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1. (p. 234) When General Motors is in trouble it affects the economy of the United States.
2. (p. 234) Today American companies hold 90% of the U.S. auto market.
3. (p. 234) GM has three of the five most productive auto assembly plants in North America.
4. (p. 234) Jobs are outsourced both from the U.S. to other countries and to the U.S. from other countries.
5. (p. 235) In the U.S., key industries like auto manufacturing have moved some production from the northern to
the southern states.
6. (p. 235) Only 10 percent of U.S. manufacturers planned on hiring new workers in 2006.
7. (p. 235) One key to the resurgence of U.S. firms as world-class competitors has been the implementation of a
focus on quality.
8. (p. 235) Evidence suggests that U.S. manufacturing firms can no longer compete against the best firms in the
rest of the world.
9. (p. 235) American manufacturers have emphasized continuous improvement to regain a competitive edge.
10. (p. 235) Production techniques such as ERP and lean manufacturing are being used by American
manufacturers so these manufacturers can become a source of strength to the U.S. economy.
11. (p. 236) To strengthen its manufacturing base, the U.S. will need to continue to innovate.
12. (p. 236) U.S. manufacturers can best compete globally on price.
13. (p. 235–236) The U.S. domestic auto industry is as healthy as it has ever been; it’s just that U.S. workers are
making foreign car brands.
14. (p. 236) Since U.S. manufacturing competes on price throughout the world, innovation plays a very small part
in the U.S. economy.
15. (p. 236) U.S. entrepreneurial spirit plays a big part in bringing innovations to market.
16. (p. 235) The main reason for the recent resurgence of American manufacturing firms has been the quotas and
tariffs imposed by the U.S. government in an attempt to protect domestic firms from cheap imports.
17. (p. 236) Many of the top-paying jobs in medicine, law, entertainment, and business involve the provision of
services.
18. (p. 236) Operations management converts resources into goods and services.
19. (p. 236) The U.S. economy today is most accurately classified as a manufacturing economy, because
manufacturing accounts for a large and rapidly growing share of the U.S. gross domestic product.
20. (p. 236) The service sector of the U.S. economy offers many jobs, but very few of them are considered high
wage occupations.
21. (p. 236) Firms that specialize in accounting, finance, and management consulting are all part of the service
sector.
22. (p. 236) Operations management is a specialized area in management that is concerned with the production of
both goods and services.
23. (p. 236) Operations management involves inventory management, quality control, and production scheduling.
24. (p. 237) Manufacturing firms focus exclusively on the production of goods and allow other firms to provide
services.
25. (p. 236) In recent years, operations management has become more focused on providing services, because that
is where the growth and profit potential is greatest.
26. (p. 236) Production is the creation of goods and services using the factors of production: land, labor, capital,
entrepreneurship, and knowledge.
27. (p. 236) The difference between production and production management is that production describes all the
activities managers do to help their firms create goods, while production management creates goods and
services using the factors of production.
28. (p. 236) Operations management is a specialized area in management that converts or transforms resources into
goods and services.
29. (p. 237) Operations management in service industries is about creating a good experience for the customer.
30. (p. 238) Operations management moves from knowing the needs of consumers to actually satisfying those
needs.
31. (p. 237) In service industries such as hotels, quality management training is the key to ensure that all
employees are “certified” in their positions.
32. (p. 237) Education and training are less important to workers in the service sector than to workers who have
jobs in the manufacturing sector.
33. (p. 237) The quality standard for service industries such as luxury hotels is meeting the customers’ requests.
34. (p. 236) Billie just graduated with high honors with a degree in operations management from a respected
university. The knowledge she gained and skills she developed while obtaining this degree could make her an
attractive employee for either a manufacturing firm or a service firm.
35. (p. 236) Justin Tyme is a manager at Elastic Plastic, Inc. His duties include production scheduling and keeping
tabs on the company’s inventory. These activities suggest that Justin is involved in promotions management.
36. (p. 236) A college education is an example of the operations management process as it uses inputs such as
information, professors, supplies, buildings, computers, and willing students, and provides outputs of educated
people.
37. (p. 236) Marci Costas is majoring in operations management at Brunau University. Unfortunately, the
evolution of the U.S. from a manufacturing-oriented to a service-oriented economy means that Marci will
probably find few job openings in her chosen area.
38. (p. 238) Production creates form utility.
40. (p. 238) The value added by the creation of finished goods and services from inputs is called ownership utility.
41. (p. 239) Process manufacturing refers to combining components and raw materials to make a product.
42. (p. 239) Process manufacturing physically or chemically alters materials to make a product.
43. (p. 239) An assembly process involves physically or chemically manipulating raw materials to create a
product.
44. (p. 239) A continuous production process is characterized by long production runs that turn out finished goods
over time.
45. (p. 239) Intermittent production processes are characterized by short production runs and frequent changes of
machinery in order to produce different products.
46. (p. 239) Most new manufacturers in the United States use continuous production processes.
47. (p. 239) One drawback of intermittent production processes is that they tend to be much slower than
continuous processes.
48. (p. 239) In the past traditional organizations were designed to be responsive to customers.
49. (p. 239, figure 9-1) Planning, routing, and scheduling are part of the production process.
50. (p. 239, figure 9-1) The objective of production is input.
51. (p. 239) Traditional firms preferred mass production techniques because they allowed the firm to respond
quickly to the needs of consumers.
52. (p. 239) One of the reasons mass production techniques lost favor is that, despite their ability to keep costs
relatively low, they often resulted in poor quality and loss of flexibility.
