OM Test 3
Which of the following is false regarding capacity expansion?
Capacity may only be added in large chunks.
Which of the following statements regarding Dell Computer is false?
Dell builds its computers overseas in order to gain a low-cost advantage.
Starbucks Coffee's approach to choosing new café locations is largely based on executive intuition, not sophisticated models and site selection technology.
False
Successful process redesign focuses on departmental areas where small, continuous improvements can be made.
False
The Hawthorne studies, which showed that there is a dynamic social system in the workplace, took place in the 1960s
False
The allowance factor that increases normal time to standard time compensates for inadequate worker training and lack of worker dexterity.
False
The center-of-gravity method finds the location of a centralized facility, such as a distribution center, that will maximize the organization's revenue.
False
The classical stopwatch study, or time study, was originally proposed by Western Electric's Hawthorne Commission in the 1920s
False
The location decisions of goods-producing firms will generally pay more attention to parking, access, and traffic counts than will service location decisions.
False
The physical environment in which employees work may affect the quality of work life, but it does not affect their performance and safety.
False
The purpose of labor standards is to accurately define the skills required to complete a job.
False
The transportation model calculates an optimal shipping system between a central facility and several outlying customers.
False
The two extremes of employment stability policy are "follow demand exactly" and "keep demand constant"
False
The typical full-service restaurant uses a product-focused process.
False
Therblig is a very small amount of time, one hundred-thousandth of an hour.
False
UPS may run the "tightest ship in the shipping business," but they got that high level of efficiency without time standards, because their contract with the Teamsters Union forbids them.
False
Utilization is the number of units a facility can hold, receive, store, or produce in a period of time.
False
Work sampling and time studies are similar in that the analyst in both cases records the time taken by the worker to accomplish each step of the task.
False
Working around asbestos raised ethical concerns before its inherent dangers became known.
False
Which of the following statements regarding FedEx is true?
FedEx believes the hub system helps reduce mishandling and delays due to better controls.
Which of the following is the best example of the proximity rule that, for service firms, proximity to market is the most important location factor?
Few people will travel out-of state for a haircut.
_________ cost is the cost that continues even if no units are produced
Fixed
___________ involves the ability to respond with little penalty in time, cost, or customer value.
Flexibility
_____________ represent an organization's attempt to gain increased efficiency through specialization, which can include, for example, concentrating on certain classes of customers.
Focused processes
The two most complex motions in the methods time measurement (MTM) system are _________ and __________.
GET and PLACE
What describes a system that stores and displays information that can be linked to a geographic location?
GIS
Databases containing such variables as street maps, utilities, population age and income, and the software that analyzes such data for location decisions, are referred to as __________.
Geographic Information Systems or GIS
__________ costs are readily identifiable and can be measured with precision.
Tangible
One essential ingredient of mass customization is modular design.
True
One reason for a firm locating near its competitors is the presence of a major resource it needs.
True
One use of camera-and-computer-based vision systems is to replace humans doing tedious and error-prone visual inspection activities.
True
One use of labor standards is to determine what makes a fair day's work
True
Optical checkout scanners and ATMs are examples of technology's impact on services.
True
Price changes are useful for matching the level of demand to the capacity of a facility.
True
Process control is the use of information technology to monitor and control a physical process.
True
Processes can be environmentally friendly and socially responsible while still contributing to profitable strategies.
True
Rest allowances can include amounts for the effects of lighting, heat and humidity, and noise
True
Self-directed teams may mean having no supervision on the factory floor.
True
Service blueprinting is a process analysis technique that focuses on the customer and the provider's interaction with the customer.
True
Service firms choose locations based, in part, on the revenue potential of a site.
True
Standard time is always greater than normal time, due to the inclusion of allowances for personal time, delay, and fatigue
True
Standard time may be less than average observed time
True
Starbucks Coffee's use of geocoded demographic and consumer data in site selection decisions is an example of the use of a Geographic Information System, or GIS.
True
Technology, location, and layout decisions are all possible constraints on the human resource strategy
True
The assembly line is a classic example of a repetitive process.
True
The factor-rating method can consider both tangible and intangible costs.
True
The goal of a human resource strategy is to manage labor and design jobs so people are effectively and efficiently utilized.
True
The graphic approach to location break-even analysis displays the range of volume over which each location is preferable.
True
The ratio of labor cost per day to productivity, in units per day, is the labor cost per unit.
True
The rest allowances that convert normal time to standard time have three components: personal time allowances, delay allowances, and fatigue allowances.
True
The term focused processes refers to the quest for increased efficiency, whether in goods or services, that results from specialization.
