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Exam (elaborations)

Chapter 7 Operations Management and Quality

1 Copyright © 2017 Pearson Education, Inc. Business Essentials, 11e (Ebert/Griffin) Chapter 7 Operations Management and Quality 1) When a company produces products when consumers want them, it creates which type of utility? A) Ownership B) Time C) Form D) Place E) Value AACSB: Application of knowledge Objective: 7.1: Explain the meaning of operations and discuss the growth in the services and goods sectors of the U.S. economy. 2) Which term refers to all the activities involved in making products—goods and services—for customers? A) Operations B) Processes C) Planning D) Scheduling E) Performance AACSB: Application of knowledge Objective: 7.1: Explain the meaning of operations and discuss the growth in the services and goods sectors of the U.S. economy. 3) In a business, whose job is it to draw up plans to transform resources into products and bring together basic resources, such as knowledge, physical materials, equipment, and labor? A) CEO B) Operations manager C) Quality manager D) Floor foreman E) Supply manager AACSB: Application of knowledge Objective: 7.1: Explain the meaning of operations and discuss the growth in the services and goods sectors of the U.S. economy. 2 Copyright © 2017 Pearson Education, Inc. 4) Which term describes services that cannot be produced ahead of time? A) Transformed B) Low-contact C) Unstorable D) Intangible E) Consistent AACSB: Application of knowledge Objective: 7.1: Explain the meaning of operations and discuss the growth in the services and goods sectors of the U.S. economy. 5) Which of the following is critical to the success or failure of service operations? A) Provider-customer contact B) Internet exposure C) Supply chain D) Tangible services products E) Supplier-manufacture contact AACSB: Application of knowledge Objective: 7.1: Explain the meaning of operations and discuss the growth in the services and goods sectors of the U.S. economy. 6) In a low-contact system, the customer must be a part of the system to receive the service. AACSB: Application of knowledge Objective: 7.1: Explain the meaning of operations and discuss the growth in the services and goods sectors of the U.S. economy. 7) By turning raw materials into finished goods, production creates form utility. AACSB: Application of knowledge Objective: 7.1: Explain the meaning of operations and discuss the growth in the services and goods sectors of the U.S. economy. 3 Copyright © 2017 Pearson Education, Inc. 8) Services are more tangible, more customized, and more storable than most products. AACSB: Application of knowledge Objective: 7.1: Explain the meaning of operations and discuss the growth in the services and goods sectors of the U.S. economy. 9) Differentiate between high- and low-contact processes. Give an example of each. Objective: 7.1: Explain the meaning of operations and discuss the growth in the services and goods sectors of the U.S. economy. 10) Explain what is meant by the term utility. What type of utility is created when a pharmacy changes its evening schedule to remain open for an extra hour in response to customer needs? AACSB: Analytical thinking Objective: 7.1: Explain the meaning of operations and discuss the growth in the services and goods sectors of the U.S. economy. 11) Explain time, place, and form utility. AACSB: Application of knowledge Objective: 7.1: Explain the meaning of operations and discuss the growth in the services and goods sectors of the U.S. economy. 4 Copyright © 2017 Pearson Education, Inc. 12) Which type of utility is created when a company makes products available where consumers want them? A) Time B) Place C) Possession D) Form E) Operations AACSB: Application of knowledge Objective: 7.2: Identify the three kinds of utility created by operations and the characteristics that distinguish service operations from goods production. 13) Which of the following refers to a set of methods and technologies used to produce a good or service? A) Quality ownership B) Production C) Utility D) Value added analysis E) Operations process AACSB: Application of knowledge Objective: 7.2: Identify the three kinds of utility created by operations and the characteristics that distinguish service operations from goods production. 14) In which of the following is the customer part of the system during service delivery? A) A high-contact system B) A low-contact system C) A customer system D) A quality system E) A utility system AACSB: Application of knowledge Objective: 7.2: Identify the three kinds of utility created by operations and the characteristics that distinguish service operations from goods production. 5 Copyright © 2017 Pearson Education, Inc. 15) When a company makes products available conveniently for consumers, based on where they are, which type of utility is created? A) Time B) Form C) Place D) Possession E) Leisure Difficulty: Moderate AACSB: Application of knowledge Objective: 7.2: Identify the three kinds of utility created by operations and the characteristics that distinguish service operations from goods production. 16) Which of the following is the ability of a product to satisfy a human want or need? A) Utility B) Relative advantage C) Content D) Satisfaction E) Quality ownership AACSB: Application of knowledge Objective: 7.2: Identify the three kinds of utility created by operations and the characteristics that distinguish service operations from goods production. 