Business Essentials, 12e (Ebert/Griffin)
Chapter 7 Operations Management and Quality
1) Which term refers to all the activities involved in making products–goods and services–for
customers?
A) Operations
B) Processes
C) Planning
D) Scheduling
E) Performance
2) Which of the following is critical to the success or failure of service operations?
A) Provider-customer contact
B) Internet exposure
C) Supply chain
D) Tangible services products
E) Supplier-manufacture contact
3) Services are more tangible, more customized, and more storable than most products.
4) When a company produces products when consumers want them, it creates which type of
utility?
A) Ownership
B) Time
C) Form
D) Place
E) Value
5) In a business, whose job is it to draw up plans to transform resources into products and bring
together basic resources, such as knowledge, physical materials, equipment, and labor?
A) CEO
B) Operations manager
C) Quality manager
D) Floor foreman
E) Supply manager
6) Which term describes services that cannot be produced ahead of time?
A) Transformed
B) Low-contact
C) Unstorable
D) Intangible
E) Consistent
7) Which type of utility is created when a company makes products available where consumers
want them?
A) Time
B) Place
C) Possession
D) Form
E) Operations
8) Which of the following refers to a set of methods and technologies used to produce a good or
service?
A) Quality ownership
B) Production
C) Utility
D) Value added analysis
E) Operations process
9) In which of the following is the customer part of the system during service delivery?
A) A high-contact system
B) A low-contact system
C) A flexible system
D) A quality system
E) A utility system
10) When a company makes products available conveniently for consumers, based on where they
are, which type of utility is created?
A) Time
B) Form
C) Place
D) Possession
E) Leisure
11) Which of the following is the ability of a product to satisfy a human want or need?
A) Utility
B) Relative advantage
C) Content
D) Satisfaction
E) Quality ownership
12) When a firm produces goods for mass consumption, what type of goods production method
is generally used?
A) High-contact systems
B) Make-to-order
C) Layout planning
D) Low-contact systems
E) Make-to-stock
13) In which type of system must the customer be actively involved in order to receive the good
or service?
A) Make-to-stock
B) High-contact
C) Intangible
D) Low contact
E) Operations process
14) What goods-producing operations method is designed around specific customer
specifications?
A) High-contact systems
B) Make-to-order
C) Layout planning
D) Low-contact systems
E) Make-to-stock
15) In a low-contact system, the customer must be a part of the system to receive the service.
16) By turning raw materials into finished goods, production creates form utility.
17) Firms that make only tangible products are engaged in goods production.
18) Differentiate between high- and low-contact processes. Give an example of each.
19) Explain what is meant by the term utility. What type of utility is created when a pharmacy
changes its evening schedule to remain open for an extra hour in response to customer needs?
20) Explain time, place, and form utility and provide an example of each.
21) Differentiate between goods production and service operations.
22) Describe the difference between the make-to-order and make-to-stock production processes.
23) What term describes a special ability that production does especially well allowing the
company to outperform the competition?
A) Supply chain management
B) Total quality management
C) Process engineering
D) Operations capability
E) Value-added analysis
24) Which of the following helps to determine operations capabilities?
A) Flexibility of activity
B) High-context system
C) Business strategy
D) Extent of customer contact
E) Production capability
25) What type of strategy is a firm using when promoting quick, consistent and on time delivery,
for every order?
A) Quality
B) Low cost
C) Flexibility
D) Dependability
E) Accessibility
26) What type of service is being given when a product performs reliably, has an appealing fit
and consistently meets or exceeds customer expectations?
A) Quality
B) Low cost
C) Flexibility
D) Dependability
E) Exclusivity
27) Which of the following supports a business strategy that incorporates the key operational
capability of flexibility?
A) Maintaining excess production capability
B) Reducing labor and shelving costs
C) Having high quality standards for suppliers
D) Utilizing specialized, automated equipment for consistent product buildup
E) Using electronic tools to improve customer communications
28) What type of strategy to attract customers should a firm that promotes quick and on time
delivery utilize?
A) Quality
B) Low cost
C) Flexibility
D) Dependability
E) Accessibility
29) Which type of strategy emphasizes low overhead and inventory, and a limited assortment of
products to attract customers?
A) Flexibility
B) Quality
C) Low-cost
D) Dependability
E) Consistency
30) A company should select the same kind of production used by most of its competitors.
31) Operations capability is a special ability that production does especially well to outperform
the competition.
32) What is an operations capability?
33) Why does each company’s operations capability match up with its business strategy?
34) Examining step-by-step procedures to reduce inefficiency most centrally involves which
approach?
