Business Process Management
Chapter Exam Questions
Course Introduction
Business Process Management (BPM) explores the methods, techniques, and tools used to design, implement, monitor, and optimize business processes within organizations. The course emphasizes how effective process management can improve efficiency, adaptability, and competitive advantage by aligning operations with business strategy. Students will examine key BPM concepts, process modeling, analysis, and automation, as well as real-world applications and case studies. The course also covers the role of technology in BPM, including workflow systems and enterprise resource planning, and equips students with skills to critically assess and enhance organizational processes.
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OM 4th Edition by David Alan Collier
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Chapter 1: Goods, Services, and Operations Management
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Q1) A golf simulator in a retail sports store is an example of A)non- durable goods replacing services
B)primary good
C)goods content
D)biztainment Answer: D
Q2) A customer benefit package (CBP) consists of both a primary good and a primary service.
A)True
B)False Answer: False
Q3) The ability to download music onto a cell phone would be considered a primary service.
A)True
B)False Answer: False
Q4) Customers and service providers often work together to co-produce a service.
A)True
B)False Answer: True
Page 3
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Chapter 2: Value Chains
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Q1) The control of Wal-Mart's value chain is ______, while the control of General Electric's is ________.
A)post-production focused, preproduction focused
B)horizontal, vertical
C)centralized, decentralized
D)backward integrated, forward integrated
Answer: C
Q2) A vertical integration strategy provides a firm more control while generally reducing the complexity of managing the value chain.
A)True
B)False
Answer: False
Q3) Which of the following is not a component of a value chain?
A)goods and services
B)information
C)sources of labor
D)financial transactions
Answer: C
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Chapter 3: Measuring Performance in Operations
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Q1) Empathy is the caring attitude and individualized attention provided to customers.
A)True
B)False Answer: True
Q2) Reliability is the ability to perform a service dependably and accurately.
A)True
B)False Answer: True
Q3) The value chain model is probably the dominant model for operations managers.
A)True
B)False Answer: True
Q4) Assurance is the willingness to help customers and provide prompt recovery to service upsets.
A)True
B)False Answer: False
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Chapter 4: Operations Strategy
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Q1) Core competencies are the strengths that are unique to an organization, such as a creative workforce or a strong supply chain.
A)True
B)False
Q2) Using the Four Key Decision Loops in Professor Terry Hill's Generic Strategy Framework, which statement is true?
A)The four loops are highly integrated and require improvement cycles.
B)The first loop ties strategy to operations.
C)Operations has no input loop into corporate strategy or marketing strategy.
D)Infrastructure decisions must come before marketing strategy decisions.
Q3) The infrastructure of an organization must support process choices and provide managers with timely and accurate information to make good decisions.
A)True
B)False
Q4) Professor Terry Hill's operations strategy framework provides a systems perspective of how operations is linked to corporate and marketing strategies.
A)True
B)False
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Chapter 5: Technology and Operations Management
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Q1) Which of the following is not a stage in technology development and adoption?
A)Birth
B)Turbulence
C)Build-out
D)Decline
Q2) Computer integrated manufacturing systems combine hardware, software, database management and communications to automate and control a broad range of production activities.
A)True
B)False
Q3) All organizations face common issues regarding technology.Which item below does not belong on the list of issues?
A)The right technology must be selected for the goods that are produced.
B)Robots must be programmed to operate the equipment.
C)Work must be scheduled to meet shipping commitments/customer promise dates.
D)Quality must be ensured..
Q4) Industrial robots automate the skills that most humans can readily perform.
A)True
B)False
Q5) Describe the three stages of the technology development and adoption process.
Page 7
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Chapter 6: Goods and Service Design
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Q1) Discuss the concept of Design for Environment (DfE).
Q2) Estate planning is an example of a low-contact system.
A)True
B)False
Q3) If a redundant component is added to a system, the overall system reliability
A)will decrease
B)will increase
C)will stay the same
D)will double
Q4) Suppose that a manufacturing specification of a dimension is 1.0 \(\pm\) 0.05.The permissible range of variation from 0.95 to 1.05 is called the tolerance.
A)True
B)False
Q5) The customer benefit package at LensCrafters is weighted more toward the primary good, which is eyewear.
A)True
B)False
Q6) Define reliability.Include the four major elements.
Q7) Explain the concept of Design Failure-Mode-and-Effect analysis.
