ch1

Student: 11. Assembly lines achieved productivity but at the

_________________________________________ expense of standard of living.
__________________________________ True False
1. Operations managers are responsible for
12. The operations manager has primary
assessing consumer wants and needs and selling
responsibility for making operations system design
and promoting the organization's goods or
decisions, such as system capacity and location of
services.
facilities.
True False
True False
2. Often, the collective success or failure of
13. The word "technology" is used only to refer to
companies' operations functions will impact the
"information technology".
ability of a nation to compete with other nations.
True False
True False
14. ‘Value added' by definition is always a positive
3. Companies are either producing goods or
number since 'added' implies increases.
delivering services. This means that only one of the
True False
two types of operations management strategies are
used. 15. Service often requires greater labor content,
True False whereas manufacturing is more capital intensive.
True False
4. Operations, marketing, and finance function
independently of each other in most organizations. 16. Measurement of productivity in service is more
True False straightforward than in manufacturing since it is
not necessary to take into account the cost of
5. The greater the degree of customer involvement,
materials.
the more challenging the design and management
True False
of operations.
True False 17. Special-purpose technology is a common way of
offering increased customization in manufacturing
6. Goods producing organizations are not involved
or services without taking on additional labor
in service activities.
costs.
True False
True False
7. Service operations require additional inventory
18. One concern in the design of production
because of the unpredictability of consumer
systems is the degree of standardization.
demand.
True False
True False
19. Most people encounter operations only in
8. The value of outputs is measured by the prices
profit-making organizations.
customers are willing to pay for goods or services.
True False
True False
20. Service involves a much higher degree of
9. The use of models will guarantee the best
customer contact than manufacturing.
possible decisions.
True False
True False
21. A systems approach emphasizes
10. People who work in the field of operations
interrelationships among subsystems, but its main
should have skills that include both knowledge and
theme is that the whole is greater than the sum of
people skills.
True False
its individual parts. 31. Operations management and marketing are the
True False two functional areas that exist to support activities
in other functions such as accounting, finance, IT
22. The Pareto phenomenon is one of the most and human resources.
important and pervasive concepts that can be True False
applied at all levels of management.
True False 32. Lean production systems incorporate the
advantages of both mass production and craft
23. Operations managers, who usually use production.
quantitative approaches, are not really concerned True False
with ethical decision-making.
True False 33. As an abstraction of reality, a model is a
simplified version of a real phenomenon.
24. The optimal solutions produced by quantitative True False
techniques should always be evaluated in terms of
the larger framework. 34. Lean production systems use a highly skilled
True False work force and flexible equipment.

25. Managers should most often rely on True False

quantitative techniques for important decisions
since quantitative approaches result in more 35. The lean production philosophy has been slow
accurate decisions. to be adopted in service industries.
True False True False

26. Many operations management decisions can be 36. Operations Management activities will be less
described as tradeoffs. important in the future because many firms are
True False becoming service-oriented operations rather than
goods producing operations.
27. A systems approach means that we concentrate True False
on efficiency within a subsystem and thereby
assure overall efficiency. 37. A modern firm has two supply chain
True False considerations - external links with suppliers and
customers, and an internal network of flows to and
28. Prior to the Industrial Revolution, goods were between the operations function itself.
produced primarily by craftsmen or their True False
apprentices using custom made parts.
True False 38. Operations management involves continuous
decision-making; hopefully most decisions made
29. Elton Mayo's "Hawthorne Experiment" was the will be:
focal point of the Human Relations Movement, A. redundant
which emphasized the importance of the human B. minor in nature
element in job design. C. informed
True False D. quantitative
E. none of the above
30. Among Ford's many contributions was the
introduction of mass production, using the concept 39. A 'product package' consists of:
of interchangeable parts and division of labor. A. the exterior wrapping
B. the shipping container
True False C. a combination of goods and services
D. goods if a manufacturing organization
E. customer relations if a service organization
 46. Manufacturing work sent to other countries is
40. Business organizations consist of three major called:
functions which, ideally: A. downsized
A. support one another B. outsourced
B. are mutually exclusive C. internationalization
C. exist independently of each other D. vertical integration
D. function independently of each other E. entrepreneurial ship
E. do not interface with each other
47. Product design and process selection are
41. Which of the following is not a type of examples of _______ decisions.
operations? A. financial
A. goods production B. tactical
B. storage/transportation C. system design
C. entertainment D. system operation
D. communication E. forecasting
E. all the above involve operations
48. The responsibilities of the operations manager
42. Technology choices seldom affect: are:
A. costs. A. planning, organizing, staffing, procuring, and
B. productivity. reviewing
C. union activity. B. planning, organizing, staffing, directing, and
D. quality. controlling
E. flexibility. C. forecasting, designing, planning, organizing, and
controlling
43. Measurements taken at various points in the
D. forecasting, designing, operating, procuring, and
transformation process for control purposes are
reviewing
called:
E. designing and operating
A. plans
B. directions 49. Knowledge skills usually don't include:
C. controls A. process knowledge
D. feedback B. accounting skills
E. budgets C. communication skills
D. global knowledge
44. Budgeting, analysis of investment proposals,
E. all of the above
and provision of funds are activities associated with
the _______ function. 50. Which of the following is not true about
A. operation systems approach?
B. marketing A. A systems viewpoint is almost always beneficial
C. purchasing in decision making.
D. finance B. A systems approach emphasizes
E. internal audit interrelationships among subsystems.
C. A systems approach concentrates on efficiency
45. Which one of the following would not generally
within subsystems.
be classified under the heading of transformation?
D. A systems approach is essential whenever
A. assembling
something is being redesigned or improved.
B. teaching
E. All of the above are true.
C. staffing
D. farming 51. What is credited with gains in industrial
E. consulting productivity, increased standards of living and
affordable products?
A. personal computers C. recognition of priorities
B. the internet D. analysis of variance
C. mass transportation E. decision table analysis
D. assembly lines
E. multi-level marketing 58. The fact that a few improvements in a few key
areas of operations will have more impact than
52. Production systems with customized outputs many improvements in many other areas is
typically have relatively: consistent with the:
A. high volumes of output A. Irwin phenomenon
B. low unit costs B. Pareto phenomenon
C. high amount of specialized equipment C. Stevenson phenomenon
D. fast work movement D. Tellier phenomenon
E. skilled workers E. Adam Smith phenomenon

