Mgt 366 Exam #1

Productivity growth can be calculated by:

(current productivity - previous productivity) x 100 / (previous productivity)

Technology choices can have a major impact on: a. costs. b. productivity. c. customer satisfaction. d. quality. e. all of the above.

All of the above

Operations, marketing, and finance function independently of each other in most organizations

False

Service operations can use inventory as a hedge against unpredictable demand.

False

Unique attributes of firms that give them a competitive edge are called: a. functional strategies. b. supply chains. c. sustainable initiatives. d. Balanced Scorecards. e. core competencies.

Core competencies

Logistics includes all of these except:

Customer Selection

An example of an operational operations management decision is inventory level management.

True

One concern in the design of production systems is the degree of standardization

True

The goal of supply chain management is to synchronize supply and demand of all of the organizations that are part of the chain.

True

The hierarchy and sequence of planning and decision making is: mission, organizational strategy, tactics, and operational decisions.

True

Core competencies in organizations generally do not relate to:

sales price.

Which is not a characteristic of exponential smoothing?

weights each historical value equally

In an assembly operation at a furniture factory, six employees assembled an average of 450 standard dining chairs per five-day week. What is the labor productivity of this operation?

15 chairs/worker/per day 450/6 workers = 75 chairs per week 75/5 day of the week = 15 per day

Which of the following statements are true about centralized versus decentralized purchasing? (I) Centralized or decentralized purchasing is directly related to the size of an organization. (II) Decentralized purchasing can usually offer quicker response than centralized purchasing. (III) Some firms have structured their procurement function to include both centralized and decentralized purchasing. (IV) An advantage of centralized purchasing is the attention given to local needs.

2 and 3

Suppose a four-period weighted average is being used to forecast demand. Weights for the periods are as follows: wt-4 = 0.1, wt-3 = 0.2, wt-2 = 0.3 and wt-1 = 0.4. Demand observed in the previous four periods was as follows: At-4 = 380, At-3 = 410, At-2 = 390, At-1 = 400. What will be the demand forecast for period t?

397The forecast will be (.1 380) + (.2 410) + (.3 390) + (.4 400) = 397.

Which of the following is not a characteristic of service operations? intangible output high customer contact high labor content easy measurement of productivity low uniformity of input

Easy measurement of Productivity

Forecasts for groups of items tend to be less accurate than forecasts for individual items because forecasts for individual items don't include as many influencing factors.

FALSE Forecasting for an individual item is more difficult than forecasting for a number of items.

Operations managers are responsible for assessing consumer wants and needs and selling and promoting the organization's goods or services.

FALSE Operation managers are not responsible for promoting goods/services.

A moving average forecast tends to be more responsive to changes in the data series when more data points are included in the average.

False

Last quarter, a retailer sold 8,000 T-shirts, 7,000 of which were sold directly from on-hand inventory. This retailer's ________ was 88 percent.

Fill rate

Which of the following is part of the purchasing cycle? (I) Purchasing selects a supplier. (II) Purchasing receives a requisition. (III) Orders from vendors are received.

I, II, and III

Which of the following statements are true about vendor analysis? (I) Vendor analysis examines the function of purchased parts and materials with a view toward improvement or cost reduction. (II) Price is the primary determining factor in choosing a vendor since most products are essentially the same. (III) Vendor analysis is the process that evaluates the source of supply in terms of price, quality, reputation, and service. (IV) Vendor analysis examines the sources of supply for purchased parts or materials in order to improve supply chain performance.

III, and IV

___________ is generally used to facilitate an organization strategy that emphasizes low cost.

Standardization

Many operations management decisions can be described as trade-offs.

TRUE Managing tradeoffs is the essence of operations management.

Crew # 2 is the most productive

The manager of a carpet store is trying to determine the best installation crew size. He has tried various crew sizes with the results shown below. Based on productivity, what crew size do you recommend?

Step #1: Calculate labor cost for week 1 = 40 week * $16 per hour * 5 works = $3200 Multi-factor productivity for week #1 = (quantity produced * standard price) / (labor cost + material Cost + overhead) (392*125) / (3200 + (2720*10) +(1500+(.5*3200)) (49000) / (3200+ 27200 + 3100) = 1.46 -------------------------------------------------------------------------- Step #2 calculate labor costs for Week #2 = 40*16*4 = 3840 Multi-factor productivity for week #2 = (quantity produced * standard price) / (labor cost + material Cost + overhead) (408 * 125) / (3840 + (2790*10) + (1,500+(.5*3840)) (51000) / ( 3840 + 27900 + 3420) = 1.451 Average Multip Factor Productivity = (1.46*1.451) / 2 = 1.457

The weekly output of a fabrication process is shown below, together with data for labor and material inputs. The standard selling price is $125 per unit. Overhead is charged weekly at the rate of $1,500 plus .5 times direct labor cost. Assume a 40-hour week and an hourly wage of $16. The material cost is $10 per foot. What is the average multi-factor productivity?

Small changes in consumer demand can result in large variations in orders placed because of the

bullwhip effect.

Small changes in consumer demand can result in large variations in orders placed because of the:

bullwhip effect.

Detecting nonrandomness in errors can be done using:

control charts.

Which of the following would be least important in the pursuit of a time-based strategy?

cost minimization

Which of the following is least likely to be a key consideration when a company chooses a supplier?

current inventory

Logistics includes all of these except:

customer selection.

The responsibilities of the operations manager include: a. allocating financial resources throughout the organization. b. the creation of goods or provision of services. c. promoting the organization's goods or services d. analyzing investment proposals e. .all of the above.

forecasting, designing, planning, organizing, and controlling. or

The more novel a new product or service design is, the more forecasters have to rely on:

subjective estimates.

Which of the following most involves coordinating the activities among all the elements of the business including its suppliers and distributors? a. planning control b. quality management c. supply chain management d. technological change

supply chain management

Which of the following refers to service and production processes that use resources in ways that do not harm ecological systems?

sustainability

Which of the following is not a type of judgmental forecasting? A. time series analysis b. sales force opinions c. the Delphi method d. executive opinions e. consumer surveys

time series analysis

Exponential smoothing is a form of weighted averaging.

true

In exponential smoothing, an alpha of 1.0 will generate the same forecast that a naive forecast would yield.

true

Linear regression is a technique for both time series with trend and associative forecasting.

true

The goal of supply chain management is to synchronize supply and demand of all of the organizations that are part of the chain.

true