Chapter 1

Which of the following is/are true? A model is an abstraction of reality. A model is a simplified representation of something. All models are miniature versions of physical entities.

A model is an abstraction of reality. A model is a simplified representation of something.

Finance and operations management personnel cooperate by exchanging information and expertise in which activities? Hiring of new personnel Budgeting Provision of funds Analysis of investment proposals Assessing customer wants and needs

Budgeting Provision of funds Analysis of investment proposals

Select all that apply Which of the following is NOT one of the three basic functional areas of business? Accounting Human resources IT Marketing Operations Finance

Accounting Human resources IT

Virtue Principle

Actions should be consistent with certain ideal virtues.

Common Good Principle

Actions should contribute to the common good of the community.

Rights Principle

Actions should respect and protect the moral rights of others.

Select all that apply Which of the following are part of the role of the finance department in a business? Allocating financial resources throughout the organization Providing the services offered by the organization Providing funds for operations Budgeting Securing financial resources at favorable prices Assessing customer wants and needs Analyzing investment proposals

Allocating financial resources throughout the organization Providing funds for operations Budgeting Securing financial resources at favorable prices Analyzing investment proposals

human resources department (HR)

Concerned with recruitment and training of personnel, labor relations, contract negotiations, wage and salary administration, assisting in manpower projections, and ensuring the health and safety of employees.

Industrial engineering

Concerned with scheduling, performance standards, work methods, quality control, and material handling.

In practice, there is significant interfacing and collaboration among the various functional areas. What does this involve? Cooperative decision making Exchange of personnel Transfer pricing Exchange of information

Cooperative decision making Exchange of information

Value-added is the term used to describe the difference between the ________________ of inputs and the value or price of outputs.

Cost

Management Information Systems (MIS)

Designing systems to capture relevant information and designing reports.

Which of the following is/are NOT part of the role of marketing for a business? Promoting the organization's goods or services Designing new products to drive demand Assessing consumer wants and needs

Designing new products to drive demand

Which of the following are characteristics of sustainability in the context of business operations and strategy? (Check all that apply.) -Political sustainability -Economic sustainability -Psychological sustainability -Environmental sustainability

Economic sustainability Environmental sustainability

Fairness Principle

Equals should be held to, or evaluated by, the same standards.

Evaluation of alternative investments in plant and equipment requires inputs from who? Marketing HR Finance Operations

Finance Operations

What are the three basic functional areas of business? Accounting, operations, IT Marketing, accounting, IT Marketing, accounting, operations Finance, marketing, accounting Finance, marketing, operations Finance, marketing, IT

Finance, marketing, operations

Which of the following primary factors are important both in managing products and managing services? Managing patents Forecasting Managing variation Managing suppliers Capacity planning Process management

Forecasting Managing variation Managing suppliers Capacity planning Process management

Which statement about the functional areas in business organizations is correct? There are many common activities across the three primary functional areas. Many of the decisions in one functional area impact other areas. A successful organization limits the knowledge that personnel in one primary function have about activities in another primary function.

Many of the decisions in one functional area impact other areas.

Which of the following is/are NOT functions or components of a supply chain? Production Inventory management Purchasing Marketing Forecasting Scheduling Delivery

Marketing

Which of the following is/are part of the role of operations in a business? Assess customer needs Secure financial resources for projects Match supply with demand Produce goods and/or services

Match supply with demand Produce goods and/or services

legal department

Must be consulted on contracts with employees, customers, suppliers, and transporters, as well as on liability and environmental issues.

Service jobs such as stock market analyst, product manager, and public accountant are most closely related to which line function in an organization? IT Finance Operations Sales

Operations

___________ management can influence the entire organization.

Operations

Which of the following statement(s) is/are NOT correct? Organizations that provide services do not sell goods. Goods are physical items Organizations that sell goods do not provide services. Services are activities that provide some sort of value

Organizations that sell goods do not provide services. Organizations that provide services do not sell goods.

Which of the following is the definition of the operations function? The analysis of the processes involved in transforming inputs into outputs. The creation of goods and/or services through the transformation of inputs into outputs. The process of storing the raw material needed for any operation.