True
The tool that calculates which process has the lowest cost at any specified production volume is a crossover chart. (T/F)
True
Time-function mapping is a flow diagram with time added to the horizontal axis.
True
Two uses of labor standards are to determine the labor content of items produced and to determine staffing needs
True
Unfavorable exchange rates can offset other savings in a location decision.
True
When innovation replaces cost as a firm's focus for location decisions, the presence of other state-of-the-art firms is a plus, not a negative, for the firm's competitiveness.
True
Work sampling estimates the percent of time that a worker spends on various tasks
True
Workers in which of the following countries probably experience the least amount of job expansion, on average?
United States
____________ is actual output as a percent of design capacity
Utilization
If demand exceeds capacity at a new facility, an organization can use which of the following to move demand to an existing facility?
aggressive marketing
When making a location decision at the region/community level, which of these would be considered?
all the above (government rules, attitudes, stability, incentives, cultural and economic issues, cost and availability of utilities)
Fabricators, Inc. wants to increase capacity by adding a new machine. The fixed costs for machine A are $90,000, and its variable cost is $15 per unit. The revenue is $21 per unit. The break-even point for machine A is
15,000 units
Sample observations of a claims processor made over a 160-hour work month reveal that the worker produced a total of 384 completed claims forms. The performance rating was 80%. The worker was idle 20% of the time (so that idle time should be subtracted from the total time when computing the average observed time). The allowance factor is 8%. What is the normal time per unit?
16.0 minutes
Process A has fixed costs of $1000 and variable costs of $5 per unit. Process B has fixed costs of $500 and variable costs of $15 per unit. The crossover point between process A and process B is
50 units
Which one of the following technologies is used only for material handling, not actual production or assembly?
AGVs
"Automatic placement and withdrawal of parts and products into and from designated places in a warehouse" describes
ASRS
Value Stream Mapping
ATA (is a variation on time function mapping, examines the supply chain to determine where value is added, extends time function mapping back to the supplier, starts with the customer and works backwards)
Process redesign
ATA (is the fundamental rethinking of business processes, can focus on any process, tries to bring about dramatic improvements in performance, focuses on activities that cross functional lines)
The tally sheet data from a work sampling study provides information regarding
the percent of time spent on various tasks
Therbligs are
the smallest unit of basic motion used in methods time measurement exercises
An advantage of work sampling is that
the time spent observing the employee is relatively short
Shadow boards and foot printing are elements of
the visual workplace
Predetermined time standards are an outgrowth of basic motions called
therbligs
All of the following are advantages of predetermined time standards except
they are customized to your company
Among the advantages of predetermined time standards are all of the following except
they can only be determined after work actually takes place
On the crossover chart where the costs of two or more location alternatives have been plotted, the quantity at which two cost curves cross is the quantity at which
total costs are equal for two alternative locations
The crossover point is that production quantity where
total costs for one process equal total costs for another process
Break-even is the number of units at which
total revenue equals total cost
In transportation modeling, what has as its purpose to summarize all relevant data and to keep track of algorithm computations?
transportation matrix
Production and/or shipping costs are always considered in which of the following location decision methods?
transportation method
The ______________ is used to determine the best pattern of shipments from several points of supply to several points of demand.
transportation method
Which of the following is a location analysis technique typically employed by a manufacturing organization?
transportation method
Which of the following is usually not one of the top considerations in choosing a country for a facility location?
zoning regulations
Which of these factors would be considered when making a location decision at the site level?
zoning regulations
A regional bookstore chain is about to build a distribution center that is centrally located for its eight retail outlets. It will most likely employ which of the following tools of analysis?
center-of-gravity model
FedEx schedules its aircraft using a __________ system, which it credits with reducing package mishandling and delay in transit.
central hub
Which of the following represents a common way to manage capacity in the service sector?
changes in staffing levels
One fundamental difference between a process chart and a process map is that
chart is a table, while the process map is more like a schematic diagram
Operations managers will need to consider ethical and social responsibility issues when location decisions involve
child labor issues, sweatshop conditions, allegiance to the firm's current location, corruption
Geographic Information Systems can assist the location decision by
combining geography with demographic analysis
Computer-integrated manufacturing (CIM) includes manufacturing systems that have
computer-aided design, a flexible manufacturing system, inventory control, warehousing and shipping integrated
Which of the following is true regarding vision systems?
consistently accurate, modest in cost, do not become bored.
