Exam 3

A family restaurant is an example of a focused service Select one: a. True b. False

a. True

When yield management is implemented which one of the following does not result: Select one: a. consumer surplus increases b. multiple prices are offered c. capacity is more fully utilized d. market for the service is segmented

a. consumer surplus increases

McDonald's includes beer on its menu for German franchises. This is an example of _______ Select one: a. cultural transferability. b. network development. c. host government policy. d. labor norms.

a. cultural transferability.

The strategy of segmenting demand is feasible only when: Select one: a. demand is not from a homogeneous source. b. demand is cyclic and predictable. c. arrivals for service are random. d. making appointments is impossible.

a. demand is not from a homogeneous source.

After selecting a line in a multiple queue system, a customer is ________ when she or he switches to a different line perceive it to be moving faster. Select one: a. jockeying b. balking c. reneging d. weaving

a. jockeying

Little's Law states that a relationship exists between Select one: a. line length and waiting time. b. multiple and single queues. c. waiting in queue and waiting in system. d. exponential time between arrivals and Poisson arrival rate.

a. line length and waiting time

Multinational expansion by a service firm is: Select one: a. often driven by customer demand. b. vital for growth. c. not recommended for labor intensive operations. d. primarily a defense strategy.

a. often driven by customer demand.

Service capacity decisions have all but one of the following strategic characteristics: Select one: a. the decision to invest in capacity will attract competitors. b. financial investment in capacity must be balanced against the costs of lost sales. c. inadequate short-term capacity needs can generate customers for the competition. d. hostile customers can result from inadequate capacity following a marketing campaign.

a. the decision to invest in capacity will attract competitors.

Which of the following is not one of Kenichi Ohmae's five "Cs" of strategic planning in a borderless world economy? Select one: a. Competitors b. Creativity c. Company d. Country

b. Creativity

A diversified network is a situation where many services are offered at a single location Select one: a. True b. False

b. False

Balking is the term used to describe the phenomenon of customers leaving a queue that they have joined before service is rendered Select one: a. True b. False

b. False

Which of the following is not one of the major considerations in planning multinational operations? Select one: a. Cultural transferability b. Technological compatibility c. Network development d. Host government policy

b. Technological compatibility

Mayo Clinic is a service firm that would fall under which of the following categories: Select one: a. single location, single service. b. single location, multiservice. c. multisite, single service d. mulitsite, multiservice

b. single location, multiservice.

Making knowledge available to customers at low cost is called: Select one: a. embellishment b. transfer c. replacement d. co-production

b. transfer

_______ is not part of the service chain concept. Select one: a. Conversion b. Distribution c. Inventory management d. Knowledge management

c. Inventory management

Which one of the following is not a characteristic of firms using yield management? Select one: a. ability to segment their market b. perishable inventory c. variable capacity d. product sold in advance

c. variable capacity

All but one of the following is a reason for outsourcing services. Select one: a. Avoids coordination expenses and delays b. Allows the firm to focus on its core competence c. Provides access to latest technology d. Leverages benefits from supplier economies of scale

a. Avoids coordination expenses and delays

Which of the following is not a strategy for managing capacity? Select one: a. Developing complementary services b. Using part-time employees c. Forecasting demand d. Scheduling shifts

a. Developing complementary services

When franchising, which of the following is not an issue for the franchisee? Select one: a. Establishing a brand b. Franchise contract c. Degree of discretion d. Conflict resolution

a. Establishing a brand

Global service strategies include all but one of the following: Select one: a. Exporting services b. Following your customers c. Beating-the-clock d. Service offshoring

a. Exporting services

A restaurant that features special lunchtime combo meals is providing all but one of the following benefits? Select one: a. Promotes off-peak demand b. Increases customer satisfaction c. Decreases service times d. Segment demand

a. Promotes off-peak demand

When franchising which one of the following is not a benefit to the franchiser? Select one: a. Proven business b. Rapid expansion c. Right to dictate conditions d. Fees from the franchisee

a. Proven business

All but one of the following is a managerial implication of bi-directional relationships: Select one: a. Vendor selection based on reputation b. Service supply relationships are hubs c. Service capacity analogous to inventory d. Quality variation of customer inputs

a. Vendor selection based on reputation

The FCFS rule is most often used because: Select one: a. analytical models depend upon its use. b. it represents social justice. c. it is viewed as fair. d. most other rules are not as easily applied.

a. analytical models depend upon its use.

