Chapter 1
Introduction to Operations Management
TRUE/FALSE
1. Organizing is the process of turning plans into realities by assigning specific tasks and
responsibilities to employees that motivate them and coordinate their efforts.
ANS: F
2. Every job entails some aspect of operations management.
ANS: T
3. A toothbrush is an example of a nondurable good.
ANS: T
4. Services cannot be standardized.
ANS: F
5. Services always involve direct customer contact.
ANS: F
6. The greater the customer participation, the more uncertainty the firm has with respect to
service time.
ANS: T
, 7. A customer benefits package (CBP) consists of goods or services coupled with peripheral
goods and/or services.
ANS: T
8. The customer benefits package is of little use to operations managers; it is primarily
important to marketing.
ANS: F
9. Process thinking is the traditional way of viewing an organization by function.
ANS: F
10. Value creating processes generally cross functional areas.
ANS: T
11. A model is basically a set of assumptions that characterize a decision situation and allow
one to draw conclusions about the real situation through some sort of analysis.
ANS: T
12. About 2001, approximately 20% of U. S. employment was in the goods producing sector. Of
those goods producing jobs, around 50% were in services.
ANS: T
13. Service organizations do not need operations management because no tangible product is
produced.
ANS: F
14. Service capacity is a surrogate for inventory.
, ANS: T
15. Compared to training for factory employees, training for service-providers is more
interdisciplinary.
ANS: T
16. Typically, most value creation processes reside in their own departments while most
support processes cross organization and functional boundaries.
ANS: F
MULTIPLE CHOICE
1. Which of the following is not a key activity of an operations manager?
a. Understanding the needs of customer
b. Continually learning
c. Managing cash flows
d. Exploiting technology to design goods and services
ANS: C
2. Which one of the following best represents a pure service?
a. Bank loans
b. Computer diagnosis and repair
c. Attending a play
d. Fast food restaurant
, ANS: C
3. Which one of the following best represents a pure good?
a. Salt
b. Fast food
c. Attending a play
d. Automobile repair
ANS: A
4. Which of the following is not true regarding the differences between goods and services?
a. Demand for services is easier to forecast
b. Customers participate in many services
c. Services cannot be stored as physical inventory
d. Patents do not protect services
ANS: A
5. Regarding service encounters, which is not true?
a. May involve more than one moment of truth
b. Should be avoided
c. May involve a company store or building
d. Involves customer perceptions
ANS: B
6. Service organizations generally
a. Locate in close proximity to the customer
Introduction to Operations Management
TRUE/FALSE
1. Organizing is the process of turning plans into realities by assigning specific tasks and
responsibilities to employees that motivate them and coordinate their efforts.
ANS: F
2. Every job entails some aspect of operations management.
ANS: T
3. A toothbrush is an example of a nondurable good.
ANS: T
4. Services cannot be standardized.
ANS: F
5. Services always involve direct customer contact.
ANS: F
6. The greater the customer participation, the more uncertainty the firm has with respect to
service time.
ANS: T
, 7. A customer benefits package (CBP) consists of goods or services coupled with peripheral
goods and/or services.
ANS: T
8. The customer benefits package is of little use to operations managers; it is primarily
important to marketing.
ANS: F
9. Process thinking is the traditional way of viewing an organization by function.
ANS: F
10. Value creating processes generally cross functional areas.
ANS: T
11. A model is basically a set of assumptions that characterize a decision situation and allow
one to draw conclusions about the real situation through some sort of analysis.
ANS: T
12. About 2001, approximately 20% of U. S. employment was in the goods producing sector. Of
those goods producing jobs, around 50% were in services.
ANS: T
13. Service organizations do not need operations management because no tangible product is
produced.
ANS: F
14. Service capacity is a surrogate for inventory.
, ANS: T
15. Compared to training for factory employees, training for service-providers is more
interdisciplinary.
ANS: T
16. Typically, most value creation processes reside in their own departments while most
support processes cross organization and functional boundaries.
ANS: F
MULTIPLE CHOICE
1. Which of the following is not a key activity of an operations manager?
a. Understanding the needs of customer
b. Continually learning
c. Managing cash flows
d. Exploiting technology to design goods and services
ANS: C
2. Which one of the following best represents a pure service?
a. Bank loans
b. Computer diagnosis and repair
c. Attending a play
d. Fast food restaurant
, ANS: C
3. Which one of the following best represents a pure good?
a. Salt
b. Fast food
c. Attending a play
d. Automobile repair
ANS: A
4. Which of the following is not true regarding the differences between goods and services?
a. Demand for services is easier to forecast
b. Customers participate in many services
c. Services cannot be stored as physical inventory
d. Patents do not protect services
ANS: A
5. Regarding service encounters, which is not true?
a. May involve more than one moment of truth
b. Should be avoided
c. May involve a company store or building
d. Involves customer perceptions
ANS: B
6. Service organizations generally
a. Locate in close proximity to the customer