Page 8
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Chapter 7: Process Selection, Design, and Analysis
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Q1) A manufacturer's average work-in-process inventory for Part 1234 is 1,250 parts.The workstation produces parts at the rate of 150 parts per day.What is the average amount of time a part spends at this workstation?
Q2) Which one of the following major activities is not one of the six major activities to design a goods-producing or service-providing process?
A)Define the purpose and objectives of the process.
B)Create a detailed process or value stream map that baselines current performance.
C)Use the product life cycle for each good or service to create a future state process map.
D)Select the appropriate equipment and technology.
Q3) Which is the correct order of hierarchy?
A)Activity, task, process, value chain
B)Value chain, process, task, activity
C)Process, value chain, activity, task
D)Value chain, process, activity, task
Q4) An automobile emissions testing center has six (6) inspectors and tests 50 autos per hour.Each inspector can inspect twelve (12) autos per hour.What is the center's utilization?
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Page 9
Chapter 8: Facility and Work Design
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Q1) All of the following are true regarding assembly lines except A)Lower cost
B)Only one model can be assembled on a line
C)Makes good affordable to mass markets
D)Used in services,e.g., insurance policies and sorting mail
Q2) Which type of layout is best for high volumes of demand with few if any setups/changeovers?
A)Product
B)Process
C)Cellular
D)Fixed position
Q3) Flow-blocking and lack-of-work delays can be reduced by assigning an appropriate level of capacity at each workstation.
A)True
B)False
Q4) Job enlargement approaches give workers more variety of work, but not necessarily more responsibility.
A)True
B)False
Q5) Discuss the advantages and disadvantages of utilizing virtual teams.
Page 10
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Chapter 9: Supply Chain Design
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Q1) The center-of-gravity model minimizes the weighted distance between the facility to be located and its supply and demand points.
A)True
B)False
Q2) A pull system
A)requires high levels of finished goods inventory
B)relies heavily on accurate sales forecasts
C)waits for customer orders
D)necessitates standardized products
Q3) Which is true regarding a responsive supply chain?
A)Demand is stable and predictable.
B)Product life cycles are short and change often because of innovation.
C)Customers require standardization.
D)Contribution margins are low.
Q4) All of the following are considered non-economic factors in location decisions except
A)Availability of labor
B)Employee empowerment
C)Transportation services
D)Quality of life
Page 11
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Chapter 10: Capacity Management
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Q1) A strategy for increasing long-term capacity in a service organization is to design higher levels of self-service into operations.
A)True
B)False
Q2) A physical constraint is associated with the capacity of a resource.
A)True
B)False
Q3) Safety capacity or a capacity cushion is
A)Needed for processes with little demand variability
B)Generally higher in a job shop
C)Not appropriate for service organizations
D)Provided for anticipated events
Q4) Offering complementary goods or services is an example of a short-term capacity strategy.
A)True
B)False
Q5) A measure of capacity is the number of seats on an airplane per flight.
A)True
B)False
Q6) What is safety capacity? Discuss reasons for using it.
Page 12
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Chapter 11: Forecasting and Demand Planning
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Q1) A tracking signal provides a method for quantifying forecast
A)bias
B)error
C)accuracy
D)outliers
Q2) In an exponential smoothing model, larger values of alpha (i.e., closer to 1) place less emphasis on recent data and more on older data.
A)True
B)False
Q3) In a regression model, both the dependent and independent variables must be numerical.
A)True
B)False
Q4) Long range forecasts expressed in sales dollars are more meaningful to top managers than to managers at the operations level.
A)True
B)False
Q5) Explain how forecasting is used at different levels of an organization.
Q6) Define forecast error and describe ways that it is measured.
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Chapter 12: Managing Inventories
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Q1) The decision of how many fruit baskets to make for the holiday season would be analyzed using a single-period inventory model.
A)True
B)False
Q2) Additional inventory kept over and above the average amount required to meet demand is called ____ inventory.
A)Seasonal
B)Work-in-process
C)Finished goods
D)Safety stock
Q3) Cynthia Baker, manager of a large medical supply house that operates 50 weeks per year and 5 days per week, has decided to implement a fixed period inventory system for all class A items.One such item has the following characteristics: Demand = 10,000 units/year
Order cost = $50/order
Holding cost = $5/unit/year
If Baker wishes to minimize total cost (thereby approximating the EOQ), what should be T, the number of workdays between orders (i.e., review period)?
