International Business, 14e (Daniels et al.)
Chapter 17 Global Manufacturing and Supply-Chain Management
1) In order to assure the quality of its products, Samsonite ________.
A) performs only internal quality tests
B) relies only on independent quality-assurance tests
C) conforms its products to industry-set standards
D) uses both internal quality tests and independent quality-assurance tests
2) In order to save costs and consolidate its manufacturing capacity, Samsonite has ________.
A) decreased investment in R&D
B) moved from a centralized configuration to a decentralized configuration
C) increased the amount of final goods and components it outsources
D) diversified its reseller base
3) Which term refers to the network that links together the different aspects of the value chain and
coordinates materials, information, and funds from the initial raw-material supplier to the ultimate
customer?
A) logistics strategy information system
B) materials management device
C) customer service
D) supply chain
4) Jordan, a manager at an MNE, is responsible for supervising the transportation and storage of
materials and final goods. Jordan is most likely a manager involved with ________.
A) quality control
B) offshoring
C) logistics
D) inventory management
5) Inbound logistics is also known as ________.
A) internal logistics
B) materials management
C) the internal supply chain
D) value-added management
6) Which of the following best describes a major difference between supply chain management and
logistics?
A) Supply chain management involves handling suppliers and customers.
B) Logistics involves longer distances and international distribution networks.
C) Supply chain management focuses on transportation and the storage of goods.
D) Logistics only encompasses the outbound flow of products and materials.
7) In the context of manufacturing strategy, the degree of consistency between the foreign investment
decision and the company’s competitive strategy is known as ________.
A) compatibility
B) coordination
C) control
D) configuration
8) Gates Manufacturing is striving to improve its performance reliability, speed of delivery, and product
reliability. Gates is most likely focusing on a(n) ________ strategy.
A) flexibility
B) innovation
C) dependability
D) quality
9) The ability of the production process to make different kinds of products and to adjust the volume of
output is known as ________.
A) quality control
B) flexibility
C) dependability
D) innovation
10) ________ strategies and the drive for global efficiencies force MNEs to establish economies of scale
in manufacturing.
A) Cost
B) Quality control
C) Cost-minimization
D) Flexibility
11) A ________ takes into account the complete costs of ownership, such as storing and transporting
inventory, and of disposal.
A) total cost analysis
B) cost-benefit analysis
C) make-or-buy decision
D) flexibility strategy
12) ________ manufacturing is any manufacturing that takes place in a country different from the home
country.
A) Offshore
B) Multidomestic
C) Cost-minimization
D) Outsourcing
13) Bocce Shoes, an Italian firm, set up a production facility in Vietnam to manufacture the firm’s line
of athletic shoes. Bocce is most likely using a (n) ________ strategy.
A) dependability
B) flexibility
C) innovation
D) efficiency/cost
14) Which of the following elements is often overlooked when firms estimate the costs of outsourcing to
low-wage countries?
A) language barriers
B) overabundance of skilled and educated workers
C) lack of inventory
D) shipping distances
15) The manufacturing plants of Orion Computers are located closer to customers rather than in low-
wage areas. What is the most likely reason for this strategy?
A) competitor locations in emerging markets
B) overseas producers with innovative designs
C) customer demand for dependability
D) diversification of product lines
16) Which of the following is NOT one of the three basic configurations that MNEs consider when
establishing a global manufacturing strategy?
A) regional manufacturing
B) centralized manufacturing
C) multidomestic manufacturing
D) multicultural manufacturing
17) Roland Enterprises, an American company, has a manufacturing facility in France in order to serve
customers throughout Europe. Roland is most likely using a ________ manufacturing strategy.
A) centralized
B) regional
C) global
D) country-specific
18) A multidomestic configuration is most important when ________.
A) demand in individual countries decreases significantly
B) exporting is the company’s main strategy
C) demand in individual countries becomes significant
D) low-priced, standardized products are available
19) Some companies select locations in different countries to specialize in the production of parts or
final goods, which is known as ________.
A) centralized manufacturing
B) the multidomestic approach
C) offshore manufacturing
D) rationalization
20) Deciding whether to establish production facilities in many different countries or in one centralized
location is part of the ________.
A) cultural matrix
B) Six Sigma process
C) manufacturing configuration
D) innovation matrix
21) ________ is the linking or integrating of activities into a unified system.
A) Control
B) Coordination
C) Configuration
D) Compatibility
22) ________ is the measuring of performance so that companies can respond appropriately to changing
conditions.
A) Coordination
B) Configuration
C) Control
D) Compatibility
23) Which of the following is NOT a major reason that companies adopt IT systems?
A) maintaining effective arms’ length relationships with customers
B) producing high-quality products quickly and efficiently
C) communicating effectively with suppliers
D) managing inventory levels proficiently
24) Giga-Mart has an IT system that links the firm’s suppliers, manufacturers, customers, and
intermediaries. Giga-Mart most likely has a(n) ________,
A) TQM (total quality management)
B) JIT (just-in-time)
C) EDI (electronic data interchange)
D) ERP (enterprise resource planning)
25) MedCo uses an IT system that labels a product with an electronic tag to provide realtime
information. Which of the following does MedCo most likely use?