The creation of goods and/or services through the transformation of inputs into outputs.

Utilitarian Principle

The good done by an action or inaction should outweigh any harm it causes or might cause.

As an example of a trade-off decision faced by an operations manager, an increased warranty period on a car will lead to ___________ customer satisfaction and an increase in costs to the company.

higher

As an example of a trade-off decision faced by an operations manager, more options for customization of a laptop will lead to _______________ level of customer satisfaction and an increase in costs to the company.

higher

Departments such as Legal, Public Relations, and Human Resources ______ operations. interact with are subordinate to are managed by report to

interact with

Increased customization in products and services generally requires _____ resources and effort. more advanced limited less

more

Certain decisions of an operations manager affect the ____, and other decisions affect the _____. (Check all that apply.) operation of the system design of a system cost of the product marketing of a product

operation of the system design of a system

Managers must learn how to establish __________. Managers must focus on issues or items that will do the most good.

priorities

Purchasing

Has responsibility for procurement of materials, supplies, and equipment.

Which of the following statements about a system approach is/are true? A systems approach to decision making assumes that the whole is greater than the sum of its (subsystem) parts. A systems approach to decision making emphasizes the interrelationship between different subsystems of the organization. A systems approach to decision making assumes that the whole is equal to the sum of its (subsystem) parts. A systems approach to decision making assumes that a system consists of unrelated subsystems.

A systems approach to decision making assumes that the whole is greater than the sum of its (subsystem) parts. A systems approach to decision making emphasizes the interrelationship between different subsystems of the organization.

Which of the following is/are NOT part of the role of operations in a business? Assessing customer wants and needs Secure financial resources for projects Promote organization's goods or service Produce goods and/or services

Assessing customer wants and needs Secure financial resources for projects Promote organization's goods or service

Increasing levels of outsourcing

Buying goods or services instead of producing or providing them themselves.

Which of the following is/are true about the degree of customization a company offers its customers? -Greater customization tends to require more specialized (or flexible) equipment. -Greater customization tends to require greater employee skill. -Greater customization tends to reduce prices because less inventory must be kept of each item. -Greater customization impacts only the operational side of the business.

Greater customization tends to require more specialized (or flexible) equipment. Greater customization tends to require greater employee skill.

Increasing globalization

Having far-flung customers and/or suppliers means longer lead times and greater opportunities for disruption of deliveries.

Which of the following area are part of, or support, the operations function? Industrial engineering Purchasing Maintenance Public relations Distribution

Industrial engineering Purchasing Maintenance Distribution

Which of the following can marketing provide? Information on what funds might be available Judgment on the manufacturability of designs. Information on consumer preferences Insight on what competitors are doing Information on supplier preferences

Information on consumer preferences Insight on what competitors are doing

Distribution

Involves the shipping of goods to warehouses, retail outlets, or final customers.

Which of the following statements is true about production of goods? "Goods" must be positive items. It cannot involve a service in conjunction with the good. It results in a tangible output. Production of goods takes place in a factory.

It results in a tangible output.

Which of the following are inputs involved in operations function? Capital Information Land Goods

Land, Capital, Information (and Labor)

Which of the following are elements or components of supply chain management? Logistics Forecasting Human resources management Capacity planning Inventory

Logistics Forecasting Capacity planning Inventory

Select all that apply Which of the following is/are NOT part of the role of operations in a business? Promote organization's goods or service Produce goods and/or services Assessing customer wants and needs Secure financial resources for projects

Promote organization's goods or service Assessing customer wants and needs Secure financial resources for projects

Which of the following is/are the responsibility of marketing? Promoting goods and services Approving new product designs Evaluating production equipment Assessing customer wants and needs Communicating customer needs to manufacturing

Promoting goods and services Assessing customer wants and needs Communicating customer needs to manufacturing

______________ approaches to decision making in operations management have been accepted because of calculators and computers capable of handling the required calculations.

