Operation management – Evolution, Value Chain & OM at workplace
- What is the main purpose of operations management?
a) To recruit employees
b) To design advertising campaigns
c) To design, manage and improve processes that create goods and services
d) To prepare financial statements
Answer: c) To design, manage and improve processes that create goods and services
- Operations management is primarily concerned with transforming:
a) Inputs into outputs
b) Customers into suppliers
c) Profits into expenses
d) Policies into laws
Answer: a) Inputs into outputs
- Which of the following is an input to an operating process?
a) A completed service
b) Sales revenue
c) Customer satisfaction
d) Labor
Answer: d) Labor
- Which of the following is an output of an operating process?
a) Raw material
b) A completed product
c) Equipment
d) Employee time
Answer: b) A completed product
- Which activity is normally part of operations management?
a) Stock-market regulation
b) Tax legislation
c) Process design
d) Shareholder voting
Answer: c) Process design
- Operations managers are responsible for ensuring that processes are:
a) Entirely manual
b) Efficient and effective
c) Independent of customers
d) Expensive and complicated
Answer: b) Efficient and effective
- Efficiency refers mainly to:
a) Using resources wisely
b) Hiring more managers
c) Increasing advertising
d) Offering more product colors
Answer: a) Using resources wisely
- Effectiveness refers mainly to:
a) Buying the least expensive materials
b) Reducing the number of customers
c) Achieving the intended result
d) Minimizing employee interaction
Answer: c) Achieving the intended result
- Which department is most directly responsible for producing goods or delivering services?
a) Legal affairs
b) Operations
c) Public relations
d) Investor relations
Answer: b) Operations
- Operations management applies to:
a) Manufacturing organizations only
b) Government organizations only
c) Service organizations only
d) Both manufacturing and service organizations
Answer: d) Both manufacturing and service organizations
- In a hospital, which activity is an operations-management responsibility?
a) Designing patient-care processes
b) Trading hospital shares
c) Preparing television advertisements
d) Developing national health laws
Answer: a) Designing patient-care processes
- In a restaurant, which decision is an operations decision?
a) Choosing an external auditor
b) Setting national food regulations
c) Selecting the kitchen layout
d) Issuing corporate bonds
Answer: c) Selecting the kitchen layout
- In a bank, operations management would most likely focus on:
a) Designing currency
b) Processing transactions accurately and quickly
c) Setting national interest rates
d) Regulating competing banks
Answer: b) Processing transactions accurately and quickly
- Which activity best represents a transformation process?
a) Filing an annual report
b) Purchasing company shares
c) Paying a dividend
d) Converting raw steel into automobile parts
Answer: d) Converting raw steel into automobile parts
- In a university, an important output of the operating system is:
a) Faculty offices
b) Classroom furniture
c) Educated graduates
d) Textbook inventory
Answer: c) Educated graduates
- Which of the following is a physical resource used in operations?
a) Brand reputation
b) Machinery
c) Customer loyalty
d) Market confidence
Answer: b) Machinery
- Which of the following is an intangible output?
a) Legal advice
b) Refrigerator
c) Computer monitor
d) Automobile
Answer: a) Legal advice
- A process is best described as:
a) A list of employee benefits
b) A financial statement
c) A marketing slogan
d) A set of activities that transforms inputs into outputs
Answer: d) A set of activities that transforms inputs into outputs
- Why should employees outside the operations department understand operations management?
a) Operations eliminates the need for teamwork
b) Every business function influences or depends on operating processes
c) Only operations employees interact with customers
d) Operations replaces every other business function
Answer: b) Every business function influences or depends on operating processes
- Which business function normally communicates customer needs to operations?
a) Treasury
b) Auditing
c) Marketing
d) Legal compliance
Answer: c) Marketing
- Which business function helps operations evaluate investments in equipment and capacity?