A) EDI (electronic data interchange)
B) RFID (radio frequency ID)
C) PTX (private technology exchange)
D) ERP (enterprise resource planning)
26) Amazon relies on the Internet to join together suppliers with companies and companies with
customers. Amazon is most likely using ________.
A) value-added networks
B) e-commerce
C) electronic data interchange
D) private technology exchange
27) ________ is an online collaboration model that brings manufacturers, distributors, value-added
retailers, and customers together to execute trading transactions.
A) Electronic data interchange (EDI)
B) ERP (enterprise resource planning)
C) Private technology exchange (PTX)
D) E-commerce
28) Which of the following is most likely a true statement about using the Internet in supply chain
management?
A) The Internet is universally accessible.
B) The Internet slows internal processes in a company.
C) The Internet minimizes efficiency gains to a company’s suppliers.
D) The Internet prevents a deeper level of collaboration and communication.
29) What is the main information-related challenge in global supply chain management?
A) The Internet is growing too quickly in emerging markets.
B) Few countries are technologically advanced.
C) The industrial equipment and food/agriculture industries use e-commerce more than industries such
as defense and motor vehicles.
D) Many emerging market networks cannot be managed through the Internet because of the lack of
technology.
30) Quality is defined as ________.
A) meeting or exceeding the expectations of the customer
B) meeting the everyday low price expected by the customer
C) meeting international quality standards, such as ISO 9000
D) meeting internal quality standards
31) Before the strong emphasis on zero defects, U.S. companies operated under the premise of
________, which allowed a level of poor quality with the assumption that service warranties and repair
facilities would deal with product defects.
A) Six Sigma
B) acceptable quality level
C) just-in-time inventory management (JIT)
D) ISO 9000
32) The Japanese approach to quality is total quality management (TQM), which stresses which of the
following principles?
A) employee involvement, commitment to international standards, and customer satisfaction
B) customer satisfaction, continuous improvements, and warranties
C) customer satisfaction, employee involvement, and continuous improvements
D) employee involvement, continuous improvements, and commitment to international quality standards
33) An element of total quality management (TQM) that focuses on continuous improvement by
identifying problems and enlisting employees to help eliminate them is known as ________.
A) kaizen
B) Six Sigma
C) kanban
D) acceptable quality level (AQL)
34) Fortis Manufacturing Systems uses a highly focused system of quality control that takes a statistical
approach and scrutinizes the firm’s entire production system. Fortis most likely uses ________.
A) total quality management
B) acceptable quality levels
C) just-in-time processes
D) Six Sigma processes
35) What are the three levels of quality standards?
A) general, industry-specific, and company
B) general, international, and domestic
C) employee, company, and customer
D) company, international, and industry-specific
36) Which of the following is a set of universal standards for a globally accepted quality assurance
system?
A) just-in-time (JIT) inventory management
B) Six Sigma
C) total quality management (TQM)
D) ISO 9000
37) ________ is the process of a firm having inputs supplied to it for the production process.
A) Sourcing
B) Subcontracting
C) External production
D) Offshoring
38) Alta Designs is considering the idea of global sourcing. What would be the most likely result for
Alta Designs?
A) gain access to more domestic markets
B) gain access to more domestic products
C) lower costs and improve quality
D) shorten lengthy supply lines
39) All of the following tend to be more expensive when sourcing abroad, EXCEPT ________.
A) transportation costs
B) inventory holding costs
C) brokers and agents fees
D) labor rates
40) ACE Computers established an assembly operation in Malaysia so that it would be close to its key
suppliers. ACE is most likely engaging in ________.
A) industrial clustering
B) horizontal sourcing
C) zero sourcing
D) offshoring
41) Which of the following would most likely be reduced by vertical integration?
A) export tariffs
B) component prices
C) product returns
D) transaction costs
42) Rapid Technologies owns its entire supplier network, which means that the firm most likely uses
________.
A) industrial clustering
B) competitive sharing
C) vertical integration
D) global outsourcing
43) Japanese ________ are groups of independent companies that work together to manage the flow of
goods and services along an entire value chain.
A) chaebol
B) keiretsus
C) sigmas
D) kaizen
44) In deciding whether to make or buy, MNEs should focus on those parts that are ________ to the
product and that they are ________ at making.
A) critical; distinctively good
B) incremental; distinctively good
C) critical; marginally good
D) incremental; marginally good
45) Which of the following is one of the biggest barriers to expanding the use of outsourcing?
A) long-term independence from an external organization
B) loss of operational control
C) cultural opportunities in the organization
D) language barriers
46) Which of the following should an MNE most likely consider in a make-or-buy decision?
A) organizational hierarchy
B) supplier capabilities
C) employee morale
D) niche markets
47) A current sourcing dilemma that some companies face is whether or not they should ________.
A) use outsourcing as a reward to underperforming employees
B) make critical components for which they have competencies
C) outsource innovative processes
D) measure supplier performance
48) Which of the following is one of the four phases of purchasing globalization?
A) foreign buying as a part of procurement strategy
B) complete rejection of domestic purchasing
C) foreign buying based on want
D) global purchasing only