Chapter 21—Managing Operations, Quality, and Productivity Key
1. When you visit a financial planner you provide her with income, expense, and goal information. She then
turns that information into a financial plan with a budget, investment plan, and insurance plan. She is practicing
operations management.
2. Inefficient or ineffective operations management will almost inevitably lead to poor performance and low
levels of both quality and productivity.
3. A Forever 21 retail store creates value and provides place and time utility by bringing together the customer
and products made by others.
4. The U.S. economy, as a whole, did not mirror the decline in manufacturing during the 1970s partly because
of tremendous growth in the service sector.
5. Managers have come to see that many of the tools, techniques, and methods that are used in a factory are also
useful to a service firm.
6. Organizational strategies and operations management affect each other directly.
7. Determining the product-service mix to be offered is a marketing function that should not affect the
operations function.
8. The capacity decision is truly a low-risk one because of the certainties of future product demand.
9. A triathlon uses a product layout.
10. Habitat for Humanity uses a cellular layout when building homes.
11. Technology is the set of processes and systems used by organizations to convert resources into products or
services.
12. Automation helps to improve products and services, and fosters innovation.
13. In the electronics industry, the rising demand for products has led to increasing employment opportunities
despite the use of automation.
14. Computer-assisted design relies on computers to manufacture products.
15. Sue just received a new assignment from her boss. She is supposed to find a way to use robots to move the
work-in-process from one workstation to another. In other words, Sue is supposed to develop a computer-aided
design system.
16. A milking machine in the dairy industry is a robot.
17. Robots excel at repetitive jobs like loading and unloading as well as at detailed work such as welding.
18. Robots are not as useful in service industries as they are in manufacturing industries.
19. It would be appropriate to make operations accountable for profitability in an organization that stresses sales
and market share over quality and productivity.
20. Pipeline inventory controls purchasing.
21. Firms with just-in-time inventory systems would be wise to have one essential supplier for inputs to their
22. Quality is both an absolute and a relative concept.
23. Features supplement the services basic functioning characteristics.
24. The Malcolm Baldrige Award is given to firms that achieve major quality improvements.
25. A six sigma defect rate is six standard deviations above the mean rate.
26. Productivity computations are basically output-input analyses.
27. Cross-training allows a firm to function with fewer workers.
28. Many unions support cross-training because they think it preserves job security.
29. ____ is the total set of managerial activities that an organization uses to create its products or services.
30. Operations management is primarily concerned with which element of systems theory?
31. Which of the following statements about the relationship between operations management and utility is
TRUE?
32. The goals of operations managers are efficiency and effectiveness, which are achieved through
33. Which of the following organizations would provide the consumer with time and place utility through its
operations management function?
34. The text notes that what we now call operations management was once called production management and
implies that there are several reasons for the change in nomenclature. Which of the following is NOT one of
those reasons?
35. Which of the following factors was largely responsible for the fact that the entire U.S. economy did not
mirror declines in the manufacturing sector during the 1970s?
36. Which sector of the United States economy was responsible for 80 percent of the GNP in 2009 and almost
90% of new jobs created since the 1990s?
37. A ____ organization is one that transforms resources into an intangible output and creates time or place
utility for its customers.
38. Restaurants are in which industry?
39. Which of the following organizations creates form utility?
40. What is the relationship between operations management and organizational strategy?
41. The problems that operations managers face generally revolve around issues related to
42. When GE executives decided to sell NBC network they were making a ____ decision.
43. There is a Canadian insurance company that provides only one kind of insurance. It insures athletes who
have multimillion dollar contracts that must be paid, even if the athlete is injured or in some other way unable to
play. Owners buy the insurance policies as a way to protect themselves. When the insurance company decided
to specialize in this type of insurance, it made a ____ decision.
44. Intel decided the new Itanium chip would replace the Pentium. During the transition, Pentium chips would
be cheaper, but once the Itanium facility was operational, Intel would cease manufacture of Pentiums. The
decision to cease Pentium production is a decision that most directly involves its
45. United Technologies offered to buy Goodrich. This is an example of what kind of an operations decision?
46. When General Odierno said the troop withdrawal from Afghanistan was going too fast, he was making a
____ statement.
47. Which of the following questions are concerned with capacity utilization decisions that must be made by
operations management?
