Deck 4: Operations Strategy

Question 1

_____ represent the strategic emphasis that a firm places on certain performance measures and operational capabilities within a value chain.

A) Competitive priorities
B) Order satisfiers
C) Value chain processes
D) Order winners

Answer 1

A

Question 2

_____ is being able to make whatever goods and services a customer wants, at any volume, at any time for anybody, and for a global organization, from any place in the world.

A) Strategic planning
B) Mass customization
C) Enterprise resource planning
D) Business analytics

Answer 2

B

Question 3

Which of the following is considered a competitive priority?

A) Sustainability
B) Flexibility
C) Reliability
D) Durability

Answer 3

B

Question 4

In an automobile, which of the following would NOT be considered an order winner?

A) Self-parking capability
B) Voice-activated music system
C) Front-seat airbags
D) Collision avoidance system

Question 5

With regard to the three types of attributes customers use in evaluating the quality of goods and services, medical diagnosis would best be classified as high in _____.

A) variant attributes
B) experience attributes
C) credence attributes
D) search attributes

Question 6

The knowledge of a finance consultant can be classified as a(n) _____.

A) search attribute
B) experience attribute
C) credence attribute
D) variant attribute

Question 7

Which of the following does NOT describe how customers evaluate services in a manner that differs from the way they evaluate goods?

A) Customers rely more on information from nonpersonal sources when evaluating services prior to purchase.
B) Customers perceive greater risks when buying services than when buying goods.
C) Customers can form prior expectations of expected service quality.
D) Dissatisfaction often results from a customer's inability to properly perform or co-produce his or her part of a service.

Question 8

Which of the following is a key competitive priority based on which organizations can compete?

A) Sustainability
B) Reliability
C) Innovation
D) Infrastructure

Question 9

A firm's ability to achieve market and financial superiority over its competitors is called _____.

A) operations strategy
B) strategic planning
C) competitive advantage
D) competitive priority

Question 10

Which of the following statements is NOT true of mass customization?

A) Mass customization involves the commercialization of a device, method, or idea that differs from existing norms.
B) Flexibility is manifest in mass-customization strategies that are becoming increasingly prevalent today.
C) Mass customization requires companies to design goods, services, and operations around flexibility.
D) Mass customization requires companies to align their activities around differentiated customer segments.

Question 11

With regard to the three types of attributes customers use in evaluating the quality of goods and services, a vacation would best be classified as high in _____.

A) search attributes
B) experience attributes
C) credence attributes
D) competitive advantage attributes

Question 12

Goods and service features and performance characteristics that differentiate one customer benefit package from another and win a customer's business are called _____.

A) order qualifiers
B) order satisfiers
C) order exciters
D) order winners

Question 13

The style and fit of a jacket can be classified as a(n) _____.

A) search attribute
B) experience attribute
C) credence attribute
D) variant attribute

Question 14

With regard to ways customers evaluate services compared to goods, which of the following is NOT true?

A) For services, customers seek and rely more on personal sources of information.
B) Customers normally adopt innovations in services faster.
C) Customers perceive greater results when buying services.
D) Dissatisfaction with services is often the result of a customer's inability to properly perform or co-produce their part of the service.

Question 15

Which competitive priority is most often ranked #1 for Southwest Airlines?

A) Time
B) Flexibility
C) Innovation
D) Cost

Question 16

_____ are those that a customer can determine prior to purchasing goods or services.

A) Search attributes
B) Experience attributes
C) Credence attributes
D) Variant attributes

Question 17

Basic customer expectations are considered the minimum performance level required to stay in business and are often called _____.

A) order qualifiers
B) order satisfiers
C) order exciters
D) order winners

Question 18

_____ are any aspects of a good or a service that a customer must believe in but cannot personally evaluate even after purchase and consumption.

A) Search attributes
B) Experience attributes
C) Credence attributes
D) Variant attributes

Question 19

Identify a true statement about the role of quality in gaining a competitive advantage.

A) Quality is unrelated to return on investment for most kinds of market situations.
B) A strategy of quality improvement is usually accompanied by increased short-run profitability.
C) Producers of high-quality goods usually charge low prices.
D) Businesses offering premium-quality goods usually have large market shares.

Question 20

Which of the following is NOT generally considered a competitive priority?

A) Sustainability
B) Flexibility
C) Innovation
D) Quality

Question 21

Professor Terry Hill's generic strategy framework can be applied to McDonald's. The operating design choices of resource scheduling, inventory placement and control, and standardized operational and job procedures best relate to the corporate objective of _____.

A) profitable growth
B) operational excellence
C) operational sustainability
D) operational diversity

Question 22

Which of the following would NOT constitute an element of operations infrastructure?

A) Market segmentation
B) Workforce
C) Quality control
D) Learning and innovation systems

Question 23

McDonald's defines four sustainability initiatives. Which of the following is NOT an example of one of its four sustainability initiatives?

A) Environmental scorecard
B) Service-encounter design
C) Supplier audits for animal welfare
D) Packaging from renewable materials

Question 24

A firm's ability to achieve market and financial superiority over competitors is called strategic planning.

Question 25

Sustainability is best described as _____.

A) design flexibility
B) mass customization
C) an organizational strategy
D) a competitive priority

Question 26

Operations design choices include all of the following EXCEPT _____.

A) operating plans and controls
B) type of processes
C) value chain integration and outsourcing
D) inventory and service capacity

Question 27

Which competitive priority is most often ranked #1 for Apple?

A) Time
B) Flexibility
C) Innovation
D) Cost

Question 28

Professor Terry Hill has presented a four-loop framework for operations strategy through an iterative and integrated process. Decision loop #2:

A) describes how operations evaluate the implications of competitive priorities in terms of process choices and infrastructure.
B) involves determining if process choice decisions and capabilities are consistent with infrastructure capabilities.
C) represents operations' input into corporate and marketing strategy.
D) ties together an organization's corporate strategy and marketing strategy.

Question 29

Identify a true statement about corporate strategy at the top level of management.

A) It defines the focus for strategic business units of an organization.
B) It provides the means by which business strategies are accomplished.
C) It is necessary to define the businesses in which an organization will participate.
D) It defines how an organization's processes are designed and organized.

Question 30

Using the four key decision loops in Professor Terry Hill's generic strategy framework, which of the following statements is TRUE of the first loop?

A)
It ties together an organization's corporate strategy and marketing strategy.
B) It describes how operations evaluate the implications of competitive priorities in terms of process choice.
C) It determines if process choice decisions are consistent with infrastructure decisions.
D) It represents operations' input into the corporate and marketing strategy.

Question 31

_____ is the discovery and practical application or commercialization of a device, method, or idea that differs from existing norms.

A) Measurement
B) Learning
C) Innovation
D) Diversity

Question 32

_____ is a pattern that integrates an organization's major goals, policies, and action sequences into a cohesive whole.

A) Strategy
B) Core competency
C) Sustainability
D) Vision statement

Question 33

_____ sustainability is driven by ethics and human ideals of protecting the planet and its people for the well-being of future generations.

A) Environmental
B) Social
C) Economic
D) Political

Question 34

Operational capabilities must be built before a firm identifies competitive priorities.

Question 35

Environmental sustainability is driven by _____.

A) charitable organizations
B) the government
C) ethics committees
D) the media

Question 36

The _____ of a firm are the strengths that are unique to that organization.

A) strategy developments
B) strategic missions
C) vision statements
D) core competencies

Question 37

A(n) _____ defines how an organization will execute its chosen business strategies.

A) operations strategy
B) functional strategy
C) competitive strategy
D) corporate strategy

Question 38

Families of goods or services having similar characteristics or methods of creation are called _____.

A) core competencies
B) corporate strategies
C) strategic business units
D) customer benefit packages

Question 39

Which of the following statements best represents McDonald's vision?

A) To be the world's best quick-service restaurant experience
B) To be the most innovate organization in the world
C) To develop and maintain a diverse workforce
D) To be the most efficient process-oriented organization in the world

Question 40

Which one of the following statements is TRUE with respect to McDonald's operations and strategy?

A) McDonald's #1 competitive priority is demand flexibility.
B) Professor Terry Hill's strategy framework cannot be applied to a company such as McDonald's.
C) There is only one standardized way (process) to make french fries in 32,000 stores worldwide.
D) McDonald's vision is to produce the world's best hamburger.

Question 41

The ease with which one can create original music compositions using a software package, such as Band in a Box or Apple's GarageBand, is an example of an experience attribute.

Question 42

A flexibility strategy requires a capacity for both design and demand flexibility.

Question 43

Order qualifiers are goods and service features and performance characteristics that differentiate one customer benefit package from another and win a customer's business.

Question 44

Improving design quality usually allows a firm to charge higher prices and thus increase revenue and profit.

Question 45

Customer segments might be based on sales volume and profitability.

Question 46

The customer benefit package that a firm designs is meant to appeal to all customers.

Question 47

Employee training is an example of a key competitive priority.

Question 48

Although it may be difficult to change the structure of a value chain, operations managers can make strategic choices about technology and human resources.

Question 49

Quality improvement initiatives generally increase market share in the long term and also increase profitability in the short term.

Question 50

Eventually, order qualifiers become order winners.

Question 51

Of the three types of attributes customers use to evaluate goods and services, goods are high in search attributes, while services are high in experience and credence attributes.

Question 52

Reductions in flow time generally lead to a deterioration of quality.

Question 53

Southwest Airlines has gained a competitive advantage by focusing on innovation as a key competitive priority.

Question 54

Order winners are goods and service features and performance characteristics that differentiate one customer benefit package from another and win a customer's business.

Question 55

A clean bed in a hotel would be considered an order qualifier.

Question 56

Being able to access the Internet in an automobile at any speed and in any location would be considered an order qualifier.

Question 57

Customers generally perceive greater risk when buying goods than when buying services.

Question 58

Formal marketing research, such as surveys and focus groups, is the only useful approach to learn about customer needs and expectations.

Question 59

The color and size of an iPod would be considered credence attributes.

Question 60

Apple's primary competitive priority would probably be innovation, while Dell's would be flexibility.

Question 61

Explain the concepts of search, experience, and credence attributes.

Question 62

In today's global market, mass customization has become less important than it was in the past.

Question 63

Identify a TRUE statement about the Lawn Care Company (LCC) case study.

A) The LCC already had experience and capabilities in the residential lawn application service and market segment, and was considering using this expertise to enter the golf and park market segment.
B) The gross margin on grass seed and fertilizer was higher than on the lawn application service.
C) Service management skills play a major role in the LCC current strategy and vision of the business at the time of the case.
D) The application service for parks and golf courses provided by a competitor of Lawn Care can be considered the competitor's competitive advantage.

Question 64

Operating decisions must be aligned with achieving the desired competitive priorities.

Question 65

What are competitive priorities? Provide some examples of how OM influences the five major types of competitive priorities.

Question 66

As McDonald's and Pal's Sudden Service are both in the quick-service restaurant business, one would expect their operations strategies to be nearly identical.

Question 67

Professor Terry Hill's operations strategy framework provides a systems perspective of how operations are linked to corporate and marketing strategies.

Question 68

With regard to the Lawn Care Company case study, which one of the following statements is TRUE?

A) If the Lawn Care Company adopts a service view of their business and adds an application service, one strategic option is to buy someone else's application service.
B) The current managers of the Lawn Care Company had complete control of their value chain.
C) If the Lawn Care Company adopts a service view of their business and adds an application service, resource scheduling becomes less important.
D) If the Lawn Care Company adopts a service view of their business and adds an application service, call centers become less important.

Question 69

What do managers need to understand in order to create a sustainable competitive advantage?

Question 70

What is the difference between corporate, business and functional strategy?

Question 71

A creative workforce and a strong supply chain can be considered as an organization's core competency.

Question 72

Explain core competencies with examples.

Question 73

To correctly identify what customers expect requires being "close to the customer." Discuss.

Question 74

How do customers evaluate services differently from manufacturing, and what implications do these have for operations?

Question 75

An operations strategy provides the direction on which corporate strategy is based.

Question 76

Which one of the following statements in the Lawn Care Company (LCC) case study is TRUE?

A) The LCC already had experience and capabilities in the residential lawn application service and market segment, and was considering using this expertise to enter the golf and park market segment.
B) The gross margin on grass seed and fertilizer were higher than on the lawn application service.
C) Service management skills play a major role in the LCC current strategy and vision of the business at the time of the case.
D) The order winner for the current strategy at LCC is the high quality of physical goods.

Question 77

The infrastructure of an organization must support process choices and provide managers with timely and accurate information to make good decisions.

Question 78

Innovation does not necessarily involve practical application or commercialization.

Question 79

Explain the difference between an order qualifier and an order winner. Provide some examples.

Question 80

Which of the following statements in the Lawn Care Company (LCC) case study is TRUE?

A) The LCC already had experience and capabilities in the residential lawn application service and market segment, and was considering using this expertise to enter the golf and park market segment.
B) The gross margin on grass seed and fertilizer were higher than on the lawn application service.
C) Service management skills play a major role in the LCC current strategy and vision of the business at the time of the case.
D) Social sustainability is an important issue for this business in today's market.