17) In which type of system must the customer be actively involved in order to receive the good or service? A) Make-to-stock B) High-contact C) Intangible D) Low contact E) Operations process Difficulty: Moderate AACSB: Application of knowledge Objective: 7.2: Identify the three kinds of utility created by operations and the characteristics that distinguish service operations from goods production. 6 Copyright © 2017 Pearson Education, Inc. 18) What goods-producing operations method is designed around specific customer specifications? A) High-contact systems B) Make-to-order C) Layout planning D) Low-contact systems E) Make-to-stock AACSB: Analytical thinking Objective: 7.2: Identify the three kinds of utility created by operations and the characteristics that distinguish service operations from goods production. 19) When a firm produces goods for mass consumption, what type of goods production method is generally used? A) High-contact systems B) Make-to-order C) Layout planning D) Low-contact systems E) Make-to-stock AACSB: Analytical thinking Objective: 7.2: Identify the three kinds of utility created by operations and the characteristics that distinguish service operations from goods production. 20) Firms that make only tangible products are engaged in goods production. AACSB: Application of knowledge Objective: 7.2: Identify the three kinds of utility created by operations and the characteristics that distinguish service operations from goods production. 7 Copyright © 2017 Pearson Education, Inc. 21) Differentiate between goods production and service operations. AACSB: Analytical thinking Objective: 7.2: Identify the three kinds of utility created by operations and the characteristics that distinguish service operations from goods production. 22) Describe the difference between the make-to-order and make-to-stock production processes. Difficulty: Moderate AACSB: Application of knowledge Objective: 7.2: Identify the three kinds of utility created by operations and the characteristics that distinguish service operations from goods production. 23) What term describes a special ability that production does especially well to outperform the competition? A) Supply chain management B) Total quality management C) Process engineering D) Operations capability E) Value-added analysis Difficulty: Easy AACSB: Application of knowledge Objective: 7.3: Explain how companies with different business strategies are best served by having different operations capabilities. 8 Copyright © 2017 Pearson Education, Inc. 24) What type of service is being given when a product performs reliably, has an appealing fit and consistently meets or exceeds customer expectations? A) Quality B) Low cost C) Flexibility D) Dependability E) Exclusivity AACSB: Application of knowledge Objective: 7.3: Explain how companies with different business strategies are best served by having different operations capabilities. 25) What type of strategy to attract customers should a firm that promotes quick and on time delivery utilize? A) Quality B) Low cost C) Flexibility D) Dependability E) Accessibility AACSB: Analytical thinking Objective: 7.3: Explain how companies with different business strategies are best served by having different operations capabilities. 26) Which of the following helps to determine operations capabilities? A) Flexibility of activity B) High-context system C) Business strategy D) Extent of customer contact E) Production capability Difficulty: Moderate AACSB: Application of knowledge Objective: 7.3: Explain how companies with different business strategies are best served by having different operations capabilities. 9 Copyright © 2017 Pearson Education, Inc. 27) Which type of strategy emphasizes low overhead and inventory, and a limited assortment of products to attract customers? A) Flexibility B) Quality C) Low-cost D) Dependability E) Consistency Difficulty: Moderate AACSB: Application of knowledge Objective: 7.3: Explain how companies with different business strategies are best served by having different operations capabilities. 28) A company should select the same kind of production used by most of its competitors. Difficulty: Moderate AACSB: Application of knowledge Objective: 7.3: Explain how companies with different business strategies are best served by having different operations capabilities. 29) Operations capability is a special ability that production does especially well to outperform the competition.. Difficulty: Easy AACSB: Application of knowledge Objective: 7.3: Explain how companies with different business strategies are best served by having different operations capabilities. 30) What is an operations capability? Difficulty: Moderate AACSB: Application of knowledge Objective: 7.3: Explain how companies with different business strategies are best served by having different operations capabilities. 10 Copyright © 2017 Pearson Education, Inc. 31) Why does each company's operations capability match up with its business strategy? AACSB: Analytical thinking Objective: 7.3: Explain how companies with different business strategies are best served by having different operations capabilities. 32) Examining step-by-step procedures to reduce inefficiency most centrally involves which approach? A) Operations scheduling B) Performance analysis C) Value-added analysis D) Methods improvement E) Quality ownership AACSB: Analytical thinking Objective: 7.4: Identify the major factors that are considered in operations planning. 33) Machine, woodworking, and dry cleaning shops typically use which type of layout? A) Product B) Custom-products C) Same-steps D) Hybrid E) Make-to-stock Difficulty: Moderate AACSB: Analytical thinking Objective: 7.4: Identify the major factors that are considered in operations planning. 