Multiproduct break-even analysis calculates the __________ of each product, __________ it in proportion to each product's share of total sales
contribution; weighting
A location decision for an appliance manufacturer would tend to have a(n)
cost focus
In transportation modeling, what do we do if total supply is greater than total demand?
create a dummy destination
In mass service and service factory quadrants of the service process matrix, the operations manager could focus on all of the following except
customization
The difference between job enrichment and job enlargement is that
enriched jobs involve vertical expansion, while enlarged jobs involve horizontal expansion
An organization whose capacity is on that portion of the average unit cost curve that falls as output rises
has a facility that is below optimum operating level and should build a larger facility
Advances in technology
have had dramatic impact on customer interaction with services and with products
Which of the following is not a work environment issue with ethical implications?
hazardous materials in the workplace, equal opportunity, equal pay for equal work, danger on the job
Which of the following phrases best describes product focus?
high fixed costs, low variable costs
Which of the following is not one of the essential ingredients for mass customization?
high machine utilizations
A product-focused process is commonly used to produce
high-volume, low-variety products
Which of the following is not a limitation of job expansion?
higher capital cost, higher wage rates, smaller labor pool, higher training costs
Globalization of the location decision is the result of all of the following except
higher quality of labor overseas
Which of the following techniques may not provide reliable and accurate time standards?
historical example
In mass service and professional service, the operations manager should focus on
human resources
Managers should seek to control such work environment factors as
illumination, noise and vibration, temperature, air quality
Which of the following represents an aggressive approach to demand management in the service sector when demand and capacity are not particularly well matched?
inexpensive rates for weekend phone calls
Properly set labor standards represent the amount of time that it should take an average employee to perform specific job activities under
normal working conditions
Identify two methods that can be used to establish an initial feasible solution for the transportation problem:
northwest-corner rule and intuitive lowest-cost method
Which of the following is used by methods analysis in analyzing body movement at the workstation level?
operations chart
Adding a complementary product to what is currently being produced is a demand management strategy used when
the existing product has seasonal or cyclical demand
Which of the following is NOT a requirement for using the transportation model?
the fixed cost of operating each origin point
A useful tactic for increasing capacity is to redesign a product in order to get more throughput.
True
A value-stream map includes both (1) inventory quantities, and (2) symbols for customers and suppliers.
True
An advantage of predetermined time standards is that the standard can be set before a task is actually performed.
True
An example of an intangible cost, as it relates to location decisions, is the quality of education.
True
An operations chart, or right-hand/left-hand chart, points out wasted motion and idle time.
True
Automated storage and retrieval systems are commonly used in distribution facilities of retailers.
True
Changes in capacity may lead, lag, or straddle the demand.
True
Design capacity is the theoretical maximum output of a system in a given period under ideal conditions.
True
Equitable pay alone cannot achieve a reasonable quality of work life in an organization.
True
Expected output is sometimes referred to as rated capacity.
True
Fixed costs are those costs that continue even if no units are produced.
True
Flexible manufacturing systems, because of easily changed control programs, are able to perform such tasks as manufacturing one-of-a-kind parts economically.
True
Flextime is a system that allows employees, within limits, to determine their own work schedules.
True
Hackman and Oldham's five desirable characteristics of job design include job significance and autonomy
True
In process-focused facilities, equipment utilization is low.
True
In selecting new equipment and technology, decision-makers look for flexibility—the ability to respond with little penalty in time, cost, or customer value.
True
Intermittent processes are organized around processes.
True
Job rotation is an example of job enlargement.
True
Kanbans and andons are both elements of the visual workplace, because they are visual signals that replace printouts and paperwork.
True
Labor cost and labor availability often drive the location decision in the call center industry.
True
Labor planning determines employment stability.
True
Labor standards based on historical experience are relatively inexpensive to obtain
True
Lists have been developed that rank countries on issues such as "competitiveness" and "corruption."
True
A(n) __________ uses an automated work cell controlled by electronic signals from a common centralized computer facility.
flexible manufacturing system or FMS
"Operators simply load new programs, as necessary, to produce different products" describes
flexible manufacturing systems
"Schematic used to investigate movement of people or material" describes a(n)
flow diagram
A drawing of the movement of material, product, or people is a
flow diagram
Methods analysis employs which of the following charts in its analysis of the movement of workers and materials?
flow diagram
In a large aerospace company, it has been discovered that some insulators have been damaged. A methods specialist is sent out to follow the insulators through the production and storage processes and to try to find out where in the process they are damaged. The specialist should use
flow diagrams
Service blueprinting
focuses on the provider's interaction with the customer
The two most basic policies associated with employment stability are
follow demand exactly and hold employment constant
In time studies, average observed time for an element is
for all observations, the sum of all times recorded divided by the number of observations
A quasi-custom product
gets its apparent customization from the combinations available from a small number of modules, is often the output of repetitive focus facilities, is a valid description of a fast food sandwich
Standard Register
groups people and machines into departments that perform specific activities
Which of the following is not one of the four approaches to capacity expansion?