a) Finance
b) Public relations
c) Corporate communications
d) Government relations
Answer: a) Finance
- Human resources supports operations primarily by:
a) Transporting finished goods
b) Setting product prices
c) Designing factory equipment
d) Providing people with the required skills
Answer: d) Providing people with the required skills
- Information technology supports operations by:
a) Replacing all suppliers
b) Enabling data collection, communication and automation
c) Preparing tax regulations
d) Eliminating the need for process design
Answer: b) Enabling data collection, communication and automation
- Which factor most directly affects an operation’s capacity?
a) The number of shareholders
b) The corporate logo
c) Available people, equipment and facilities
d) The annual advertising theme
Answer: c) Available people, equipment and facilities
- Capacity refers to:
a) The maximum output a process can produce over a period
b) The amount spent on advertising
c) The number of company policies
d) The price customers are willing to pay
Answer: a) The maximum output a process can produce over a period
- Which decision concerns the physical arrangement of resources?
a) Tax decision
b) Branding decision
c) Dividend decision
d) Facility-layout decision
Answer: d) Facility-layout decision
- Scheduling is concerned with:
a) Selecting the company’s legal structure
b) Determining when activities and resources will be used
c) Issuing financial securities
d) Designing advertisements
Answer: b) Determining when activities and resources will be used
- Quality in operations is best understood as:
a) Charging the highest possible price
b) Using the most expensive technology
c) Consistently meeting customer requirements
d) Producing only luxury goods
Answer: c) Consistently meeting customer requirements
- Productivity generally compares:
a) Outputs produced with inputs used
b) Sales with advertising
c) Assets with liabilities
d) Profits with taxes
Answer: a) Outputs produced with inputs used
- A company improves productivity when it:
a) Uses more resources to produce less
b) Produces more output with the same resources
c) Raises prices without improving operations
d) Increases the number of policies
Answer: b) Produces more output with the same resources
- Which performance measure reflects how quickly a process responds?
a) Market capitalization
b) Ownership
c) Advertising reach
d) Speed
Answer: d) Speed
- Which performance measure reflects the ability to adjust to changing customer needs?
a) Flexibility
b) Seniority
c) Publicity
d) Taxability
Answer: a) Flexibility
- Which performance measure focuses on meeting promised delivery dates?
a) Market awareness
b) Product ownership
c) Delivery reliability
d) Employee seniority
Answer: c) Delivery reliability
- Operations managers often need to balance:
a) Taxes, dividends and share prices only
b) Cost, quality, speed, flexibility and reliability
c) Advertising, branding and publicity only
d) Office titles and reporting levels
Answer: b) Cost, quality, speed, flexibility and reliability
- Which statement best describes operations management in the workplace?
a) It focuses only on reducing the workforce
b) It is relevant only after a product is sold
c) It operates separately from business strategy
d) It connects resources and processes to customer and business needs
Answer: d) It connects resources and processes to customer and business needs
- A value chain is best described as:
a) A connected network of activities that creates value for customers
b) A chain of retail buildings
c) A financial reporting structure
d) A list of product prices
Answer: a) A connected network of activities that creates value for customers
- The central purpose of a value chain is to:
a) Replace customer service
b) Deliver benefits that customers value
c) Increase organizational hierarchy
d) Eliminate all business risks
Answer: b) Deliver benefits that customers value
- Value is generally created when:
a) The company owns many facilities
b) The product has the highest price
c) Customer benefits justify the cost or sacrifice required
d) The product uses the most materials
Answer: c) Customer benefits justify the cost or sacrifice required
- Which participant normally begins an external supply chain?
a) Final customer
b) Advertising agency
c) Retail cashier
d) Supplier
Answer: d) Supplier
- Which participant is normally the final focus of a value chain?
a) Customer
b) Equipment manufacturer
c) Internal auditor
d) Raw-material supplier
Answer: a) Customer
- Which flow commonly moves from suppliers toward customers?
a) Tax regulations
b) Goods and services
c) Customer complaints only
d) Product returns only
Answer: b) Goods and services
- Which flow may move in both directions across a value chain?
a) Finished products only
b) Raw materials only
c) Information
d) Factory buildings
Answer: c) Information
- Customer orders moving toward suppliers are an example of:
a) Capital depreciation
b) Employee rotation
c) Physical transformation
d) Information flow
Answer: d) Information flow
- Which of the following is a preproduction activity?
