MG111 Chapter 1

Six Sigma was introduced by ______. a. Pennril Datacom b. General Electric c. Motorola d. Toyota

c. Motorola

Which is not an organization associated with operations management? a. NSA b. APICS c. ASQ d. ISM

a. NSA

Which of the following statements is true with respect to offshoring and outsourcing? a. Offshoring is a subset of outsourcing. b. Companies typically engage in either outsourcing or offshoring but not both. c. Outsourcing is a subset of offshoring. d. Offshoring practices are common in the early stages of the product life cycle.

a. Offshoring is a subset of outsourcing.

Which of the following is a primary reason for the accelerated pace of global interaction? a. advancements in information technology b. language barriers c. cultural differences d. trade barriers

a. advancements in information technology

What is typically not a benefit of offshoring? a. an increase in quality b. lower cost c. a larger pool of talent d. work is completed faster

a. an increase in quality

Which of the following is part of the inbound portion of a company"s supply chain? a. basic raw materials and components, transportation links, and warehouses b. wholesalers c. regulatory organizations and government agencies d. retailers

a. basic raw materials and components, transportation links, and warehouses

What industry would be most associated with providing services? a. counseling b. restaurants c. steel d. fast foods

a. counseling

Which of the following is part of the outbound portion of a company"s supply chain? a. distribution centers b. suppliers of raw materials c. local or foreign suppliers of product ideas and designs d. suppliers of partly assembled products and other inputs

a. distribution centers

Trends that are expected to continue with regard to resource usage include ______. a. elimination of waste b. decline in productivity c. increase in resource price d. decline in sustainability

a. elimination of waste

Which of the following would not be considered as part of a transformation process? a. finished goods b. labor c. capital d. raw material

a. finished goods

Outputs that are tangible and can be inventoried generally require low customer contact and often require intensive capital investment are known as a. goods b. supply Chains c. operations d. services

a. goods

Suppliers are the ______ portion of an organization"s supply chain. a. inbound b. internal c. downstream d. outbound

a. inbound

Operations management in an organization ______. a. is a part of functional strategy b. guides corporate strategy c. is concerned only with short-term strategies as the environment is rapidly changing d. has declined in importance in recent years

a. is a part of functional strategy

One reason why many of the manufacturing jobs are outsourced is ______. a. lower labor cost in these countries b. trade barriers c. greater potential for products of poor quality d. increased political risk

a. lower labor cost in these countries

Pick the odd one out in relation to supply chain decisions a. operational b. None of these c. tactical d. strategic

a. operational

Suppliers that provide raw materials, basic services, or manufacturing components for the primary firm"s manufacturing or service production processes are known as a. second-tier b. first-tier c. outbound d. inbound

a. second-tier

If a firm"s products are no longer properly aligned with changing market trends, the firm can ______. a. sell its products to customers in another market who do value its products b. make new investments to upgrade its manufacturing facilities c. acquire new suppliers d. reorganize its product distribution processes

a. sell its products to customers in another market who do value its products

The use of methods, systems, and materials that won"t deplete resources or harm natural cycles is known as a. sustainability b. corporate responsibility c. environmentalism d. green thumb

a. sustainability

Which of the following statements about a supply chain is true? a. A supply chain focuses on the organizations involved in transforming raw materials to finished products but does not include the handling and management of products returned by customers b. A supply chain includes all organizations that contribute to the development, manufacture, and shipping of products to a consumer. c. A supply chain refers to the organizations to which a company either offshores or outsources production or other operations. d. A company that does not offshore or outsource production or other operations is said not to have a supply chain.

b. A supply chain includes all organizations that contribute to the development, manufacture, and shipping of products to a consumer.

The management philosophy that focuses on continuously improving the quality of a company"s products and processes is a. TQM b. CQI c. Six Sigma d. BPR

b. CQI

Which of the following countries is the world"s leading provider of services? a. Brazil b. India c. China d. Russia

b. India

A management philosophy where any activity or process that does not add value to the product or service is a waste and, therefore, should be eliminated is a. Six Sigma b. Lean c. TQM d. CQI

b. Lean

Which of the following statements about managing a supply chain is true? a. Managing supply chains has become easier, as an organization can function simply by offshoring all its operations. b. Managing supply chains has become difficult over the years, as it involves working with a large number of organizations. c. The difficulty of managing supply chains has remained about the same. d. Managing supply chains has become easier, as a large number of operations are outsourced to other companies.

b. Managing supply chains has become difficult over the years, as it involves working with a large number of organizations.

