Operations Strategy
Final Test Solutions
Course Introduction
Operations Strategy explores the critical role that operational decisions and capabilities play in shaping and sustaining business competitiveness. This course examines frameworks and tools for aligning operations with overall corporate strategy, addressing topics such as process design, capacity planning, technology management, supply chain coordination, and quality improvement. Emphasis is placed on understanding how operations can drive innovation, cost leadership, customer responsiveness, and long-term organizational goals. Through real-world case studies and analytical exercises, students develop the skills to formulate and implement effective operations strategies across a range of industries.
Recommended Textbook
Introduction to Operations and Supply Chain Management 3rd Edition by Cecil B. Bozarth
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Chapter 1: Introduction to Operations and Supply Chain Management
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Sample Questions
Q1) Operations management activities are ________ and ________ intensive. Answer: information;decision
Q2) The supply chain is a network of manufacturers and service providers that work together to convert and move goods from the raw materials stage to the end user.
A)True
B)False
Answer: True
Q3) The drive for efficiency has decreased the level of globalization in the world economy over the last twenty years.
A)True
B)False
Answer: False
Q4) A second-tier supplier is located ________ from a first-tier supplier. Answer: upstream
Q5) To participate in a supply chain,a firm must actually handle the physical goods at some point.
A)True
B)False Answer: False
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Chapter 2: Operations and Supply Chain Strategies
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Sample Questions
Q1) A major retailer wants to sell items as cheaply as possible while maintaining an attractive and enjoyable shopping atmosphere.Spending too much on ambience will raise prices and drive away shoppers but spending too little will drive shoppers away also.Clearly,the retailer is faced with a(n)________.
Answer: trade-off
Q2) Conformance quality addresses whether the product was made or the service performed to specifications.
A)True
B)False
Answer: True
Q3) Superior performance on a(n)________ will not,by itself,give a company a competitive advantage.
Answer: order qualifier
Q4) At the ________ stage of alignment,the business strategy seeks to exploit core competencies found within the operations and supply areas.
Answer: externally supportive
Q5) ________ are the people,policies,and organizational structure choices made by a firm.
Answer: Infrastructural elements
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Chapter 3: Process Choice and Layout Decisions in Manufacturing and Services
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Sample Questions
Q1) The product process matrix uses a scale of ________ and ________.
Answer: volume;standardization
Q2) "My tour of the Duff Brewery was the greatest experience of my life," Homer recalled.Lenny's favorite part was the batch process that was evident during the fermenting stage but Carl's favorite part was the high speed continuous flow process evident in the bottling line."You're both right," Homer declared,"Duff takes both elements to create a(n)________ process."
Answer: hybrid (manufacturing)
Q3) Capability variety is the difference in how customers view an identical service outcome.What some customers might view as economical and thrifty others might view as cheap and poor value.
A)True
B)False
Answer: False
Q4) A collection of different departments must be visited by every new student on campus to take care of registration,housing,books,and other campus services.The placement of these departments within the university center is an example of a(n)________ layout.
Answer: functional
Page 5
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Chapter 4: Business Processes
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Sample Questions
Q1) When constructing a fishbone diagram,brainstorming takes place during the: A)closed phase.
B)narrow phase.
C)wide phase.
D)open phase.
Q2) Which of the following approaches to process improvement could be described as competitive benchmarking?
A)Employees at XEROX ignore the way they have always processed customer orders and design an entirely new way to do so.
B)Employees at XEROX visit GM to pick up ideas on processing customer orders.
C)Employees at XEROX purchase a Canon copier and take it apart to get design ideas for their next generation of copiers.
D)Employees at XEROX take classes in quality improvement and make small,incremental changes to their order filling processes.
Q3) Productivity is measured as the ratio of inputs to outputs.
A)True
B)False
Q4) Level two of the SCOR model divides SCM activities into what are referred to as ________.
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Chapter 5: Managing Quality
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Sample Questions
Q1) Appraisal costs can occur when a company has NOT produced any defective items.
A)True
B)False
Q2) The probability of rejecting a lot with quality better than the acceptable quality level is:
A)the lot tolerance percent defective.
B)the lot tolerance percent acceptable.
C)the consumer's risk.
D)the producer's risk.
Q3) The upper and lower limits of a control chart should be wider than the upper and lower tolerance limits.
A)True
B)False
Q4) What is the center line for the appropriate chart?
A)0.0129
B)10.875
C)0.0435
D)3.29
Q5) The ability of a non-centered process to meet certain quality standards is measured by its ________.
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Chapter 6: Managing Capacity
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Sample Questions
Q1) A ninety percent learning curve is steeper than an eighty percent learning curve.
