Operations Management Exam Preparation
Guide
Operations Management is a foundational course that explores the principles, strategies, and techniques used to design, operate, and improve the processes that transform resources into goods and services. Students will learn to analyze and optimize workflows, ensure quality control, manage supply chains, and address challenges such as capacity planning, inventory management, and process improvement. Emphasis is placed on both manufacturing and service operations and the integration of technology to achieve organizational efficiency and effectiveness. Case studies and practical applications help students develop problem-solving skills and the ability to make data-driven decisions in a dynamic business environment.
Recommended Textbook
Managing Operations Across the Supply Chain 2nd Edition by Morgan Swink
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527 Flashcards
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Chapter 1: Introduction to Managing Operations Across the Supply Chain
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Sample Questions
Q1) Johnson Company makes widgets, which it then sends to Smith Company. Smith Company puts the widgets in packages. Smith Company is considered by Johnson to be a:
A)Critical customer.
B)Upstream product supplier.
C)Aftermarket supplier.
D)Downstream product supplier.
Answer: D
Q2) During the "mass production" era, operations management focused primarily on:
A)Production and design.
B)Internal production.
C)The global supply chain.
D)Sales, production and design.
Answer: B
Q3) A process is:
A)A set of planned steps used to achieve an objective.
B)A system of activities that transforms inputs into valuable outputs.
C)A system of decisions.
D)A combined effort by people who want to get something done.
Answer: B
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Chapter 2: Operations and Supply Chain Strategy
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Sample Questions
Q1) Which of the following is NOT a component of the business model?
A)Critical customer
B)Value proposition
C)Desired outcome statement
D)System capabilities
Answer: C
Q2) Which three elements make up the triple bottom line?
A)Planet, Pollution, Profit.
B)Pollution, Equality, People.
C)Profit, Equality, Pollution.
D)People, Profit, Planet.
Answer: D
Q3) Which of the following is the most appropriate definition of a core capability?
A)A set of products unique to a firm.
B)Technical capabilities of a firm.
C)Reputation.
D)Production/design processes unique to the firm.
Answer: D
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Chapter 3: Managing Processes and Capacity
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Sample Questions
Q1) Suppose you learn that a process has a very long waiting time. Which of the following would decrease the waiting time?
A)Decrease utilization.
B)Increase the coefficient of variation of job arrival times.
C)Increase the coefficient of variation of job processing times.
D)None of these would decrease waiting time.
Answer: A
Q2) A short-term, highly focused effort for improving a process is known as a:
A)Jidoka Event.
B)Kaizen Event.
C)Chaebol Event.
D)Poka-yoke Event.
E)Enchilada Event.
Answer: B
Q3) Kaizen Events are most appropriate for which type of operations problem?
A)Customer-based
B)Metrics-based
C)Process-based
D)Product-based
Answer: C
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Chapter 3: Extension: Process Mapping and Analysis
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Sample Questions
Q1) Joe's Quick Oil Change shop is interested in improving its ability to satisfy customers. The most appropriate mapping tool for a company such as this is called:
A)Service architecture.
B)Service blueprinting.
C)Service diagramming.
D)Service mapping.
Q2) Why are processes that are visible to the customer considered to be critical?
A)They often exhibit the greatest variance (thus affecting customer waiting times).
B)They are often bottlenecks (thus causing customer delays).
C)They are often shared processes.
D)They affect the customer perceptions of value.
Q3) The symbol indicates what type of activity in a process?
A)Operation
B)Transportation
C)Delay
D)Storage
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6
Chapter 4: Productprocess Innovation
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Sample Questions
Q1) Which of the following statements is true regarding product/process innovation?
A)Innovation projects are operational processes.
B)Product and process development activities are usually closely linked.
C)Product/process design is a part of the resource/technology supply chain.
D)All of these statements are true.
Q2) High-quality innovators typically gain which advantages?
A)They can fund more new design and development projects than other firms.
B)They satisfy customers more effectively, building strong brand image and customer loyalty.
C)They can sell at lower prices or lower the total sales needed for a new product to pay back its initial development costs.
D)None of these.
Q3) A project team interested in identifying and correcting potential quality problems in a product design would find which one of the following tools most useful?
A)QFD
B)FMEA
C)Value analysis
D)DFM
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Chapter 5: Manufacturing and Service Process Structures
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Sample Questions
Q1) Companies with a make-to-stock orientation are most likely to use which of the following process structures?
A)Mass customization
B)Job shop
C)Repetitive process
D)They are likely to use any one of these process structures.
Q2) An approach that analyzes the interface between customers and service processes is called:
A)Service process matrix.
B)Service blueprinting.
C)Process mapping.
D)Product/process matrix.
Q3) Compared to a functional layout, cellular layouts have:
A)Less work-in-process inventory.
B)More complexity in scheduling.
C)More frequent setups.
D)Lower efficiency.
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8
Chapter 6: Managing Quality
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Sample Questions
Q1) If a company spends more on prevention, what would be the expected impact on other costs of quality?
