SPOM 2
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? Group technology layout Job-shop layout Assembly line layout Functional layout Process layout
Assembly line layout
A process flowchart uses which of the following symbols to represent flows of material or customers in a flow diagram? Diamond Rectangle Arrow Inverted triangle A dashed line
Arrow
To reduce process throughput time, you might try which of the following actions? Introduce incentive pay Change the sequence of activities. Reduce management interference. Improve teamwork. Outsource activities
Change the sequence of activities.
Which of the following is not a strategy for managing capacity? Forecasting demand. Developing complementary services. Scheduling shifts. Using part-time employees.
Developing complementary services.
Which of the following is not a step in developing a manufacturing cell layout? Identifying dominant flow patterns of parts families as a basis for location of processes None of these Disposing of leftover machinery and outsourcing ungrouped processes Grouping parts into families that follow a common sequence of steps Physically grouping machines and processes into cells
Disposing of leftover machinery and outsourcing ungrouped processes
Which of the following is not considered a major work flow structure? Continuous flow Assembly line Work center Project Fabrication
Fabrication
The customer is (or should be) the second most important focal point of all decisions in a service organization
False
______ is not a strategy for reduction of customer-induced variability. Target customers based on capability Require reservations Limit service breadth Adapt to customer skill levels
Adapt to customer skill levels
Which of the following is not a strategy to manage demand? Offering price incentives. Cross-training employees. Developing reservation systems. Partitioning demand.
Cross-training employees.
______ variability is not one of the five sources of customer-induced variability. Capability Effort Demand Arrival
Demand
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
Blocking in production processes is when activities in a stage must continue because there is no place to deposit completed items.
False
Cross-docking is a practice used in the international shipping industry that facilitates port utilization.
False
Implicit services are not part of the service package.
False
In facility location decision making, the factor-rating system is one of the least used general location techniques.
False
Make-to-order production processes are well suited for high-volume production of a standardized product.
False
Quality of life in a host community is not a major factor in making the facility location decision.
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
A process flowchart uses symbols to represent which of the following? Flows of material or customers Workforce schedules Data analysis Factory location Warehouse space available
Flows of material or customers
Which of the following is not Plant location Method we discussed? Factor-rating system Hub and Spoke Method Centroid Method Transportation Method of Linear Programming
Hub and Spoke Method
For a chase demand strategy which of the following does not have a high trade-off? Employee utilization. Supervision required. Labor turnover. Labor-skill level.
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 Murphy's law None of these Peterson's rule Robert's rule
Little's law
In the service-system design matrix, a mail contact service encounter is expected to have which of the following? None of these High production efficiency Low sales opportunity High degree of customer/server contact High sales opportunity
Low sales opportunity
Which of the following is a characteristic that can be used to guide the design of service systems? Services cannot be inventoried. Quality work means quality service. Services businesses are inherently entrepreneurial. Even service businesses have internal services. Services are all similar.
Services cannot be inventoried.
In the design of retail service layouts, the term "ambient conditions" does not refer to which of the following? Scent Noise level Lighting Staffing Music
Staffing
Which of the following is not a characteristic of yield management? The service is considered a perishable inventory. Demand fluctuates yet is somewhat predictable. Capacity is relatively fixed. There is one homogeneous customer class.
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 favorable business climate in facility location decision making might include local government providing basic skill training for prospective members of the workforce.
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
Facility location analysis considers proximity to customers important to timeliness of deliveries.
True
Services typically have multiple site locations to maintain close contact with customers.
True
Setup time is the time required to prepare a process to produce a particular item.
True
The objective of a retail service layout is to maximize net profit per square foot of store space.
True
Yield management is a strategy that manages both demand and capacity.
True
A good overbooking strategy should ______. minimize the expected cost of turning away reservations minimize the expected opportunity cost of idle service capacity none of the above; services should try to avoid overbooking balance the expected opportunity cost of idle service capacity and expected cost of turning away customers who have reservations
balance the expected opportunity cost of idle service capacity and expected cost of turning away customers who have reservations
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? 500 units 900 units 790 units 667 units 1,000 units
1,000 units
A process flowchart uses which of the following symbols to represent a decision point in a flow diagram? Inverted triangle Diamond Rectangle A dashed line Arrow
Diamond
Which of the following is not an example of the differential pricing policy? Weekend and night rates for long-distance telephone calls. None of the above. Peak-load pricing by utility companies. Difference in hospital fees for walk-in and scheduled services.
