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Ops Mgt

Process selection refers to the strategic decision of selecting which kind of production processes to use to produce a product or provide a service.

(T)
-Process selection refers to the strategic decision of selecting which kind of production processes to use to produce a product or provide a service.

One difference between an assembly line process flow and a continuous process flow is that on the assembly line the flow is discrete rather than continuous

(T)
-A continuous process is similar to an assembly line in that production follows a predetermined sequence of steps, but the flow is continuous such as with liquids, rather than discrete.

The choice of which process structure to select is generally a function of the volume requirements for the product.

(T)
-Two dimensions (of the product/process matrix, exhibit 6.2) are shown. The first dimension relates to the volume of a particular product or group of standardized products. Standardization is shown on the vertical axis and refers to variations in the product that is produced. These variations are measured in terms of geometric differences, material differences, and so on. Standardized products are highly similar from a manufacturing processing point of view, whereas low standardized products require different processes.

Workcenter layouts allocate dissimilar machines into cells to work on products that have dissimilar processing requirements.

(F)
-A workcenter layout, sometimes referred to as a job shop, is where similar equipment or functions are grouped together.

A project layout is characterized by a relatively low number of production units in comparison with process and product layout formats.

(T)
-See exhibit 6.2, Product-Process Matrix: Framework Describing Layout Strategies.

A make-to-order firm will work with the customer to design the product, and then make it from purchased materials, parts, and components.

(F)
-Firms that make the customer's product from raw materials, parts, and components are make-to-order firms.

Which of the following basic types of process structures is the one in which equipment or work processes are arranged according to the progressive steps by which the product is made?
Project
Workcenter
Manufacturing cell
Assembly line
Continuous process

Assembly line
- An assembly line is where work processes are arranged according to the progressive steps by which the product is made.

Most services consist of a bundle of goods and services known as the service package which is the major output of the development process.

(T)
-Every service has a service package, which is defined as a bundle of goods and services that is provided in some environment. The service package, rather than a definable good, constitutes the major output of the development process.

A service system with a high degree of customer contact is less difficult to control than a low degree of customer contact service system.

(F)
-Service systems with a high degree of customer contact are more difficult to control than those with a low degree of customer contact.

Because little or no inventory is carried in a service operation, it is easy to separate the operations management functions from marketing in services.

(F)
-Too much capacity generates excessive costs. Insufficient capacity leads to lost customers. In these situations, of course, we seek the assistance of marketing. This is one reason we have discount airfares, hotel specials on weekends, and so on. This is also a good illustration of why it is difficult to separate the operations management functions from marketing in services.

The "service blueprint" is a classification of services.

(F)
-Just as is the case with manufacturing process design, the standard tool for service process design is the flowchart. Recently, the service gurus have begun calling the flowchart a service blueprint to emphasize the importance of process design.

Poka-Yokes are procedures that block the inevitable mistake from becoming a service defect.

(T)
-Poka-yokes —procedures that block the inevitable mistake from becoming a service defect.

Service guarantees can be used at the service design stage to focus the firm's delivery system on the things it must do well to satisfy the customer.

(T)
-From an operations perspective, a service guarantee can be used not only as an improvement tool but also at the design stage to focus the firm's delivery system squarely on the things it must do well to satisfy the customer.

It is not necessary that a well-designed service system be robust.

(F)
-The seven characteristics of a well-designed service system include: It is robust. That is, it can cope effectively with variations in demand and resource availability. For example, if the computer goes down, effective backup systems are in place to permit service to continue.

"Combine the pain" is an application of behavioral science to service encounters. It means that, when something is going wrong for a group of customers it is better to totally enrage one or a very few customers rather than slightly annoying a large number of customers.

(F)
-Events seem longer when they are segmented. This suggests that we want to break pleasant experiences into multiple stages and combine unpleasant ones into a single stage.

A supporting facility is the same thing as a facilitating good.

(F)
-A supporting facility is the physical resources that must be in place before a service can be offered. A facilitating good is the material purchased or consumed by the buyer or the items provided by the customer.

Which of the following is a characteristic that can be used to guide the design of service systems?
Services cannot be inventoried
Services are all similar
Quality work means quality service
Services businesses are inherently entrepreneurial
Even service businesses have internal services

Services cannot be inventoried
-In designing service organizations we must remember one distinctive characteristic of services: We cannot inventory services.

