are expensive.

e. All of the above are true.

Which of the following statements concerning CPM activities is false?

a. The early finish of an activity is the early start of that activity plus its duration.

b. The late finish is the earliest of the late start times of all successor activities.

c. The late start of an activity is its late finish less its duration.

d. The late finish of an activity is the earliest late start of all preceding activities.

e. The early start of an activity is the latest early finish of all preceding activities.

The _____ distribution is used by PERT analysis to calculate expected activity times and variances.

a. Normal

b. Beta

c. Alpha

d. Gaussian

e. Binomial

The Beta distribution is used in project management to

a. calculate slack on activities not on the critical path

b. calculate the probability that a project will be completed within its budget

c. calculate pessimistic and optimistic activity times

d. determine which activity should be crashed

e. none of the above

Which of the following statements regarding PERT analysis is true?

a. Each activity has two estimates of its duration.

b. Project variance is the sum of all activity variances.

c. Project standard deviation is the sum of all critical activity standard deviations.

d. Only critical activities contribute to the project variance. e. None of the above is true

A project being analyzed by PERT has 60 activities, 13 of which are on the critical path. If the

estimated time along the critical path is 214 days with a project variance of 100, the probability that

the project will take 224 days or more to complete is

a. near zero

b. 0.0126

c. 0.1587

d. 0.8413

e. 2.14

A local project being analyzed by PERT has 42 activities, 13 of which are on the critical path. If

the estimated time along the critical path is 105 days with a project variance of 25, the probability

that the project will be completed in 95 days or less is

a. -0.4

b. 0.0228

c. 0.3444

d. 0.9772

e. 4.2

A PERT project has 45 activities, 19 of which are on the critical path. The estimated time for the

critical path is 120 days. The sum of all activity variances is 64, while the sum of variances along

the critical path is 36. The probability that the project can be completed between days 108 and 120

is

a. -2.00

b. 0.0227

c. 0.1058

d. 0.4773

e. 0.9773

One advantage of exponential smoothing is the limited amount of record keeping involved.

Mean Squared Error and Coefficient of Correlation are two measures of the overall error of a

forecasting model.

If a quarterly seasonal index has been calculated at 1.55 for the October-December quarter, then

raw data for that quarter must be multiplied by 1.55 so that the quarter can be fairly compared to other quarters.

Focus forecasting tries a variety of computer models and selects the best one for a particular

application.

What two numbers are contained in the daily report to the CEO of Walt Disney Parks & Resorts

regarding the six Orlando parks?

a. yesterday’s forecasted attendance and yesterday’s actual attendance

b. yesterday’s actual attendance and today’s forecasted attendance

c. yesterday’s forecasted attendance and today’s forecasted attendance

d. yesterday’s actual attendance and last year’s actual attendance

e. yesterday’s forecasted attendance and the year-to-date average daily forecast error

Using an exponential smoothing model with smoothing constant α = .20, how much weight would

be assigned to the 2nd most recent period?

a. .16

b. .20

c. .04

d. .09

e. .10

Forecasts

a. become more accurate with longer time horizons

b. are rarely perfect

c. are more accurate for individual items than for groups of items

d. all of the above

e. none of the above

. One use of short-range forecasts is to determine

a. production planning

b. inventory budgets

c. research and development plans

d. facility location

e. job assignments

The forecasting model that pools the opinions of a group of experts or managers is known as the

a. sales force composition model

b. multiple regression

c. jury of executive opinion model

d. consumer market survey model

e. management coefficients model

Which of the following techniques uses variables such as price and promotional expenditures,

which are related to product demand, to predict demand?

a. associative models

b. exponential smoothing

c. weighted moving average

d. simple moving average

e. time series

Gradual, long-term movement in time series data is called

a. seasonal variation

b. cycles

c. trends

d. exponential variation

e. random variation

John’s House of Pancakes uses a weighted moving average method to forecast pancake sales. It

assigns a weight of 5 to the previous month’s demand, 3 to demand two months ago, and 1 to

demand three months ago. If sales amounted to 1000 pancakes in May, 2200 pancakes in June, and

3000 pancakes in July, what should be the forecast for August?

a. 2400

b. 2511

c. 2067

d. 3767

e. 1622

Which of the following statements comparing the weighted moving average technique and

exponential smoothing is true?

a. Exponential smoothing is more easily used in combination with the Delphi method.

b. More emphasis can be placed on recent values using the weighted moving average.

c. Exponential smoothing is considerably more difficult to implement on a computer.

d. Exponential smoothing typically requires less record keeping of past data.

e. Exponential smoothing allows one to develop forecasts for multiple periods, whereas weighted

moving averages does not.

Which is not a characteristic of exponential smoothing?

a. smoothes random variations in the data

b. easily altered weighting scheme

c. weights each historical value equally

d. has minimal data storage requirements

e. none of the above; they are all characteristics of exponential smoothing

Which of the following is true regarding the two smoothing constants of the Forecast Including

Trend (FIT) model?

a. One constant is positive, while the other is negative.

b. They are called MAD and RSFE.

c. Alpha is always smaller than beta.

d. One constant smoothes the regression intercept, whereas the other smoothes the regression

slope.

e. Their values are determined independently.