The quality improvement and management system developed at Motorola in the late 1980"s was a. CQI b. Six Sigma c. CSI d. TQM

b. Six Sigma

Which of the following is true with respect to strategic decisions? a. In the hierarchy of decisions, strategic decisions follow operational decisions. b. Strategic decisions are long-term in nature. c. Master production scheduling and material requirements planning are examples of strategic decisions. d. Each strategic decision is independent of other decisions.

b. Strategic decisions are long-term in nature.

Which of the following is true with respect to strategic, tactical, and operational decisions? a. Customer relationship planning is often considered a strategic decision. b. Tactical and operational decisions have to conform to their higher-order, strategic choices. c. Tactical and operational decisions are clearly delineated. d. The hierarchy of decisions suggests that strategic, tactical, and operational decisions are independent of each other.

b. Tactical and operational decisions have to conform to their higher-order, strategic choices.

Which of the following is a risk that a company faces when it outsources its operations? a. The cost of labor for the outsourcing company may decline. b. The third-party provider may not have the degree of expertise that the outsourcing company has. c. If the outsourcing operation is too successful, the third-party provider may want to acquire the outsourcing company. d. If the outsourcing operation is too profitable, the outsourcing company may want to acquire the third-party provider.

b. The third-party provider may not have the degree of expertise that the outsourcing company has.

Which of the following is true with regard to primary firms, first-tier suppliers, and second-tier suppliers? a. Second-tier suppliers are not as important as first-tier suppliers. b. To a primary firm, a first-tier supplier supplies finished goods and a second-tier supplier supplies raw materials. c. A second-tier supplier is the primary firm to a first-tier supplier. d. A first-tier supplier is the primary firm to a second-tier supplier.

b. To a primary firm, a first-tier supplier supplies finished goods and a second-tier supplier supplies raw materials.

It is critical that strategic decisions, tactical decisions, and operations decisions need to be a. written up and presented to lower-level staff b. aligned c. analyzed by computers d. thought about carefully

b. aligned

Which of the following is false about the quality assurance manager? a. an integral part of a firm"s TQM strategic initiatives b. always reports directly to the CEO of the company c. ensures preestablished quality standards are met d. responsible for the elimination of product defects

b. always reports directly to the CEO of the company

Supplier management is ______ interface in a product supply chain. a. a horizontal b. an upstream c. a vertical d. a downstream

b. an upstream

The application of Six Sigma is least likely to be appropriate for ______. a. services b. creative works like painting c. manufacturing d. supply chain

b. creative works like painting

First-tier suppliers are those who ______. a. charge the highest prices b. depend on other suppliers for certain supplies or raw materials c. charge the lowest prices d. depend on the primary firm for certain supplies or raw materials

b. depend on other suppliers for certain supplies or raw materials

Which of the following is a challenge for today"s supply chain managers? a. advances in scientific management b. finding reliable low-cost suppliers c. emphasis on high-volume mass production d. advances in information technology

b. finding reliable low-cost suppliers

The four walls of the supplier does not include one of the following a. production of the products b. finding third party logistics company c. transporting of the goods d. sourcing of raw materials

b. finding third party logistics company

Firms that provide components or finished goods and services to the primary firm are called ______. a. second-tier suppliers b. first-tier suppliers c. second-tier customers d. first-tier customers

b. first-tier suppliers

Some of the risks presented by offshoring jobs include ______. a. growth in political stability in developing economie b. geopolitical risks c. increasing use of English as a common language d. reduction in trade barriers

b. geopolitical risks

Some of the risks presented by offshoring jobs include ______. a. reduction in trade barriers b. geopolitical risks c. growth in political stability in developing economies d. increasing use of English as a common language

b. geopolitical risks

A firm"s operations strategy ______. a. Is directly influenced by a firm"s corporate strategy b. guides a firm in using its operational resources effectively to help it achieve a competitive advantage c. provides a road map for decisions regarding business acquisitions or divestitures that the firm"s operations managers make d. Directly influences a firm"s corporate strategy

b. guides a firm in using its operational resources effectively to help it achieve a competitive advantage