53. Which is not a significant difference between 59. The process of comparing outputs to previously
manufacturing and service operations? established standards to determine if corrective
A. cost per unit action is needed is called:
B. uniformity of output A. planning
C. labor content of jobs B. directing
D. customer contact C. controlling
E. measurement of productivity D. budgeting
E. disciplining
54. Which of the following is not a characteristic of
service operations? 60. Which of the following does not relate to
A. intangible output system design?
B. high customer contact A. altering the system capacity
C. high labor content B. location of facilities
D. easy measurement of productivity C. inventory management
E. low uniformity of output D. selection and acquisition of equipment
E. physical arrangement of departments
55. Which of the following is a recent trend in
business? 61. Taking a systems viewpoint with regard to
A. pollution control operations in today's environment increasingly
B. total quality management leads decision-makers to consider ______________
C. supply chain management in response to the ___________.
D. competition from foreign manufacturers A. flexibility; pressure to be more efficient
E. technological change B. offshoring; need to promote domestic
production
56. Farming is an example of: C. sustainability; threat of global warming
A. an obsolete activity D. technology; impact of random variation
B. a virtual organization E. forecasting; stabilization of demand
C. non-manufactured goods
D. a growth industry 62. Some companies attempt to maximize the
E. customized manufacturing revenue they receive from fixed operating capacity
by influencing demands through price
57. Dealing with the fact that certain aspects of any manipulation. This is an example of
management situation are more important than __________________:
others is called: A. Illegal price discrimination
A. analysis of tradeoffs B. Collusion
B. sensitivity analysis C. Volume analysis
D. Revenue management
E. Outsourcing 67. Marketing depends on operations for
information regarding ___________.
63. Which of the following is not an ongoing trend A. productivity
in manufacturing? B. lead time
A. globalization C. cash flow
B. quality improvement D. budgeting
C. flexibility and agility E. corporate intelligence
D. mass production for greater economies of scale
E. technological advances 68. Two widely used metrics of variation are the
__________ and the _________.
64. Which of the following is not a benefit of using A. mean; standard deviation
models in decision making? B. productivity ratio; correlation
A. They provide a standardized format for analyzing C. standardized mean; assignable deviation
a problem. D. randomized mean; standardized deviation
B. They serve as a consistent tool for evaluation. E. normal distribution; random variation
C. They are easy to use and less expensive than
dealing with the actual situation. 69. Which of the following statements about
D. All of the above are benefits. variation is FALSE?
E. None of the above is a benefit. A. Variation prevents a production process from
being as efficient as it can be.
65. Modern firms increasingly rely on other firms to B. Some variation can be prevented.
supply goods and services instead of doing these C. Variation can either be assignable or random.
tasks themselves. This increased level of D. Any variation makes a production process less
_____________ is leading to increased emphasis productive.
on ____________ management. E. Random variation generally cannot be influenced
A. outsourcing; supply chain by managers.
B. offshoring; lean
C. downsizing; total quality 70. Which of the following is essential to consider
D. optimizing; inventory with respect to managing a process to meet
E. internationalization; intercultural demand?
A. strategy
66. Operations and sales are the two ________ B. demand forecasts
functions in businesses. C. capacity
A. strategic D. random variability
B. tactical E. all of the above
C. support
D. value-adding
E. line
ch1 Key
AACSB: Reflective Thinking
Blooms: Remember
1. Operations managers are responsible for Difficulty: Easy
assessing consumer wants and needs and selling Learning Objective: 01-04 Describe the operations function and the nature of
the operations managers job.
and promoting the organization's goods or Stevenson - Chapter 01 #1
services. Topic Area: The Scope of Operations Management