Which of the following is not part of "the service triangle"?
Employees
Support systems
Customers
Service strategy
Service encounter

Service encounter
-Service triangle includes the following: The service strategy, the customer, support system, and employees.

In the service-system design matrix, a face-to-face total customization service encounter is expected to have which of the following?
Low sales opportunity
Low production efficiency
High production efficiency
Low degree of customer/server contact
None of the above

Low production efficiency

An operational goal of total quality management is the careful design of the product or service.

(T)
-Total quality management has two fundamental operational goals: 1. Careful design of the product or service. 2. Ensuring that the organization's systems can consistently produce the design.

An operational goal of total quality management is ensuring that the organization's systems will never produce a defective product or service.

(F)
-Total quality management has two fundamental operational goals:
1. Careful design of the product or service.
2. Ensuring that the organization's systems can consistently produce the design.

Kaizen is a term used when perfect quality levels have been attained.

(F)
-Continuous improvement, also called kaizen, seeks continual improvement of machinery, materials, labor utilization, and production methods.

One of the definitions for the cost of quality is that it represents the costs attributable to the production of quality that is not 100 percent perfect.

(T)
-There are a number of definitions and interpretations of the term cost of quality. From the purist's point of view, it means all of the costs attributable to the production of quality that is not 100 percent perfect.

Six-Sigma refers to the philosophy and methods that some companies use to eliminate defects in their products and processes.

(T)
-Six-Sigma refers to the philosophy and methods companies such as General Electric and Motorola use to eliminate defects in their products and processes.

A flow chart as part of a six-sigma quality improvement process might be found in which DMAIC category?
Define
Measure
Analyze
Improve
Control

Define
-Flowcharts. There are many types of flow charts. The one shown in Exhibit 9.5 depicts the process steps as part of a SIPOC analysis. SIPOC in essence is a formalized input-output model, used in the define stage of a project. (See also exhibit 9.5)

The dimension of design quality that concerns the sensory characteristics of the product is which of the following?
Features
Serviceability
Perceived quality
Reputation
Aesthetics

Aesthetics
-Exhibit 9.2: "The Dimensions of Design Quality." Aesthetics: Sensory characteristics (sound, feel, look, and so on)

The dimension of design quality that concerns the consistency of performance over time or the probability of failing is which of the following?
Response
Serviceability
Reliability
Reputation
Perceived quality

Reliability
-Exhibit 9.2: "The Dimensions of Design Quality." Reliability/durability: consistency of performance over time, probability of failing, useful life.

A cost of quality classification is which of the following?
Material costs
Prevention costs
Variable overhead
Direct labor
Inventory costs

Prevention costs
-The costs of quality are generally classified into four types: 1. appraisal costs, 2. prevention costs, 3. internal failure costs, 4. external failure costs.

Which of the following is the cost of quality classification for costs such as inspection, testing, and other tasks to ensure that the product or process is acceptable?
Appraisal costs
Prevention costs
External failure costs
Internal failure costs
Checking costs

Appraisal costs
-Appraisal costs, costs of the inspection, testing, and other tasks to ensure that the product or process is acceptable

For which of the following should we use a "p" chart to monitor process quality?
Defective electrical switches
Errors in the length of a pencil
Weight errors in cans of soup
Temperature of entrees in a restaurant
Letter grades on a final examination

Defective electrical switches
-In the case of the p chart, the item was either good or bad. Also, Measurement by attributes means taking samples and using a single decision—the item is good or it is bad. Because it is a yes or no decision, we can use simple statistics to create a p chart with an upper control limit (UCL) and a lower control limit (LCL).

A "p chart" has upper and lower control limits expressed as lines on the chart. As long as the sample values fall between these two lines there is no need to investigate process behavior.
True
False

(F)
-There are several situations where investigation of process behavior is necessary even though all points have fallen between the UCL and the LCL. For example, a run of five above or below the central line calls for one to investigate for the cause of sustained poor performance.

Measurement by attributes means taking a sample, measuring the attribute in question and determining the level of quality in the population from which the sample was drawn.
True
False

(F)
-Measurement by attributes means taking samples and using a single decision—the item is good or it is bad.

Process control is concerned with monitoring quality after the product or service has been produced.
True
False

(F)
-Process control is concerned with monitoring quality while the product or service is being produced.