A) Operations scheduling
B) Performance analysis
C) Value-added analysis
D) Methods improvement
E) Quality ownership
35) Machine, woodworking, and dry cleaning shops typically use which type of layout?
A) Product
B) Custom-products
C) Same-steps
D) Hybrid
E) Make-to-stock
36) Which type of layout is designed to move resources through a smooth, fixed sequence of
steps?
A) Same-steps
B) Location
C) Custom-products
D) Quality
E) Make-to-order
37) Which of the following is an advantage of using a product layout plan?
A) They do not require specialized equipment.
B) They can be easily rearranged for new applications.
C) They can only be used for custom products.
D) They are inflexible in nature.
E) Unskilled labor can be utilized.
38) Which term is defined as the combination of “characteristics of a product or service that bear
on its ability to satisfy stated or implied needs”?
A) Quality
B) Production
C) Quantity
D) Clarification
E) Capacity
39) Performance refers to which of the following?
A) The principle that quality belongs to each person who creates it while performing a job
B) The consistency of product quality from unit to unit
C) How well the product does what it is supposed to do
D) The process by which a company analyzes a competitor’s products to identify desirable
improvement
E) Providing value by making products available when customers want them
40) Consistency refers to which of the following?
A) The principle that quality belongs to each person who creates it while performing a job
B) The sameness of product quality from unit to unit
C) The sum of all activities involved in getting high-quality products into the marketplace
D) The process by which a company analyzes a competitor’s products to identify desirable
improvements
E) Providing value by making products available where customers want them
41) Managers can work to reduce waste, inefficiency, and poor performance by examining
procedures on a step-by-step basis. Which term describes this process?
A) Advance planning
B) Materials management
C) Methods improvement
D) Quality planning
E) Quality ownership
42) Which of the following is the amount of a product that a company can produce under normal
working conditions?
A) Capacity
B) Output
C) Efficiency
D) Burden
E) Performance
43) Equipment and people are grouped according to function in which type of production layout?
A) Fixed position
B) Same-steps
C) Custom-products
D) Supply-chain
E) Service
44) Which term refers to how well a product does what it is supposed to do?
A) Capacity
B) Consistency
C) Reliability
D) Performance
E) Quality control
45) The sameness of product quality from unit to unit is referred to by which term?
A) Utility
B) Reliability
C) Performance
D) Consistency
E) Quality control
46) What type of planning has the greatest effect on production costs and flexibility?
A) Capacity
B) Layout
C) Quality
D) Location
E) Process
47) Which of the following affects how efficiently a company can respond to demand for more
or different products and their ability to match competitors speed and convenience?
A) Location planning
B) Quality planning
C) Technology planning
D) Long-range capacity planning
E) Layout planning
48) What is the main advantage of effective process layouts?
A) Flexibility
B) Cost
C) Speed
D) Quality
E) Performance
49) When planning for quality, two key elements are
A) speed and dependability.
B) consistency and accuracy.
C) flexibility and accuracy.
D) dependability and flexibility.
E) performance and consistency.
50) What can be used to identify the sequence of activities, movements of materials and work
performed?
A) Operations schedules
B) Process flowcharts
C) Gantt charts
D) PERT charts
E) Project schedules
51) Which of the following would be best used when producing make-to-stock operations or
mass production of a product?
A) Fixed position layout
B) Process layout
C) Customer-product layout
D) Operations scheduling layout
E) Assembly line layout
52) Why do organizations use fixed-position layouts for some goods or services?
A) When the customer requests it
B) When it is more cost effective
C) When it increases the quality level
D) When it is difficult to move the good or service
E) When consistency in production is needed
53) A firm’s capacity depends on both how many people it employs and the number and size of
its facilities.
54) In a same-steps layout, equipment and people are set up to produce one type of good in a
fixed sequence of steps and are arranged according to its production requirements.
55) A process flowchart identifies the sequence of production activities, movements of materials,
and work performed at each stage of the process.
56) A fixed-position layout is most effective when there is a large-volume make-to-stock
operation in place.
57) Describe two alternatives for production facility layouts.
58) Describe the purpose of an assembly line layout and when a firm would choose to use this
format.
59) Which of the following is a scheduling tool that breaks down large projects into steps to be
performed and specifies the time required to perform each one?
A) Myers graphic
B) Critical path chart
C) Gantt chart
D) Process analysis graph
E) Master schedule
60) Which of the following tracks which service or products will be produced and when?
A) Master operations schedule
B) Detailed schedule
C) Gantt chart
D) Staff schedule
E) PERT chart
61) Which scheduling tool shows the necessary sequence of activities in a project and identifies
the critical path?
A) Gantt chart
B) Process flowchart
C) Detailed schedule
D) Master production schedule
E) PERT chart