A)Appraisal costs will go up.
B)Failure costs will go down.
C)Failure costs will go up.
D)Other costs will be unaffected.
Q2) The TQM view of organizational structure states that
A)Employees must support management decisions.
B)Management must support employees.
C)Customers want quality products.
D)Middle management must support and enforce top management decisions.
Q3) The Plan-Do-Check-Act cycle is best defined as:
A)A rigorous procedure for strategic planning.
B)A method used to guide problem identification and solution.
C)A method first proposed by Joseph Juran.
D)All of these statements apply to the definition.
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Chapter 6: Extension: Quality Improvement Tools
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Sample Questions
Q1) A firm has an existing process that it would like to use for producing a part it will sell to an industrial customer. The customer requires that defective (out of specification) parts be kept to 3,000 parts per million (three-tenths of 1 percent) or less. A process capability study done on the process revealed that it has a process capability index (C<sub>pk</sub>) of 1.00 for this part. What should the firm conclude from the study?
A)The process is not capable, but with careful process control, it could be used to meet the customer's requirements.
B)The process is highly capable, and when operating in control, a very high percentage of output will meet the customer's requirements.
C)The process is not capable, and even with careful control, it will not be able to meet the customer's requirements.
D)The process is capable, but just barely, and will require careful monitoring in order to meet customer requirements.
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Chapter 7: Managing Inventories
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Sample Questions
Q1) Jones Company has calculated that the EOQ for a particular item is 1,000 units. However, Jones does not have enough capital to order that many units each time, so it only orders 250 units at a time. This will result in:
A)Higher annual inventory carrying cost than ordering the EOQ quantity.
B)Lower annual inventory carrying cost than ordering the EOQ quantity.
C)Lower annual ordering cost than ordering the EOQ quantity.
D)Cannot be determined.
Q2) The ABC analysis used for analyzing inventory is an example of:
A)Safety stock calculation.
B)Regression analysis.
C)Pareto's Law.
D)Inventory carrying cost.
Q3) Alpha Company places 10 orders per year with its supplier. Each order is for an amount exactly equal to the EOQ. Alpha's order cost has been determined to be $50 per order. Alpha carries no safety stock at all. What is Alpha's annual inventory carrying cost?
A)Cannot be determined without further information
B)$50
C)$250
D)$500
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Page 11
Chapter 8: Lean Systems
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Sample Questions
Q1) Which of the following lean principles best communicates the notion of demand synchronization?
A) Produce only the products that the customer wants.
B) Build with perfect quality.
C) Build only as quickly as customers want them.
D) Build only with features that the customers want and no others.
Q2) Unnecessary automation is an example of which of the following forms of waste?
A)Overproduction
B)Process
C)Motion
D)Rework
Q3) John Jones is a plant manager. He believes his plant is guilty of "waste of overproduction." Which of the following symptoms might he have observed that led to this belief?
A)Idle equipment.
B)Excess inventory.
C)High customer returns of products.
D)All of these.
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Chapter 9: Customer Service Management
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Sample Questions
Q1) A firm has found that it provides a 90 percent order fill rate (orders shipped complete), 90 percent on-time delivery, 90 percent of its orders arrive at customers' destination in perfect condition, and 90 percent of the time all documentation is correct. These are all of the elements of a perfect order for this company's customers. If the firm improves its performance in on-time delivery to 98 percent, what is its new perfect order performance?
A)88 percent
B)98 percent
C)0 percent
D)80 percent
E)71.4 percent
Q2) Alpha Company has a performance standard of 97 percent fill rate. Last month it achieved a 94 percent fill rate. This is an example of:
A)A knowledge gap.
B)A standards gap.
C)A performance gap.
D)A perception gap.
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Chapter 10: Sourcing and Supply Management
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Sample Questions
Q1) A relationship with a supplier that is characterized by lack of trust, little communication, and short-term transactions is called a(n):
A)Adversarial relationship.
B)Arms-length relationship.
C)Acceptance of mutual goals.
D)Full partnership.
Q2) All of the following are supply management goals EXCEPT:
A)Ensure timely availability of resources.
B)Purchase at the lowest price.
C)Enhance quality.
D)Assess technology and innovation.
Q3) Negotiation is typically used when:
A)Price is the most important factor.
B)There are many equally qualified suppliers who are willing to compete.
C)Early supplier involvement is needed in new product development.
D)There are standard product specifications that are clear and complete.
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14
Chapter 11: Logistics Management
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Q1) Suppose you are shipping 1,000 pounds of product to a customer location that is 500 miles away from you. The customer calls you and increases the order size to 10,000 pounds. Which of the following is NOT LIKELY to occur as a result of this change?
A)The cost per pound of transportation for the order will decrease.
B)The total cost of transportation for the order will increase.
C)Both of these are likely to occur.
Q2) Zanda Corp. made a decision to use a more expensive mode of transportation to deliver orders to customers. This decision was likely made after an examination of
A)Cost-to-cost tradeoffs.
