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In facility location decision-making the educational and skill levels of the labor pool must match the company’s needs. Answer: One of the tools common to all quality efforts is leadership. Answer: FALSE The tools common to all quality efforts, including […]

An input to the material requirements planning (MRP) system is an inventory records file. Answer: The capability index is used to gauge economic changes in service systems. Answer: FALSE We use the capability index to measure how well our process […]

A quality guru named Philip Crosby defined quality as fitness for use. Answer: Strategic sourcing is the development and management of supplier relationships to acquire goods and services in a way that aids in achieving the immediate needs of the […]

Once an operations strategy is adopted and articulated, the primary emphasis becomes perfecting the system of activities that make up the strategy through detailed refinements over a long period of time. Answer: In contrast to careers in finance and marketing, […]

Earned Value Management (EVM) is a technique for measuring project progress in an objective manner. Answer: A BOM file is often called a product structure file or product tree because it shows how a product is put together. Answer: TRUE […]

Outsourcing is the act of moving some of a firm’s internal activities and decision responsibility to outside providers. Answer: A principle of value stream mapping is to concentrate on speeding up value-added operations. Answer: FALSE Value stream mapping (VSM) is […]

Group technology is a philosophy wherein similar parts are grouped together and the processes required to make the parts are arranged as a work cell. Answer: Statistical process control involves testing random samples of output from a process to determine […]

The sales and marketing plans are typically developed separately from the aggregate operations plan as a way of cross-checking results to insure the integrity of assumptions about the future. Answer: Cyclical influences on demand are often expressed graphically as a […]

Services are intangible processes that cannot be weighed or measured. Answer: Continual review and updating in light of new data is a forecasting technique called second-guessing. Answer: FALSE Second guessing is not a forecasting technique. In the weighted moving average […]

The demand on a hospital’s emergency medical services is considered a controllable arrival pattern of the calling population. Answer: Subcontractor networks are not very important in Japanese manufacturing. Answer: FALSE Toyota relies heavily on subcontractor networks. The term CTQ stands […]

In the Time-Cost CPM model, cost is assumed to be a linear function of time. Answer: Random errors can be defined as those that cannot be explained by the forecast model being used. Answer: TRUE Random errors can be defined […]

The deeper one looks into the product creation sequence, the more the requirements of dependent demand items tend to become more “lumpy.” Answer: The standard fixed-time period model assumes that inventory is never counted but determined by EOQ measures. Answer: […]

The approach that advocates making revolutionary changes as opposed to evolutionary changes is called creation theory. Answer: Little’s law can be thought of as a relationship between units and time. Answer: TRUE We can think of Little’s law as a […]

The fixed-order quantity inventory model favors less expensive items because average inventory is lower. Answer: In services, once the aggregate staffing level is determined, the focus is on short-term workforce and customer scheduling. Answer: TRUE See Exhibit 8.1. The term […]

One of the many lean techniques that have been successfully applied in service firms is the eliminating of unnecessary activities. Answer: A matrix project structure is often referred to as a ‘skunkworks.” Answer: FALSE A pure project is nicknamed skunkworks. […]

There are no differences in strategic and tactical forecasting. A forecast is a mathematical projection and its ultimate purpose should make no difference to the analyst. Answer: Break-Even Analysis can only be used in production equipment decision making when dealing […]

For an activity in a CPM analysis the Early Finish time is 20 and the Late Finish time is 20. Which of the following statements is TRUE? A. The activity’s late start must happen before its early start B. The […]

Sharing capacity is a common source of external capacity. Answer: The Baldrige National Quality Award was started under the direction of the National Institute of Standards and Technology. Answer: TRUE Helping the quality movement along is the Baldrige National Quality […]

The critical path in a project is that sequence of activities that consume the longest amount of time in a project network of activities. Answer: Capacity can be defined as the ability to hold, receive, store, or accommodate. Answer: TRUE […]

A car wash is an example of a single channel, multiphase queuing system. Answer: A project layout is characterized by a relatively low number of production units in comparison with process and product layout formats. Answer: TRUE See exhibit 6.3, […]