Contingency planning ______. a. is not essential as it will not be used in most cases b. is time-consuming and expensive c. all of the these d. should be avoided

b. is time-consuming and expensive

The formation of the European Union ______. a. encouraged trade barriers among European countries b. led to strict quality and environmental standards that companies have to meet in order to do business with member countries. c. was initiated by World War II d. was initiated by World War I

b. led to strict quality and environmental standards that companies have to meet in order to do business with member countries.

Which of the following strategies is best suited according to the textbook for companies who want to perform better in a globalized supply chain: a. defining consumer allocation zones b. managing internal operations c. conducting market research analysis d. determining logistic partnership

b. managing internal operations

Which of the following is not a transformation process? a. physiological b. metaphysical c. transaction will d. physical

b. metaphysical

Contracting with a third party or an external company to manufacture a good or deliver a service is known as ______. a. offshoring b. outsourcing c. internalization d. domestic production

b. outsourcing

Both operations management and supply chain management share the same goal of ______. a. managing flows of information b. producing and delivering goods and services that create value for customers c. managing internal and external interfaces d. managing a transformation process

b. producing and delivering goods and services that create value for customers

Which one of the following variables connect the three entities of the Operations as a Transformation System together. a. None of these b. quality control or quality assurance c. machines d. goods

b. quality control or quality assurance

Which is not a component of the outbound portion of the supply chain? a. consumers b. raw materials c. retailers d. wholesalers

b. raw materials

When firms break their traditional supply chains into smaller and more agile supply chains that can better respond to higher levels of business complexity, save money, and improve customer service, it is known as a. diversification b. splintering c. conglomeration d. supply chain segmentation

b. splintering

A sequence of interconnected organizations that help develop, produce, distribute, and sell a product to the final consumer is known as a. operations Management b. supply Chain c. outsourcing d. offshoring

b. supply Chain

Which of the following are reasons a company may outsource its operations? a. to have greater control over its operations b. to access specialized skills c. to comply with foreign government regulations d. to avoid trade barriers

b. to access specialized skills

Which one of the following is NOT one of the approaches with regard to quality improvement? a. agile manufacturing b. total rework c. Six Sigma d. lean manufacturing

b. total rework

Which of the following can be on both the inbound and outbound portion of a supply chain? a. customer b. transportation c. retailer d. supplier

b. transportation

Firms that receive goods directly from an organization and are responsible for providing the goods to end-point retailers, and who sell directly to consumers are a. inbound suppliers b. wholesalers c. outbound suppliers d. retailers

b. wholesalers

Which is not a component of the inbound portion of the supply chain? a. foreign suppliers b. wholesalers c. local suppliers d. raw materials

b. wholesalers

Decisions that are made for the medium term are a. strategic b. operational c. tactical d. moderately Important

c. tactical

______ manufacturing refers to the ability of an organization to respond quickly to market changes. a. Six sigma b. Lean c. Agile d. Total quality

c. Agile

Which of the following statements is true when we consider operations as a transformation system? a. Raw materials and finished goods are considered part of the transportation process. b. Finished products and services are in the middle stage of the transformation process. c. Labor, capital, and energy are considered as inputs into the system. d. The communication from inputs to outputs is considered a feedback loop.

c. Labor, capital, and energy are considered as inputs into the system.

Companies that do not include environmental costs into the cost of production a. Are conscientious corporate citizens b. Have an advantage over those companies that do so c. May face serious problems in the long run d. Are likely to have high production costs

c. May face serious problems in the long run

Which of the following is likely to be a core competency for a company? a. ability to set up an R&D unit b. ability to outsource c. ability to innovate d. availability of commodities

c. ability to innovate

The management philosophy that emphasizes a firm"s ability to respond quickly to market changes with a set of processes, tools, and training available as needed is a. six Sigma b. lean c. agile Manufacturing d. synchronized Manufacturing