Difference in hospital fees for walk-in and scheduled services.
Work-center layouts allocate dissimilar machines into cells to work on products that have dissimilar processing requirements.
False
One of the objectives of facility location analysis is to select a site with the lowest total cost. Which of the following costs should not be included in the analysis? Incidental costs Hidden costs Energy costs Taxes Outbound distribution costs
Incidental costs
Which of the following is not a basic type of production layout format? Manufacturing cell layout Process layout Project layout Workcenter Assembly line
Process layout
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? Blocking Setup time Buffering Buffer Starving
Starving
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 None of these Low sales opportunity Low degree of customer/server contact High production efficiency
Low production efficiency
An explicit service is readily observable by the senses.
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
Facility location analysis considers the competitive imperative of locating near the appropriate labor pool to take advantage of high technical skills.
True
Facility location analysis considers the competitive imperative of locating near the appropriate labor pool to take advantage of low wage costs and/or skill levels.
True
In designing a production layout a flexible line layout might have the shape of a "U".
True
In facility location decision making, the educational and skill levels of the labor pool must match the company's needs.
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
The purpose of differential pricing is to ______. make peak period usage unattractive charge customers according to their ability to pay make off-peak usage attractive adjust capacity to demand
make off-peak usage attractive
A health club's offering a reduced rate membership for students to workout before 4:00 p.m. on weekdays is ______. offering price incentives partitioning demand using yield management promoting off-peak demand
promoting off-peak demand
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
Benchmarking refers to the practice of comparing the production metrics of one firm with the production metrics of another.
True
In class we did the Airplane exercise, describe what the exercise was trying to convey about the manufacturing process, and what the advantages of smaller batch sizes are, and also how those changes can effect a manufacturing process and ultimately improve the customer experience.
The airplane exercise in class was meant to convey the advantages of smaller batch sizes, as well as the stress of working in a manufacturing facility. Having smaller batch sizes means less WIP and wasted inventory. It also allows for more special projects to be completed and more to get done in a small amount of time. When smaller batch sizes are used, customers get their products faster and have to pay less since the manufacturing process is more efficient. Using smaller batch sizes also reduces stress for the workers, as the only have to think about one product as a time. Lastly, using smaller batch sizes also effects a manufacturing process by producing a more balanced workflow. This is especially true if a pull manufacturing process is used
Explain what the Hub and Spoke model of distribution is, and the advantages of using this model
The hub and spoke model of distribution is when a company has one main warehouse that sorts the goods. The goods are sorted and consolidated into areas for shipping to a specific region. This system seeks to reduce the distance a good must travel by placing the warehouses in locations between important locations. These companies have multiple warehouses.
Which of the following is a major factor that distinguishes service design and development from manufacturing design and development? Capacity decisions are much more critical in manufacturing operations. Manufacturing is far more capital intensive than services. The service process and service product can be developed independently. The service package is the major output of the development process. The service package has the same legal protection available to manufactured goods.
The service package is the major output of the development process.
A third-party logistics company is a firm that manages all or part of another company's product delivery operations.
True
Assemble-to-order means moving the customer order decoupling point from finished goods to components.
True
The Association for Operations Management defines logistics as "the art and science of obtaining, producing, and distributing material and product in the proper place and in proper quantities."
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 local government's willingness to invest in upgrading infrastructure to the levels required by a company is an important issue in a company's decision of where to locate a new facility.
