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Operations Management Practice Questions

Which of the following tasks would NOT typically represent an operations management activity at Hard Rock Cafe?

A) Receiving a shipment of incoming food ingredients
B) Designing an efficient layout
C) Filing a tax return
D) Preparing an employee schedule

C) Filing a tax return
The creation of goods and services is referred to as:
Production
Which of the following is NOT considered to be one of the three primary functions that all organizations perform?

A) Research and Development
B) Production/Operations
C) Finance/Accounting
D) Marketing

A) Research and Development
Which of the following activities at an airline is NOT an operations activity?

A) Catering
B) Crew Scheduling
C) Flying
D) Sales

D) Sales
A global network of organizations and activities that supply a firm with goods and services is referred to as:
A supply chain
Competition in the 21st century is no longer between companies; it is between:
Supply chains
A large percentage of the revenue of most firms is spent of which function?
Operations
Which of these is NOT one of the basic functions of the management process?

A) Inspecting
B) Staffing
C) Leading
D) Controlling

A) Inspecting
Which of the following OM decisions determines how a good or service is produced and commits management to specific technology, quality, human resources, and capital investment?
A) Process and capacity design
The father of scientific management is:
Frederick Taylor
The person who believed that management must do more to improve the work environment and processes so that quality can be improved was:
W. Edwards Deming
The economic activities that typically produce an intangible product are referred to as:
Services
Which of the following organizations does NOT belong to the service sector?

A) Costco
B) Southwest Airlines
C) San Diego Zoo
D) Ford Motor Company

D) Ford Motor Company
Productivity increases when:
Inputs decrease while outputs remain the same
What is the goal for mass customization?
The goal is to product customized products, whenever and wherever needed
Which of the following is NOT considered to be a stakeholder?

A) Community members
B) Distributors
C) Competitors
D) Customers

C) Competitors
The stated purpose of NAFTA is to:
Phase out all trade and tariff barriers among Canada, Mexico, and the U.S.
Which of the following is NOT a reason why domestic business operations decide to change to some form of international operation?

A) Improve operations
B) Attract and retain local talent
C) Improve the supply chain
D) Improve products

B) Attract and retain local talent
A strategy is:
An action plan to achieve a mission
Which of the following is the purpose or rationale for an organization’s existence?
Mission
What is a correct example of differentiation?
Safeskin Corporation, as it’s number one in latex exam gloves that were designed to prevent all allergic reactions
What is a correct example of cost leadership?
Southwest Airlines, as it fulfills a need for low-cost and short-hop flights
What is a correct example or response?
Johnson Electric, as it competes on speed-speed in design, production, and delivery
Competing on differentiation is:
Concerned with uniqueness
Which of the following does NOT represent competing on response?

A) Based on flexibility
B) Concerned with reliability of scheduling
C) Based on providing uniqueness
D) Based on uniqueness

C) Based on providing uniqueness (this is differentiation)
Which of the following is NOT one of the 10 strategic OM decisions listen in the text?

A) Location
B) Quality
C) Layout
D) Finance/Accounting

D) Finance/Accounting
Which of the following is NOT an OM strategy/issue during the growth stage of the product lifecycle?

A) Reduce capacity
B) Forecasting critica
C) Enhance distribution
D) Shift towards product focus

A) Reduce capacity
Correct impacts a maturing product might have on OM strategy:
-Manufacturing process stabilizes
-Cost cutting is instituted
-Optimum capacity may be achieved
Correct impacts technology innovation in the manufacturing process might have on OM strategy:
-New human resource skills
-Product design needs to be revised
-Quality standards need to be revised
Correct impacts changes in laptop computer design that builds in wireless technology might have on OM strategy:
-New human resource skills
-Purchasing needs to be revised
-Inventory needs to be revised
SWOT analysis refers to:
Strengths, opportunities, weaknesses, and threats
Which of these is NOT an advantage of outsourcing?

A) Gaining outside expertise
B) Accessing outside technology
C) Cost savings
D) Potential creation of future compeition

D) Potential creation of future competition
An international business is a firm that:
Engages in international trade or investment
Which international operations strategies uses decentralized authority with substantial autonomy at each business?
Multidomestic
The three phases involved in the management of large projects are:
Planning, scheduling, and controlling
Which of the following does NOT belong to the planning phase of project management?