A queuing system is described by all but one of the following: Select one: a. balking behavior b. calling population c. arrival process d. queue configuration

a. balking behavior

A health club offering a reduced rate membership for students to workout before 4:00 p.m. on weekdays is: Select one: a. promoting off-peak demand. b. partitioning demand. c. using yield management. d. offering price incentives.

a. promoting off-peak demand.

For the system to operate satisfactorily over the long run, Select one: a. the capacity to serve must be greater than the average demand. b. the expected waiting time for each customer must not exceed average service time. c. the arrival rate must be less than the service rate. d. the number of servers must equal the average number of arrivals per unit time.

a. the capacity to serve must be greater than the average demand.

What is the principal reason that service trade receives low priority at WTO meetings? Select one: a. Controlling service trade is difficult. b. Governments are more concerned with trade in manufactured products. c. Service trade is an insignificant factor in international trade. d. Tariffs cannot be applied to services.

b. Governments are more concerned with trade in manufactured products.

For a chase demand strategy which of the following does not have a high trade-off? Select one: a. Employee utilization b. Labor-skill level c. Labor turnover d. Supervision required

b. Labor-skill level

________ is not a characteristic appropriate for a yield management strategy. Select one: a. Relatively fixed capacity b. Steady demand c. Ability to segment markets d. Products sold in advance

b. Steady demand

"Develop foreign customers" is a consideration for the global service strategy of "following your customers". The relevant globalization factor is: Select one: a. cultural adoption. b. customer contact. c. complexity. d. Customization.

b. customer contact

A parking lot is a special variation of the _________ queuing model. Select one: a. infinite queue M/G/∞ b. finite-queue M/M/c c. infinite queue M/M/c d. finite-queue M/G/1

b. finite-queue M/M/c

According to Maister's Second Law of Service: Select one: a. perceptions minus expectations equal the level of customer satisfaction. b. first impressions can influence the remainder of the service experience. c. quality in the service industry is essentially free. d. a waiting customer cannot be satisfied.

b. first impressions can influence the remainder of the service experience.

"Hiring local personnel" addresses the labor intensity factor in the ________ global service strategy Select one: a. multicountry expansion b. following your customers c. service offshoring d. beating the clock

b. following your customers

The impact of the production element on physical goods supply chain management was _____ before and _____ after. Select one: a. push , pull b. inflexible, flexible c. vertical, virtual d. multinational, global

b. inflexible, flexible

The purpose of differential pricing is to: Select one: a. make peak period usage unattractive. b. make off-peak usage attractive. c. charge customers according to their ability to pay. d. adjust capacity to demand.

b. make off-peak usage attractive.

The calling population is termed finite when: Select one: a. there is restriction on the maximum number in the queue. b. only a limited number of people may use the facility in any given period. c. the interarrival time is not very large. d. there is no queue discipline specified

b. only a limited number of people may use the facility

Pooling of servers results in reduced waiting time because: Select one: a. the mean service time for the pool as a whole is now constant. b. servers are utilized better. c. multiple queues are replaced by a single queue. d. alternatives (a) and (b) above.

b. servers are utilized better.

Which of the following strategies is inappropriate for managing capacity and demand? Select one: a. Smooth customer demand by offering price incentives. b. Scheduling staff to meet variations in forecasted customer demand. c. Decrease customer participation in the service process. d. Promoting off-peak use of facilities.

c. Decrease customer participation in the service process.