FALSE 2. Often, the collective success or failure of

Operation managers are not responsible for companies' operations functions will impact the
promoting goods/services. ability of a nation to compete with other nations.
TRUE
A nation is often only as competitive as its 6. Goods producing organizations are not involved
companies. in service activities.
FALSE
AACSB: Reflective Thinking
Most systems involve a blend of goods and
Blooms: Remember services.
Difficulty: Easy
Learning Objective: 01-01 Define the term operations management.
Stevenson - Chapter 01 #2
AACSB: Reflective Thinking
Topic Area: Operations Today
Blooms: Remember
Difficulty: Medium
3. Companies are either producing goods or Learning Objective: 01-03 Identify similarities and differences between
delivering services. This means that only one of the production and service operations.
Stevenson - Chapter 01 #6
two types of operations management strategies are Topic Area: Introduction
used.
FALSE 7. Service operations require additional inventory
Most systems involve a blend of goods and because of the unpredictability of consumer
services. demand.
FALSE
Service operations cannot use inventory as a hedge
AACSB: Reflective Thinking against unpredictable demand.
Blooms: Understand
Difficulty: Medium
Learning Objective: 01-03 Identify similarities and differences between
production and service operations. AACSB: Reflective Thinking
Stevenson - Chapter 01 #3 Blooms: Understand
Topic Area: Introduction Difficulty: Easy
Learning Objective: 01-03 Identify similarities and differences between
4. Operations, marketing, and finance function production and service operations.
Stevenson - Chapter 01 #7
independently of each other in most organizations. Topic Area: Introduction
FALSE
Operations, marketing and finance are naturally 8. The value of outputs is measured by the prices
dependent upon one another. customers are willing to pay for goods or services.
TRUE
Customers' willingness to pay for goods or services
AACSB: Reflective Thinking sets the value of these outputs.
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-02 Identify the three major functional areas of
organizations and describe how they interrelate. AACSB: Reflective Thinking
Stevenson - Chapter 01 #4 Blooms: Remember
Topic Area: Introduction Difficulty: Easy
Learning Objective: 01-04 Describe the operations function and the nature of
5. The greater the degree of customer involvement, the operations managers job.
Stevenson - Chapter 01 #8
the more challenging the design and management Topic Area: Introduction
of operations.
TRUE 9. The use of models will guarantee the best
Greater customer involvement leads to more possible decisions.
complexity in the design and management of FALSE
operations. Models are useful, but their use does not
guarantee the best decisions.

AACSB: Reflective Thinking

Blooms: Remember AACSB: Reflective Thinking
Difficulty: Easy Blooms: Understand
Learning Objective: 01-04 Describe the operations function and the nature of Difficulty: Medium
the operations managers job. Learning Objective: 01-06 Explain the key aspects of operations management
Stevenson - Chapter 01 #5 decision making.
Topic Area: Introduction Stevenson - Chapter 01 #9
Topic Area: Operations Management and Decision Making
10. People who work in the field of operations Topic Area: Operations Today

should have skills that include both knowledge and 14. ‘Value added' by definition is always a positive
people skills. number since 'added' implies increases.
TRUE FALSE
Operations management requires a blend of Some transformations result in the output being
knowledge and people skills. worth less than the inputs.

AACSB: Reflective Thinking

AACSB: Reflective Thinking
Blooms: Remember
Blooms: Understand
Difficulty: Medium
Difficulty: Medium
Learning Objective: 01-04 Describe the operations function and the nature of
Learning Objective: 01-04 Describe the operations function and the nature of
the operations managers job.
the operations managers job.
Stevenson - Chapter 01 #10
Stevenson - Chapter 01 #14
Topic Area: The Scope of Operations Management
Topic Area: Introduction

11. Assembly lines achieved productivity but at the 15. Service often requires greater labor content,
expense of standard of living. whereas manufacturing is more capital intensive.
FALSE TRUE
Productivity and standard of living go hand in hand. Service operations tend to be more labor-intensive
than manufacturing.
AACSB: Reflective Thinking
Blooms: Remember
Difficulty: Hard AACSB: Reflective Thinking
Learning Objective: 01-07 Briefly describe the historical evolution of Blooms: Remember
operations management. Difficulty: Medium
Stevenson - Chapter 01 #11 Learning Objective: 01-03 Identify similarities and differences between
Topic Area: The Historical Evolution of Operations Management production and service operations.
Stevenson - Chapter 01 #15
12. The operations manager has primary Topic Area: Introduction

responsibility for making operations system design 16. Measurement of productivity in service is more
decisions, such as system capacity and location of straightforward than in manufacturing since it is
facilities. not necessary to take into account the cost of
FALSE materials.
The operations manager plays a role in these FALSE
decisions but is not primarily responsible for them. Materials cost must be considered in services as
well.
AACSB: Reflective Thinking
Blooms: Understand
Difficulty: Hard AACSB: Reflective Thinking
Learning Objective: 01-04 Describe the operations function and the nature of Blooms: Understand
the operations managers job. Difficulty: Medium
Stevenson - Chapter 01 #12 Learning Objective: 01-03 Identify similarities and differences between
Topic Area: The Scope of Operations Management production and service operations.
Stevenson - Chapter 01 #16
13. The word "technology" is used only to refer to Topic Area: Introduction