True
Which of the following basic types of process structures is one in which similar equipment or functions are grouped together? Project Assembly line Work center Manufacturing cell Continuous process
Work center
Which of the following is a basic type of process structure? Process matrix Manual assembly Work center Product matrix Process flow diagram
Work center
Which of the following basic types of production layout formats is one that has similar equipment or functions are grouped together? Manufacturing cell layout Production line layout Workcenter layout Assembly line layout Group technology layout
Workcenter layout
Which of the following best describes the term "cycle time"? Can be no more that 60 minutes The labor content of the item being measured Average time between completions of successive units Ratio of the time a resource is activated over its use The same as utilization
Average time between completions of successive units
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 A in front of Process C None in front of Process B in front of both Process B and Process C
in front of Process B
Faced with variable demand and a perishable capacity, a service manager can smooth demand by ______. using part-time help during peak hours using reservations and appointments scheduling workshifts to vary workforce needs according to demand increasing the customer self-service content of the service
using reservations and appointments
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: Day:Mon.Tue.Wed.Th.Fri.Expected Walk-ins:4535404540 What is the total number of appointments that can be scheduled during this week? 40 35 45 30
45
Which of the following is not an infrastructure criteria used in facility location analysis? Adequate public utility systems Adequate transportation Adequate low cost labor Adequate school system Adequate health care
Adequate low cost labor
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? Project Work center Continuous process Manufacturing cell Assembly line
Assembly line
Which of the following is not considered an input to the layout decision in facility layout analysis? Space requirements for the elements in the layout Cost per square foot of alternative facilities Estimates of product or service demand on the system Processing requirements in terms of the number of operations and the flow between elements in the layout Specification of objectives and corresponding criteria to be used to evaluate the design
Cost per square foot of alternative facilities
Explain what cross docking is, and the advantages of using LTL freight and cross docking
Cross-docking occurs when large shipments are broken down into smaller parts and delivered in the local region. Often the shipping company will combine multiple shipments from different organizations together so that inventory in the Wearhouse can be reduced. Combining the shipments from different companies based on where they need to ship to reduces the wait time otherwise necessary to fill a truck and thus reduces inventory. If cross docking with LTL shipping was not used, customers would have to wait longer or companies would have to pay more for shipping, due to not being able to spread the cost over as many products. Cross-docking gives the speed of LTL while allowing the cost to be spread out between the multiple companies who are shipping products in the truck.
Which of the following refers to the physical presence of the customer in a service system? Creation of the service Intermittent production Continuous production Customer contact None of these
Customer contact
Which of the following is not a step in developing a manufacturing cell layout? identifying dominant flow patterns of parts families as a basis for location of processes None of these Disposing of leftover machinery and outsourcing ungrouped processes Grouping parts into families that follow a common sequence of steps Physically grouping machines and processes into cells
Disposing of leftover machinery and outsourcing ungrouped processes
As a general rule, manufacturing workstations should not be very close together.
False
In the service-system design matrix, an Internet and on-site technology service encounter is expected to have which of the following? Low production efficiency High degree of customer/server contact High sales opportunity High production efficiency None of these
High production efficiency
Which of the following is not a criterion that influences manufacturing plant or warehouse facility location decisions? Local labor costs Government barriers Immigration rules Trading blocs Environmental regulation
Immigration rules
A process flowchart uses which of the following symbols to represent storage areas or queues in a flow diagram? A dashed line Arrow Inverted triangle Diamond Rectangle
Inverted triangle
An advantage of a make-to-stock process is which of the following? All units of output are unique. It allows the firm to avoid inventory costs. It responds directly to customer orders. It features rapid delivery of a standard product. It combines the best features of other processes.
It features rapid delivery of a standard product.
In class we discussed managing capacity in a service organization. We discussed the Level Capacity and Chase Demand Strategies. Define and describe both strategies and provide example of firms that utilize these strategies and how each are implemented
Level Capacity is limiting production and smoothing demand. This means attempting to have the same demand and service needed the same every day and throughout the day. One example of this is a doctors office, where the customers must make appointments. There are only so many appointments every day and only at pre decided times. Chase Demand means that you are adjusting capacity to demand. When there is higher demand at peak hour of service, you must have the ability to process all of the demand. One example of this is a fast food restaurant. During busy hours, they have more staff making food and serving in order to deal with the increased demand. When they have less demand during the day, they have less employees working. Employees fluctuate with demand.