Quantitative

Which of the following statements is correct? Quantitative approaches to problem solving are used to reduce the ambiguity of the decision making process by ignoring qualitative information. Quantitative approaches to problem solving are concerned with assigning costs to everything. Quantitative approaches to problem solving frequently try to find mathematical optimal solutions to business problems.

Quantitative approaches to problem solving frequently try to find mathematical optimal solutions to business problems.

Public Relations (PR)

Responsible for building and maintaining a positive public image of the organization.

Maintenance

Responsible for general upkeep and repair of equipment, buildings and grounds, heating and air-conditioning; removing toxic wastes; parking; and perhaps security.

Which of the following are key issues for today's business operations? Risk management Economic conditions Lack of data Quality problems

Risk management Economic conditions Quality problems

What are the two line functions in a business organization? Accounting Sales Operations Human resource management Marketing

Sales Operations

Select all that apply Which of the following statement(s) is/are correct? Services are activities that provide some sort of value Companies cannot provide both goods and services. Goods are physical items

Services are activities that provide some sort of value Goods are physical items

Which of the following statements is true about delivery of services? Delivery of services generally involves a low degree of customer contact. Services are intangibles, implying acts that create value. Services are performed by human beings, not machines.

Services are intangibles, implying acts that create value.

Which of the following is/are true? Because services are consumed at the same time they are produced, services are easier to manage. Services can often require more, and more specialized, labor than manufacturing does. Services have a higher degree of wage variability. It can be more challenging to measure productivity in services because of the higher degree of variability in the types of services performed.

Services can often require more, and more specialized, labor than manufacturing does. Services have a higher degree of wage variability. It can be more challenging to measure productivity in services because of the higher degree of variability in the types of services performed.

Accounting

Supplies information to management on costs of labor, materials, and overhead, and may provide reports on items such as scrap, downtime, and inventories.

What are some problems associated with supply chains? LIttle room for improvement Supply chains operating independently of each other Large oscillations of inventories Late deliveries Inventory stockouts Dealing with shipping problems from China

Supply chains operating independently of each other Large oscillations of inventories Late deliveries Inventory stockouts

Which among the following is/are correct statements about the role of an operations manager? The operations manager must decide what resources will be needed. The operations manager does not decide when resources will be needed. This is a strategic decision taken by upper management. The operations manager may work with the finance department to determine the necessary amount of funding for resource expansion. The operations manager decides on product placement and location. The operations manager must decide when certain resources will be needed and in what quantity.

The operations manager must decide what resources will be needed. The operations manager may work with the finance department to determine the necessary amount of funding for resource expansion. The operations manager must decide when certain resources will be needed and in what quantity.

Which of the following statements captures the definition of a supply chain? The sequence of suppliers that are involved in producing and delivering a product or service. The sequence of organizations - their facilities, functions, and activities - that are involved in producing and delivering a product or service. The sequence of storage and transportation that are involved in producing and delivering a product or service. The sequence of suppliers and warehouses that are involved in producing and delivering a product or service.

The sequence of organizations - their facilities, functions, and activities - that are involved in producing and delivering a product or service.

Competitive pressures

This has led to an increasing number of new products, shorter product development cycles, and increased demand for customization.

Inventory

This plays a major role in the success or failure of a supply chain, so it is important to coordinate this throughout a supply chain.

A company's supply chain consists of the sequence of organizations, including their facilities, functions, and activities, that are involved in producing and delivering a good or service. True/ False

True

A process consists of a series of actions that transform inputs into outputs. True/ False

True

Which of the following characteristics tends to be higher in production of goods. Uniformity of inputs Inventory Opportunity to correct problems Customer contact Labor content

Uniformity of inputs Inventory Opportunity to correct problems

For a for-profit organization, what is the value of its outputs? Cost to deliver What customers will pay Value to society Profits

What customers will pay

Which among the following is/are the types of decisions an operations manager must make? When will we need certain resources? What resources will be needed? What price should we charge for our products or services? How will we procure funding for the resources?. How many resources will be needed? Where will resources be needed?

When will we need certain resources? What resources will be needed? How many resources will be needed? Where will resources be needed?