"information technology". 17. Special-purpose technology is a common way of

FALSE offering increased customization in manufacturing
Technology also refers to the technology involved in or services without taking on additional labor
resource transformations. costs.
FALSE
AACSB: Reflective Thinking Special-purpose technology typically reduces costs
Blooms: Remember through standardization.
Difficulty: Easy
Learning Objective: 01-08 Characterize current trends in business that impact
operations management.
Stevenson - Chapter 01 #13 AACSB: Reflective Thinking
Blooms: Understand
Difficulty: Hard
Learning Objective: 01-04 Describe the operations function and the nature of
AACSB: Reflective Thinking
the operations managers job.
Blooms: Understand
Stevenson - Chapter 01 #17
Difficulty: Medium
Topic Area: Operations Today
Learning Objective: 01-06 Explain the key aspects of operations management
decision making.
18. One concern in the design of production Stevenson - Chapter 01 #21
systems is the degree of standardization. Topic Area: Operations Management and Decision Making

TRUE 22. The Pareto phenomenon is one of the most

How standardized outputs will be is a critical important and pervasive concepts that can be
consideration in the system design question. applied at all levels of management.
TRUE
AACSB: Reflective Thinking Pareto phenomena can be observed in a wide
Blooms: Remember variety of organization situations.
Difficulty: Easy
Learning Objective: 01-04 Describe the operations function and the nature of
the operations managers job.
Stevenson - Chapter 01 #18 AACSB: Reflective Thinking
Topic Area: Operations Management and Decision Making Blooms: Remember
Difficulty: Medium
19. Most people encounter operations only in Learning Objective: 01-06 Explain the key aspects of operations management
decision making.
profit-making organizations. Stevenson - Chapter 01 #22
FALSE Topic Area: Operations Management and Decision Making

Operations are also relevant to not-for-profit 23. Operations managers, who usually use
organizations such as the Red Cross. quantitative approaches, are not really concerned
with ethical decision-making.
AACSB: Reflective Thinking FALSE
Blooms: Understand Ethics issues are touching on all areas of
Difficulty: Medium
Learning Objective: 01-04 Describe the operations function and the nature of management, including operations.
the operations managers job.
Stevenson - Chapter 01 #19
Topic Area: Introduction
AACSB: Ethics
Blooms: Understand
20. Service involves a much higher degree of Difficulty: Medium
customer contact than manufacturing. Learning Objective: 01-04 Describe the operations function and the nature of
the operations managers job.
TRUE Stevenson - Chapter 01 #23
Customer contact tends to be much higher in Topic Area: Key Issues for Todays Business Operations

services. 24. The optimal solutions produced by quantitative

techniques should always be evaluated in terms of
AACSB: Reflective Thinking the larger framework.
Blooms: Remember TRUE
Difficulty: Easy
Learning Objective: 01-03 Identify similarities and differences between Quantitative techniques have limitations that must
production and service operations.
Stevenson - Chapter 01 #20
be considered.
Topic Area: Introduction

21. A systems approach emphasizes AACSB: Reflective Thinking

Blooms: Remember
interrelationships among subsystems, but its main Difficulty: Medium
theme is that the whole is greater than the sum of Learning Objective: 01-06 Explain the key aspects of operations management
decision making.
its individual parts. Stevenson - Chapter 01 #24
TRUE Topic Area: Operations Management and Decision Making