c. agile Manufacturing

Which of the following quality philosophies is correctly paired with its strategy? a. TQM: expediting rework b. lean: improving quality by reducing the number of defects c. agile manufacturing: using technology to integrate different operations d. Six Sigma: eliminating waste

c. agile manufacturing: using technology to integrate different operations

By globalization, we mean, among other things, that ______. a. a business can sell in a foreign country b. a business can source materials from an overseas supplier c. both A and B d. neither A nor B

c. both A and B

In the process of transforming inputs into value added goods and services, it is useful to have a feedback loop. Which of the following is less likely to be considered part of the operations feedback loop? a. communications from customers to the company b. communications from customers to the company"s suppliers c. communications from the manufacturing manager to the company"s management d. feedback from the manufacturer to its suppliers

c. communications from the manufacturing manager to the company"s management

Which of the following statements is true with regard to the current global business environment a. companies are well equipped to deal with challenges in the current environment b. companies compete in simpler environments c. companies compete in complex environments d. companies are willing to take significant risk

c. companies compete in complex environments

Challenges that a company can face with regard to global supply chains include ______. a. impact of organizations such as the European Union b. political upheavals c. decline in the importance of outsourcing d. decline in the importance of offshoring

c. decline in the importance of outsourcing

The process used to anticipate and manage customer demand for a product or service is known as a. upstream Management b. logistics Management c. demand Management d. downstream Management

c. demand Management

Operations management can add economic value by ______. a. enhancing the value of products and services b. increasing costs to customers c. identifying markets for new products d. identifying new markets for existing products

c. identifying markets for new products

Decisions that are short-term, day-to-day decisions are a. tactical b. strategic c. operational d. not Very Important

c. operational

Contracting with a third party or an external company to manufacture a good or deliver a service is known as a. flexible management b. strategic cost reduction c. outsourcing d. expediting

c. outsourcing

Outputs that are intangible, cannot be easily inventoried, generally require high customer contact and often do not require intensive capital investment are known as a. operations b. supply Chains c. services d. goods

c. services

Companies successful in integrating their operations and supply chains globally possess which of the following capabilities? a. ability to follow the dictates of corporate strategy b. strict adherence to ISO requirement c. supply chain adaptability d. ability to divest a business

c. supply chain adaptability

Inventory control, quality control, production scheduling, supplier evaluation, performance measurement, and customer relations management would be examples of what type of decisions? a. production b. operational c. tactical d. strategic

c. tactical

Sustainability refers to ______. a. the financial capability of a firm to maintain its operations without resorting to external funding b. a company"s ability to ensure that suppliers deliver raw materials and other inputs on a timely basis over an extended period c. the use of methods, systems, and materials that will not deplete resources or harm natural cycles d. the use of proper methods for maintaining the longevity of machines and other equipment

c. the use of methods, systems, and materials that will not deplete resources or harm natural cycles

Which of the following statements best describes the ultimate goal of operations and supply chain strategies? a. to produce and deliver products or services to satisfy customers b. to make sure customers receive defect-free products c. to produce and deliver products or services that delight customers d. to make sure profits are maximized

c. to produce and deliver products or services that delight customers

A firm"s operations should have a risk management program that can anticipate ______. a. how employees can be redeployed from a business in distress b. the need to redeploy its resources c. uncontrollable events d. the need to divest the business

c. uncontrollable events

Through effective operations management a. increase cost to the consumer b. we can reduce a product"s aesthetic features c. we can increase product quality d. we can deliver products to customers slowly

c. we can increase product quality

Which of the following statements about a supply chain is true? a. A supply chain refers to the organizations to which a company either offshores or outsources production or other operations. b. A supply chain focuses on the organizations involved in transforming raw materials to finished products but does not include the handling and management of products returned by customers. c. A company that does not offshore or outsource production or other operations is said not to have a supply chain. d. A supply chain includes all organizations that contribute to the development, manufacture, and shipping of products to a consumer.

d. A supply chain includes all organizations that contribute to the development, manufacture, and shipping of products to a consumer.