In class we discussed 4 types of Manufacturing process strategies; Make-to-Stock, Assemble-to-Order, Make-to-Order, and Engineer-to-Order. Define each one of these, and describe both the advantages and disadvantage of these strategies.
Make to stock manufacturing involves making products and sending them to stores, where they are in stock until a customer purchases them. The advantage of this type is that they are ready for the customer whenever they want them. A disadvantage is not being able to personalize and not being able to tack stock and need well Assemble to order involves having parts of a product ready (modules), but putting them together into the final product when a customer orders. An advantage of this is increased personalization. A disadvantage is taking longer to ship to customers and increased cost Make to Order means having to components of a product ordered, but letting the customer design the product. The organization then uses the parts to make the final product. This allows for even more personalization, but requires companies to work with customers to make the product and is more costly both in purchasing parts and time usage. Engineer to order means letting the customer design and build their product. The parts are not ordered until the product is designed. This allows the most customer satisfaction but takes the longest time and requires ordering special parts for every product.
What transportation mode has very high initial investment costs but gives a very low cost per mile for products that are highly specialized and require no packaging? Rail Water Air Highway Pipeline
Pipeline
Which of the following is not a basic type of process structure? Work center Assembly line Product-process matrix Manufacturing cell Continuous process
Product-process matrix
Which one of the following is not a major factor distinguishing service design and development from manufacturing design and development? The process and product must be developed at the same time. Service operations can be protected by patents; manufacturing operations cannot. Many service organizations can change their service offerings virtually overnight. The service package, rather than a definable good, is the output of the development process. Many parts of the service package are often defined by the training that individuals receive before they become part of the service organization.
Service operations can be protected by patents; manufacturing operations cannot.
In the design of retail service layouts, the term "ambient conditions" could refer to which of the following? Customers' perceptions of the service Employee morale How long the customer stays Temperature How much money a customer spend
Temperature
In class we discussed 5 types of material movement: Trucking, Rail, Ocean, Plane, and Pipeline. Describe each and provide the advantages and disadvantages of each.
Trucking - moving things on a truck. flexible but low capacity Ocean - moving things on the water on a ship. High capacity and low cost, but slow Plane - moving things on a plane. Fast, but low capacity and expensive Rail - moving things on a train. Low cost but slow and not flexible Pipeline - Moving things through an underground pipeline. Specialized and low cost per mile with no packaging needed. Limited to liquids, gases, and slurry forms
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
Cross-docking is an approach used in consolidation warehouses, where large shipments are broken down into small shipments for local delivery in an area.
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
Hub-and-spoke systems combine the idea of consolidation and that of cross-docking.
True
If you want to reduce process flow time, one solutions is to perform activities in the process in parallel.
True
In designing a production line, a mixed-model line layout is used by JIT manufacturers.
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 facility location analysis is to select the site with the lowest total cost.
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
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 A since it has a low fixed cost. choose Process B, since it will have higher net profit than process A in the next three years. choose Process B, since it has low variable cost. choose either Process A or B, since both will result in same profit for the next three years. be indifferent between choosing Process A and B , because they both have the same break-even point.
choose Process B, since it will have higher net profit than process A in the next three years.
A restaurant that features special lunchtime combo meals is providing all of the following benefits, except: ______. increases customer satisfaction decreases service times segment demand promotes off-peak demand
promotes off-peak demand
Bars that offer happy hours in the afternoon are using the strategy of ______. increasing customer participation developing complementary services creating adjustable capacity promoting off-peak demand
promoting off-peak demand
Several approaches to demand management exist, but only ______ seeks to maximize revenue. offering price incentives yield management reservation systems promoting off-peak demand
yield management
Explain the chart below and the relationships between all parties
you missed this in class, the three bases of the triangle hold up the strategy. They all need to be correct to make the strategy work
A process flowchart uses which of the following symbols to represent tasks or operations in a flow diagram? A dashed line Diamond Rectangle Arrow Inverted triangle
Rectangle
Which of the following is not part of "the service triangle"? Service encounter Customers Service strategy Employees Support systems
Service encounter
