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Exam 9: Production and Operations Management

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Question 21

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One important issue with respect to managing the operation of a business is to make certain that customers leave feeling as though they had a good experience with your service and with your company in general.

A) True
B) False

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Question 22

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The quality standard for service industries such as luxury hotels is meeting the customers' requests.

A) True
B) False

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Question 23

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Mini-Case Sparky Weyer, president and CEO of Minimotors, Inc., a growing manufacturer of small (some of them downright tiny) electric motors used in a variety of power tools and appliances told potential investors, "These are exciting times for our company. We've made a lot of changes over the past two years that have really improved our operations and lowered our costs. Now we are ready to expand into new markets. Minimotors is on its way to becoming a global player." Sparky was meeting with potential financial backers in an effort to obtain funding for some expensive new machinery he wanted to purchase. "You may have heard about some of the ways we've cut costs," Sparky continued. "We've developed a new arrangement with several of our biggest suppliers. They've agreed to make more frequent deliveries tied directly to our production schedules. This will help us reduce our inventory costs dramatically. We've also greatly reduced the number of defective motors we produce by carefully keeping tabs on all of our manufacturing processes. In fact, we have set a goal of reducing our defects to 3.4 parts per million. The main purpose of my meeting with you today is because we want to install some sophisticated new machinery and software that will allow us to quickly design and produce motors to the exact specifications of our customers. The machinery is computer-controlled and can produce custom-designed products at very little increase in cost compared to our mass-produced motors. We feel this flexibility and quick response time will give us a tremendous competitive advantage and help us attract new customers. Installing the new equipment and training our workers to use it properly will be a complex project, but I'm confident that once we get everything up and running we'll be able to strengthen our position as the leading maker of high-quality electric motors." -The arrangements Minimotors has worked out with its suppliers to reduce the amount of inventory the company holds at any one time show that it is committed to a(n)

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.

The decreased use of enterprise resource planning (ERP) reflects the fact that firms are not interested in combining the computerized functions of all divisions and subsidiaries of a firm.

A major advantage of a just-in-time inventory system is that it reduces costs and the effort for both the producer and its suppliers.

CAD has ________ productivity in many firms.

For the past two years, Mountain High Bike Company used suppliers from India, Japan, and Malaysia to provide precision parts for its custom bikes. There was only one problem: the quality of the parts from all locations lacked precision and consistency. Skilled technicians complained that as many as three out of five parts had to be discarded due to imperfections. The quality control manager convinced the owners to partner with a slightly higher-priced company in Omaha, Nebraska, which utilized ________ to test samples of product components for deviations in quality and precision, prior to sending them to Mountain High Bike Company. The bike company realized savings in both time and money.

The significance of the critical path on a PERT chart is that it identifies the least costly method of producing a given product.

Corie is a development engineer for a company that manufactures solar panels for both residential and commercial purposes. Her company uses PERT network software for all development projects. As she nears the final month of her timeline for completing a new panel, Corie will focus on those activities that are

A benefit of CAD is

A basic characteristic of flexible manufacturing is that it

Gianni's Gelato, a large ice cream producer on the east coast, wants to license firms in Europe to produce and sell its products. We can conclude that this is good strategy if it wants to save the money it would cost to be ISO 9001 certified because the EU (European Union), unlike U.S. firms, has not yet adopted these standards.

While planning a new product launch, Cassandra knew that the art department was ready to work on the promotional pieces right away. But they are not able to start until the strategy group established the price point and the purchasing group obtained the paper needed to make the promotional piece. Establishing price points would take about a week and was dependent on manufacturing getting the costs to the strategy group. This was expected a week from today. The purchasing group indicated the paper could be obtained locally the same day it was requested. Based on this information and assuming things go according to plan, when will the art department be able to begin work on the promotional pieces?

Review the PERT Network below: If it takes 2 weeks for each activity (represented by a box) to be completed, it can be determined that the boxes labeled with No. 1 create the critical path because this path of activities takes the shortest time to complete.

A continuous production process involves physically or chemically manipulating raw materials to create a product.

Chinese companies use so many robots in its manufacturing sector that it may soon become the world's largest robot market.

Firms that have a goal of ________ tend to locate facilities with access to major highways, ports, railways, and airports.

BeltIn, Inc., is a seat belt manufacturer about 8 miles from two major auto assembly plants. Every two hours, BeltIn delivers seatbelts to each of the plants. The assembly plants only accept the number of seatbelts that they will use in cars during the next two hours after delivery. The auto plants embrace lean manufacturing.

Facility layout is the function of operations management that considers the physical arrangement of resources (including people) in the production process.