B)Consolidation strategies.
C)Product availability problems.
D)Cost-to-service trade-offs.
Q3) A major disadvantage of private warehousing is:
A)It offers less control than contract warehousing.
B)It requires more investment than contract warehousing.
C)It has less flexibility in operating policies than contract warehousing.
D)All of these are disadvantages of private warehousing.
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Chapter 12: Demand Planning: Forecasting and Demand Management
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Sample Questions
Q1) Zanda Corp. has been testing the performance of two different forecasting models to see which it should adopt for use. It wants to choose the model that has the smaller standard deviation of the forecast errors. Zanda should compare which of the following to make its choice?
A)MAD of the two models
B)MAPE of the two models
C)RMSE of the two models
D)MFE of the two models
Q2) Assume that the forecast for the last period is FIT<sub>t</sub> = 200 units, and recent experience suggests a likely sales increase of 10 units each period. Actual sales for the last period reached 230 units. Assume a smoothing coefficient of a = 0.20 and a trend smoothing coefficient of = 0.10. Demand in period t + 1 turned out to be 220. What is the adjusted forecast for period t + 2 (choose the closest answer)?
A)227.3
B)215.9
C)217.3
D)221.3
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Page 16
Chapter 13: Sales and Operations Planning
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Sample Questions
Q1) Which type of aggregate production plan is likely to have the LEAST negative impact on the local community and the workforce?
A)Chase plan with hiring and firing
B)Chase plan with overtime
C)Level plan
D)The plans do not differ in their impact on the local community and the workforce.
Q2) You are sitting next to a person in business class on a flight from Los Angeles to Sydney, Australia. You mention to that person that you got your ticket two months ago for only $12,500. The person responds that she bought her ticket two days ago for $7,800. This sometimes happens because airlines often use an approach called:
A)Capacity management.
B)Yield management.
C)Load management.
D)Workforce leveling.
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Chapter 14: Materials and Resource Requirements Planning
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Sample Questions
Q1) Which of the following is NOT included in the information about the inventory records file for an item?
A)Safety stock
B)Preferred order quantity
C)Net requirements
D)Lead time
Q2) Materials requirement planning (MRP) systems are used primarily to:
A)Plan materials.
B)Plan lead time.
C)Plan production.
D)Plan distribution.
E)A and C
Q3) Rough-cut capacity planning does all of the following EXCEPT:
A)Determines if a work center has the capacity to implement the MRP plan.
B)Uses planned order releases and scheduled receipts to estimate work center loads.
C)Develops a load profile.
D)Recalculates the MRP plan.
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18
Chapter 15: Project Management
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Sample Questions
Q1) Nearly all projects seem to go through the same phases and in the following sequence:
A)Planning, definition, execution, completion
B)Definition, planning, delivering, and closing
C)Definition, planning, execution, and completion
D)Selection, planning, delivering and completion
Q2) Why do businesses often NOT pursue the best mix of projects in their project portfolio?
A)Projects are selected based on criteria that are not always consistent with the business strategy.
B)Businesses do not use enough financial metrics in selecting projects.
C)Too much emphasis is placed on feasibility.
D)Selection committees neglect to use a portfolio value matrix.
Q3) Typically the resources required during a project's life are greatest in which stage of its life?
A)Planning
B)Definition
C)Completion
D)Execution
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Page 19
Chapter 15: Extension: Advanced Methods for Project Scheduling
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Sample Questions
Q1) In evaluating time-cost trade-offs, we start by crashing the task on the critical path that:
A)Has the lowest cost to reduce by one unit of time.
B)Has the lowest total crash cost.
C)Can be reduced the most.
D)Is the longest.
E)None of the these.
Q2) If a project path has an expected duration of 10 days and a standard deviation of 3 days, what is the probability that the path will be completed in 13 days or less?
A)50 percent
B)33 percent
C)75 percent
D)84 percent
Q3) Which of the following statements best describes "crash cost"?
A)Estimated cost to reduce a project task duration by one time unit.
B)Estimated cost to reduce a project duration by one time unit.
C)Estimated cost to reduce the project schedule by one time unit.
D)Actual cost to reduce a project duration by one time unit.
E)Actual cost to change a project schedule.
Page 20
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Chapter 16: Sustainable Operations Managementpreparing for the Future
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Sample Questions
Q1) Which of the following terms best describes the impact of sustainability initiatives on the business model?
A)Sustainability affects primarily the capabilities offered by the supply chain.
B)Sustainability helps the firm to change its value proposition.
C)Sustainability impacts primarily the customers that we serve.
D)Sustainability affects the entire business model.
Q2) Zanda Corp. has always operated within one country. It is contemplating opening production facilities in another country. Zanda should realize:
A)Production processes used domestically should work well in a different country.
B)The means of motivating the workforce domestically may not work well in a different country.
C)The technology used domestically is often the best to use in a different country.
D)The same business model that is used domestically should apply to the foreign country.
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