A) Monitoring resources
B) Defining the project
C) Team organization
D) Goal setting

A) Monitoring resources
The project organization may be LESS helpful when:
The job is familiar to the existing organization
What is the THIRD level in work breakdown structure? (WBS)
Subtasks in major tasks
Gantt charts are:
Planning charts used to schedule resources and allocate time
Which of the following is NOT a part of project controlling?

A) Using feedback loop to revise the project plan
B) Close monitoring of resources, costs, quality, and budgets
C) Sequencing and allotting time to all project activities
D) Shifting resources to where they are needed most

C) Sequencing and allotting time to all project activities
The critical path of a network is the:
Longest time path through the netowrk
How is the EF (earliest finish) computed?
ES (earliest start) + activity time
Which of these time estimates is NOT used in PERT?

A) Standard time
B) Optimistic time
C) Pessimistic time
D) Most likely time

A) Standard time
What is the shortest duration required to complete an activity?
Crash time
Which of the following is a limitation of PERT and CPM?
There is the inherent danger of placing too much emphasis on the critical path
Among the following, the critical path and slack time analysis MOST help:
Pinpoint activities that need to be closely watched
What is the most popular example of specialized software for managing projects?
Microsoft project
The forecasting time horizon that would typically be easiest to predict for would be the:
Short range
A forecast that projects a company’s sales is:
A demand forecast
CPFR is:
Collaborative, planning, forecasting, and replenishment
Which of the following statements is NOT true?

A) When capacity exists, cost can decrease
B) When capacity is inadequate, customers can be lost
C) When excess capacity exists, cost can increase
D) When capacity is inadequate, market share can shrink

A) When capacity exists, cost can decrease
Which of the following is the FIRST step in a forecasting system?
Determine the use of the forecast
Which of the following forecasting steps comes directly after determining the time horizon of the forecast?
Gather the data
Which of the following is a quantitative forecasting method?
Exponential smoothing
Which forecasting model is based upon salespersons’ estimates of expected sales?
Sales force composite
What is a data pattern that repeats itself after a period of days, weeks, months, or quarters?
Seasonality
Which forecasting method considers several variables that are related to the variable being predicted?
Multiple regression
A tracking signal is:
A measurement of how well a forecast is predicting actual values
Which of the following statements is NOT true about the forecasting in the service sector?

A) Detailed forecasts of demand are not needed
B) Forecasting in the service sector presents some unusual challenges
C) Demand patterns are often different from those in non-service sectors
D) Hourly demand forecasts may be necessary

A) Detailed forecasts of demand are not needed
Managing quality helps build successful strategies of:
Differentiation, low cost and response
Which of the following does NOT increase profit by improving quality?

A) Flexible pricing
B) Higher warranty costs
C) Increased productivity
D) Improved reputation

B) Higher warranty costs
The American Society for Quality defines quality as:
The totality of features and characteristics of a product or service that bears on its ability to satisfy stated or implied needs
Which of the following costs is NOT a cost of quality?

A) Lost goodwill
B) Research and development
C) Scrap
D) Rework

B) Research and development
Which of the following is the Japanese term used to describe continuous improvement efforts?
Kaizen
Which of the following is NOT one of the techniques for building employee empowerment?

A) Build communication networks that include employees
B) Build high-morale organizations
C) Eliminate formal organization structures such as teams and quality circles
D) Develop open, supportive supervisors

C) Eliminate formal organization structures such as teams and quality circles
Cause-and-effect diagrams are also known as:
Fish-bone charts
A device or technique that ensure production of a good unit every time is a:
Poka-yoke
Inspections should NOT take place:
After costly or irreversible processes
Which of the following determinants of service quality means the firm performs the service right the first time and that the firm honors its promises?
Reliability
Which of the following is NOT true regarding the importance of the role that an operations manager play in addressing service quality?

A) The tangible component of many services is important
B) The operations manager should realize that the customer expectations are the standard against which the service is judged
C) The manager may be able to influence the quality of the service but has little control over the customers’ expectation
D) Managers must expect exceptions

C) The manager may be able to influence the quality of the service but hast little control over the customers’ expectation
Which type of control chart should be used when it is possible to have more than one mistake per item?
C-Chart
Process capability:
Means that the natural variation of the process must be small enough to produce products that meet the standard
Which of the following measures the proportion of variation (3 standard dev.) between the center of the process and the nearest specification limit?
Process capability index
What is the percentage defective in an average lot of goods inspected through acceptance sampling?
AOQ
Which is the best statement regarding an operating characteristic curve?
As the AQL decreases, the producer’s risk also decreases

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