a) Product research and design
b) Warranty repair
c) Complaint resolution
d) Product disposal
Answer: a) Product research and design
- Which of the following is a production activity?
a) Conducting market research only
b) Manufacturing or delivering the main offering
c) Recycling a returned product only
d) Processing warranty claims only
Answer: b) Manufacturing or delivering the main offering
- Which of the following is a postproduction activity?
a) Product design
b) Initial market research
c) Warranty service
d) Raw-material selection
Answer: c) Warranty service
- The term “supply chain” emphasizes:
a) The company’s legal ownership
b) The organization’s advertising message
c) The personal goals of managers
d) The movement and coordination of goods, services and information
Answer: d) The movement and coordination of goods, services and information
- How is a value chain broader than a traditional supply chain?
a) It includes all activities contributing to customer value
b) It considers only raw materials
c) It focuses only on transportation
d) It excludes customers
Answer: a) It includes all activities contributing to customer value
- Which activity can add value before a product is produced?
a) Processing warranty claims
b) Understanding customer needs
c) Recycling the used product
d) Repairing a delivered product
Answer: b) Understanding customer needs
- Which activity can add value after a product is sold?
a) Product prototyping
b) Raw-material purchasing
c) Technical support
d) Capacity planning
Answer: c) Technical support
- In a value chain, an internal customer is:
a) A competing organization
b) A government regulator
c) A retail customer
d) A person or department receiving work from another internal process
Answer: d) A person or department receiving work from another internal process
- Why are internal customers important?
a) The quality of internal work affects the final customer experience
b) They eliminate the need for suppliers
c) They replace external customers
d) They determine national tax rates
Answer: a) The quality of internal work affects the final customer experience
- A customer benefit package usually consists of:
a) Only the listed price
b) A combination of goods and services that creates customer value
c) Only promotional communication
d) Only the physical product
Answer: b) A combination of goods and services that creates customer value
- Which offering is primarily a good?
a) Medical diagnosis
b) Legal consultation
c) Refrigerator
d) University lecture
Answer: c) Refrigerator
- Which offering is primarily a service?
a) Automobile tire
b) Mobile phone
c) Office chair
d) Financial advice
Answer: d) Financial advice
- Most customer offerings are:
a) Combinations of goods and services
b) Pure services with no supporting goods
c) Unrelated to operating processes
d) Pure goods with no service element
Answer: a) Combinations of goods and services
- Which is a supporting service associated with purchasing a car?
a) Engine block
b) Financing assistance
c) Rubber tire
d) Steel body panel
Answer: b) Financing assistance
- Which is a supporting good in a restaurant service?
a) Reservation assistance
b) Dining atmosphere
c) The meal
d) The server’s courtesy
Answer: c) The meal
- Which characteristic is more common in services than in manufactured goods?
a) Ability to store output for long periods
b) Absence of human interaction
c) Complete separation of production and consumption
d) Customer participation in the process
Answer: d) Customer participation in the process
- Which characteristic is generally more common in goods production?
a) Output can often be inventoried
b) The customer must always be present
c) Output is always intangible
d) Production and consumption always occur together
Answer: a) Output can often be inventoried
- Why is customer contact important in service operations?
a) It eliminates process variability
b) It can directly affect the customer’s view of quality
c) It guarantees low cost
d) It removes the need for employees
Answer: b) It can directly affect the customer’s view of quality
- Which action best improves value-chain coordination?
a) Increasing unnecessary handoffs
b) Hiding demand forecasts from suppliers
c) Sharing accurate information among participants
d) Allowing each department to optimize independently
Answer: c) Sharing accurate information among participants
- What is likely to happen when value-chain members do not share information?
a) Customer demand becomes perfectly predictable
b) Transportation becomes unnecessary
c) Product quality improves automatically
d) Delays, excess inventory and poor decisions may increase
Answer: d) Delays, excess inventory and poor decisions may increase
- Which activity connects a manufacturer with the final market?