Optimizing the performance of individual 25. Managers should most often rely on
subsystems does not guarantee optimal quantitative techniques for important decisions
performance from the overall system. since quantitative approaches result in more
accurate decisions. 29. Elton Mayo's "Hawthorne Experiment" was the
FALSE focal point of the Human Relations Movement,
Just as other techniques do, quantitative which emphasized the importance of the human
techniques have limitations. element in job design.
TRUE
AACSB: Reflective Thinking
The Hawthorne Experiments were the beginning of
Blooms: Understand the Human Relations Movement.
Difficulty: Hard
Learning Objective: 01-06 Explain the key aspects of operations management
decision making.
AACSB: Reflective Thinking
Stevenson - Chapter 01 #25
Blooms: Remember
Topic Area: Operations Management and Decision Making
Difficulty: Medium
Learning Objective: 01-07 Briefly describe the historical evolution of
26. Many operations management decisions can be operations management.
described as tradeoffs. Stevenson - Chapter 01 #29
Topic Area: The Historical Evolution of Operations Management
TRUE
Managing tradeoffs is the essence of operations 30. Among Ford's many contributions was the
management. introduction of mass production, using the concept
of interchangeable parts and division of labor.
AACSB: Reflective Thinking
Blooms: Remember TRUE
Difficulty: Medium Ford made mass production a practical success.
Learning Objective: 01-06 Explain the key aspects of operations management
decision making.
Stevenson - Chapter 01 #26
Topic Area: Operations Management and Decision Making AACSB: Reflective Thinking
Blooms: Remember
27. A systems approach means that we concentrate Difficulty: Easy
Learning Objective: 01-07 Briefly describe the historical evolution of
on efficiency within a subsystem and thereby operations management.
assure overall efficiency. Stevenson - Chapter 01 #30
Topic Area: The Historical Evolution of Operations Management
FALSE
Subsystem efficiency doesn't necessarily translate 31. Operations management and marketing are the
into overall efficiency. two functional areas that exist to support activities
in other functions such as accounting, finance, IT
AACSB: Reflective Thinking
and human resources.
Blooms: Understand FALSE
Difficulty: Medium Operations management and marketing are
Learning Objective: 01-06 Explain the key aspects of operations management
decision making. supported by these functions.
Stevenson - Chapter 01 #27
Topic Area: Operations Management and Decision Making
AACSB: Reflective Thinking
28. Prior to the Industrial Revolution, goods were Blooms: Understand
produced primarily by craftsmen or their Difficulty: Medium
Learning Objective: 01-02 Identify the three major functional areas of
apprentices using custom made parts. organizations and describe how they interrelate.
TRUE Stevenson - Chapter 01 #31
Topic Area: Introduction
After the Industrial Revolution, more standardized
approaches became common. 32. Lean production systems incorporate the
advantages of both mass production and craft
AACSB: Reflective Thinking
production.
Blooms: Remember TRUE
Difficulty: Medium Lean production blends the best of both worlds.
Learning Objective: 01-07 Briefly describe the historical evolution of
operations management.
Stevenson - Chapter 01 #28
Topic Area: The Historical Evolution of Operations Management AACSB: Reflective Thinking
Blooms: Remember
Difficulty: Medium Difficulty: Medium
Learning Objective: 01-08 Characterize current trends in business that impact Learning Objective: 01-08 Characterize current trends in business that impact
operations management. operations management.
Stevenson - Chapter 01 #32 Stevenson - Chapter 01 #36
Topic Area: The Historical Evolution of Operations Management Topic Area: Key Issues for Todays Business Operations

33. As an abstraction of reality, a model is a 37. A modern firm has two supply chain
simplified version of a real phenomenon. considerations - external links with suppliers and
TRUE customers, and an internal network of flows to and
Models are valuable abstractions and between the operations function itself.
simplifications of real, complex phenomena. TRUE
Supply chain considerations are at play both in and
AACSB: Reflective Thinking
beyond the modern firm.
Blooms: Remember
Difficulty: Easy
Learning Objective: 01-06 Explain the key aspects of operations management AACSB: Reflective Thinking
decision making. Blooms: Remember
Stevenson - Chapter 01 #33 Difficulty: Easy
Topic Area: Operations Management and Decision Making Learning Objective: 01-04 Describe the operations function and the nature of
the operations managers job.
34. Lean production systems use a highly skilled Stevenson - Chapter 01 #37
Topic Area: Key Issues for Todays Business Operations
work force and flexible equipment.
38. Operations management involves continuous
TRUE decision-making; hopefully most decisions made
Lean depends on a skilled workforce. will be:
A. redundant
AACSB: Reflective Thinking
B. minor in nature
Blooms: Remember C. informed
Difficulty: Easy D. quantitative
Learning Objective: 01-08 Characterize current trends in business that impact
operations management. E. none of the above
Stevenson - Chapter 01 #34
Topic Area: The Historical Evolution of Operations Management
Informed decisions incorporate all relevant issues.

35. The lean production philosophy has been slow AACSB: Reflective Thinking
to be adopted in service industries. Blooms: Remember
FALSE Difficulty: Easy
Learning Objective: 01-06 Explain the key aspects of operations management
Lean concepts apply very well in service industries. decision making.
Stevenson - Chapter 01 #38
Topic Area: Operations Management and Decision Making
AACSB: Reflective Thinking
Blooms: Remember 39. A 'product package' consists of:
Difficulty: Medium A. the exterior wrapping
Learning Objective: 01-08 Characterize current trends in business that impact
operations management. B. the shipping container
Stevenson - Chapter 01 #35 C. a combination of goods and services
Topic Area: The Historical Evolution of Operations Management
D. goods if a manufacturing organization
36. Operations Management activities will be less E. customer relations if a service organization
important in the future because many firms are Most firms are not pure service or manufacturing
becoming service-oriented operations rather than firms; they produce combinations of goods and
goods producing operations. services.
FALSE
Operations management is just as important for AACSB: Reflective Thinking
service firms. Blooms: Remember
Difficulty: Medium
Learning Objective: 01-03 Identify similarities and differences between
production and service operations.
AACSB: Reflective Thinking
Stevenson - Chapter 01 #39
Blooms: Understand
Topic Area: Introduction 43. Measurements taken at various points in the
40. Business organizations consist of three major transformation process for control purposes are
functions which, ideally: called:
A. support one another A. plans
B. are mutually exclusive B. directions
C. exist independently of each other C. controls
D. function independently of each other D. feedback
E. do not interface with each other E. budgets
Finance, Marketing and Operations are these major Feedback is used to monitor and improve
functions. processes.