53. (p. 240) Integration of computers into the design and manufacture of products is the development that has had
the greatest impact on production techniques and strategies in recent years.
54. (p. 240) CAD/CAM has made it possible to custom-design products to meet the tastes of small markets with
very little increase in costs.
55. (p. 240) CAD systems allow designers to work in four dimensions.
56. (p. 240) Despite its early promise, computer-aided design has not met with much success in increasing
productivity.
57. (p. 240) The purpose of computer-integrated manufacturing (CIM) is to unite computer-aided design with
computer-aided manufacturing.
58. (p. 240) The advantage of computer integrated manufacturing software is that it allows computer aided design
machines to communicate directly with computer aided manufacturing machines.
59. (p. 240) So far, the high cost of CAD/CAM techniques has limited their use to large, expensive manufactured
goods such as automobiles.
60. (p. 240) Flexible manufacturing systems use machines that are designed to do a multitude of tasks so that they
can produce a variety of goods.
61. (p. 240) A disadvantage of flexible manufacturing systems is that they usually require a great deal of labor
because machines are rarely capable of handling a wide variety of tasks.
62. (p. 241) One way to compete with cheap labor is to use robots.
63. (p. 241) Lean manufacturing is a strategy of producing standardized products that have no frills or extra
features in order to keep prices low.
64. (p. 241) A company becomes lean by increasing its capacity to produce high quality goods while decreasing its
need for resources.
65. (p. 241) Technological improvements are largely responsible for the increase in productivity and efficiency of
U.S. plants.
66. (p. 241) The higher productivity of U.S. plants makes it possible to pay higher wages.
67. (p. 241) Mass customization is tailoring products to meet the needs of individual customers.
68. (p. 241) Mass customization is a strategy of convincing customers to choose from a relatively small number of
alternatives in order to achieve the efficiencies of mass production.
69. (p. 241) While mass customization works well for producers it is not used in the service sector.
70. (p. 241) Actually, it is much easier to custom-design service programs than it is to custom-make goods.
71. (p. 241) Speeding up the process of responding to consumer wants and needs is a key to global
competitiveness.
72. (p. 241) A fast-changing plant needs a fast-moving employee base to achieve maximum productivity.
73. (p. 239) The Cooldaze Ice Company compresses carbon dioxide and cools it to a very low temperature to make
dry ice. The method used by Cooldaze is an example of process manufacturing.
74. (p. 239) The main difference between process manufacturing and an assembly process is that process
manufacturing uses sophisticated robots and automated machinery to produce a good or service, while an
assembly process uses labor and simple tools to make a product.
75. (p. 239) Featured Furnishings is a company that specializes in producing custom-made furniture. A continuous
production process would be the most efficient way for Featured Furnishings to produce its products.
76. (p. 239) J & R Industries typically produces very large batches of standardized products used by plumbers,
such as pipe fittings and valves that must be produced in standard sizes. A continuous production process would
work well for J & R.
77. (p. 239) Frolichstein Fabrics promotes itself as a specialty manufacturer that will produce according to
customer specifications. This firm will probably be best served by using an intermittent process in production.
78. (p. 239) Computers and robots are only useful in continuous production processes where the same type of
product is produced many times.
79. (p. 241) Although lean manufacturing attempts to reduce the amount of labor used in the manufacturing
process, it typically does so by increasing the amount of most of the other resources used in the production
process.
80. (p. 241) Businesses that provide services typically cannot use mass customization because services are not
tangible products that can be customized.
81. (p. 241) Carol Preston is the plant manager for a firm that makes coats and jackets. She would like to use
CAD/CAM techniques to be able to custom-make these items. Unfortunately, CAD/CAM is much better suited
for producing industrial goods like machinery and equipment than it is at producing consumer goods like coats
and jackets.
82. (p. 241) A limitation of current CAD/CAM technology is that the complexity of such systems means that
computers used in design are unable to communicate directly with the computer-aided machines used to
manufacture goods.
83. (p. 242) Facility location is one of the functions of operations management planning.
84. (p. 242) Facility location is the process of selecting a geographic location for a company’s operations.
85. (p. 242) When considering the issue of facility location, it is important to find an isolated location so that work
can get done without interruption from customers.
86. (p. 242–243) Facility location is extremely important to retailers.
87. (p. 242) When it comes to location decisions, labor costs are no longer an important consideration for most
manufacturing firms.
88. (p. 242) Operations management planning includes such issues as facility location and facility layout.
89. (p. 243) Due to the growth of the Internet, the cost of labor is no longer an important consideration in location
decisions of business firms.
90. (p. 243) Manufacturing firms that want to minimize time-to-market are likely to choose facility sites that give
them easy access to their preferred modes of transportation.
91. (p. 245) Many state and local governments offer tax incentives and government services to attract businesses.
92. (p. 244) In making a location decision, businesses seldom consider “quality of life” in various locations,
because factors that influence quality of life have little or no impact on profits.
93. (p. 244, Dealing with Change box) According to the “Dealing with Change” box in Chapter 9, manufacturers are more
adept at responding to natural disasters like Hurricane Katrina than service firms are.
94. (p. 244) Internet-focused strategies don’t affect operations managers since these managers only deal with a
single firm.
95. (p. 244) Operations managers are adjusting from a relatively stable environment to one that is constantly
changing and evolving.
96. (p. 244) The Internet has enabled operations management to become an interfirm process where companies
work together to design, produce and ship products.