a) Distribution
b) Employee appraisal
c) Corporate auditing
d) Product design
Answer: a) Distribution
- A process that does not add customer value and is not required should generally be:
a) Expanded
b) Reduced or eliminated
c) Hidden from management
d) Assigned to the customer
Answer: b) Reduced or eliminated
- Which statement best describes value-added work?
a) It creates avoidable errors
b) It duplicates completed work
c) It changes an offering in a way the customer values
d) It increases waiting without improving the offering
Answer: c) It changes an offering in a way the customer values
- Waiting caused by poor coordination is usually considered:
a) Product innovation
b) Competitive advantage
c) Customer benefit
d) Non-value-added activity
Answer: d) Non-value-added activity
- Reworking a defective item is generally:
a) Non-value-added work
b) A marketing activity
c) A primary customer benefit
d) A planned source of customer value
Answer: a) Non-value-added work
- The best way to evaluate a value chain is to consider:
a) The number of managers in each unit
b) The total customer experience and overall performance
c) The company’s office locations only
d) The performance of one department only
Answer: b) The total customer experience and overall performance
- Which statement best reflects value-chain thinking?
a) Customer feedback should be considered only after production
b) Suppliers should receive as little information as possible
c) Departments should work together to optimize total customer value
d) Every department should maximize its own results regardless of others
Answer: c) Departments should work together to optimize total customer value
- Early production systems were commonly characterized by:
a) Fully automated global factories
b) Artificial-intelligence planning
c) Internet-based supply chains
d) Skilled craftspeople producing customized goods
Answer: d) Skilled craftspeople producing customized goods
- The Industrial Revolution contributed to operations management by encouraging:
a) Mechanization and factory production
b) The end of specialization
c) The elimination of machines
d) A return to household production only
Answer: a) Mechanization and factory production
- Division of labor means:
a) Eliminating job roles
b) Breaking work into specialized tasks
c) Allowing customers to perform all production work
d) Giving every worker all responsibilities
Answer: b) Breaking work into specialized tasks
- What was a major benefit of specialization?
a) Inventory was eliminated
b) Quality problems disappeared completely
c) Workers became faster and more skilled at specific tasks
d) Every product became fully customized
Answer: c) Workers became faster and more skilled at specific tasks
- Scientific management focused mainly on:
a) Expanding employee benefits
b) Managing stock-market investments
c) Developing social-media campaigns
d) Studying work methods to improve efficiency
Answer: d) Studying work methods to improve efficiency
- Frederick W. Taylor is most closely associated with:
a) Scientific management
b) Behavioral finance
c) International accounting
d) Relationship marketing
Answer: a) Scientific management
- Time-and-motion studies were developed to:
a) Forecast stock prices
b) Analyze how work could be performed more efficiently
c) Design advertisements
d) Measure customer income
Answer: b) Analyze how work could be performed more efficiently
- Standardization contributed to mass production by:
a) Preventing employee training
b) Eliminating equipment
c) Making parts and methods more consistent
d) Increasing variation at every workstation
Answer: c) Making parts and methods more consistent
- Interchangeable parts made it easier to:
a) Avoid quality standards
b) Eliminate all inventories
c) Produce without suppliers
d) Assemble and repair products
Answer: d) Assemble and repair products
- The moving assembly line is strongly associated with:
a) High-volume, standardized production
b) Medical diagnosis
c) Professional consulting
d) One-of-a-kind craft production
Answer: a) High-volume, standardized production
- Henry Ford’s production approach emphasized:
a) Production without machinery
b) Standardized products and efficient flow
c) Maximum customization at every workstation
d) Suppliers with no coordination
Answer: b) Standardized products and efficient flow
- A major limitation of traditional mass production is:
a) Too much customer customization
b) An inability to produce high volumes
c) Difficulty responding to variety and changing customer needs
d) An absence of standardized work
Answer: c) Difficulty responding to variety and changing customer needs
- The human-relations movement emphasized that productivity is influenced by:
a) Advertising alone
b) Machinery alone
c) Product price alone
d) Social and psychological factors
Answer: d) Social and psychological factors
- The Hawthorne studies encouraged managers to pay greater attention to:
a) Employee motivation and group behavior
b) Tax policies only
c) Raw-material prices only
d) Factory size only
Answer: a) Employee motivation and group behavior
- Operations research became especially important because it applied:
a) Legal principles to scheduling
b) Mathematical methods to complex decisions
c) Advertising methods to inventory
d) Artistic methods to process design
Answer: b) Mathematical methods to complex decisions
- Which development increased the use of quantitative models in operations?