AACSB: Reflective Thinking

AACSB: Reflective Thinking
Blooms: Remember
Blooms: Remember
Difficulty: Hard
Difficulty: Medium
Learning Objective: 01-04 Describe the operations function and the nature of
Learning Objective: 01-02 Identify the three major functional areas of
the operations managers job.
organizations and describe how they interrelate.
Stevenson - Chapter 01 #43
Stevenson - Chapter 01 #40
Topic Area: Introduction
Topic Area: Introduction

41. Which of the following is not a type of 44. Budgeting, analysis of investment proposals,
operations? and provision of funds are activities associated with
A. goods production the _______ function.
B. storage/transportation A. operation
C. entertainment B. marketing
D. communication C. purchasing
E. all the above involve operations D. finance
All of these involve taking inputs and transforming E. internal audit
them. These are the primary tasks for the finance
function.

AACSB: Reflective Thinking

Blooms: Remember AACSB: Reflective Thinking
Difficulty: Medium Blooms: Remember
Learning Objective: 01-01 Define the term operations management. Difficulty: Easy
Stevenson - Chapter 01 #41 Learning Objective: 01-02 Identify the three major functional areas of
Topic Area: Introduction organizations and describe how they interrelate.
Stevenson - Chapter 01 #44
42. Technology choices seldom affect: Topic Area: Introduction

A. costs. 45. Which one of the following would not generally

B. productivity. be classified under the heading of transformation?
C. union activity. A. assembling
D. quality. B. teaching
E. flexibility. C. staffing
Union activity can affect a firm's technology D. farming
choices, but not the other way around. E. consulting
Staffing doesn't involve transforming resources so
AACSB: Reflective Thinking much as it involves acquiring them.
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-08 Characterize current trends in business that impact
AACSB: Reflective Thinking
operations management.
Blooms: Remember
Stevenson - Chapter 01 #42
Difficulty: Hard
Topic Area: Operations Today
Learning Objective: 01-04 Describe the operations function and the nature of
the operations managers job.
Stevenson - Chapter 01 #45
Topic Area: Process Management Blooms: Remember
Difficulty: Medium
46. Manufacturing work sent to other countries is Learning Objective: 01-04 Describe the operations function and the nature of
the operations managers job.
called: Stevenson - Chapter 01 #48
Topic Area: The Scope of Operations Management
A. downsized
B. outsourced 49. Knowledge skills usually don't include:
C. internationalization A. process knowledge
D. vertical integration B. accounting skills
E. entrepreneurial ship C. communication skills
Outsourcing is increasingly a part of operations D. global knowledge
management. E. all of the above
Communication skills generally are considered to
AACSB: Reflective Thinking be people skills.
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-08 Characterize current trends in business that impact
AACSB: Reflective Thinking
operations management.
Blooms: Remember
Stevenson - Chapter 01 #46
Difficulty: Medium
Topic Area: The Scope of Operations Management
Learning Objective: 01-04 Describe the operations function and the nature of
the operations managers job.
47. Product design and process selection are Stevenson - Chapter 01 #49
examples of _______ decisions. Topic Area: The Scope of Operations Management

A. financial 50. Which of the following is not true about

B. tactical systems approach?
C. system design A. A systems viewpoint is almost always beneficial
D. system operation in decision making.
E. forecasting B. A systems approach emphasizes
These major decisions affect decisions made at interrelationships among subsystems.
lower levels. C. A systems approach concentrates on efficiency
within subsystems.
AACSB: Reflective Thinking D. A systems approach is essential whenever
Blooms: Remember something is being redesigned or improved.
Difficulty: Hard
Learning Objective: 01-05 Summarize the two major aspects of process E. All of the above are true.
management. Subsystem efficiency doesn't necessarily translate
Stevenson - Chapter 01 #47
Topic Area: The Scope of Operations Management into overall system efficiency.

48. The responsibilities of the operations manager

are: AACSB: Reflective Thinking
Blooms: Understand
A. planning, organizing, staffing, procuring, and Difficulty: Medium
reviewing Learning Objective: 01-06 Explain the key aspects of operations management
decision making.
B. planning, organizing, staffing, directing, and Stevenson - Chapter 01 #50
controlling Topic Area: Operations Management and Decision Making

C. forecasting, designing, planning, organizing, and 51. What is credited with gains in industrial
controlling productivity, increased standards of living and
D. forecasting, designing, operating, procuring, and affordable products?
reviewing A. personal computers
E. designing and operating B. the internet
The scope of operations management ranges C. mass transportation
across the organization. D. assembly lines
E. multi-level marketing
AACSB: Reflective Thinking
Mass production has played a prominent role in The productivity of service operations is often hard
increasing standards of living. to measure.