lag demand with one-step expansion
When making a location decision at the country level, which of these would be considered?
location of markets
Which of the following phrases best describes process focus?
low volume, high variety
The objective of a human resource strategy is to
manage labor and design jobs so people are effectively and efficiently utilized
he objective of a human resource strategy is to
manage labor and design jobs so people are effectively and efficiently utilized.
Labor standards can help a firm determine expected production, which in turn enables
managers and workers to know what constitutes a fair day's work
The transportation method, when applied to location analysis
minimizes total production and transportation costs
Flexibility can be achieved with
movable, inexpensive, sophisticated, and modular equipment
Which of the following is not an analytical target of methods analysis?
movement of capital
Flow diagrams are used to analyze
movement of people and materials
For a time study, the three factors that determine how large a sample size to take are
needed accuracy, desired confidence, and absolute amount of error
A fabrication company wants to increase capacity by adding a new machine. The firm is considering proposals from vendor A and vendor B. The fixed costs for machine A are $90,000 and for machine B, $75,000. The variable cost for A is $15.00 per unit and for B, $18.00. The revenue generated by the units processed on these machines is $21 per unit. If the estimated output is 5000 units, which machine should be purchased?
no purchase because neither machine yields a profit at that volume
A shop wants to increase capacity by adding a new machine. The firm is considering proposals from vendor A and vendor B. The fixed costs for machine A are $90,000 and for machine B, $75,000. The variable cost for A is $15.00 per unit and for B, $18.00. The revenue generated by the units processed on these machines is $22 per unit. If the estimated output is 9,000 units, which machine should be purchased
no purchase because neither machine yields a profit at that volume
A manager who is conducting a time study now needs an accuracy of ±0.1 minutes, rather than ±0.2 minutes as in the past. Because of this change in accuracy, the adequate sample size becomes
none of the above
Which of the following transformations generally has the highest equipment utilization?
product-focused process
Which of these factors would be considered when making a location decision at the region/community level?
proximity to raw materials and customers
Which of the following is a location analysis technique typically employed by a service organization?
purchasing power analysis
Intangible costs include which of the following?
quality of prospective employees, quality of education, availability of public transportation
Industrial location analysis typically attempts to
reduce costs
Mutual trust is
reflected in reasonable, documented employment policies, honestly and equitably implemented to the satisfaction of both management and the employees
In location planning, environmental regulations, cost and availability of utilities, and taxes are
regional/community factors
An assembly line is an example of a
repetitive process
Which of the following industries is likely to have low equipment utilization?
restaurants
A location decision for a traditional department store (Macy's) would tend to have a(n)
revenue focus
Industrial firms choose locations that minimize cost, but service firms look for locations with good demographics and traffic count because these variables are indicators of good __________.
revenue or volume of business
A system using an automated work cell controlled by electronic signals from a common centralized computer facility is called a(n)
FMS
Location decisions are based on many things, including costs, revenues, incentives, attitudes, and intangibles, but not on ethical considerations.
False
Maintaining a stable workforce generally results in the firm paying higher wages than a firm that follows demand
False
Most unions do not accept the use of predetermined time standards.
False
Mutual trust means that both management and employee strive to meet common objectives.
False
Normal time equals the average observed time multiplied by the allowance factor
False
Normal time is always less than the average observed time
False
Process maps use distance, but not time, to show the movement of material, product, or people through a process.
False
Production technology has had a major impact on services, but as yet there has been little reduction in service labor requirements.
False
Professional services typically require low levels of labor intensity.
False
Profit-sharing is a motivation and incentive system where executives receive stock options.
False
Psychological factors have little relevance in the design of assembly line jobs since they involve physical products and production technology.
False
Self-directed teams tend to be successful in work environments where there is little employee empowerment
False
Break-even analysis is a powerful analytical tool, but is useful only when the organization produces a single product.
False
Building an additional warehouse is an incremental expansion, not a one-step expansion.
False
Capacity decisions are based on technological concerns, not demand forecasts.
False
Dell's approach to personal computer manufacturing is to use a product focus, which gives the company its low-cost competitive advantage.
False
Ergonomics is a branch of economics that deals with costs of scheduling workers.