11 Copyright © 2017 Pearson Education, Inc. 34) Which type of layout is designed to move resources through a smooth, fixed sequence of steps? A) Same-steps B) Location C) Custom-products D) Quality E) Make-to-order Difficulty: Moderate AACSB: Analytical thinking Objective: 7.4: Identify the major factors that are considered in operations planning. 35) Which of the following is an advantage of using a product layout plan? A) They do not require specialized equipment. B) They can be easily rearranged for new applications. C) They can only be used for custom products. D) They are inflexible in nature. E) Unskilled labor can be utilized. AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 36) Which term is defined as the combination of "characteristics of a product or service that bear on its ability to satisfy stated or implied needs"? A) Quality B) Production C) Quantity D) Clarification E) Capacity AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 12 Copyright © 2017 Pearson Education, Inc. 37) Performance refers to which of the following? A) The principle that quality belongs to each person who creates it while performing a job B) The consistency of product quality from unit to unit C) How well the product does what it is supposed to do D) The process by which a company analyzes a competitor's products to identify desirable improvement E) Providing value by making products available when customers want them AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 38) Consistency refers to which of the following? A) The principle that quality belongs to each person who creates it while performing a job B) The sameness of product quality from unit to unit C) The sum of all activities involved in getting high-quality products into the marketplace D) The process by which a company analyzes a competitor's products to identify desirable improvements E) Providing value by making products available where customers want them AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 39) Managers can work to reduce waste, inefficiency, and poor performance by examining procedures on a step-by-step basis. Which term describes this process? A) Advance planning B) Materials management C) Methods improvement D) Quality planning E) Quality ownership AACSB: Analytical thinking Objective: 7.4: Identify the major factors that are considered in operations planning. 13 Copyright © 2017 Pearson Education, Inc. 40) Which of the following is the amount of a product that a company can produce under normal working conditions? A) Capacity B) Output C) Efficiency D) Burden E) Performance AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 41) Equipment and people are grouped according to function in which type of production layout? A) Fixed position B) Same-steps C) Custom-products D) Supply-chain E) Service AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 42) Which term refers to how well a product does what it is supposed to do? A) Capacity B) Consistency C) Reliability D) Performance E) Quality control AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 14 Copyright © 2017 Pearson Education, Inc. 43) The sameness of product quality from unit to unit is referred to by which term? A) Utility B) Reliability C) Performance D) Consistency E) Quality control Difficulty: Easy AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 44) What type of planning has the greatest effect on production costs and flexibility? A) Capacity B) Layout C) Quality D) Location E) Process Difficulty: Moderate AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 45) Which of the following affects how efficiently a company can respond to demand for more or different products and their ability to match competitors speed and convenience? A) Location planning B) Quality planning C) Technology planning D) Long-range capacity planning E) Layout planning AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 15 Copyright © 2017 Pearson Education, Inc. 46) What is the main advantage of effective process layouts? A) Flexibility B) Cost C) Speed D) Quality E) Performance AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 47) When planning for quality, two key elements are A) speed and dependability. B) consistency and accuracy. C) flexibility and accuracy. D) dependability and flexibility. E) performance and consistency. Difficulty: Moderate AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 48) What can be used to identify the sequence of activities, movements of materials and work performed? A) Operations schedules B) Process flowcharts C) Gantt charts D) PERT charts E) Project schedules AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 16 Copyright © 2017 Pearson Education, Inc. 49) Which of the following would be best used when producing make-to-stock operations or mass production of a product? A) Fixed position layout B) Process layout C) Customer-product layout D) Operations scheduling layout E) Assembly line layout AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 50) Why do organizations use fixed-position layouts for some goods or services? A) When the customer requests it B) When it is more cost effective C) When it increases the quality level D) When it is difficult to move the good or service E) When consistency in production is needed Difficulty: Moderate AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 51) A firm's capacity depends on both how many people it employs and the number and size of its facilities. Difficulty: Easy AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 52) In a same-steps layout, equipment and people are set up to produce one type of good in a fixed sequence of steps and are arranged