AACSB: Reflective Thinking AACSB: Reflective Thinking

Blooms: Remember Blooms: Understand
Difficulty: Hard Difficulty: Medium
Learning Objective: 01-08 Characterize current trends in business that impact Learning Objective: 01-03 Identify similarities and differences between
operations management. production and service operations.
Stevenson - Chapter 01 #51 Stevenson - Chapter 01 #54
Topic Area: The Historical Evolution of Operations Management Topic Area: Introduction

52. Production systems with customized outputs 55. Which of the following is a recent trend in
typically have relatively: business?
A. high volumes of output A. pollution control
B. low unit costs B. total quality management
C. high amount of specialized equipment C. supply chain management
D. fast work movement D. competition from foreign manufacturers
E. skilled workers E. technological change
Skilled workers are necessary to accommodate the Supply chain management involves a broader
variation inherent in customized outputs. systemic view of operations.

AACSB: Reflective Thinking AACSB: Reflective Thinking

Blooms: Remember Blooms: Remember
Difficulty: Hard Difficulty: Medium
Learning Objective: 01-06 Explain the key aspects of operations management Learning Objective: 01-08 Characterize current trends in business that impact
decision making. operations management.
Stevenson - Chapter 01 #52 Stevenson - Chapter 01 #55
Topic Area: Operations Management and Decision Making Topic Area: Key Issues for Todays Business Operations

53. Which is not a significant difference between 56. Farming is an example of:
manufacturing and service operations? A. an obsolete activity
A. cost per unit B. a virtual organization
B. uniformity of output C. non-manufactured goods
C. labor content of jobs D. a growth industry
D. customer contact E. customized manufacturing
E. measurement of productivity Farm operations are not manufacturing operations.
Manufacturing operations aren't necessarily more
or less efficient than service operations. AACSB: Reflective Thinking
Blooms: Remember
Difficulty: Medium
AACSB: Reflective Thinking Learning Objective: 01-03 Identify similarities and differences between
Blooms: Understand production and service operations.
Difficulty: Hard Stevenson - Chapter 01 #56
Learning Objective: 01-03 Identify similarities and differences between Topic Area: Introduction
production and service operations.
Stevenson - Chapter 01 #53 57. Dealing with the fact that certain aspects of any
Topic Area: Introduction
management situation are more important than
54. Which of the following is not a characteristic of others is called:
service operations? A. analysis of tradeoffs
A. intangible output B. sensitivity analysis
B. high customer contact C. recognition of priorities
C. high labor content D. analysis of variance
D. easy measurement of productivity E. decision table analysis
E. low uniformity of output Solutions tend to be targeted toward higher priority
aspects of a situation.
 Inventory management is a system operation
AACSB: Reflective Thinking
decision area.
Blooms: Remember
Difficulty: Hard
Learning Objective: 01-06 Explain the key aspects of operations management AACSB: Reflective Thinking
decision making. Blooms: Remember
Stevenson - Chapter 01 #57 Difficulty: Medium
Topic Area: Operations Management and Decision Making Learning Objective: 01-05 Summarize the two major aspects of process
management.
58. The fact that a few improvements in a few key Stevenson - Chapter 01 #60
Topic Area: The Scope of Operations Management
areas of operations will have more impact than
many improvements in many other areas is 61. Taking a systems viewpoint with regard to
consistent with the: operations in today's environment increasingly
A. Irwin phenomenon leads decision-makers to consider ______________
B. Pareto phenomenon in response to the ___________.
C. Stevenson phenomenon A. flexibility; pressure to be more efficient
D. Tellier phenomenon B. offshoring; need to promote domestic
E. Adam Smith phenomenon production
Pareto phenomena direct our attention to the C. sustainability; threat of global warming
difference between the "important few" and the D. technology; impact of random variation
"trivial many." E. forecasting; stabilization of demand
Sustainability is a relatively recent operations
AACSB: Reflective Thinking
management consideration.
Blooms: Understand
Difficulty: Medium
Learning Objective: 01-06 Explain the key aspects of operations management AACSB: Reflective Thinking
decision making. Blooms: Understand
Stevenson - Chapter 01 #58 Difficulty: Hard
Topic Area: Operations Management and Decision Making Learning Objective: 01-06 Explain the key aspects of operations management
decision making.
59. The process of comparing outputs to previously Stevenson - Chapter 01 #61
Topic Area: Operations Management and Decision Making
established standards to determine if corrective
action is needed is called: 62. Some companies attempt to maximize the
A. planning revenue they receive from fixed operating capacity
B. directing by influencing demands through price
C. controlling manipulation. This is an example of
D. budgeting __________________:
E. disciplining A. Illegal price discrimination
Controls are used to maintain performance. B. Collusion
C. Volume analysis
AACSB: Reflective Thinking
D. Revenue management
Blooms: Remember E. Outsourcing
Difficulty: Hard Revenue management is used to ensure that as
Learning Objective: 01-04 Describe the operations function and the nature of
the operations managers job. much perishable capacity as possible is sold.
Stevenson - Chapter 01 #59
Topic Area: The Scope of Operations Management
AACSB: Reflective Thinking
60. Which of the following does not relate to Blooms: Remember
system design? Difficulty: Medium
Learning Objective: 01-08 Characterize current trends in business that impact
A. altering the system capacity operations management.
B. location of facilities Stevenson - Chapter 01 #62
Topic Area: Operations Today
C. inventory management
D. selection and acquisition of equipment 63. Which of the following is not an ongoing trend
E. physical arrangement of departments in manufacturing?
A. globalization Learning Objective: 01-08 Characterize current trends in business that impact
operations management.
B. quality improvement Stevenson - Chapter 01 #65
Topic Area: Key Issues for Todays Business Operations
C. flexibility and agility
D. mass production for greater economies of scale 66. Operations and sales are the two ________
E. technological advances functions in businesses.
Manufacturers are moving away from mass A. strategic
production for economies of scale. B. tactical
C. support
AACSB: Reflective Thinking D. value-adding
Blooms: Remember E. line
Difficulty: Medium
Learning Objective: 01-08 Characterize current trends in business that impact Others are support functions.
operations management.
Stevenson - Chapter 01 #63
Topic Area: Key Issues for Todays Business Operations
AACSB: Reflective Thinking
Blooms: Remember
64. Which of the following is not a benefit of using Difficulty: Easy
models in decision making? Learning Objective: 01-02 Identify the three major functional areas of
organizations and describe how they interrelate.
A. They provide a standardized format for analyzing Stevenson - Chapter 01 #66
a problem. Topic Area: Why Learn about Operations Management?

