Exam 3 Terms
job sharing
A scheduling option that allows two individuals to split the tasks, responsibilities, and work hours of one 40-hour-per-week job.
critical path method (CPM)
A scheduling tool that enables a manager to determine the critical path of activities for a project—the activities that will cause the entire project to fall behind schedule if they are not completed on time.
program evaluation and review technique (PERT)
A scheduling tool that is similar to the CPM method but assigns three time estimates for each activity (optimistic, most probable, and pessimistic); allows managers to anticipate delays and potential problems and schedule accordingly.
ISO 9000
A set of five technical standards of quality management created by the International Organization for Standardization to provide a uniform way of determining whether manufacturing plants and service organizations conform to sound quality procedures.
ISO 14000
A set of technical standards designed by the International Organization for Standardization to promote clean production processes to protect the environment.
relationship marketing
A strategy that focuses on forging long-term partnerships with customers by offering value and providing customer satisfaction.
just-in-time (JIT)
A system in which materials arrive exactly when they are needed for production, rather than being stored on-site.
value-stream mapping
Routing technique that uses simple icons to visually represent the flow of materials and information from suppliers through the factory to customers.
pricing strategy
Setting a price based upon the demand for and cost of a good or service.
job enlargement
The horizontal expansion of a job by increasing the number and variety of tasks that a person performs.
mass production
The manufacture of many identical goods at once.
product life cycle
The pattern of sales and profits over time for a product or product category; consists of an introductory stage, growth stage, maturity, and decline (and death).
Hawthorne effect
The phenomenon that employees perform better when they feel singled out for attention or feel that management is concerned about their welfare.
environmental scanning
The process in which a firm continually collects and evaluates information about its external environment.
exchange
The process in which two parties give something of value to each other to satisfy their respective needs.
purchasing
The process of buying production inputs from various sources; also called procurement.
quality control
The process of creating quality standards, producing goods that meet them, and measuring finished goods and services against them.
marketing research
The process of planning, collecting, and analyzing data relevant to a marketing decision.
e-procurement
The process of purchasing supplies and materials online using the internet.
market segmentation
The process of separating, identifying, and evaluating the layers of a market in order to identify a target market.
supply-chain management
The process of smoothing transitions along the supply chain so that the firm can satisfy its customers with quality products and services; focuses on developing tight bonds with suppliers.
customization
The production of goods or services one at a time according to the specific needs or wants of individual customers.
outsourcing
The purchase of items from an outside source rather than making them internally.
customer value
The ratio of benefits to the sacrifice necessary to obtain those benefits, as determined by the customer; reflects the willingness of customers to actually buy a product.
culture
The set of values, ideas, attitudes, and other symbols created to shape human behavior.
job rotation
The shifting of workers from one job to another; also called cross-training.
price skimming
The strategy of introducing a product with a high initial price and lowering the price over time as the product moves through its life cycle.
leader pricing
The strategy of pricing products below the normal markup or even below cost to attract customers to a store where they would not otherwise shop.
penetration pricing
The strategy of selling new products at low prices in the hope of achieving a large sales volume.
inventory
The supply of goods that a firm holds for use in production or for sale to customers.
five Ps
The traditional 4Ps of marketing: product, price, promotion, place (distribution), now with people added as a key marketing component, which together make up the marketing mix.
promotion strategy
The unique combination of personal selling, traditional advertising, publicity, sales promotion, social media, and e-commerce to stimulate the target market to buy a product. Sometimes referred to as the promotion mix.
computer-aided design (CAD)
The use of computers to design and test new products and modify existing ones.
computer-aided manufacturing (CAM)
The use of computers to develop and control the production process.
Total Quality Management (TQM)
The use of quality principles in all aspects of a company's production and operations.
job enrichment
The vertical expansion of a job by increasing the employee's autonomy, responsibility, and decision-making authority.
Six Sigma
A quality-control process that relies on defining what needs to be done to ensure quality, measuring and analyzing production results statistically, and finding ways to improve and control quality.
want
The gap between what is and what is desired.
need
The gap between what is and what is required.
mass customization
A manufacturing process in which goods are mass-produced up to a point and then custom-tailored to the needs or desires of individual customers.
survey research
A marketing research method in which data is gathered from respondents, either in person, by telephone, by mail, at a mall, or through the internet to obtain facts, opinions, and attitudes.
experiment
A marketing research method in which the investigator changes one or more variables—price, packaging, design, shelf space, advertising theme, or advertising expenditures—while observing the effects of these changes on another variable (usually sales).
observation research
A marketing research method in which the investigator monitors respondents' actions without interacting directly with the respondents; for example, by using cash registers with scanners.
line extension
A new flavor, size, or model using an existing brand name in an existing category.
assembly process
A production process in which the basic inputs are either combined to create the output or transformed into the output.
manufacturing resource planning II (MRPII)
A complex computerized system that integrates data from many departments to allow managers to more accurately forecast and assess the impact of production plans on profitability.
enterprise resource planning (ERP)
A computerized resource-planning system that incorporates information about the firm's suppliers and customers with its internally generated data.
materials requirement planning (MRP)
A computerized system of controlling the flow of resources and inventory. A master schedule is used to ensure that the materials, labor, and equipment needed for production are at the right places in the right amounts at the right times.
perpetual inventory
A continuously updated list of inventory levels, orders, sales, and receipts.
product (or assembly-line) layout
A facility arrangement in which workstations or departments are arranged in a line with products moving along the line.
cost competitive advantage
A firm's ability to produce a product or service at a lower cost than all other competitors in an industry while maintaining satisfactory profit margins.
differential competitive advantage
A firm's ability to provide a unique product or service with a set of features that the target market perceives as important and better than the competitor's.
niche competitive advantage
A firm's ability to target and effectively serve a single segment of the market, often within a limited geographic area.
focus group
A group of eight to 12 participants led by a moderator in an in-depth discussion on one particular topic or concept.
bill of material
A list of the items and the number of each required to make a given product.
