Service and Production Operations Test 2

Assume a fixed cost for a process of $15,000. The variable cost to produce each unit of product is $10, and the selling price for the finished product is $25. Which of the following is the number of units that has to be produced and sold to break even?

1,000 units

Using the assembly-line balancing procedure, which of the following is the theoretical minimum number of workstations if the task times for the six tasks that make up the job are 4, 6, 7, 2, 6, and 5 minutes, and the cycle time is 10 minutes?

3

A medical clinic has two doctors and each can treat 25 patients a day. The doctors see walk-in patients whose arrival times cannot be controlled, and also patients who have made appointments. Knowing the expected number of walk-ins per day, appointments are scheduled to utilize the doctors fully. The following table gives the expected number of walk-ins for a particular week: What is the total number of appointments that can be scheduled during this week?

45

Using the assembly-line balancing procedure, which of the following is the required cycle time in minutes per unit if the daily production time is 480 minutes and the required daily output is 50 units?

9.6

______ is not a strategy for reduction of customer-induced variability.

Adapt to customer skill levels

To reduce process flow time, you might try which of the following actions?

All of these

A process flowchart uses which of the following symbols to represent flows of material or customers in a flow diagram?

Arrow

Which of the following basic types of process structures is one in which equipment or work processes are arranged according to the progressive steps by which the product is made?

Assembly line

Which of the following basic types of production layout formats is one in which equipment or work processes are arranged according to the progressive steps by which the product is made?

Assembly line layout

Which of the following best describes the term "cycle time"?

Average time between completions of successive units

To reduce process throughput time, you might try which of the following actions?

Change the sequence of activities

Suppose that you have two processes A and B for producing a widget. Process A has a fixed cost of $10,000 and per unit variable cost of $80.00. Process B has a fixed cost of $30,000 and the per unit variable cost is $40.00. The widget sells for $100 regardless of production process used. During the next three years (your planning horizon for the widgets) you expect the economy to be pretty good with sales of widgets to be at least 700 units per year. You will

Choose Process B, since it will have higher net profit than process A in the next three years

Which of the following is not considered an input to the layout decision in facility layout analysis?

Cost per square foot of alternative facilities

Which of the following is not a strategy to manage demand?

Cross-training employees

Which of the following refers to the physical presence of the customer in a service system?

Customer contact

______ variability is not one of the five sources of customer-induced variability.

Demand

Which of the following is not a strategy for managing capacity?

Developing complementary services

A process flowchart uses which of the following symbols to represent a decision point in a flow diagram?

Diamond

Which of the following is not an example of the differential pricing policy?

Difference in hospital fees for walk-in and scheduled services

Which of the following is not a step in developing a manufacturing cell layout?

Disposing of leftover machinery and outsourcing ungrouped processes

The placement of which of the following is not determined by production process organization decisions?

Emergency exits

Which of the following is not considered a major work flow structure?

Fabrication

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

False

A manufacturing cell groups identical machines together to work on products having similar shapes and processing requirements.

False

A service operation by its very nature is a make-to-stock type of production process.

False

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

False

An example of segmenting demand is seen when movie theaters offer matinee prices before 6:00 p.m.

False

As a general rule, manufacturing workstations should not be very close together.

False

Blocking in production processes is when activities in a stage must continue because there is no place to deposit completed items.

False

Having a lot of interstage storage of materials is considered a good layout design for a manufacturing plant.

False

Implicit services are not part of the service package.

False

Make-to-order production processes are well suited for high-volume production of a standardized product.

False

The customer is (or should be) the second most important focal point of all decisions in a service organization.

False

The time needed to respond to a customer's order is called the customer response time.

False

When a make-to-order production process is used, production is based on forecasts.

False

Work-center layouts allocate dissimilar machines into cells to work on products that have dissimilar processing requirements.

False

Which of the following terms describes the time a unit spends actually being worked on together with the time spent waiting in a queue?

Flow time

A process flowchart uses symbols to represent which of the following?

Flows of material or customers

In the service-system design matrix, an Internet and on-site technology service encounter is expected to have which of the following?

High production efficiency

Consider a three sequentially stepped process named as Process A, Process B and Process C. Input comes into Process A. Output form A goes into Process B. Output from B goes into Process C. Output of C is the final output. Suppose that it takes 2 minutes per unit in Process A, 3 minutes per unit in Process B and 1 minute per unit in Process C. Suppose further that Process A receives input at the rate of 30 per hour. Where would you place a buffer?

In front of process B

A process flowchart uses which of the following symbols to represent storage areas or queues in a flow diagram?

Inverted triangle

An advantage of a make-to-stock process is which of the following?

It features rapid delivery of a standard product

For a chase demand strategy which of the following does not have a high trade-off?

Labor-skill level

The long-term relationship among the inventory, throughput, and flow time of a production system in steady state is called which of the following?

Little's law

In the service-system design matrix, a face-to-face total customization service encounter is expected to have which of the following?