A)True
B)False
Q2) The relationship between the number of units within system boundaries and the time they spend within the system on average is formalized in ________.
Q3) A busy toll highway that has four toll collectors for northbound traffic is an example of a single-channel,single-phase system.
A)True
B)False
Q4) The ________ is the output volume level where the firm realizes a $0 net profit.
Q5) Which of these factors typically does NOT impact capacity?
A)fixed cost
B)conformance quality
C)product variations
D)actions of supply chain partners
Q6) Of the three capacity strategies discussed in this chapter,the ________ strategy is the most optimistic from the standpoint of the decision maker.
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Chapter 7: S Advanced Waiting Line Theory and Simulation
Modeling
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Sample Questions
Q1) The bank manager of a busy downtown location found herself unable to find good teller help so she invested in an ATM to handle the routine withdrawals that tended to occupy an inordinate amount of the teller's time.Before she installed the ATM she found that customers were arriving on average every 60 seconds (Poisson distributed)and it took a teller 20 seconds (exponentially distributed)to process their request.The ATM is able to maintain a constant 30 second service time.What is the impact on the waiting time for the customers?
A)There is no change.
B)The wait in the ATM line is 50% shorter than the wait in the teller line.
C)The wait in the ATM line is 50% higher than the wait in the teller line.
D)The wait in the ATM line is 25% shorter than the teller line.
Q2) What is Monte Carlo simulation and how is one conducted?
Q3) Management is concerned about the waiting time for customers and decides to train one more student.If the arrival and service rates remain the same as in the original scenario,what happens to the number of customers in the system?
A)There are about half as many as in the original scenario.
B)There are about a third as many as in the original scenario.
C)There are about a fourth as many as in the original scenario.
D)There are about a fifth as many as in the original scenario.
Page 9
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Chapter 8: Supply Management
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Sample Questions
Q1) The first step of the purchasing process is to select the supplier.
A)True
B)False
Q2) ________ are high level,often strategic decisions regarding which products or services will be provided internally and which will be provided by external supply chain members.
Q3) A manufacturer seeking to reduce the variability of quality should use multiple sourcing.
A)True
B)False
Q4) The two basic types of purchasing contracts are:
A)fixed-price and cost-based.
B)bid-rigged and cost-plus.
C)cost-zero and fixed-variable.
D)fixed-quantity and variable-cost.
Q5) What takes place in each step in the procure-to-pay cycle and which step is most critical?
Q6) Top executives name ________ as a significant threat to their companies' revenue streams.
Q7) The bulk of insourcing costs are usually ________ costs.
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Chapter 9: Logistics
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Sample Questions
Q1) In order for the weighted center of gravity method to yield an optimal solution all of the transportation costs in the area must be identical.
A)True
B)False
Q2) What percent of North American gross domestic product is accounted for by logistics?
A)almost 8 percent
B)almost 12 percent
C)almost 16 percent
D)almost 20 percent
Q3) The printer manufacturer shipped all finished goods to a centrally located warehouse just down the street from an international airport.When orders came in from one country,workers at the warehouse added instruction manuals in that language and included a power supply that fit the appropriate electrical distribution system.This is an example of ________.
Q4) ________ is a form of warehousing in which smaller outgoing shipments are created from large incoming shipments.
Q5) A(n)________ can handle shipments on an as-needed basis with no long-term contract required.
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Chapter 10: Forecasting
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Sample Questions
Q1) The greater the randomness in the model,the greater the number of periods should be used in a moving average forecast.
A)True
B)False
Q2) A tracking signal value between ________ and ________ would suggest that the forecasting technique in use is appropriate.
Q3) A collaborative planning,forecasting and replenishment system eliminates the need for forecasting.
A)True
B)False
Q4) The panel consensus forecasting approach requires that the forecasting team discuss their forecast as a team but the ________ requires that each member of the team develop a separate forecast initially.
Q5) Using the data in the table,first plot the data and comment on the appearance of the demand pattern.Then develop a forecast for weekend #5 that fits the data.
Q6) A seasonal index less than 1.0 means that the model is overforecasted.
A)True
B)False
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Chapter 11: Sales and Operations Planning Aggregate Planning
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Sample Questions
Q1) As potato harvest season approaches,the number of year-round llama wranglers is insufficient to meet the demand,so a few wranglers are hired just for the month it takes to haul the harvest down from the mountains to the anxious potato-festival crowd.This approach to meeting the labor requirements is called:
A)a tiered workforce.
B)offloading.
C)labor management.
D)yield management.
Q2) When the products and services have very different resource requirements and the mix is unstable from one period to the next,bottom-up planning works best.
A)True B)False
Q3) A sales and operations plan that varies both production and inventory levels is called a(n)________ production plan.