Investors pay close attention to efficiency and productivity measures like net income per employee because they are interested in how well the firm manages its workforce relations. Answer: A worker can be efficient without being effective. Answer: TRUE Efficiency means […]

If the fraction defective is 0.12 based on a sample size of 16, the standard deviation used in the “p” chart is about 0.08. Answer: One tool used in total quality management is the run chart. Answer: TRUE The tools […]

The aggregate operations planning variable “inventory on hand” refers to the balance of unused inventory carried over from the previous time period. Answer: Attributes are those quality characteristics that are classified as either conforming or not conforming to specification. Answer: […]

MRP is most valuable where a number of products are made in batches using the same productive equipment. Answer: Facility location analysis considers the competitive imperative of lowest total cost. Answer: TRUE The objective is to select a site with […]

The total cost of ownership (TCO) is an estimate of the cost of an item that includes all the costs related to the procurement and use of an item, but does not include any of the costs related to disposing […]

Inventory turn values that are considered good differ by industry and the type of products being handled. Answer: Multiple regression analysis uses several regression models to generate a forecast. Answer: FALSE Multiple regression analysis, (is where) a number of variables […]

The standard error of the estimate of a linear regression is not useful for judging the fit between the data and the regression line when doing forecasts. Answer: The fact that organizations are flattening is one of the reasons that […]

In variables sampling the actual measurements of the variable observed are used regardless of whether the unit is good or bad. Answer: Automobiles and appliances are classified as “pure goods.” Answer: FALSE In exhibit 1.4 automobiles and appliances are classified […]

When a firm’s design capacity is less than the capacity required to meet its demand, it is said to have a negative capacity cushion. Answer: The three main inputs to an MRP system are the bill of materials, the master […]

In forecasting, RSFE stands for “running sum of forecast errors.” Answer: Internet technology has made the sharing of reliable real-time information expensive. Answer: FALSE Internet technology has made the sharing of reliable real-time information inexpensive. Accurate medium-range planning increases the […]

Because little or no inventory is carried in a service operation, it is easy to separate the operations management functions from marketing in services. Answer: A rate fence is a person who books airline seats at low rates far in […]

Capturing information directly from the source through such systems as point-of-sale, radio-frequency identification tags, bar-code scanners, and automatic recognition has had little impact on Operations and Supply Chain Management. Answer: A free trade zone operates under different rules and laws […]

Project management software available today combines CPM and other scheduling aids, like Gantt charting, to aid in tracking progress of project completion. Answer: Safety stock can be computed when using the fixed-order quantity inventory model by multiplying a “z” value […]

JIT manufacturing forces a firm to work with a lower water level despite safety hazards. Answer: The focus in the make-to-stock environment is on providing finished goods where and when the customers want them. Answer: TRUE The focus in the […]

One SPC tool used in total quality management is the Pareto chart. Answer: In a price break model of lot sizing, to find the lowest-cost order quantity, it is sometimes necessary to calculate the economic order quantity for each possible […]

Capability Sourcing refers to outsourcing the functions that they do best to trusted key partners. Answer: CPM is an abbreviation for Critical Path Method. Answer: TRUE CPM is defined as an abbreviation for critical path method in the text. According […]

The time needed to respond to a customer’s order is called the customer response time. Answer: Decomposition of a time series means identifying and separating the time series data into its components. Answer: TRUE Decomposition of a time series means […]

Overemphasis on purchase price frequently results in failure to address other significant costs. Answer: Philip Crosby states that the correct cost for a well-run quality management program should be under 2.5 percent of sales. Answer: TRUE How significant is the […]

One difference between an assembly line process flow and a continuous process flow is that on the assembly line the flow is discrete rather than continuous. Answer: An organizationally-driven reason for outsourcing is that it can improve effectiveness by focusing […]

Aggregate sales and operations planning occur in a company about every 3 to 18 months. Answer: Fixed-order quantity inventory models are “event triggered.” Answer: TRUE The basic distinction is that fixed-order quantity models are “event triggered” and fixed-time period models […]