Service Management
Textbook Exam Questions
Course Introduction
Service Management explores the principles and practices involved in designing, operating, and improving service-based organizations across various industries. The course covers key topics such as service strategy, service quality, customer relationship management, service process design, and the use of technology in service delivery. Students will examine case studies from sectors like hospitality, healthcare, retail, and financial services to understand challenges specific to services, including managing customer expectations, ensuring consistent quality, and optimizing service operations. Emphasis is placed on both the operational and strategic aspects of managing service organizations to enhance customer satisfaction and achieve organizational goals.
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Sanjeev Bordoloi
Chapter 1: The Service Economy
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Q1) Which of the following does not describe a business service experience?
A) Themed.
B) Co-creation.
C) Collaboration.
D) Problem solving.
Answer: A
Q2) The consumer participates in the service process, which is not the case in manufacturing.
A)True
B)False
Answer: True
Q3) The major input into a large public hospital from a service point of view would be ________.
A) physicians' services
B) patients
C) nursing services
D) federal reimbursement (Medicare/Medicaid)
Answer: B
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Chapter 2: Service Strategy
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Q1) Bar coding and checkout scanner technology have created a wealth of consumer buying information that can be used to target customers with precision. This process is an example of ________.
A) service development
B) micromarketing
C) data envelopment analysis
D) point of sale
Answer: B
Q2) A highly scalable firm such as Kelly Blue Book (kkb.com) requires a call center.
A)True
B)False
Answer: False
Q3) SWOT analysis is objective with easily agreed upon results.
A)True
B)False
Answer: False
Q4) A cost-leadership strategy often involves customizing a standard service.
A)True
B)False
Answer: False
Page 4
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Chapter 3: New Service Development
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Q1) JIT is an example of information driven technology innovation.
A)True
B)False Answer: False
Q2) The service encounter is a structural service design element.
A)True
B)False Answer: False
Q3) Dry cleaning is an example of a service where isolation of the technical core would be inappropriate.
A)True
B)False Answer: False
Q4) The "project authorization" in the NSD cycle is part of the development step.
A)True
B)False Answer: False
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Page 5
Chapter 4: The Service Encounter
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Q1) A customers who becomes intoxicated and disruptive is an example of ________.
A) unreasonable demands
B) abusive or hostile attitude
C) inappropriate behavior
D) demands contrary to policies
Q2) All of the following are characteristics of a service organization with an inverted T structure, except ________.
A) the layers of supervision are reduced
B) contact personnel are trained, motivated, and supplied with timely computer-based information
C) the service encounter is managed at the point of delivery
D) limiting discretion of contact personnel
Q3) Southwest Airlines delivered high service value because of employee retention and productivity.
A)True
B)False
Q4) Customer and server interact face-to-face in technology-mediated service encounters.
A)True
B)False
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Chapter 5: Supporting Facility and Process Flows
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Q1) Which one of the following is not a major factor that could influence facility design?
A) Objectives and nature of the service.
B) Flexibility in operations.
C) Availability of land.
D) Site location.
Q2) A fixed sequence of steps that all customers must experience is characteristic of process layouts.
A)True
B)False
Q3) Signage is not an environmental dimension of the servicescape.
A)True
B)False
Q4) The automobile driver's license office is an example of a product layout.
A)True
B)False
Q5) Mid-Columbia Medical Center has a special employee-only entrance to enhance security.
A)True
B)False
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Chapter 6: Service Quality
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Q1) Which of the following is a strategy for closing the gap between customer expectations and management perceptions of customer's expectations (GAP 1)?
A) Standardization of service delivery.
B) Improved market research.
C) Employee empowerment.
D) Investment in training.
Q2) The most important function of SERVQUAL is to keep a record of service quality trends through periodic customer surveys.
A)True
B)False
Q3) Being meaningful and easy to invoke are important elements of a good unconditional service guarantee.
A)True
B)False
Q4) Severity of failure, speed of recovery, service guarantee and perceived service quality are all factors governing service recovery expectations.
A)True
B)False
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Chapter 7: Process Improvement
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Q1) The objective of Six Sigma is to eliminate variation in process performance.
A)True
B)False
Q2) Planning, control, and ________ are the three-component cycles required for ISO 9001 implementation.
A) reporting
B) documentation
C) testing
D) budgeting
Q3) Which pair of parameters describes the "candidates for divestiture" quadrant in the DEA strategic matrix?
A) Low efficiency and low profit.
B) Low efficiency and high profit.
C) High efficiency and high profit.
D) High efficiency and low profit.
Q4) Which of the following statements is not part of Deming's 14-point philosophy?
A) Create constancy of purpose for improvements of product and service.
B) Promote numerical goals for the workforce.
C) Constantly and forever improve the system of production and service.
D) Cease dependence on mass inspection.
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Chapter 8: Service Facility Location
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Q1) Finding a unique set of sites in a multi-location problem is a simple extension of the methods used for single facility location.
A)True
B)False
Q2) The Huff model for retail outlet location postulates an inverse relationship between the attractiveness of a location and the travel time to that location for a particular customer.
A)True
B)False
Q3) A strategy of locating sites in a number of states (or countries) can reduce the overall risk of financial crisis from a regional economic downturn. This strategic approach to facility location is known as ________.