according to its production requirements. AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 17 Copyright © 2017 Pearson Education, Inc. 53) A process flowchart identifies the sequence of production activities, movements of materials, and work performed at each stage of the process. AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 54) A fixed-position layout is most effective when there is a large-volume make-to-stock operation in place. Difficulty: Moderate AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 55) Describe two alternatives for production facility layouts. Difficulty: Difficult AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 56) Describe the purpose of an assembly line layout and when a firm would choose to use this format. AACSB: Application of knowledge Objective: 7.4: Identify the major factors that are considered in operations planning. 18 Copyright © 2017 Pearson Education, Inc. 57) Which of the following is a scheduling tool that breaks down large projects into steps to be performed and specifies the time required to perform each one? A) Myers graphic B) Critical path chart C) Gantt chart D) Process analysis graph E) Master schedule AACSB: Application of knowledge Objective: 7.5: Discuss the information contained in four kinds of operations schedules—the master operations schedule, detailed schedule, staff schedule, and project schedule. 58) Which of the following tracks which service or products will be produced and when? A) Master operations schedule B) Detailed schedule C) Gantt chart D) Staff schedule E) PERT chart Difficulty: Moderate AACSB: Application of knowledge Objective: 7.5: Discuss the information contained in four kinds of operations schedules—the master operations schedule, detailed schedule, staff schedule, and project schedule. 59) Which scheduling tool shows the necessary sequence of activities in a project and identifies the critical path? A) Gantt chart B) Process flowchart C) Detailed schedule D) Master production schedule E) PERT chart Difficulty: Moderate AACSB: Application of knowledge Objective: 7.5: Discuss the information contained in four kinds of operations schedules—the master operations schedule, detailed schedule, staff schedule, and project schedule. 19 Copyright © 2017 Pearson Education, Inc. 60) Which of the following would be used to provide coordination for completing large-scale projects? A) Master schedule B) Detailed schedules C) Staff schedules D) Project schedules E) Coordination schedules Difficulty: Moderate AACSB: Application of knowledge Objective: 7.5: Discuss the information contained in four kinds of operations schedules—the master operations schedule, detailed schedule, staff schedule, and project schedule. 61) Which of the following breaks large tasks down to a series of smaller steps and includes all activities to successfully perform the task? A) Master schedule B) Coordination schedule C) Gantt chart D) Detailed schedule E) PERT chart Difficulty: Moderate AACSB: Application of knowledge Objective: 7.5: Discuss the information contained in four kinds of operations schedules—the master operations schedule, detailed schedule, staff schedule, and project schedule. 62) Which of the following indicates the critical path needed for the completion of large projects? A) Master schedule B) Coordination schedule C) Gantt chart D) Detailed schedule E) PERT chart AACSB: Application of knowledge Objective: 7.5: Discuss the information contained in four kinds of operations schedules—the master operations schedule, detailed schedule, staff schedule, and project schedule. 20 Copyright © 2017 Pearson Education, Inc. 63) What is the main advantage of using a PERT chart on a large scale project? A) It aids in the ordering of supplies and materials. B) It shows the most time-consuming path for project completion. C) It allows managers to plan for delays. D) It allows managers to monitor performance by comparing results with detailed schedules. E) It identifies which tasks can be performed at the same time as others. AACSB: Analytical thinking Objective: 7.5: Discuss the information contained in four kinds of operations schedules—the master operations schedule, detailed schedule, staff schedule, and project schedule. 64) Staff schedules identify which products will be produced and when. AACSB: Application of knowledge Objective: 7.5: Discuss the information contained in four kinds of operations schedules—the master operations schedule, detailed schedule, staff schedule, and project schedule. 65) A detailed schedule will consider employees' needs and the company's efficiency and cost, including demand for production. AACSB: Application of knowledge Objective: 7.5: Discuss the information contained in four kinds of operations schedules—the master operations schedule, detailed schedule, staff schedule, and project schedule. 66) If parts A, B, and C must be produced this week, a detailed schedule will indicate the sequence of work. AACSB: Application of knowledge Objective: 7.5: Discuss the information contained in four kinds of operations schedules—the master operations schedule, detailed schedule, staff schedule, and project schedule. 21 Copyright © 2017 Pearson Education, Inc. 67) Describe how a Gantt chart and a PERT chart are similar, and how they are different. Difficulty: Difficult AACSB: Analytical thinking Objective: 7.5: Discuss the information contained in four kinds of operations schedules—the master operations schedule, detailed schedule, staff schedule, and project schedule. 