False
FedEx chose Memphis, Tennessee, for its central location, or "hub," primarily because of the incentives offered by the city of Memphis and the state of Tennessee.
False
For a location decision, labor productivity may be important in isolation, but low wage rates are a more important criterion.
False
Fredrick W Taylor is credited with introducing psychology into the workplace.
False
Generally, the objective of the location decision is to maximize the firm's profit.
False
Harley-Davidson, because it has so many possible combinations of products, utilizes the process strategy of mass customization.
False
If a manager conducting a time study needed an accuracy of ± 0.1 minutes, rather than ± 0.2 minutes, the adequate sample size would have to be twice as large.
False
In constructing the standard time for a task, the elements that make up the task must use the same performance ratings factor.
False
In location decisions, intangible costs are easier to measure than tangible costs.
False
Industrial location decisions often assume that costs are relatively constant for a given area.
False
Job expansion can lead to increased labor cost because of the extra workers hired in the expansion.
False
Labor specialization includes the development of specialized tools to reduce labor costs.
False
Labor standards based on historical experience are the preferred method of choice
False
__________________ is a cost-volume analysis to make an economic comparison of location alternatives.
Locational break-even analysis
Which of these is the most common predetermined time standard?
MTM
____________ is a rapid, low-cost production process that caters to constantly changing unique customer desires.
Mass customization
FedEx chose Memphis, Tennessee, as its U.S. hub because
- center of the U.S. - airport has few hours of bad weather closures - reach cities w/ no direct flights - the firm believed hub system > city-to-city flight scheduling
When done correctly, mass customization
- increases pressure on supply chain performance, - helps eliminate the guesswork that comes with sales forecasting - drives down inventories - increases pressure on scheduling
A Time Measurement Unit, or TMU, is
0.00001 hour
The data below represent time study observations for an assembly operation. Assume a 7% allowance factor. What is the normal time for element 3? Observations (times in minutes) Element Performance Rating12345 1100%1.51.61.41.51.5 290%2.32.22.12.22.4 3115%1.71.91.91.41.6 4100%3.53.63.63.63.2
1.96 min.
A work sampling study requires an acceptable error level of 10 percent and z = 2 for 95.45 percent confidence. The adequate sample size is _______ if the sample proportion is thought to be as large as 50 percent, but ________ if the sample proportion is thought to be about 20 percent.
100; 64
Sample observations of a claims processor made over a 160-hour work month reveal that the worker produced a total of 384 completed claims forms. The performance rating was 80%. The worker was idle 20% of the time (so that idle time should be subtracted from the total time when computing the average observed time). The allowance factor is 8%. What is the standard time per unit?
17.4 minutes
In work measurement, personal time allowances are often established in the range of
4 - 7%
Fred's Fabrication, Inc. wants to increase capacity by adding a new machine. The firm is considering proposals from vendor A and vendor B. The fixed costs for machine A are $90,000 and for machine B, $70,000. The variable cost for A is $9.00 per unit and for B, $14.00. The revenue generated by the units processed on these machines is $20 per unit. The crossover between machine A and machine B is
4,000 units, with B more profitable at low volumes
Christopher's Cranks uses a machine that can produce 100 cranks per hour. The firm operates 12 hours per day, five days per week. Due to regularly scheduled preventive maintenance, the firm expects the machine to be running during approximately 95% of the available time. Based on experience with other products, the firm expects to achieve an efficiency level for the cranks of 85%. What is the expected weekly output of cranks for this company?
4845
The actual average observed time for a given job is 10 minutes. The performance rating is 80%, and allowances are set by contract at 10%. What is the time standard?
8.88 minutes
The Academic Computing Center has five trainers available in its computer labs to provide training sessions to students. Assume that the capacity of the system is 1900 students per semester and the utilization is 90%. If the number of students who actually got their orientation session is 1500, what is the efficiency of the system?
87.7%
The staff training center at a large regional hospital provides training sessions in CPR to all employees. Assume that the capacity of this training system was designed to be 1200 employees per year. Since the training center was first put in use, the program has become more complex, so that 1050 now represents the most employees that can be trained per year. In the past year, 950 employees were trained. The efficiency of this system is approximately _____ and its utilization is approximately _____.
90.5 percent; 79.2 percent
The accuracy of a labor standard is to be within 5%, and the confidence level is 95%. The standard deviation of the sample is 2 and the mean is 8. What sample size should be used?
96
An organization's process strategy
ATA (will have long-run impact on efficiency and flexibility of production, is the same as its transformation strategy, must meet various constraints, including cost, is concerned with how resources are transformed into goods and services)
___________ is a computer-controlled warehouse that provides for the automatic placement of parts into and from designated places within the warehouse.