It is impossible to have zero variability in production processes.
True
False

(T)
-However, engineers also know that it is impossible to have zero variability.

Variation in production systems that is caused by factors that can be clearly identified and possibly even managed is called assignable variation.
True
False

(T)
-Variation caused by factors that can be clearly identified and possibly even managed is called assignable variation.

Strategic sourcing is the development and management of supplier relationships to acquire goods and services in a way that aids in achieving the immediate needs of the business.
True
False

(T)
-Strategic sourcing is the development and management of global supplier relationships to acquire goods and services in a way that aids in achieving the immediate needs of the business.

Two common measures to evaluate supply chain efficiency are the inventory turnover and weeks of supply ratios.
True
False

(T)
-Two common measures to evaluate supply chain efficiency are inventory turnover and weeks of supply.

The optimal strategy for functional products is to use an efficient supply chain.
True
False

(F)
-According to Hau Lee's uncertainty framework the optimal supply chain for functional products is either an efficient supply chain or a risk hedging supply chain. See exhibit 11.4.

Outsourcing allows a firm to achieve an improved focus on its core competencies.
True
False

(T)
-Outsourcing allows a firm to focus on activities that represent its core competencies.

Logistics is a term that refers to the management functions that support the complete cycle of material flow, from the purchase and internal control of production materials; to the planning and control of work-in-process; to the purchasing, shipping, and distribution of the finished product.
True
False

(T)
-Logistics is a term that refers to the management functions that support the complete cycle of material flow: from the purchase and internal control of production materials; to the planning and control of work-in-process; to the purchasing, shipping, and distribution of the finished product.

Logistics is a term indicating transportation choices for goods produced internationally but consumed domestically.
True
False

(F)
-Logistics is a term that refers to the management functions that support the complete cycle of material flow: from the purchase and internal control of production materials; to the planning and control of work-in-process; to the purchasing, shipping, and distribution of the finished product.

Green sourcing is only about finding new environmentally friendly technologies and increasing the use of recyclable materials.
True
False

Green sourcing is not just about finding new environmentally friendly technologies or increasing the use of recyclable materials. It can also help drive cost reductions in a variety of ways including product content substitution, waste reduction, and lower usage.

(F)
-Green sourcing is not just about finding new environmentally friendly technologies or increasing the use of recyclable materials. It can also help drive cost reductions in a variety of ways including product content substitution, waste reduction, and lower usage.

The total cost of ownership (TCO) can be categorized into three areas: acquisition costs, ownership costs, and post-ownership costs.
True
False

(T)
-See exhibit 11.8. The costs can be categorized into three broad areas: acquisition costs, ownership costs, and post-ownership costs.

In Hau Lee's uncertainty framework to classify supply chains, a supply chain for innovative products with an evolving supply process is called which of the following?
Efficient
Forward looking
Agile
Risk hedging
Responsive

Agile
-See exhibit 11.4

The effect of the lack of synchronization among supply chain members is referred to as which of the following?
Forward buying
Continuous replenishment
Bullwhip effect
Metcalf's Law
Being out of step

Bullwhip effect
-The bullwhip effect indicates a lack of synchronization among supply chain members.

Which of the following is one of the strategic characteristics to consider when deciding how supplier relationships should be structured on the continuum between vertical integration (do not outsource) to arm's length relationships (outsource)?
Cost
Location
Investment
Coordination
Control

Coordination
-Strategic characteristics to consider when deciding how supplier relationships should be structured on the continuum between vertical integration to arm's length relationships are required coordination, strategic control, and intellectual property.

12) Ownership costs include which of the following costs?
Environmental costs
Warranty costs
Supply chain costs
Quality costs
Taxes

Supply chain costs
-See exhibit 11.8. Ownership costs include energy costs; maintenance and repair; financing; and supply chain/supply network costs.

Facility location analysis considers the competitive imperative to be close to customers as to timeliness of deliveries.
True
False

(T)
-Japan's NTN Driveshafts Inc. built a major plant in Columbus, Indiana, to be closer to major automobile manufacturing plants in the United States whose buyers want their goods delivered.

In facility location decision-making matching the educational and skill levels of the labor pool to a company's needs is even more important than the labor pool's willingness and ability to learn.
True
False

(F)
-The educational and skill levels of the labor pool must match the company's needs. Even more important are the willingness and ability to learn.