68) In operations control, production managers monitor production performance by which method? A) Comparing results with detailed plans and schedules B) Checking on each worker on the production floor C) Observing activities from a platform above the workers D) Constantly talking with employees involved E) Performing spot checks of worker performance Difficulty: Moderate AACSB: Application of knowledge Objective: 7.6: Discuss the two key activities required for operations control. 69) What is the name for a production system in which all the needed materials and parts arrive at the precise moment they are required for each production stage? A) Quality control system B) Process control system C) Just-in-time production D) Standardized production E) Custom-products production AACSB: Application of knowledge Objective: 7.6: Discuss the two key activities required for operations control. 22 Copyright © 2017 Pearson Education, Inc. 70) Which type of system is designed for smooth production flow to avoid inefficiencies, eliminate unnecessary inventories, and continuously improve production processes? A) Quality system B) Lean system C) Managed system D) Production system E) Flexible system AACSB: Application of knowledge Objective: 7.6: Discuss the two key activities required for operations control. 71) Which term refers to the acquisition of the raw materials a company needs to produce its products? A) Development B) Purchasing C) Goods control D) Quality control E) Wholesaling Difficulty: Easy AACSB: Application of knowledge Objective: 7.6: Discuss the two key activities required for operations control. 72) Which of the following refers to the receiving, storing, handling, and counting of all raw materials, partly finished goods, and finished goods? A) Materials handling B) Inventory control C) Quality control D) Wholesaling E) Distribution control AACSB: Application of knowledge Objective: 7.6: Discuss the two key activities required for operations control. 23 Copyright © 2017 Pearson Education, Inc. 73) Which department is responsible for ensuring that operations departments produce products that meet specific, predetermined standards? A) Purchasing B) Production systems C) Quality control D) Productivity E) Marketing Difficulty: Moderate AACSB: Analytical thinking Objective: 7.6: Discuss the two key activities required for operations control. 74) How can managers and employees support quality control efforts within the organization? A) Identify and correct mistakes and failures B) Pursue cost savings measures C) Develop project schedules such as Gantt or PERT charts D) Identify the critical path for activities of the project E) Outline the proper sequence of events before the process begins Difficulty: Moderate AACSB: Analytical thinking Objective: 7.6: Discuss the two key activities required for operations control. 75) Which of the following identifies the process of determining which outside firm will provide service and materials for the production process? A) Materials management B) Purchasing C) Inventory control D) Inventories of information E) Supplier selection AACSB: Analytical thinking Objective: 7.6: Discuss the two key activities required for operations control. 24 Copyright © 2017 Pearson Education, Inc. 76) Material management requires the negation of terms of service and maintaining the relationship between the buyer and those who sell the firm goods. Which process supports this activity? A) Supplier selection B) Purchasing C) Inventory control D) Production E) Materials management AACSB: Analytical thinking Objective: 7.6: Discuss the two key activities required for operations control. 77) Which material management process describes the movement of finished goods from a business to the customer? A) Procurement B) Purchasing C) Inventory control D) Transportation E) Warehousing AACSB: Analytical thinking Objective: 7.6: Discuss the two key activities required for operations control. 78) Which material management process stores incoming materials for production and finished goods for distribution? A) Warehousing B) Lean production C) Transportation D) Purchasing E) Supply chain AACSB: Analytical thinking Objective: 7.6: Discuss the two key activities required for operations control. 25 Copyright © 2017 Pearson Education, Inc. 79) Just-in-time (JIT) production systems normally require large amounts of safety stock to be maintained in a firm's warehouse. AACSB: Application of knowledge Objective: 7.6: Discuss the two key activities required for operations control. 80) Operations control includes materials management and quality control. AACSB: Application of knowledge Objective: 7.6: Discuss the two key activities required for operations control. 81) Materials management involves the flow of materials inside of the production facility, while distribution management involves the flow of finished goods. AACSB: Application of knowledge Objective: 7.6: Discuss the two key activities required for operations control. 82) Inventory control is the means of moving resources to the producer and finished goods to the customer. Difficulty: Moderate AACSB: Analytical thinking Objective: 7.6: Discuss the two key activities required for operations control. 83) Explain how JIT production and lean manufacturing are related. AACSB: Analytical thinking Objective: 7.6: Discuss the two key activities required for operations control. 26 Copyright © 2017 Pearson Education, Inc. 84) Describe the differences among transportation, warehousing, and inventory control in the materials management process. AACSB: Application of knowledge Objective: 7.6: Discuss the two key activities required for operations control. 