SCM 303 EXAM 2 STUDY GUIDE 2026
Quality - Answers - A term used by customers to describe their general satisfaction
with a service or product
Defect - Answers - Any instance when a process fails to satisfy its customer
Prevention Costs - Answers - Costs associated with preventing defects before they
happen
Appraisal Costs - Answers - Costs incurred when the firm assesses the performance
level of its processes
External Failure Costs - Answers - Costs that arise when a defect is discovered after
the customer receives the service or product
Internal Failure Costs - Answers - Costs resulting from defects that are discovered
during the production of a service or product
Top Quality Management - Answers - Customer Satisfaction, employee involvement,
and continuous improvement
Customer Satisfaction - Answers - Conformance to specifications, fitness for use,
support, psychological impressions, and value
Employee Involvement - Answers - Cultural change, and teams
Continuous Improvement - Answers - Kaizen, problem solving tools, Plan-Do-Act cycle
Six Sigma Target: Spread out - Answers - Too much variability and ok process
Six Sigma Target: Close together on the sides - Answers - Process off target and
variability ok
Process performance and quality video - Answers - Starwood hotels
Acceptance Sampling - Answers - The application of statistical techniques to
determine if a quantity of material from a supplier should be accepted or rejected based
on the inspection or test of one or more samples.
Acceptable Quality Level - Answers - Quality level desired by consumer
, Statistical Process Control (SPC) - Answers - The application of statistical techniques
to determine whether a process is delivering what the customer wants.
Variation of Outputs - Answers - No two services or products are exactly alike because
the processes used to produce them contain many sources of variation, even if the
processes are working as intended.
Performance Measurements (Variable and Attribute) - Answers - Variable: Service or
product characteristics that can be measured
Attribute: Service or product characteristics that can be quickly counted for acceptable
performance
Complete Inspection - Answers - Inspect each service or product at each stage of the
process for quality
Categories of variation - Answers - Common cause - The purely random, unidentifiable
sources of variation that are unavoidable with the current process
Assignable cause - Any variation-causing factors that can be identified and eliminated
Type I error - Answers - An error that occurs when the employee concludes that the
process is out of control based on a sample result that falls outside the control limits,
when it fact it was due to pure randomness
Type II error - Answers - An error that occurs when the employee concludes that the
process is in control and only randomness is present, when actually the process is out
of statistical control
Variable control charts - Answers - R-chart and x-chart
Attribute control charts - Answers - P-chart and C- chart
The culture of quality video - Answers - Arnold Palmer hospital
Process Capability - Answers - The ability of the process to meet the design
specifications for a service or product
Process capability nominal value - Answers - Target for design specifications
Process capability tolerance - Answers - An allowance above or below the nominal
value
Process capability index (Cpk) - Answers - An index that measures the potential for a
process to generate defective outputs relative to either upper or lower specifications
Quality - Answers - A term used by customers to describe their general satisfaction
with a service or product
Defect - Answers - Any instance when a process fails to satisfy its customer
Prevention Costs - Answers - Costs associated with preventing defects before they
happen
Appraisal Costs - Answers - Costs incurred when the firm assesses the performance
level of its processes
External Failure Costs - Answers - Costs that arise when a defect is discovered after
the customer receives the service or product
Internal Failure Costs - Answers - Costs resulting from defects that are discovered
during the production of a service or product
Top Quality Management - Answers - Customer Satisfaction, employee involvement,
and continuous improvement
Customer Satisfaction - Answers - Conformance to specifications, fitness for use,
support, psychological impressions, and value
Employee Involvement - Answers - Cultural change, and teams
Continuous Improvement - Answers - Kaizen, problem solving tools, Plan-Do-Act cycle
Six Sigma Target: Spread out - Answers - Too much variability and ok process
Six Sigma Target: Close together on the sides - Answers - Process off target and
variability ok
Process performance and quality video - Answers - Starwood hotels
Acceptance Sampling - Answers - The application of statistical techniques to
determine if a quantity of material from a supplier should be accepted or rejected based
on the inspection or test of one or more samples.
Acceptable Quality Level - Answers - Quality level desired by consumer
, Statistical Process Control (SPC) - Answers - The application of statistical techniques
to determine whether a process is delivering what the customer wants.
Variation of Outputs - Answers - No two services or products are exactly alike because
the processes used to produce them contain many sources of variation, even if the
processes are working as intended.
Performance Measurements (Variable and Attribute) - Answers - Variable: Service or
product characteristics that can be measured
Attribute: Service or product characteristics that can be quickly counted for acceptable
performance
Complete Inspection - Answers - Inspect each service or product at each stage of the
process for quality
Categories of variation - Answers - Common cause - The purely random, unidentifiable
sources of variation that are unavoidable with the current process
Assignable cause - Any variation-causing factors that can be identified and eliminated
Type I error - Answers - An error that occurs when the employee concludes that the
process is out of control based on a sample result that falls outside the control limits,
when it fact it was due to pure randomness
Type II error - Answers - An error that occurs when the employee concludes that the
process is in control and only randomness is present, when actually the process is out
of statistical control
Variable control charts - Answers - R-chart and x-chart
Attribute control charts - Answers - P-chart and C- chart
The culture of quality video - Answers - Arnold Palmer hospital
Process Capability - Answers - The ability of the process to meet the design
specifications for a service or product
Process capability nominal value - Answers - Target for design specifications
Process capability tolerance - Answers - An allowance above or below the nominal
value
Process capability index (Cpk) - Answers - An index that measures the potential for a
process to generate defective outputs relative to either upper or lower specifications