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Chapter 13: Resource Management
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Q1) A POQ for a one-week time period is equivalent to LFL lot sizing.
A)True
B)False
Q2) Dependent demand does not occur in the service business.
A)True
B)False
Q3) The Lot-for-Lot (LFL) rule
A)Minimizes purchase or setup costs
B)Allows the firm to take advantage of quantity discounts (price breaks) by suppliers
C)Is best applied when inventory carrying costs are high and setup/order costs are low
D)Masks the true nature of dependent demand
Q4) Which aggregate planning strategy generally would result in the least amount of inventory?
A)Level production
B)Chase demand
C)Mixed
D)Period-Order-Quantity (POQ)
Q5) Differentiate between a level production strategy and a chase demand strategy.
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Chapter 14: Operations Scheduling and Sequencing
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Q1) In sequencing a set of jobs on a single processor, different sequences will have different makespans but the same average flow times.
A)True
B)False
Q2) In sequencing jobs in a flow shop with two resources, Johnson's rule finds a sequence that has the smallest makespan.
A)True
B)False
Q3) Sequencing is not as much of a concern when several activities use a common resource.
A)True
B)False
Q4) Compare and contrast the advantages and disadvantages of the Shortest Processing Time (SPT) and the Earliest Due Date (EDD) sequencing rules.
Q5) Which of the following is NOT a criterion for evaluating job sequencing rules?
A)average flow time
B)lateness
C)tardiness
D)sum of processing times
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Chapter 15: Quality Management
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Q1) The seven QC tools are designed to be simple so that workers at all levels can use them.
A)True
B)False
Q2) Quality management includes how goods and services are designed, rather than simply how quality is assured during the manufacturing or service delivery process.
A)True
B)False
Q3) The recognized benchmark for Six Sigma implementation is
A)Sears, Roebuck and Co.
B)DuPont
C)General Electric
D)American Express
Q4) Costs of recalls and warranty claims are classified as internal failure costs.
A)True
B)False
Q5) Performance standards in services are analogous to manufacturing specifications. A)True
B)False
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Chapter 16: Quality Control and Spc
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Q1) Which of the following is most closely related to Statistical Process Control (SPC)?
A)Removing common causes of variation
B)Removing special causes of variation
C)Removing all causes of variation
D)Computing process capability
Q2) An airline found that on average, 0.62% of the luggage they received from passengers at LAX (Los Angeles Airport) is lost or damaged.On a typical day, 1000 pieces of luggage pass through this airport.The upper control limits for a p chart for monitoring the daily fraction nonconforming?
Q3) Historically, the average proportion of defective bars has been 0.015.Samples of 100 bars each are taken.Construct a p-chart using z = 3.Suppose a sample had 0.044 defectives.What would you do?
A)Nothing; it appears to be random variation.
B)Look for assignable causes.
C)Delete the sample with 0.044 defects and take another sample that is better.
D)None of these choices
Q4) Explain the issues associated with selecting the appropriate sample size and sampling frequency for control charts.
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Chapter 17: Lean Operating Systems
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Q1) According to the Toyota Motor Company, which of the following is not one of the seven major waste categories?
A)Overproduction
B)Transportation
C)Motion
D)Single-piece flow
Q2) Which of the following is least related to a push system?
A)Maximum customer responsiveness
B)Predefined schedule
C)Finished goods inventory
D)Based on forecast
Q3) A manufacturer of automobile engines is designing a new Kanban system for engine #321.The demand for #321 is 75/day and they are built in groups of 8.The total process and wait time is 3 days.The manager wants an alpha (\(\alpha\)) of 2 or 200%.How many Kanbans are required?
Q4) When producing a broad goods or service mix with diverse requirements on common equipment, the ideal strategy is to run large batches.
A)True
B)False
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Chapter 18: Project Management
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Q1) The early start time for an activity is computed by finding the largest early finish time of all immediate predecessors.
A)True
B)False
Q2) In most organizations, projects cut across organizational boundaries, making it difficult to implement projects exclusively within functional departments.
A)True
B)False
Q3) Which of the following is least related to Program Evaluation and Review Technique (PERT)?
A)Beta distribution
B)Variance
C)Most probable time
D)Crashing
Q4) List at least six principal factors (contributors) to project success.
Q5) Project management objectives revolved around on-time and budget performance.
A)True
B)False
Q6) Explain the stages of the project life cycle.