A seasonal index for a monthly series is about to be calculated on the basis of three years'

accumulation of data. The three previous July values were 110, 150, and 130. The average over all

months is 190. The approximate seasonal index for July is

a. 0.487

b. 0.684

c. 1.462

d. 2.053

e. cannot be calculated with the information given

The degree or strength of a linear relationship is shown by the

a. alpha

b. mean

c. mean absolute deviation

d. correlation coefficient

e. RSFE

Taco Bell's unique employee scheduling practices are partly the result of using

a. point-of-sale computers to track food sales in 15 minute intervals

b. focus forecasting

c. a six-week moving average forecasting technique

d. multiple regression

e. a and c are both correct

The goal of the product decision is to develop and implement a product strategy that meets the

needs of the marketplace with a competitive advantage.

In the maturity stage of the product life cycle, operations managers will be concerned with keeping

sufficient capacity available for the product.

The enhancement of existing products is an external product development strategy.

An assembly chart shows an exploded view of the product, usually via a three-dimensional or

isometric drawing.

The expected value of each course of action in a decision tree is determined by starting at the

beginning of the tree (the left-hand side) and working toward the end of the tree (the right).

The three major subdivisions of the product decision are

a. selection, definition, and design

b. goods, services, and hybrids

c. strategy, tactics, and operations

d. cost, differentiation, and speed of response e. legislative, judicial, and executive

Which of the following would likely cause a change in market opportunities based upon levels of

income and wealth?

a. economic change

b. sociological and demographic change

c. technological change

d. political change

e. legal change

When should product strategy focus on forecasting capacity requirements?

a. at the introduction stage of the product life cycle

b. at the growth stage of the product life cycle

c. at the maturity stage of the product life cycle

d. at the decline stage of the product life cycle

e. none of the above

The analysis tool that helps determine what products to develop, and by what strategy, by listing

products in descending order of their individual dollar contribution to the firm is

a. decision tree analysis

b. Pareto analysis

c. breakeven analysis

d. product-by-value analysis

e. product life cycle analysis

. In which stage of the product life cycle should product strategy focus on improved cost control?

a. introduction

b. growth

c. maturity

d. decline

e. none of the above

Reducing the complexity of a product and improving a product's maintainability for use are

activities of

a. Product Lifecycle Management (PLM)

b. product-by-value-analysis

c. manufacturability and value engineering

d. organizing for product development

e. design for destruction (DFD)

Quality function deployment (QFD)

a. determines what will satisfy the customer

b. translates customer desires into the target design

c. is used early in the design process

d. is used to determine where to deploy quality efforts

e. all of the above

An operations manager's most ethical activity is

a. to enhance productivity while delivering desired goods and services

b. to use less energy

c. to use more recycled ingredients

d. to use less harmful ingredients

e. to follow appropriate OSHA and EPA regulations

Value analysis takes place

a. when the product is selected and designed

b. during the initial stages of production when something needs to be done to assure product

success

c. when the product is first conceived

d. during the production process when it is clear the new product is a success

e. when the product cost is very low

Which of the following is an example of an external product development strategy?

a. new internally developed products

b. enhancements to existing products

c. alliances

d. migrations of existing products

e. All of the above are examples of internal product development strategy.

An engineering drawing shows the

a. dimensions, tolerances, materials, and finishes of a component

b. dimensions, tolerances, cost, and sales or use volume of a component

c. materials, finishes, machining operations, and dimensions of a component

d. cost, materials, tolerances, and lead-time for a component

e. cost, dimensions, and machining operations for a component

Which of the following does not result from the effective use of group technology?

a. reduced tooling setup time

b. simplified training

c. reduced raw materials and purchases

d. simplified production planning and control

e. improved layout, routing, and machine loading

Which of the following shows in schematic form how a product is assembled?

a. an engineering drawing

b. an assembly routing

c. an assembly chart

d. a route sheet

e. a process sheet

A route sheet provides a(n)

a. exploded view of the product

b. instruction to make a given quantity of a particular item

c. schematic showing how the product is assembled

d. sequence of operations necessary to produce the component

e. set of detailed instructions about how to perform a task

An assembly drawing

a. shows, in schematic form, how the product is assembled

b. shows an exploded view of the product

c. lists the operations, including assembly and inspection, necessary to produce the component

with the material specified in the bill of material

d. provides detailed instructions on how to perform a given task

e. describes the dimensions and finish of each component

Which of the following documents lists the operations (including assembly and inspection)

necessary to produce the component with the material specified in the bill of material?

a. an engineering drawing

b. an assembly drawing

c. a route sheet

d. an assembly chart

e. an operations chart

Modern ATM machines are an automated example of a service design that

a. reduces customer interaction

b. modularizes the service

c. delays service customization

d. has no moment of truth

e. has insufficient quality function deployment

Payoffs, alternatives, and expected monetary values are terms associated with

a. virtual reality

b. Product Lifecycle Management

c. Quality Function Deployment

d. decision trees

e. make-or-buy analysis