Theory X
A management style, formulated by Douglas McGregor, that is based on a pessimistic view of human nature and assumes that the average person dislikes work, will avoid it if possible, prefers to be directed, avoids responsibility, and wants security above all.
Theory Y
A management style, formulated by Douglas McGregor, that is based on a relatively optimistic view of human nature; assumes that the average person wants to work, accepts responsibility, is willing to help solve problems, and can be self-directed and self-controlled.
job shop
A manufacturing firm that produces goods in response to customer orders.
scientific management
A system of management developed by Frederick W. Taylor and based on four principles: developing a scientific approach for each element of a job, scientifically selecting and training workers, encouraging cooperation between workers and managers, and dividing work and responsibility between management and workers according to who can better perform a particular task.
Theory Z
A theory developed by William Ouchi that combines U.S. and Japanese business practices by emphasizing long-term employment, slow career development, moderate specialization, group decision-making, individual responsibility, relatively informal control over the employee, and concern for workers.
goal-setting theory
A theory of motivation based on the premise that an individual's intention to work toward a goal is a primary source of motivation.
Maslow's hierarchy of needs
A theory of motivation developed by Abraham Maslow; holds that humans have five levels of needs and act to satisfy their unmet needs. At the base of the hierarchy are fundamental physiological needs, followed in order by safety, social, esteem, and self-actualization needs.
reinforcement theory
A theory of motivation that holds that people do things because they know that certain consequences will follow.
expectancy theory
A theory of motivation that holds that the probability of an individual acting in a particular way depends on the strength of that individual's belief that the act will have a particular outcome and on whether the individual values that outcome.
equity theory
A theory of motivation that holds that worker satisfaction is influenced by employees' perceptions about how fairly they are treated compared with their coworkers.
personality
A way of organizing and grouping how an individual reacts to situations.
Malcolm Baldrige National Quality Award
An award given to recognize U.S. companies that offer goods and services of world-class quality; established by Congress in 1987 and named for a former secretary of commerce.
punishment
Anything that decreases a specific behavior.
reward
Anything that increases a specific behavior.
Gantt charts
Bar graphs plotted on a time line that show the relationship between scheduled and actual production.
distribution strategy
Creating the means by which products flow from the producer to the consumer.
hygiene factors
Extrinsic elements of the work environment that do not serve as a source of employee satisfaction or motivation.
reference groups
Formal and informal groups that influence buyer behavior.
quality
Goods and services that meet customer expectations by providing reliable performance.
marketing concept
Identifying consumer needs and then producing the goods or services that will satisfy them while making a profit for the organization.
critical path
In a critical path method network, the longest path through the linked activities.
product
In marketing, a good, service or idea, along with its perceived attributes and benefits, that creates value for the customer.
motivating factors
Intrinsic job elements that lead to worker satisfaction.
expense items
Items (purchased by businesses) that are smaller and less expensive than capital products and usually have a life span of less than one year.
capital products
Large, expensive items with a long life span that are purchased by businesses for use in making other products or providing a service.
CAD/CAM systems
Linked computer systems that combine the advantages of computer-aided design and computer-aided manufacturing. The system helps design the product, control the flow of resources needed to produce the product, and operate the production process.
blockchain technology
Refers to a decentralized "public ledger" of all transactions that have ever been executed. It is constantly expanding, as "completed" blocks are added to the ledger with each new transaction.
motivation
Something that prompts a person to release his or her energy in a certain direction.
lean manufacturing
Streamlining production by eliminating steps in the production process that do not add benefits that customers want.
product strategy
Taking the good or service and selecting a brand name, packaging, colors, a warranty, accessories, and a service program.
buyer behavior
The actions people take in buying and using goods and services.
routing
The aspect of production control that involves setting out the work flow—the sequence of machines and operations through which the product or service progresses from start to finish.
scheduling
The aspect of production control that involves specifying and controlling the time required for each step in the production process.
marketing mix
The blend of product offering, pricing, promotional methods, distribution system, and strategies for utilizing people that creates an offering that brings a specific group of consumers superior value.
production control
The coordination of materials, equipment, and human resources to achieve production and operating efficiencies
customer satisfaction
The customer's feeling that a product has met or exceeded expectations.
make-or-buy decision
The determination by a firm of whether to make its own production materials or to buy them from outside sources.
inventory management
The determination of how much of each type of inventory a firm will keep on hand and the ordering, receiving, storing, and tracking of inventory.
volume segmentation
The differentiation of markets based on the amount of the product purchased.
benefit segmentation
The differentiation of markets based on what a product will do rather than on customer characteristics.
psychographic segmentation
The differentiation of markets by personality or lifestyle.
geographic segmentation
The differentiation of markets by region of the country, city or county size, market density, or climate.
demographic segmentation
The differentiation of markets through the use of categories such as age, education, gender, income, and household size.
electronic data interchange (EDI)
The electronic exchange of information between two trading partners.
supply chain
The entire sequence of securing inputs, producing goods, and delivering goods to customers.