The two-way classification for the taxonomy for outsourcing business services contains six cells. Which one of the following is not a descriptive title for one of the cells? Select one: a. Facility support b. Professional c. Employee d. Facilitator

c. Employee

When outsourcing facilitator services, which one of the following is not a consideration? Select one: a. Knowledge of alternate vendors is important b. Involvement of end user in vendor identification c. Experience with particular industry is important d. Detailed specification written by user

c. Experience with particular industry is important

The "cookie-cutter" concept best describes which expansion strategy? Select one: a. Focused service b. Clustered service c. Focused network d. Diversified network

c. Focused network

A cruise ship has available a certain number of rooms in each of 10 categories of appointments ranging from a two-bunk inside cabin to a suite with an outside patio and indoor sitting area. If a passenger requests a sailing date in which the desired cabin is sold out, which of the following actions would be considered the least viable alternative for the cruise line? Select one: a. Offer an upgraded cabin at a reduced price. b. Attempt to steer the passenger to an available date. c. Overbook the cabin. d. Offer a downgraded cabin with special privileges such as a $100 certificate for use in the casino.

c. Overbook the cabin.

_______ is not a strategy for accommodating of customer-induced variability. Select one: a. Provide generous staffing b. Cross-train employees c. Reward increased effort d. Do work for customers

c. Reward increased effort

________ is(are) the highest level of professional body of knowledge. Select one: a. Advanced skills b. System understanding c. Self-motivated creativity d. Cognitive knowledge

c. Self-motivated creativity

Travel booking is a service that falls in the _________ category of outsourcing business service. Select one: a. facility support b. employee development c. facilitator d. professional

c. facilitator

A queuing system is said to be in a transient condition when: Select one: a. its parameters change with time. b. its parameters remain constant. c. it is still under the influence of the initial state. d. it grows beyond bound.

c. it is still under the influence of the initial state.

Which of the following is not an essential feature of a queuing system? Select one: a. Calling population b. Queue configuration c. Service process d. Customer

d. Customer

Removing the kitchen from Taco Bell outlets to a central location resulted in all of the following benefits, except: Select one: a. Reduction in waste b. Consolidation of demand c. Shorter customer wait times d. Make-to-order customization

d. Make-to-order customization

A community hospital is an example of a: a. diversified network. b. focused network. c. focused service. d. clustered service.

d. clustered service.

Which one of the following is not part of the queuing system features? Select one: a. calling population b. queue configuration c. queue discipline d. departure process

d. departure process

All but one of the following are techniques to lessen the boredom of waiting customers: Select one: a. placement of mirrors in elevators. b. telling customers how long the wait is at different points in the queue. c. installing a television tuned to CNN. d. displaying time with a large analog clock.

d. displaying time with a large analog clock.

A 5:00 p.m. pickup for FedEx was not workable in Spain owing to extended business hours. This is an example of cultural adoption under which of the following global service strategies: a. beating the clock. b. service offshoring. c. following your customers. d. multicountry expansion.

d. multicountry expansion.

In using the critical fractile criterion P(d<x) = Cu/(Cu + Co) for overbooking, the 'd' refers to: Select one: a. cost of overestimating demand. b. cost of underestimating demand. c. number of rooms overbooked. d. number of no-shows based on past experience.

d. number of no-shows based on past experience.

Bars that offer happy hours in the afternoon are using the strategy of: Select one: a. creating adjustable capacity. b. developing complementary services. c. increasing customer participation. d. promoting off-peak demand.

d. promoting off-peak demand.

All of the following are benefits of a multisite type of expansion except: Select one: a. ability to reach a mass market quickly. b. reduced financial risk from local economic downturn. c. preemption of competitors by capturing premium locations. d. retention of control.

d. retention of control.

The following are all advantages of the single queue system, except: Select one: a. the arrangement guarantees fairness by ensuring that the FCFS rule applies. b. the anxiety of "Am I in the fastest line?" is eliminated. c. the problem of line cutting is reduced. d. the customer has the option of selecting a particular server of preference.

d. the customer has the option of selecting a particular server of preference.

Faced with variable demand and a perishable capacity, a service manager can smooth demand by: Select one: a. using part-time help during peak hours. b. scheduling workshifts to vary workforce needs according to demand. c. increasing the customer self-service content of the service. d. using reservations and appointments.

d. using reservations and appointments.