Low production efficiency

In the service-system design matrix, a mail contact service encounter is expected to have which of the following?

Low sales opportunity

Which of the following is not a basic type of production layout format?

Process layout

Which of the following is not a basic type of process structure?

Product-process matrix

A restaurant that features special lunchtime combo meals is providing all of the following benefits, except: ______.

Promotes off-peak demand

A health club's offering a reduced rate membership for students to workout before 4:00 p.m. on weekdays is ______.

Promoting off-peak demand

A process flowchart uses which of the following symbols to represent tasks or operations in a flow diagram?

Rectangle

Which of the following is not part of "the service triangle"?

Service encounter

Which one of the following is not a major factor distinguishing service design and development from manufacturing design and development?

Service operations can be protected by patents; manufacturing operations cannot

Which of the following is a characteristic that can be used to guide the design of service systems?

Services cannot be inventoried

In the design of retail service layouts, the term "ambient conditions" does not refer to which of the following?

Staffing

Which of the following production process terms best describes the situation when activities in a stage of production must stop because there is no work?

Starving

In the design of retail service layouts, the term "ambient conditions" could refer to which of the following?

Temperature

Which of the following is a major factor that distinguishes service design and development from manufacturing design and development?

The service package is the major output of the development process

Which of the following is not a characteristic of yield management?

There is one homogeneous customer class

A "process" is any part of an organization that takes inputs and transforms them into outputs that, hopefully, are of greater value to the organization than the original inputs.

True

A drawback to increased consumer participation is the fact that service quality is no longer completely under the control of the provider of the service.

True

A high-level map or diagram of a supply chain process can be useful to understand how material flows and where inventory is held.

True

A project layout is characterized by a relatively low number of production units in comparison with workcenter and assembly-line formats.

True

A workcenter is a basic production layout format in which similar equipment or functions are grouped together.

True

An explicit service is readily observable by the senses.

True

An implicit service implies psychological benefits that the customer may sense only vaguely.

True

An important aspect of service products is that they cannot be inventoried.

True

Assemble-to-order means moving the customer order decoupling point from finished goods to components.

True

Assembly-line balancing means assigning all necessary tasks to a series of workstations so that each workstation has no more than can be done in the workstation cycle time and so that idle time across all workstations is minimized.

True

Benchmarking refers to the practice of comparing the production metrics of one firm with the production metrics of another.

True

Buffering in a production process refers to a storage area between stages of production activity where output of a stage is placed prior to being used in a "downstream" stage.

True

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

True

For the purposes of assembly-line balancing, cycle time is found by dividing production time per day by the required units of output per day.

True

If the sum of the task times required to produce a product is 45 minutes and the cycle time for the same product is 10 minutes, the theoretical minimum number of workstations is 5 using the assembly-line balancing procedure.

True

If you want to reduce process flow time, one solutions is to perform activities in the process in parallel.

True

In assembly-line balancing, the theoretical minimum number of workstations is found by a ratio of the sum of all task times divided by the cycle time.

True

In designing a production layout a flexible line layout might have the shape of a "U".

True

In designing a production line, a mixed-model line layout is used by JIT manufacturers.

True

Job design is defined as the function of specifying the work activities of an individual or group in an organizational setting.

True

One methodology used to evaluate equipment investment decisions where the investment entails an initial investment, fixed costs, and variable costs is break-even analysis.

True

One trade-off illustrated by the product-process matrix is between flexibility and cost

True

Pacing in production processes refers to the fixed timing of the movement of items through the process.

True

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

True

Service capacity is defined in terms of an achievable level of output per unit time.

True

Setup time is the time required to prepare a process to produce a particular item.

True

The essential issue in satisfying customers in the make-to-stock environment is to balance the level of finished inventory against the level of service to the customer.

True

The focus in the make-to-stock environment is on providing finished goods where and when the customers want them.

True

The objective of a mixed-model line layout is to meet the demand for a variety of products and avoid building high inventories.

True

The objective of a retail service layout is to maximize net profit per square foot of store space.

True

The term "assembly line" refers to progressive assembly linked by some material handling device.

True

Using part-time personnel at fast-food restaurants allows capacity to vary with demand.

True

Yield management is a strategy that manages both demand and capacity.

True

Faced with variable demand and a perishable capacity, a service manager can smooth demand by ______.

Using reservations and appointments

Which of the following basic types of process structures is one in which similar equipment or functions are grouped together?

Work center

Which of the following is a basic type of process structure?

Work center

Which of the following basic types of production layout formats is one that has similar equipment or functions are grouped together?

Workcenter layout

Several approaches to demand management exist, but only ______ seeks to maximize revenue.

Yield management

A good overbooking strategy should ______.

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

The purpose of differential pricing is to ______.

make off-peak usage attractive

Bars that offer happy hours in the afternoon are using the strategy of

promoting off-peak demand