MGT 610 Module 4: Operations Strategy Quiz

The operations function is made up of the collection of transformative resources (physical, information-based, financial, and human) together with the system by which these resources are organized. These operations resources transform which of the following types of inputs? (A) Physical raw materials (B) Information (C) Financial resources (D) Suppliers (E) Customers

A B C E

The realized operations strategy can be heavily influenced by the pattern of responses to the normal pressures on operating managers, which can lead to decisions that don't fit with the directed strategy. Which of the following represent examples of such normal pressures? (A) Finance managers urging operations to reduce costs (B) Quality control managers not insisting on strict adherence to process control specifications (C) Industrial engineers urging operations to increase standardization (D) Marketing managers insisting on quicker turnaround times

A C D

A popular local restaurant sources only natural, organic, and locally grown ingredients to prepare its menu offerings. It takes pride in offering high-quality food. A recent outbreak of swine flu led to a significantly reduced supply of locally sourced pork products and a corresponding increase in costs. There is still adequate supply for the restaurant to fulfill its supply needs, although at this higher cost. The restaurant manager decides to raise the price of pork-based menu items by 25% to cover the higher costs of pork rather than sourcing pork products from untested vendors outside the local region. This decision involves trade-offs in which of the following performance objectives? (A) Cost (B) Quality (C) Flexibility

A and B

The realized operations strategy of a firm usually differs from its directed strategy because of which of the following reason(s)? (A) Directed strategy is misinterpreted by lower-level managers. (B) Directed strategy is not communicated effectively by higher-level managers. (C) Operating managers respond to normal pressures from other functions, such as marketing and finance, by making decisions that may better serve the customers but don't fit with the objectives of the directed strategy.

A, B, and C

Relative to a resource-based operations strategy framework, a decision area-based framework will always be limited because of which of the following? (A) It is not adaptable to fit different types of companies in a wide range of industries. (B) It is limited by the choices that have already been identified. (C) It might not capture the priorities of the business models of tomorrow.

B and C

A successful company ensures its sustained success based largely on the fact that, while it is possible for its competitors to copy the component parts of the operating system's resource-based strategy framework, it is very difficult to replicate their integration successfully. Because of the complexity of an operating system, however, the organization and integration of resources may become so ingrained that the system can become inflexible, and a successful company may lose its ability to adapt. Which of the case studies discussed in the Core Reading provides a direct illustration of this intriguing situation?

Boeing

Which of the following is NOT part of the infrastructural decisions in the decision area-based operations framework for gauging the strategic alignment of the operations function?

Capacity and scope

Which of the following statements is FALSE with regard to operations focus?

Choice of operations focus should be made independently by the production people.

The first-year MBA course in strategy at Harvard Business School defines strategy as "an integrated set of choices that positions a firm in an industry so as to generate superior financial returns over the long run". Marketing strategy, finance strategy, corporate strategy, operations strategy, and business or other functional unit strategy are not independent because the choices of each unit can affect the performance outcome. In a top-down directed model, strategy follows a clear path through the organization, called the strategy hierarchy. This hierarchical flow is best represented by which of the following directional paths?

Corporate strategy -> business unit strategy -> functional strategy

True or false: By definition, directed strategies determine the organization's actual strategy.

False

True or false: From an operations strategy perspective, it is never appropriate for a firm to make trade-offs (among performance objectives) that limit the range of its activities.

False

True or false: In realigning its traditional operations strategy for its 787 Dreamliner program, Boeing envisioned that a significantly large number of employees would be required to design and assemble the new airplane using composite materials that would offer improved fuel efficiency.

False

Both Boeing and Microsoft responded to the competitive challenges they faced by adopting an operations strategy that included significant changes to their traditional strategies. Which of the following statements is TRUE with respect to the changes in either company's strategy?

Microsoft STB's cloud service strategy called for an increase in its physical resource base (i.e., becoming more asset-intensive).

The resource-based operations strategy framework is a useful tool for gauging the strategic alignment of a firm's operations function. This framework can be best captured in the form of a 3 × 5 matrix (3 rows by 5 columns). The rows represent the decisions categorized into three groups relating to (1) available resources, (2) the connections among them, and (3) new resources. The columns represent the five distinct categories into which resources can the classified. Which of the following choices correctly represents the labels for the rows of a resource-based operations strategy framework?

Resource base, resource integration, and resource development and acquisition

True or false: Delays in Boeing's completion and release of the 787 Dreamliner were caused largely by a dramatic change in operational strategy that was not fully aligned with the actual execution.

True

As companies make important trade-off decisions in manufacturing, major decisions in structural and infrastructural decision areas require substantial financial investments and are difficult to make and reverse. Structural decision areas include:

capacity, facilities, scope, information, and process technology.

Companies can improve their performance objectives by making trade-offs between achieving low cost and providing various types of differentiation. In this view, companies must align their performance objectives with the business strategy. Performance objectives that operations managers might directly trade off to limit the range of activities while seeking operations focus should include:

cost, quality, delivery, and flexibility.

In setting operations strategy, companies must focus on specific activities to perform while explicitly avoiding others. Focus does NOT allow for operational specialization when it:

increases the variety of product offerings.

One of the most dramatic transitions in the history of computing, one that was motivated by the emergence of cloud computing, is:

software delivered as a service on demand rather than as a shipped, licensed product.

In complex operational strategies, which often call for the operations function to take on a wide range of activities, the operational specialization benefits of focus can still be achieved by:

splitting the activities among several units, each of which focuses on a specific subset.

The most critical factor that influenced Boeing's failure to align the transformed operations strategy for Dreamliner 787 with its execution was:

too much outsourcing, in which Boeing relied excessively on ecosystem resources.