Automated storage and retrieval system or ASRS
_______________ analysis finds the point at which cost equals revenues
Break-even
__________ occurs when competing companies locate near each other because of a critical mass of information, talent, venture capital, or natural resources.
Clustering
Which of the following statements regarding "proximity" in the location decision is false?
Clustering among fast food chains occurs because they need to be near their labor supply.
Political risk, cultural issues, and exchange rates are among those __________ that affect which country will be selected for a location decision.
Critical Success Factors
____________ is actual output as a percent of effective capacity
Efficiency
"Visual workplace" is a term coined by Hawthorne, and refers to the need for proper lighting at employee workstations.
False
A decision tree for analyzing capacity would have future demands or market favorability as the decision alternatives.
False
A decision tree indicates at what quantity profit changes from negative to positive.
False
A process map with the addition of a time axis becomes a process chart.
False
Activity times should not be included in a service blueprint.
False
An advantage of work sampling is that it completely breaks down work elements
False
An enlarged job has more responsibility than the same job enriched.
False
An example of the postponement strategy for improving service productivity is having the customer wait until you have sufficient time to serve the customer.
False
Because service jobs are so much more variable than manufacturing jobs, time measurement standards similar to MTM do not exist for most services.
False
Because various employment laws now require it, "equal pay for equal work" is no longer an ethical concern in the work environment.
False
Break-even analysis identifies the volume at which fixed costs and revenue are equal.
False
uses work cells to feed its assembly line
Harley Davidson
Which of these assumptions is not associated with strategies for goods-producing location decisions?
High customer contact issues are critical.
Which of the following statements is NOT true?
Implementing a flexible workweek often moves employees to part-time status.
Which of the following is true regarding work sampling?
It can be used to estimate the percentage of time workers spend in unavoidable delays.
Which of the following is true regarding the concept of flexibility?
It is the ability to change production rates with little penalty in time, cost, or customer value., It can be accomplished with sophisticated electronic equipment., It may involve modular, movable, even cheap equipment.
Which of the following characteristics best describes repetitive focus?
Its output is a standardized product produced from modules.
_____________ is a means of determining the discounted value of a series of future cash receipts.
Net present value or NPV
Which of the following is true regarding opportunities to improve service processes?
None of the above is true.
Which of the following statements regarding ethical and environmentally friendly processes is true?
Operations managers can be environmentally sensitive and still follow a low cost strategy.
allowances are those that depend upon the distance from employees to restrooms, water fountains, and other facilities
Personal time
A firm is considering two location alternatives. At location A, fixed costs would be $4,000,000 per year, and variable costs 0.30 per unit. At alternative B, fixed costs would be $3,600,000 per year, with variable costs of $0.35 per unit. If demand is expected to be 10 million units, which plant offers the lowest total cost?
Plant B, because it is cheaper than Plant A for all volumes over 8,000,000 units
divide(s) manual work into small basic elements that have established and widely accepted times.
Predetermined time standards
Process X has fixed costs of $10,000 and variable costs of $2.40 per unit. Process Y has fixed costs of $9,000 and variable costs of $2.25 per unit. Which of the following statements is true?
Process Y is cheaper than process X at all volumes; there is no crossover point.
__________ is the use of information technology to control a physical process.
Process control
_______________ is the fundamental rethinking and radical redesign of business processes to bring about dramatic improvements in performance.
Process reengineering
Which of the following technologies would enable a cashier to scan the entire contents of a shopping cart in seconds?
RFID
______________ is a process strategy that uses a product-oriented production process that uses modules.
Repetitive focus
Management and labor share the labor cost reductions in which of these compensation schemes?
Scanlon plan
______________ is a process analysis technique that focuses on the customer and the producer's interaction with the customer.
Service blueprinting
Which of the following statements regarding incentive systems is false?
The Scanlon plan is based on team productivity.
Which of the following statements regarding Starbucks Coffee is false?
The firm's cafes are exclusively in traditional settings: malls, tourist areas, and airports.
Manufacturers may want to locate close to their customers, if the transportation of finished goods is expensive or difficult.
True
Which of the following statements describes job rotation?
The operator is allowed to move, for example, from one type of CNC machine to the other.
Which of the following is false regarding repetitive processes?
They allow easy switching from one product to the other.
A time-study procedure involves timing a sample of worker's performance and using it to set a standard.
True
Which of the following are true regarding allowances in time studies?