85) Which of the following terms includes all activities involved in getting quality products into the marketplace? A) Quality control B) Quality reliability C) Total quality management D) Performance quality E) Quality overview AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 86) What should a firm use to evaluate the work activities, materials flow and paperwork in an effort to determine how those activities provide benefit for the customers? A) Value-added analysis B) Benchmarking C) Getting closer to the customer D) Supply chain management E) Follow-up AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 27 Copyright © 2017 Pearson Education, Inc. 87) Which term describes the idea that quality belongs to each person who creates it while performing a job? A) Quality control B) Quality ownership C) Quality circles D) Total quality management E) Quality improvement teams AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 88) What name is given to the process by which a company analyzes another company's product to identify desirable improvements in its own product? A) Quality reliability analysis B) Benchmarking C) Performance quality analysis D) Competitive product analysis E) Quality outsourcing AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 89) Which of the following is patterned after the successful Japanese concept of quality circles? A) Supply chain management B) Quality improvement team C) Total quality management D) Quality ownership E) Value-added analysis AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 28 Copyright © 2017 Pearson Education, Inc. 90) Which of the following BEST describes total quality management? A) The principle that quality belongs to each person who creates it while performing a job B) The consistency of a product's quality from unit to unit C) The sum of all activities involved in getting high-quality products into the marketplace D) The process by which a company analyzes a competitor's products to identify desirable improvements E) A certification program attesting that an operations process has met rigorous requirements AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 91) Which of the following BEST describes competitive product analysis? A) The principle that quality belongs to each person who creates it while performing a job B) The consistency of a product's quality from unit to unit C) The process by which a company analyzes a different company's products to identify desirable improvements D) The sum of all activities involved in getting a high-quality product into the marketplace E) Examining a product to improve its form utility Difficulty: Moderate AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 92) Which term refers to collaborative groups of employees from various work areas who meet regularly to define, analyze, and solve common production problems? A) Quality improvement teams B) Quality assurance teams C) Quality control teams D) Quality evaluation teams E) Quality review teams AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 29 Copyright © 2017 Pearson Education, Inc. 93) Which of the following BEST describes ISO 9000? A) The concept that all employees are valuable contributors to a firm's business, and should be entrusted with decisions regarding their work B) The redesigning of business processes to improve performance, quality, and productivity C) A program certifying that a factory, laboratory, or office has met the quality management standards of the International Organization for Standardization D) A certification program attesting to the fact that a factory, laboratory, or office has improved environmental performance E) The process of evaluating all work activities to determine the value they add for customers AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 94) Which of the following BEST describes ISO 14000? A) The concept that all employees are valuable contributors to a firm's business and should be entrusted with decisions regarding their work B) A certification program attesting to the fact that a factory, laboratory, or office has improved environmental performance C) A certification program attesting to the fact that a factory, laboratory, or office has met the quality management standards of the International Organization for Standardization D) A standardized method of evaluating a company's greenhouse gas emissions E) A certification program attesting to the fact that a factory, laboratory, or office is operating under free-trade principles AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 30 Copyright © 2017 Pearson Education, Inc. 95) Which term refers to the fundamental rethinking and radical redesign of a business activity to achieve dramatic improvements in performance? A) Supply chain management B) Business process reengineering C) Total quality management D) Quality ownership E) Quality control AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 96) Successful companies often focus total quality management efforts on both the quantity and quality of goods produced or delivered, known as A) cost of quality. B) supply chain management. C) material management. D) productivity. E) quality ownership. AACSB: Analytical thinking Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 97) Quality improvement teams are groups of employees from various work areas who define, analyze, and solve common production problems. AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 31 Copyright © 2017 Pearson Education, Inc. 98) The biggest challenge of total quality management is motivating employees throughout the company to achieve quality goals. AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 99) Value-added analysis might focus on both the elimination