Because the world is becoming more highly interconnected, the proximity of an important supplier's plants is not crucial in supporting lean production methods.
True
False

(F)
-A high-quality and competitive supplier base makes a given location suitable. The proximity of important suppliers' plants also supports lean production methods.

Issues of product mix and capacity are strongly interconnected to the facility location decision.
True
False

(T)
-The location of other plants or distribution centers of the same company may influence a new facility's location in the network. Issues of product mix and capacity are strongly interconnected to the location decision in this context.

A third-party logistics company is a firm that manages all or part of another company's product delivery operations.
True
False

(T)
-There are companies that specialize in logistics, such as United Parcel Service (UPS), Federal Express (FedEx), and DHL. These global companies are in the business of moving everything from flowers to industrial equipment. Today a manufacturing company most often will contract with one of those companies to handle many of its logistics functions. In this case, those transportation companies often are called a third-party logistics company.

Cross docking is a practice used in the international shipping industry that facilitates port utilization.
True
False

(F)
-Cross-docking is an approach used in consolidation warehouses, where large shipments are broken down into small shipments for local delivery in an area.

One of the objectives of facility location analysis is to select a site with the lowest total cost. Which of the following are hidden costs that should be included in the analysis?
Becoming less responsive to the customer
Supplier costs
Taxes
Construction costs
Product life cycle costs

Becoming less responsive to the customer
-Additional hidden costs are difficult to measure. These involve (1) excessive moving of preproduction material between locations before final delivery to the customers and (2) loss of customer responsiveness arising from locating away from the main customer base.

What transportation mode has very high initial investment costs but gives a very low cost per mile for products that are highly specialized and require no packaging?
Highway
Rail
Water
Pipeline
Air

Pipeline
-Pipelines (are) highly specialized and limited to liquids, gases, and solids in slurry forms. No packaging is needed and the costs per mile are low. The initial cost to build a pipeline is very high.

Lean production is an integrated set of activities designed to achieve high-volume production using minimal inventories of raw materials, work in process, and finished goods.
True
False

(T)
-Lean production is an integrated set of activities designed to achieve production using minimal inventories of raw materials, work-in-process, and finished goods.

Lean production requires a "push & pull" system of inventory replenishment.
True
False

(F)
-Rather than "pushing" material through the system based on weekly schedules generated by production control, the entire process is converted to a pull system that is operated directly in response to customer demand.

"Quality at the source" requires factory workers to become their own inspectors.
True
False

(T)
-Quality at the source Factory workers become their own inspectors, personally responsible for the quality of their output.

The goal of Just-in-time (JIT) production is to drive all inventory queues lower.
True
False

(F)
-The goal of JIT is to drive all inventory queues to zero, thus minimizing inventory investment and shortening lead times.

Value stream mapping is a technique that aims to eliminate waste in a process.
True
False

(T)
-With (value stream mapping) identification of wasteful processes and flows can be made so that they can be modified or eliminated, and the manufacturing system can be made more productive.

Respect for people is a key to Toyota's improvement ideas in manufacturing.
True
False

(T)

One of the many lean techniques that have been successfully applied in service firms is the eliminating of unnecessary activities.

(T)
-A step that does not add value is a candidate for elimination. A step that does add value may be a candidate for reengineering to improve the process consistency or to reduce the time to perform the tasks.

To implement lean production schedules, a firm would do which of the following?
Have excess capacity
Force demand
Hire a consultant
Bottom-up management
Implement kanban groups

Have excess capacity
-Under lean production, excess labor, machines, and overtime provide the hedge. The excess capacity in labor and equipment that results is much cheaper than carrying excess inventory.

In implementing a lean production system you should work with suppliers to do which of the following?
Calculate lead times
Quality circles
Freeze windows
Make frequent deliveries
Achieve bottom-round management

Make frequent deliveries
-Speed and quick response to changes are keys to the success of a lean supply chain.

Which of the following is a lean production technique that has been successfully applied in service firms?
Decision trees
Leveling the facility load
Linear programming
Fully utilizing capacity
Backflushing

Leveling the facility load
-Level the Facility Load: Service firms synchronize production with demand. They have developed unique approaches to leveling demand so they can avoid making customers wait for service.

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