48. Which of the following factors is NOT a consideration when determining the capacity utilization required in
an operations system?
49. Which of the following pairs of factors that are important to designing operations systems are MOST
closely related to demand?
50. Operations managers must specifically address both ____ when setting up an operations system.
51. Many shows broadcast on U.S. television today are filmed in British Columbia, Canada. The production
company takes advantage of the many amenities that British Columbia offers. Operations management
decisions to film in British Columbia are an example of ____ decisions.
52. A product layout MOST likely would be found in organizations
53. Callaway makes golf clubs. Which type of layout would you expect to find in a manufacturing plant that
makes silverware?
54. Katina is in the emergency room. They think she has a broken wrist, so she is taken to x-ray. This is an
example of the use of ____ layout.
55. Dina works in construction. She travels to the job site to build the next house. This is an example of a ____
layout.
56. Clif Bar and Company makes Clif energy bars. Which type of layout would you expect to find in the
manufacturing plant that makes Clif bars?
57. Calphalon makes pots and pans using similar techniques but each in their own family of product, like
nonstick, stick or copper. This is an example of a ____ layout.
58. Which of the following is NOT an important part of automation?
59. In the short-term people may lose their jobs, but in the long-term jobs are generally created by
60. Which of the following statements about the effects of automation on employees is TRUE?
61. To ensure that a newly designed product moves smoothly to the production stage, ____ could be used.
62. The production manager has just received a large block of orders for products that are not manufactured yet;
however, he is not concerned. Which of the following items can you safely assume this production manager
uses?
63. Heather’s boss has just given her the responsibility of developing a new line of protective gear for kayakers.
However, he warned her that the time available for development is not as long as she would probably like. What
should Heather use to speed up the development process?
64. One of the major tasks for movies like The Chronicles of Narnia is to create costumes for various species
that reflect the mythical persona and that can be worn by humans for lengthy periods of time. ____ could be
used to speed up the development process.
65. Which of the following would utilize computer-controlled transportation systems?
66. The first application of robots was for which of the following?
67. Which of the following is NOT a current use for robotics?
68. Unmanned aircraft are increasingly sent into combat instead of piloted aircraft. This is an example of
69. On your way home from class, you stopped at the student center to get some money from an automatic
teller. Which of the following best describes the machine you used?
70. Power School allows parents to review grades, attendance, assignments, and student data on a daily basis.
This is an example of
71. The basic functional purpose of operations systems is to
72. ____ is the process of managing operations control, resource acquisition and purchasing, and inventory to
thus improve overall efficiency and effectiveness.
73. Which of the following statements about the use of operations management as a control is TRUE?
74. The Limited has a competitive advantage in speed. The product moves from finish good to retail stores in a
fraction of the time it takes competitors to do the same thing. Its operations management excels at
75. The purchasing agent for Wegmans, a grocery store, would
76. Which of the following is NOT one of the constraints with which a purchasing agent must deal?
77. Levels of finished-goods inventories are controlled by
78. Which of the following is a type of inventory that must be controlled by a manufacturing organization?
79. Just-in-time systems are a means of improving the management of
80. Dale has seen unit production costs go up dramatically during the past two or three years. One major reason
is high interest rates on money borrowed to purchase and store inputs. Which of the following should Dale
consider?
81. At Wal-Mart, 70 percent of merchandise is rung up at the cash register before the company even pays for it.
This is an example of
82. Which of the following would seem especially appropriate for firms using a just-in-time inventory system?
83. ____ is the totality of features and characteristics of a product or service that determines its ability to satisfy
stated or implied needs.
84. Rich is comparing the quality and features of Facebook to those on Google+. This is an example of the ____
of quality.
85. The fact that a product or system needs to be capable of meeting established standards refers to which
quality dimension?
86. Which of the following is one of the dimensions that can be used to assess or evaluate quality?
87. Which of the eight dimensions of quality is a measure of product life?