Q4) Planning values are used in bottom-up planning,but cannot be used in top-down planning.
A)True B)False
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Chapter 12: Managing Inventory Throughout the Supply Chain
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Sample Questions
Q1) Cycle stock can occur at more than one point in a supply chain.
A)True
B)False
Q2) The food engineers at Moria Foods have developed a new variety of banana they have named the "mayfly banana" which holds perfect ripeness for exactly one day before becoming a black-skinned sack of putrid mush.Which of these actions will result in a lower order quantity from the many retail establishments clamoring to stock up on this new foodstuff?
A)an increase in the price consumers are willing to pay for the mayfly banana
B)an increase in the standard deviation of the number of mayfly bananas demanded by consumers
C)a decrease in the salvage value of the mayfly bananas
D)a decrease in the disposal cost of the mayfly bananas
Q3) The ________ is an extreme change in the supply position upstream generated by a small change in demand downstream.
Q4) Define the bullwhip effect and discuss the advantages of holding inventory far upstream or downstream in the supply chain.
Q5) Derive the economic order quantity model,beginning with a definition of terms and graph of cost curves.
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Chapter 13: Managing Production Across the Supply Chain
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Sample Questions
Q1) Describe the scope,inputs,and outputs of sales and operations planning,master scheduling,and MRP.
Q2) With a beginning inventory of zero for all components and finished items,how many assembly As are needed to produce 25 product Xs?
A)125
B)250
C)325
D)400
Q3) Since the booked orders figure represents actual customer demand in a master schedule,that value is always less than or equal to forecasted demand.
A)True
B)False
Q4) Material requirements planning is used to manage independent demand inventory.
A)True
B)False
Q5) The estimated level of an end item at the end of each planning period,whether the period is a week or a month is the ________.
Q6) Confirmed demand for products is called ________ in master scheduling.
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Chapter 14: S Supply Chain Information Systems
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Sample Questions
Q1) One characteristic of cloud computing is that the provider's computing resources may serve multiple consumers with the resources dynamically allocated according to customer demand.
A)True
B)False
Q2) An execution and transaction processing level system that is used throughout the supply chain is a(n):
A)CRM system
B)DS system.
C)ERP system.
D)SRM system
Q3) A system that controls all aspects of a company's business from production,through human resources,to accounting and other departments and accomplishes this with a single source of data is ________.
Q4) Which of these supply chain activities is the most day-to-day,routine activity?
A)control of monetary flows
B)capacity decision
C)warehouse location
D)workforce leveling
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Chapter 15: Jitlean Production
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Sample Questions
Q1) Since a JIT manufacturer has very little inventory,it is vital that all incoming parts receive a thorough inspection.
A)True
B)False
Q2) Inflexible or unreliable processes that cause organizations to produce goods before they are required are called:
A)excess motion.
B)inappropriate processes.
C)overproduction.
D)defects.
Q3) ________ combines the focus on waste reduction with the discipline of define,measure,analyze,improve,and control.
Q4) The forecast for next month is 200 units so the manufacturer gathers materials for this anticipated level of production activity.This is an example of pull production.
A)True
B)False
Q5) The number of kanbans in a production system is inversely related to the ________.
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Chapter 16: Managing Projects
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Sample Questions
Q1) Work on a project's constituent activities begins in the project's:
A)planning phase.
B)concept phase.
C)post-completion phase.
D)performance phase.
Q2) Performance or time targets for each major group of activities in a project are set during the planning phase of a project.
A)True
B)False
Q3) During the ________,project planners identify how to accomplish the work,how to organize for the project,and the key personnel and resources needed.
Q4) A performance or time target for each major group of activities in a project is a(n)________.
Q5) PERT is an acronym meaning:
A)Project Evaluation and Review Technique.
B)Project Execution and Review Technique.
C)Program Evaluation and Review Technique.
D)Plan Estimation and Review Technique.
Q6) An activity's length added to its early start time yields the ________.
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Chapter 17: Developing Products and Services
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Q1) The ________ is the process whereby many ideas are considered at the concept development phase but few ideas make it to the commercial development and launch phases.
Q2) What is the operations and supply chain function responsible for in each of the product development phases?
Q3) In ________,the supplier works with the customer to jointly design the product.
Q4) The output from the first QFD matrix that feeds into the second QFD matrix is the product characteristics information.
A)True
B)False
Q5) The roof of the house of quality displays conflicts between the voice of the customer and product characteristics and permits designers to rapidly identify trade-offs.
A)True
B)False
Q6) The ease with which parts can be replaced or evaluated is:
A)repeatability.
B)serviceability.
C)testability.
D)functionality.
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