They have a "constant" and a "variable" component, are adjusted for work conditions such as heating, lighting, and noise, include allowances for personal time, delay, and fatigue, represent the adjustment between normal time and standard time
Which of the following are typical of process control systems?
They have sensors., The digitized data are analyzed by computer, which generates feedback., Their sensors take measurements on a periodic basis., The sensors' measurements are digitized.
____________ is the amount a facility can hold, store, receive, or produce in a period of time
Throughput or Capacity
Timing a sample of a worker's performance and using it to set a standard is the work measurement technique of
Time studies
involves timing a sample of a worker's performance and using it as a basis for setting a standard time.
Time study
A firm's process strategy is its approach to transforming resources into goods and services.
True
A modern "stopwatch" study can be conducted using a special-purpose PDA, one which can digitally capture events, times, and other variables for later analysis on a spreadsheet.
True
Which of the following statements regarding fixed costs is true?
While fixed costs are ordinarily constant with respect to volume, they can "step" upward if volume increases result in additional fixed costs.
Which of the following is an ergonomics issue with ethical implications?
a noisy workplace
Traffic counts and purchasing power analysis of drawing area are techniques associated with
a retail or professional service location decision
Standard time
accounts for performance rating factors and for allowances
Ergonomics is not concerned with
adequate compensation schemes
The visual workplace
all the above (uses low-cost visual devices to share information, is an effective means of rapid communication in a dynamic workplace, helps with both "big picture" and "housekeeping" issues in the workplace, eliminates non-value added activities by making problems and standards visual)
Labor standards are defined as the
amount of time required to perform a job or part of a job
"Designed to show economy of motion by pointing out waste motion and idle time" describes
an operations chart
Product Focused processes
are processes that are specialized for relatively few products or customer groups
Activity charts
are used to study and improve the utilization of an operator and a machine.
Which of the following worker characteristics would likely be least important for U.S. firms looking to open up call centers in different countries?
are young
Which of the following products is likely to be assembled on a repetitive process line?
automobiles, personal computers, dishwashers, television sets
When a worker has a say in the work methods that he/she wishes to utilize, his/her job is characterized by
autonomy
In a stopwatch time study, the average time it takes a given worker to perform a task a certain number of times, without correction for performance rating or allowances, is the
average observed time
In time studies, normal time is
average observed time multiplied by a performance rating factor
The capacity planning strategy that delays adding capacity until capacity is below demand, then adds a capacity increment so that capacity is above demand, is said to____________ demand
average or straddle
Which of the following best describes mutual commitment in an organization?
both management and the employees are committed to the same objective
When firms build supply chains that include foreign firms, __________ and __________ are issues that raise ethical and legal concerns with operations managers.
bribery, corruption
Which of the following costs would be incurred even if no units were produced?
building rental costs
When a worker obtains clear and timely information about his/her performance, his/her job is characterized by
feedback
Making environmentally sound products through efficient processes
can still be profitable
Effective capacity is the
capacity a firm expects to achieve given the current operating constraints
The ____________ is a mathematical technique used for finding the best location for a single distribution point that services several stores or areas.
center-of-gravity method
In the service sector, scheduling customers is ____________, and scheduling the workforce is ____________
demand management; capacity management
One of the elements of ergonomics is
designing tools and machines that facilitate human work
The center-of-gravity method is used primarily to determine what type of locations?
distribution center locations
Ethical and environmentally friendly processes include which of the following?
emission controls, recycling, efficient use of resources, reduction of waste by-products
A firm is seeking a new factory location, and is considering several countries worldwide. In some of these countries, child labor is prevalent; in others, working conditions and worker safety are inferior to conditions in the U.S. An operations manager paying attention to __________ will factor these issues into the location decision.
ethical and social responsibility issues
Utilization in process-oriented facilities is frequently low because
excess capacity for peak demands is desirable
What is sometimes referred to as rated capacity?
expected output
An approach to location analysis that includes both qualitative and quantitative considerations is
factor rating
Evaluating location alternatives by comparing their composite (weighted-average) scores involves
factor rating analysis
Which of the following methods best considers intangible costs related to a location decision?
factor rating analysis
Community attitudes, zoning restrictions, and quality of labor force are likely to be considered in which of the following location decision methods?
factor rating method
Location analysis techniques typically employed by service organizations include
factor rating method, center-of-gravity method, purchasing power analysis of area, traffic counts
The ___________ method is popular because a wide variety of factors, from education to recreation to labor skills, can be objectively included.
factor-rating
A manufacturing firm finds a location that has a significant cost advantage over alternatives, but rejects that location because the educational infrastructure was insufficient to train the firm's workers in its special production technologies. The firm's action illustrates the link between __________ and location.