of waste and cost minimization. AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 100) ISO 9000 is a certification program attesting to the fact that a factory, laboratory, or office has improved its environmental performance. AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 101) Japanese companies adapted the concept of quality circles from quality improvement teams used by U.S. companies. AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 32 Copyright © 2017 Pearson Education, Inc. 102) The sales department relies on the engineering department to send samples and quotes to prospective customers on a timely basis. The sales department may be considered the engineering department's internal customer. AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 103) Explain competitive product analysis. AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 104) In a TQM environment, what are some steps that companies use to emphasize the importance of quality? AACSB: Analytical thinking Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 33 Copyright © 2017 Pearson Education, Inc. 105) Describe the five most commonly used tools for TQM. Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 106) Describe the relationship between a firm's productivity level affect and a country's GDP. AACSB: Application of knowledge Objective: 7.7: Identify the activities and underlying objectives involved in total quality management. 34 Copyright © 2017 Pearson Education, Inc. 107) Which term refers to the flow of information, materials, and services from raw-materials suppliers through stages in the operations process until the product reaches the end customer? A) Distribution chain B) Supply chain C) Service channel D) Distribution channel E) Performance channel AACSB: Application of knowledge Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 108) Which term refers to the strategy of paying suppliers and distributors to perform certain business processes or to provide needed materials or services? A) Outsourcing B) Reengineering C) Controlling D) Scheduling E) Warehousing AACSB: Application of knowledge Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 109) Which of the following BEST describes supply chain management? A) The principle of improving the supply chain by focusing on the slowest step in the chain B) A limitation on the number of suppliers allowed to supply a particular company C) Complete movement of raw materials throughout a manufacturing or service facility D) A cost-reduction program in which wholesalers and retailers are eliminated in an effort to entice consumers to purchase directly from manufacturers E) The principle of looking at the supply chain as a whole in order to improve the overall flow through the system AACSB: Application of knowledge Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 35 Copyright © 2017 Pearson Education, Inc. 110) When a company shares information to improve the overall flow through a system composed of companies working together, it is engaging in which of the following? A) Distribution chain management B) Total quality management C) Supply chain management D) Service channel analysis E) Supplier selection analysis AACSB: Application of knowledge Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 111) The systematic direction and control of activities that transform resources into finished products is known as which of the following? A) Service operations B) Operations capability C) Operations management D) Good operations E) Process capability Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 36 Copyright © 2017 Pearson Education, Inc. 112) How do firms create benefits for themselves and their customers and effectively use resources such as knowledge, physical materials, equipment, and information? A) By creating intangible goods and services B) By instituting high-contact systems C) By changing capacity planning based on customer needs D) By utilizing operations management techniques E) By creating a fixed-position production layout Difficulty: Moderate AACSB: Analytical thinking Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 113) A value chain includes an entire network of firms, beginning with suppliers and ending when production is complete. AACSB: Application of knowledge Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 114) Because supply chain strategy is based on the collective effort of a number of firms, no one firm in the chain gains a competitive advantage. AACSB: Application of knowledge Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 115) Each stage in the supply chain adds value for the final customer. AACSB: Application of knowledge Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 37 Copyright © 2017 Pearson Education, Inc. 116) The goal of supply chain management is better overall flow in the system. AACSB: Application of knowledge Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 117) What is a supply chain? How can supply chain management create competitive advantage? AACSB: Analytical thinking Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 118) How does outsourcing affect global supply chain management? Difficulty: Difficult AACSB: Analytical thinking Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms. 119) Outsourcing has led to increasingly global supply chains. Describe three ways that a more global supply chain might be risky for a company that outsources. AACSB: Analytical thinking Objective: 7.8: Explain how a supply chain strategy differs from traditional strategies for coordinating operations among firms.

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