Page 20
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Chapter 19: Work Measurement, Learning Curves, and Standards
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Q1) A manufacturer made a commitment to supply 20 units of a product.The first unit took 1,200 hours to make, the second unit took 900 hours and the third unit took 768 hours.Determine the total number of hours required to make the first ten (10) items.
Q2) The outputs from a work measurement study leads to development of labor and equipment standards that are used for all of the following except A)Estimating workforce capacity
B)Fatigue and personal needs allowances
C)Determining the cost of new work procedures
D)Providing accurate information for scheduling and sequencing
Q3) Based on data from a work sampling study, an office worker spends 21.5% of his time filing.Over the work sampling period, he was idle 12% of the time.If the worker filed 420 items in a 40-hour work week while performing other activities, and if his performance rating factor for filing was 0.95, determine the standard time, in minutes, that it took him to file an item.
Q4) The performance rating factor and allowances are based upon human judgment. A)True B)False
Q5) Define work sampling.Give both manufacturing and service applications.
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Chapter 20: Queuing Analysis
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Q1) Discuss the seven key assumptions for the multiple-server waiting line model.
Q2) An ice cream shop is quite busy after the neighborhood high school lets out each day.From 3 pm to 5 pm customers arrive at the rate of 50 per hour, on average.Currently, the clerk can serve one customer per minute, on average.The store manager can buy an electrically heated scoop with an automatic ice cream ejector which will decrease the serving time to one customer per 45 seconds, on average.
a.What is the current time (in minutes) spent waiting in line?
b.What will the waiting time (in minutes) become using the automatic ice cream ejector?
c.What fraction of time is the clerk currently idle?
d.What fraction of time will the clerk be idle using the automatic ice cream ejector?
e.How many customers, on average, are in the shop under the current system?f. How many customers would be in the shop, on average, using the automatic ice cream ejector?
Q3) Many analytical queuing models exist, each based upon unique assumptions.
A)True
B)False
Q4) Describe at least four queue disciplines.
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Chapter 21: Modeling Using Linear Programming
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Q1) X<sub>1</sub>, X<sub>2</sub> \(\ge\) 0 refers to
A)Feasibility
B)Maximization
C)Production-rate changes
D)Non-negativity
Q2) A small lumber company in the Southeast produces two types of pine boards used in home construction: 2x4s and 2x6s (dimensions in inches).They are attempting to determine how many of each to produce so as to minimize their costs on a per-minute basis.They have sales commitments to produce four 2x4s and two 2x6s per minute, but they think they shouldn't produce any more than eight 2x6s because of market demand.They are also trying to support the community by employing people.Thus they want to keep at least 12 men employed, but only need 2 men to produce each 2x4 and 1 person to produce each 2x6 per minute.It costs them $.50 to produce 2x4 and $.80 to produce a 2x6 per minute.
a.What is the objective function for this LP problem?
b.What is the constraint for the employment issue, assuming X1 corresponds to 2x4s?
c.What is the optimal solution point for this problem?
d.What is the optimal value of the objective function?
Q3) Explain the essence of a transportation problem.
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Chapter 22: Simulation
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Q1) Which of the following is not correct regarding next-event simulation models?
A)Used more commonly in practice
B)Basis for most commercial simulation software
C)Waste computer time
D)More accurate than fixed-time-increment simulation
Q2) Explain the major differences between a fixed-time and a next-event simulation model.Include advantages and disadvantages of each.
Q3) All of the following are disadvantages of simulation except A)Limited application
B)Difficulty of collecting the appropriate input data
C)Selecting the correct probability distribution
D)The accuracy of outputs
Q4) If variability of demand were the only source of uncertainty, the order quantity and reorder-point decision could be based on a single-period inventory model.
A)True
B)False
Q5) A simulator is a general purpose simulation model.
A)True
B)False
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Chapter 23: Decision Analysis
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Q1) The expected value concept weighs each payoff for an alternative in proportion to the likelihood that the payoff will occur.
A)True
B)False
Q2) A conservative or risk-averse approach to one-time decisions without event probabilities is ____.
A)Maximax
B)Maximin
C)Minimax regrets
D)Expected value
Q3) The decision criterion, for a one-time decision without event probabilities, that is neither aggressive nor conservative is
A)maximax
B)maximin
C)minimax regret
D)expected value
Q4) In what type of situation would the expected monetary value criterion be useful? In what type situation would it not be useful?
Q5) Differentiate between uncertainty and risk.
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