a) Corporate logos
b) Office furniture
c) Computers
d) Printed advertisements
Answer: c) Computers
- Inventory models, forecasting and scheduling techniques are examples of:
a) Marketing communication tools
b) Corporate-governance methods
c) Employee-benefit programs
d) Quantitative operations-management tools
Answer: d) Quantitative operations-management tools
- The quality revolution shifted attention toward:
a) Preventing defects and continuously improving processes
b) Producing more defects at lower cost
c) Removing customers from quality decisions
d) Inspecting quality only after production
Answer: a) Preventing defects and continuously improving processes
- Total quality management emphasizes:
a) Ignoring customer feedback
b) Organization-wide responsibility for quality
c) Quality responsibility belonging only to inspectors
d) Increasing inspection without process improvement
Answer: b) Organization-wide responsibility for quality
- Continuous improvement means:
a) Avoiding employee suggestions
b) Maintaining every process without review
c) Regularly seeking small and large process improvements
d) Changing a process only after complete failure
Answer: c) Regularly seeking small and large process improvements
- Lean operations primarily seek to:
a) Add more process delays
b) Increase unnecessary inventory
c) Maximize rework
d) Eliminate waste while creating customer value
Answer: d) Eliminate waste while creating customer value
- Just-in-time practices aim to provide:
a) The required item in the required quantity at the required time
b) Materials without supplier coordination
c) Maximum inventory at every location
d) Products before customers need them regardless of cost
Answer: a) The required item in the required quantity at the required time
- Greater global competition caused organizations to focus more strongly on:
a) Eliminating technology
b) Cost, quality, speed, innovation and flexibility
c) Avoiding supplier partnerships
d) Local operations without customer input
Answer: b) Cost, quality, speed, innovation and flexibility
- Globalization has made operations management more complex because organizations must manage:
a) Fewer regulations in every country
b) Identical conditions in all markets
c) International suppliers, markets, risks and logistics
d) Only one local customer group
Answer: c) International suppliers, markets, risks and logistics
- The growth of service industries expanded operations management beyond:
a) Process improvement
b) Customer value
c) Quality management
d) Factory production
Answer: d) Factory production
- Modern operations management gives greater attention to services because:
a) Services represent a major part of economic activity
b) Services require no processes
c) Services cannot be improved
d) Services have no customers
Answer: a) Services represent a major part of economic activity
- Information technology has transformed operations by enabling:
a) Production without planning
b) Faster information sharing, automation and coordination
c) Business without customers
d) The elimination of all operational risks
Answer: b) Faster information sharing, automation and coordination
- Modern supply-chain management differs from isolated purchasing because it emphasizes:
a) Selecting the lowest price without considering other factors
b) Avoiding long-term supplier relationships
c) Coordination across suppliers, organizations and customers
d) Managing each organization independently
Answer: c) Coordination across suppliers, organizations and customers
- Sustainability has become important in operations because organizations must consider:
a) Advertising impact only
b) Financial results only
c) Production volume only
d) Economic, environmental and social impacts
Answer: d) Economic, environmental and social impacts
- Which statement best summarizes the evolution of operations management?
a) It evolved from production efficiency toward integrated management of value, quality, technology, people and supply chains
b) It became limited to factory machinery
c) It eliminated the need for strategic decisions
d) It changed from customer focus to customer exclusion
Answer: a) It evolved from production efficiency toward integrated management of value, quality, technology, people and supply chains