innovation
When _________, in addition to creativity and R&D investments, is critical to operations strategy, cost may cease to be the primary focus of location criteria.
innovation
A job shop is an example of a(n)
intermittent process
Methods analysis focuses on
issues such as the movement of individuals or materials
A disadvantage of work sampling is that
it tends to be less accurate, particularly when task times are short
Job rotation is an example of
job enlargement
The behavioral approach to job design that involves giving the worker a larger portion of the total task is
job enlargement
Which of the following terms implies an increase in responsibility and control?
job enrichment
Four of the components of job design are
job specialization, job expansion, psychological components, and self-directed teams
Labor cost per unit is also referred to as __________.
labor content
What are uses of labor standards?
labor content of items produced, cost and time estimates prior to production, crew size and work balance, basis of wage-incentive plans
Human resource strategy includes the decision areas of
labor planning, job design, and labor standards.
The visual workplace includes
painted symbols to indicate the proper place for tools and equipment, labeling of parts, bins, and tools to reduce waste, kanbans, andons, and statistical process control (SPC) charts, color-coded lights and signs to indicate that there is a problem
Which one of the following products is most likely made in a job shop environment?
paper forms
A jewelry store is more likely than a jewelry manufacturer to consider __________ in making a location decision.
parking and access
Which of the following is most likely to affect the location decision of a service firm rather than a manufacturing firm?
parking and access
In transportation modeling, how do we handle degeneracy?
placing a zero in one of the unused squares.
Governmental attitudes toward issues such as private property, intellectual property, zoning, pollution, and employment stability may change over time. The term associated with this phenomenon is
political risk
The strategy for improving service productivity that customizes at delivery, rather than at production, is _____________.
postponement
The basic break-even model can be modified to handle more than one product. This extension of the basic model requires
price and variable cost for each product, and the percent of sales that each product represents
A(n) _______________ uses symbols to analyze the movement of people or material.
process chart
The use of information technology to monitor and control a physical process is known as
process control
The process strategy that is organized around processes to facilitate low-volume, high-variety processes is called a(n) ________________.
process focus
Three types of processes are
process focus, repetitive focus, and product focus
An organization's approach to transforming resources into goods and services is called its _____________.
process strategy
Strategies for improving productivity in services are
separation, self-service, automation, and scheduling
Traffic counts and demographic analysis of drawing areas are associated with
service location decisions
Which of the following is not among the eight components of revenue and volume for a service firm?
shipment cost of finished goods
A job characterized by _______ allows a worker to use his/her dexterity, physical strength, and skills to do his/her work.
skill variety
What is an alternative name for origin points within transportation modeling?
sources
Ethical work environment decisions by managers may be guided by
state agencies, trade associations, insurers, employees
What is an iterative technique for moving from an initial feasible solution to an optimal solution in the transportation method?
stepping-stone method
Tangible costs include which of the following?
taxes
What is "normal time," as it relates to labor standards?
the average observed time adjusted for pace
A time study is being conducted to determine the standard time for a job that is made up of several elements. This standard time requires as input(s)
the average observed time for each element
Break-even analysis can be used by a firm that produces more than one product, but
the break-even point depends upon the proportion of sales generated by each of the products
The smaller the percentage established for allowances
the closer is normal time to standard time
Which of the following is among the eight components of revenue and volume for a service firm?
uniqueness of the firm's and the competitor's locations, quality of the competition, quality of management, purchasing power of the customer-drawing area
The northwest-corner rule requires that we start in the ________ cell of the table and then begin to allocate units to shipping routes.
upper-left-hand
A flow diagram is
used to analyze the movement of people or material.
Of the four approaches to capacity expansion, the approach that "straddles" demand
uses incremental expansion & at some times leads demand, and at other times lags
LaQuinta Motor Inns has a competitive edge over its rivals because it
uses regression analysis to determine which variables most influence profitability
Which of the following is most likely to affect the location strategy of a manufacturing firm?
utility costs
Activity charts help analyze
utilization of an operator and machine
The center-of-gravity method does not take into consideration the
value of the goods shipped
A special form of time-function mapping, which goes beyond the organization into its supply chain, is _____________.
value stream mapping
Basic break-even analysis typically assumes that
variable costs and revenues increase in direct proportion to the volume of production
Therbligs
were named by Frank Gilbreth
A technique for estimating the proportion of time a worker spends on various activities is
work sampling
estimates, by sampling, the percent of time that a worker spends on various tasks.
work sampling