A) competitive positioning
B) flexibility
C) demand management
D) focus
Q4) The Euclidian location model is used when vector travel is involved.
A)True
B)False
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Chapter 9: Service Supply Relationships
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Q1) Outsourcing can provide access to the latest technology without investment.
A)True
B)False
Q2) Conversion is a primary value component of service chain management.
A)True
B)False
Q3) Product postponement is the strategy of stocking a product in generic form for later customization.
A)True
B)False
Q4) Removing the kitchen from Taco Bell outlets to a central location resulted in all of the following benefits, except ________.
A) reduction in waste
B) consolidation of demand
C) shorter customer wait times
D) make-to-order customization
Q5) Customer-supplier duality acknowledges the customer inputs in a service relationship.
A)True
B)False
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Chapter 10: Globalization of Services
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Q1) Mayo Clinic is a service firm that would fall under which of the following categories?
A) Single location and single service.
B) Single location and multiservice.
C) Multisite and single service.
D) Multisite and multiservice.
Q2) 'Develop foreign customers' is a consideration for the global service strategy of 'following your customers'. The relevant globalization factor is ________.
A) cultural adoption
B) customer contact
C) complexity
D) customization
Q3) Network development is a consideration in the decision to plan a multinational service.
A)True
B)False
Q4) A family restaurant is an example of a focused service.
A)True
B)False
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Chapter 11: Managing Capacity and Demand
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Q1) Expected loss for an overbooking reservation strategy would be calculated by multiplying the loss for each no-show possibility and its probability of occurrence, and then adding the products.
A)True
B)False
Q2) Using part-time personnel at fast-food restaurants allows capacity to vary with demand.
A)True
B)False
Q3) ________ is not a strategy for accommodating of customer-induced variability.
A) Provide generous staffing
B) Cross-train employees
C) Reward increased effort
D) Do work for customers
Q4) SABRE is the name for American Airlines' yield management system.
A)True
B)False
Q5) Yield management is a strategy that manages both demand and capacity. A)True
B)False
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Chapter 12: Managing Waiting Lines
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Q1) Spatial distribution of demand is important to consider in which of the following services?
A) Restaurants.
B) Banking.
C) Emergency ambulance services.
D) Motels.
Q2) Waiting is often seen as psychological punishment because the consumer is aware of the opportunity cost of waiting time and the resulting loss of earnings.
A)True
B)False
Q3) In analytical queuing models, the calling population mainly determines whether the queue will be finite or infinite.
A)True
B)False
Q4) Which one of the following is not true of multiple queue configurations?
A) Jockeying is eliminated.
B) Division of labor is possible.
C) Service provided can be differentiated.
D) The FCFS rule is not always followed.
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Chapter 13: Capacity Planning and Queuing Models
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Q1) In general, for infinite queues, the expected number of people in the system is equal to ________.
A) the average arrival rate minus the average service rate
B) the expected number in the queue plus the expected number in service
C) the expected arrival rate times the expected waiting time
D) A and B
Q2) Verification refers to determining whether or not the structure of a simulation model is consistent with the real system.
A)True
B)False
Q3) Which of the following is not an advantage of using one large computer system to serve an entire university community?
A) Short turnaround time.
B) Large memory.
C) Economics of scale in services.
D) Short wait in queue.
Q4) In the M/M/1 model the calling population is finite.
A)True
B)False
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Chapter 14: Forecasting Demand for Services
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Q1) Most forecasting models assume that the underlying pattern of behavior of their data will remain the same. The only component of error is attributable to random fluctuations that are not under the control of anyone.
A)True
B)False
Q2) Both trend and seasonal adjustments can augment a single exponential-smoothing model.
A)True
B)False
Q3) The forecast horizon for a cross-impact analysis method is medium-term.
A)True
B)False
Q4) In the Delphi method, the opinions of experts are collected, then the analyst resolves differences of opinion to arrive at a consensus.
A)True B)False
Q5) Subjective models are used to assess the future impact of changing demographics. A)True
B)False
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Chapter 15: Managing Service Inventory
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Q1) In the design of an inventory system all of the following is considered except ________.
A) type of customer demand
B) relevant inventory costs
C) constraints
D) safety stocks
Q2) When a quantity discount is offered, the first step should be to compute ________.
A) EOQ for the highest price per unit
B) EOQ for the lowest price per unit
C) the total annual cost for the highest quantity discount
D) the total annual cost for the lowest quantity discount
Q3) In the 'news vendor problem', the underlying concept is that the news vendor should continue increasing the stock until the expected loss on the last sale ________ the expected revenue on the last unit stocked.
A) equals
B) just exceeds
C) is just lower than D) greatly exceeds
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Chapter 16: Managing Service Projects
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Q1) A project history report should include all of the following items, except ________.
A) project performance
B) organization structure
C) project success and failures
D) project and administrative team
Q2) A major weakness with project completion time analysis with uncertain activity times is the ________.
A) possibility that more than one critical path might exist
B) need to solicit three time estimates for each activity
C) assumption that the project completion time is normally distributed
D) bias associated with the expected project completion time
Q3) When delays occur owing to technical difficulties, performance becomes the source of unexpected project management problems.
A)True
B)False
Q4) The single important attribute of a project manager is leadership ability.
A)True
B)False
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