B. They serve as a consistent tool for evaluation. 67. Marketing depends on operations for
C. They are easy to use and less expensive than information regarding ___________.
dealing with the actual situation. A. productivity
D. All of the above are benefits. B. lead time
E. None of the above is a benefit. C. cash flow
Models are useful tools for making decisions D. budgeting
without confronting the actual situation with all of E. corporate intelligence
its complexity. Marketing uses lead time information to make
promises to customers.
AACSB: Reflective Thinking
Blooms: Remember
Difficulty: Hard AACSB: Reflective Thinking
Learning Objective: 01-06 Explain the key aspects of operations management Blooms: Remember
decision making. Difficulty: Easy
Stevenson - Chapter 01 #64 Learning Objective: 01-04 Describe the operations function and the nature of
Topic Area: Operations Management and Decision Making the operations managers job.
Stevenson - Chapter 01 #67
65. Modern firms increasingly rely on other firms to Topic Area: Why Learn about Operations Management?

supply goods and services instead of doing these 68. Two widely used metrics of variation are the
tasks themselves. This increased level of __________ and the _________.
_____________ is leading to increased emphasis A. mean; standard deviation
on ____________ management. B. productivity ratio; correlation
A. outsourcing; supply chain C. standardized mean; assignable deviation
B. offshoring; lean D. randomized mean; standardized deviation
C. downsizing; total quality E. normal distribution; random variation
D. optimizing; inventory The mean and standard deviation summarize
E. internationalization; intercultural important facets regarding the variation in a
Supply chain management takes a more systemic process.
view of the firm, its operations, and its suppliers.

AACSB: Reflective Thinking

AACSB: Reflective Thinking Blooms: Remember
Blooms: Understand Difficulty: Easy
Difficulty: Medium Learning Objective: 01-04 Describe the operations function and the nature of
the operations managers job. management.
Stevenson - Chapter 01 #68 Stevenson - Chapter 01 #69
Topic Area: Process Management Topic Area: Process Management

69. Which of the following statements about 70. Which of the following is essential to consider
variation is FALSE? with respect to managing a process to meet
A. Variation prevents a production process from demand?
being as efficient as it can be. A. strategy
B. Some variation can be prevented. B. demand forecasts
C. Variation can either be assignable or random. C. capacity
D. Any variation makes a production process less D. random variability
productive. E. all of the above
E. Random variation generally cannot be influenced All of these play a role in determining whether a
by managers. process can meet demand.
The choice to offer customers greater variety might
increase variation but increase productivity even AACSB: Reflective Thinking
more. Blooms: Understand
Difficulty: Medium
Learning Objective: 01-05 Summarize the two major aspects of process
management.
AACSB: Reflective Thinking
Stevenson - Chapter 01 #70
Blooms: Understand
Topic Area: Process Management
Difficulty: Hard
Learning Objective: 01-05 Summarize the two major aspects of process

ch1 Summary
Category
AACSB: Ethics
AACSB: Reflective Thinking
Blooms: Remember
Blooms: Understand
Difficulty: Easy
Difficulty: Hard
Difficulty: Medium
Learning Objective: 01-01 Define the term operations management.
Learning Objective: 01-02 Identify the three major functional areas of organizations
e.
Learning Objective: 01-03 Identify similarities and differences between production
Learning Objective: 01-04 Describe the operations function and the nature
Learning Objective: 01-05 Summarize the two major aspects of process management.
Learning Objective: 01-06 Explain the key aspects of operations management
Learning Objective: 01-07 Briefly describe the historical evolution of operations
Learning Objective: 01-08 Characterize current trends in business that impact
Stevenson - Chapter 01
Topic Area: Introduction
Topic Area: Key Issues for Todays Business Operations
Topic Area: Operations Management and Decision Making
Topic Area: Operations Today
Topic Area: Process Management
Topic Area: The Historical Evolution of Operations Management
Topic Area: The Scope of Operations Management
Topic Area: Why Learn about Operations Management?