Which of the following statements about managing a supply chain is true? a. Managing supply chains has become easier, as a large number of operations are outsourced to other companies. b. The difficulty of managing supply chains has remained about the same. c. Managing supply chains has become easier, as an organization can function simply by offshoring all its operations d. Managing supply chains has become difficult over the years, as it involves working with a large number of organizations.

d. Managing supply chains has become difficult over the years, as it involves working with a large number of organizations.

The triple bottom line is a way to ______. a. Both X and Y b. Y. ensure that society is compensated for any harm (e.g., pollution) imposed on it c. X. ensure a minimum level of returns for the company"s stockholders d. Neither X nor Y

d. Neither X nor Y

A supply chain is often called ______. a. an operation b. a global network c. a knowledge chain d. a value chain

d. a value chain

Which of the following would not be considered as part of a transformation process? a. input b. output c. feedback loop d. accounting

d. accounting

As a result of global competition, many companies ______. a. lost their competitive edge and market share b. realized the importance of operations strategies c. adopted total quality management d. all of these

d. all of these

The benefits of offshoring include ______. a. availability of child labor b. increased labor costs c. high processing costs d. availability of skilled human resources

d. availability of skilled human resources

The allocation of resources between different strategic business units of the corporations is guided by ______. a. divisional strategy b. business strategy c. departmental strategy d. corporate strategy

d. corporate strategy

Offshoring is simply defined as sourcing a. externally (outside) and services b. none of these c. externally (outside) and products d. externally (outside) and work (products and services)

d. externally (outside) and work (products and services)

Suppliers that provide components, systems, and finished goods to primary firms are known as a. inbound b. outbound c. second-tier d. first-tier

d. first-tier

What is NOT a likely outcome for committing to a program of sustainability? a. lower risks b. more Innovation c. lower costs d. more litigation

d. more litigation

Sales and operations planning, inventory management, master production scheduling, material requirements planning, distribution and transportation planning would be examples of what type of decisions? a. tactical b. strategic c. marketing d. operational

d. operational

Managing operations within each company in a supply chain requires ______ both long-term and short-term tasks. a. planning, staffing, and executing b. strategizing, staffing, and controlling c. supervising, motivating, and executing d. planning, organizing, and executing

d. planning, organizing, and executing

Which of the following is a risk that a company faces when it outsources its operations a. modular production b. third party provider not lacking degree of expertise c. declining cost of labor for outsourcing company d. product transformation risk

d. product transformation risk

Which of the following is a strategic supply chain and operations decision? a. transportation planning b. inventory management c. supplier evaluation d. quality management

d. quality management

Which of the following strategies describes how best Zara attracts customers from the textbook? a. sourcing differentiation b. keeping styles available for extended period c. speed to production d. speed to market

d. speed to market

What industry would be most associated with producing goods? a. fast foods b. repairs c. restaurants d. steel

d. steel

Decisions that have a long-term impact on the firm are a. operational b. significant c. tactical d. strategic

d. strategic

Product and service design, process design, plant and warehouse location, layout planning, supplier selection, outsourcing and offshoring, choosing transportation modes would be examples of what type of decisions? a. marketing b. operational c. tactical d. strategic

d. strategic

First-tier suppliers refers to ______. a. suppliers who provide components, systems, or finished goods and services at the highest cost b. suppliers who provide components, systems, or finished goods and services that are of high quality c. suppliers who provide components, systems, or finished goods and services at the lowest cost d. suppliers who provide components, systems, or finished goods and services to the primary firm

d. suppliers who provide components, systems, or finished goods and services to the primary firm

Achieving total quality requires ______. a. the involvement of the United Nations b. the involvement of the ISO c. the involvement of the U.S. Senate d. the commitment of the organization"s management and employees

d. the commitment of the organization"s management and employees

Sustainability refers to ______. a. a company"s ability to ensure that suppliers deliver raw materials and other inputs on a timely basis over an extended period b. the use of proper methods for maintaining the longevity of machines and other equipment c. the financial capability of a firm to maintain its operations without resorting to external funding d. the use of methods, systems, and materials that will not deplete resources or harm natural cycles

d. the use of methods, systems, and materials that will not deplete resources or harm natural cycles

The Six Sigma approach to quality ______. a. was welcomed by all companies b. applies only to manufacturing c. was started in 1962 d. was initiated by Motorola

d. was initiated by Motorola