The physical goods supply chain contains all but one of the following elements: Select one: a. competitor b. distributor c. retailer d. customer

a. competitor

Which of the following service providers likely would be involved in a single-level bi-directional service supply relationship? Select one: a. Pharmacy b. Professor c. Garage d. Mortgage company

b. Professor

What one of the following is not a characteristic of yield management? Select one: a. Capacity is relatively fixed. b. There is one homogeneous customer class. c. The service is considered a perishable inventory. d. Demand fluctuates yet is somewhat predictable.

b. There is one homogeneous customer class.

A good overbooking strategy should: Select one: a. minimize the expected opportunity cost of idle service capacity. b. balance the expected opportunity cost of idle service capacity and expected cost of turning away customers who have reservations. c. minimize the expected cost of turning away reservations. d. none of the above; services should try to avoid overbooking.

b. balance the expected opportunity cost of idle service capacity and expected cost of turning away customers who have reservations.

A relatively recent concept that refers to the movement of new products through existing distribution channels is called: Select one: a. economies of scale b. economies of scope c. diversification d. micromarketing

b. economies of scope

When the number of arrivals per unit time follows a Poisson distribution, the most important implication is that: Select one: a. the arrivals are dependent and non-random. b. the time between arrivals is exponentially distributed. c. eventually the queue length will stabilize. d. the rate of completion of service is also Poisson distributed.

b. the time between arrivals is exponentially distributed.

Which one of the following four steps in "daily workshift scheduling" is out of order? Select one: a. Forecast demand. b. Convert to operator requirements. c. Assign operators to shifts. d. Schedule shifts.

c. Assign operators to shifts.

All but one of the following is a caution when considering outsourcing services: Select one: a. Loss of direct control over quality b. Jeopardize employee loyalty because of job-loss fears c. Costs might increase d. In-house capability to perform service will atrophy

c. Costs might increase

Sources of value in service chain management include all but one of the following: Select one: a. bidirectional optimization b. management of productive capacity c. management of mobile workers d. management of perishability

c. management of mobile workers

Which of the following is not a criterion for capacity planning? Select one: a. average customer waiting time b. probability of excessive waiting c. the rate of departure d. probability of sales lost because of inadequate waiting area

c. the rate of departure

Which of the following is not a benefit to the franchisee of a franchise? Select one: a. Brand name b. National advertising c. Economics of scale d. Autonomy

d. Autonomy

_________ variability is not one of the five sources of customer-induced variability. Select one: a. Arrival b. Capability c. Effort d. Demand

d. Demand

_________ is not a reason for outsourcing services. Select one: a. Leveraging benefits from a supplier b. Allowing the firm to focus on core competence c. Providing access to latest technology d. None of the above

d. None of the above

All but one of the following depicts the impact of service chain management: Select one: a. Proactive demand management b. Variable pricing c. Real-time tracking d. Pull system for flow of information

d. Pull system for flow of information

Which of the following is not a source of uncertainty in managing a supply chain? Select one: a. Supplier delivery performance b. Manufacturing reliability c. Customer demand d. Quality control

d. Quality control

Strategies to improve productive capacity include all but one of the following: Select one: a. embellishment b. transfer c. replacement d. bidirectional optimization

d. bidirectional optimization

American Express, which offers financial and travel services on a global basis, is an example of a: Select one: a. focused service. b. focused network. c. clustered service. d. diversified network.

d. diversified network.

The impact of pricing on service chain management was _____ before and _____ after. Select one: a. high, low b. passive, active c. static, dynamic d. fixed, variable

d. fixed, variable

One advantage of the multiple queue compared to a single queue is that multiple queues Select one: a. minimize wait times. b. reduce the average service time. c. lead to a perceived shorter service time. d. lead to a perceived shorter wait time.

d. lead to a perceived shorter wait time.

The "employment support" category in the taxonomy for outsourcing business services falls under _________ importance of service and __________ focus of service Select one: a. high, people b. low, process c. high, process d. low, people

d. low, people

The cost of service capacity is determined by Select one: a. the number of customers waiting. b. the total number of customers. c. waiting time. d. the number of servers on duty.

d. the number of servers on duty.

Several approaches to demand management exist, but only _______ seeks to maximize revenue. Select one: a. promoting off-peak demand b. reservation systems c. offering price incentives d. yield management

d. yield management