5C - total Flashcards
Benchmarking compares the current performance of operations to which of the following factors related to competing organizations?
Standard cost of developing performance measures
Current performance measures
Prior performance measures
Anticipated future performance measures
Current Performance Measure
A benchmark is a point of reference from which measurements can be made and current performance of operations can be assessed; a benchmark serves as a standard of comparison.
. The four types of benchmarking are discussed below.
____Evaluation of business units within the organization that have similar business processes to identify the best practices. Easy to do. Resu;lts in quality improvements
___benchmarking: This is the process of measuring an organization’s products, services, and processes against those of its toughest competitors. It is both more difficult and more expensive than internal benchmarking, but it may identify practices unknown to the firm and release an organization from self-imposed limits
\_\_\_benchmarking: This examines business functions in organizations outside the firm's industry. The purpose is to find innovative processes not used in the industry. Marketing Distribution & Finace are the departments its used in
____benchmarking: This examines specific activities such as invoicing, payroll, purchasing, and order entry.
Internal benchmarking:
Competitive
Functional
Generic
What is process-based management (PBM)?
A management strategy that aligns raw material orders from suppliers directly with production schedules
A data-driven methodology for eliminating defects in any process
An organizational approach that views a business as a collection of managed processes designed to achieve a desired result
An approach that seeks continuous improvement through small, incremental changes in processe
An organizational approach that views a business as a collection of managed processes designed to achieve a desired result
___) is a philosophy that views business as a collection of processes (or activities) that are managed to achieve the organization’s vision,
mission, and core values.
focuses on internal processes such as customer satisfaction, quality of product, and security, as well as financial results (revenues, costs, profit, and budget). PBM works for any industry and is compatible with any business model. T/F
Process-based management (PBM
True
Companies that adopt just-in-time purchasing systems often experience:
an increase in carrying costs.
a reduction in the number of suppliers.
fewer deliveries from suppliers.
a greater need for inspection of goods as the goods arrive.
Reduction in suppliers
his increased dependence on, and interaction with, vendors forces the company that adopts a just-in-time purchasing system to reduce the number of suppliers to those few who will guarantee the needed quality and timeliness of delivery.
JIT shifts the production philosophy from a Pull approach to a Push approach.
____The basic principle of just-in-time production is not to produce anything until the next stage in the production process is ready to work on it.
Quality control is critical, as is a good relationship with vendors to obtain high-quality materials with frequent deliveries. If quality control procedures are not in place, the entire process breaks down. T/F
The rate of production for individual departments is determined by the needs of each succeeding department
False – Push to Pull
Kanban:
True
True
The ___approach begins with the acquisition of raw materials, which are pushed into production
The ____approach starts with the demand for finished products from a customer.
Push
Pull
This is based on what idea?
That an organization has a single goal that is achieved through a complex system of linked activities
Theory of Constraints
5 steps for implementing Constraints
Identify Exploit Subordinate Elevate Go back to step 1
i
Business process modeling (BPM) is used in process-based management and systems engineering to diagram (or model) the activities of an organization. One of those modeling tools is extended business modeling language (xBML), which is:
a graphical representation that identifies the business processes in business process modeling.
a type of flowchart used for business process modeling used for modeling, analyzing, and redesigning business processes.
an intuitive graphical language that unlocks the DNA of a corporation using a system of diagrams based on five W’s (Who, What, Which, Where, and When).
a conceptual fact-based modeling method that aims to integrate the different dimensions of knowledge: data, rules, processes and semantics.
an intuitive graphical language that unlocks the DNA of a corporation using a system of diagrams based on five W’s (Who, What, Which, Where, and When).
____An intuitive graphical language that unlocks the DNA of a corporation using a system of diagrams based on five W’s (Who, What, