Deck 1: Operations Management and You

Question 1

Operations management gathers materials and resources to transform them into products and services.

Answer 1

True

Question 2

As a functional area of a business, operations is concerned with delivering products and services to the customer.

Answer 2

False

Question 3

Operations managers are in charge of managing inventory, suppliers, and product and service quality.

Answer 3

True

Question 4

Operations management only ensures that a business is very productive.

Question 5

Operations drive revenues only.

Question 6

Operations affect and influence every aspect of the organizational structure.

Question 7

Functional strategies are not executed via operational practices.

Question 8

Operational strategies should be aligned with the business-level strategies for maximum efficiency.

Question 9

Operations managers are lower-level managers.

Question 10

Key performance indicators (KPIs) help in business decision making.

Question 11

Operational key performance indicators (KPIs) provide only an overview of operations.

Question 12

Productivity is measured as the value of inputs relative to the value of outputs.

Question 13

There are only two types of productivity: single-factor and multi-factor.

Question 14

The value of the output relative to the value of the input is measured by productivity.

Question 15

Productivity metrics can be manipulated in the short run by running a short-staffed operation for instance.

Question 16

Comparisons of productivity using only labor hours may be misleading.

Question 17

Only productivity and quality are important aspects of business performance.

Question 18

Every business should be overly focused on efficiency and cost control.

Question 19

Supply chain management (SCM) is a current trend in operations management.

Question 20

Supply chain design today also needs to satisfy other criteria such as ethics and sustainability.

Question 21

The design of the supply chain-selecting suppliers in different locations that can make and move goods and services-supports the buying company's competitive edge.

Question 22

Service processes not are generally people centered or people sensitive.

Question 23

Service science is the systematic application of operations management to the cause of understanding, analyzing, and improving the performance of service processes.

Question 24

Lean operations are an important trend in operations management.

Question 25

Operations management provides an array of useful tools for lean operations.

Question 26

Sustainability is not a major concern of operations management.

Question 27

Sustainability differs from lean operations in that it has a moral element and is much larger in scope.

Question 28

Sustainability is only practiced by very large businesses.

Question 29

Globalization by many firms has decreased the liability to behave ethically.

Question 30

The operations function in an organization designs, makes, and delivers

A) products only
B) services only
C) products and services
D) processes

Question 31

A simple model of operations management can be described in the following manner:
Organization: inputs→transformation processes→outputs
Which one of the following correctly describes a production system?

A) automobile manufacturer: steel→molding→car
B) hospital: sick patients→nurses→doctors
C) restaurant: meat→chefs→food
D) airline: pilots→planes→passengers

Question 32

Figure 1.1
You are the operations manager for pizza manufacturing at The Dough Factory.

-Use the information provided in Figure 1.1. The flour supplier is an example of a(n)

A) input
B) output
C) process
D) product

Question 33

Figure 1.1
You are the operations manager for pizza manufacturing at The Dough Factory.

-Use the information provided in Figure 1.1. The Dough Factory is

A) the transformation process
B) the output of the flour supplier
C) the only input for the pizza shop
D) the output for the pizza shop

Question 34

Operations managers do all of the following except

A) design work processes
B) study work processes
C) analyze work processes
D) report work processes

Question 35

Operations management transforms inputs into outputs. Which of the following are not inputs?

A) labor
B) services
C) information
D) technology

Question 36

Outputs include

A) goods
B) services
C) technology
D) information

Question 37

Which one of the following statements is true about operations management (OM)?

A) OM impacts profits directly.
B) OM impacts revenues indirectly.
C) OM does not affect the company's stock price.
D) OM does not have much impact on costs.

Question 38

OM helps to boost return on assets (ROAs) by all of the following except

A) increasing revenues
B) increasing cost of goods sold
C) reducing costs
D) reducing assets

Question 39

OM is a key to any organization because it is a part of the

A) business-level strategy
B) functional-level strategy
C) marketing strategy
D) company-level strategy

Question 40

All of the following are functional-level strategic decisions except

A) location planning
B) capacity planning
C) forecasting
D) quality management

Question 41

Key performance indicators (KPIs) at the operational level include

A) inventory holding costs
B) sales by major product line
C) quality
D) average gross margin

Question 42

All of the following are KPIs at the operational level except

A) inventory weeks of cycle time
B) delivery lead time
C) input costs
D) customer service

Question 43

In an assembly operation at a computer factory, nine employees assembled an average of 540 custom computers per 5-day week. What is the labor productivity of this operation?

A) 75 computers per worker per day
B) 50 computers per worker per day
C) 12 computers per worker per day
D) 108 computers per worker per day

Question 44

A process produces 2,500 units of output that sell for $10 per unit. Resources contributed to this output are 100 hours of labor at $20 per hour, materials at $300, and overhead at $700. What is the labor productivity?

A) 20 units per hour
B) 25 units per hour
C) 40 units per hour
D) 30 units per hour

Question 45

The manager of your school's cafeteria is trying to determine the best staff size to use for the Fall semester. She has tried various staff sizes in the past, with the results shown below. Based on productivity, which crew size should she employ? $$\begin{array} { | l | c | c | c | c | c | c | } \hline \text { Crew Size } & 2 & 4 & 3 & 3 & 4 & 2 \\\hline \text { Sales Per Week } ( \$ ) & 1,716 & 2,298 & 2,034 & 2,004 & 2,278 & 1,702 \\\hline\end{array}$$

A) Either a 3- or 4-person crew
B) 4-person crew
C) 3-person crew
D) 2-person crew

Question 46

A manufacturing process requires 60 minutes of labor to make 20 units of production. How can productivity be increased?

A) Increase labor time per 20 units of production.
B) Increase labor time per 60 units of production.
C) Increase number of units produced per 60 minutes of labor.
D) Decrease number of units produced per 60 minutes of labor.
The details of weekly outputs and inputs for a hotel cleaning process are as follows: Output is 400 units, with a standard room rate of $150 per unit. For the week, total labor costs are: 10 workers at 40 hours for the week, paid $20 per hour. Total material costs for the 400 units are $2,000. Weekly overhead is charged at the rate of 1.5 times the labor costs.

Question 47

What is the labor productivity for the week?

A) 1
B) 40
C) 10
D) 7.5

Question 48

What is the multi-factor productivity for the week?

A) 2.73
B) 1.50
C) 6
D) 3

Question 49

What is the total system productivity for the week?

A) 3
B) 1.50
C) 2.00
D) 2.73

Question 50

Which of the following is not a current trend in operations management?

A) supply chain management
B) lean operations
C) sustainability
D) technology

Question 51

Supply chain management includes managing all of the following except

A) threats from suppliers
B) foreign exchange risks
C) labor costs increases
D) product features

Question 52

Which of the following statements is true?

A) Service processes are generally people centered.
B) Service processes have a higher degree of tangibility.
C) Service processes have a lower degree of customer contact.
D) Service processes have a lower amount of variability than manufacturing processes.

Question 53

Sustainability in operations management can take place through all of the following actions except

A) supply chain initiatives
B) carbon credit offsets
C) profitability
D) analysis and design

Question 54

Which of the following would be considered an advantage to a firm using a global supply chain?

A) highly skilled but expensive foreign workers
B) cheap but untrained foreign workers
C) cheap sources of raw materials from a politically corrupt country
D) highly reliable suppliers

Question 55

Lean operations does not include which of the following practices?

A) improving quality
B) reducing bottlenecks
C) redesigning complex pathways
D) reducing the number of reliable suppliers

Question 56

Operations management refers to the design, management, and improvement of the systems and activities that transform ________ and ________ into products and services.

Question 57

A(n) ________ is any activity or group of activities that takes materials and resources, and transforms and adds value to them to provide goods and services for its customers.

Question 58

Operations managers manage _______ to achieve desired customer service levels at an acceptable cost.

Question 59

Operations managers design, ______, _______, and improve work processes.

Question 60

Operations management is a strategic capability; that is, it can impact business ________ and profits directly.

Question 61

The ________ strategy of a business is executed through its operational practices.

Question 62

________ help business decision makers maintain focus, speed, and direction.

Question 63

________ is a common measure of the efficiency of operational processes.

Question 64

Three types of productivity measures are ________, ________, and ________.

Question 65

________ and ________ operations are two important current trends in operations management.

Question 66

Standardized metrics for evaluating ________ performance include carbon footprinting.

Question 67

Think of any manufacturer or service provider. Identify and describe this organization's inputs, processes, and outputs.

Question 68

How has productivity been influenced by global competition? Give specific examples and use the productivity model to support your answer.

Question 69

What are some of the current trends in operations management?

Question 70

Which of the current trends in OM do you rate as the most important, and why?

Question 71

Curly, Larry, and Moe assessed the home security systems of the prestigious Coney Island neighborhood by testing doorknobs and windows and slipping past security systems like a team of ghosts. They weren't ghosts, but they did wear white clothing to look like painters. This crew of daylight robbers hoped to grab cash, jewelry, and other valuables to fence at the next level of their supply chain. They knew the local police force was responsive, but a construction crew was creating a helpful distraction by working in the neighborhood, which completely drowned out the sounds of breaking glass. Details of the day's haul appear in the table below.
$$\begin{array} { | l | c | c | c | } \hline \text { ITEM } & \begin{array} { c } \text { SALES } \\\text { PRICE }\end{array} & \text { LABOR } & \text { MATERIAL } \\\hline \text { Jewelry } & \$ 1,600 & 1 \mathrm { hr } & \$ 2 \\\hline \text { Flat screen TV } & \$ 200 & .25 & \$ 1 \\\hline \$ 500 \text { cash } & \$ 500 & .05 & \$ 40 \\\hline \text { Antiques } & \$ 600 & .15 & \$ 20 \\\hline \text { Rolex watches } & \$ 1,180 & .10 & \$ 1 \\\hline\end{array}$$ The crew are paid at a flat rate of 20 percent of the sales price of the stolen goods. Materials cost represents the cost of gasoline, overalls, and surgical gloves, and overhead is 20 percent of the sales price of the stolen goods.

A) What is the labor productivity?
B) What is the multifactor productivity?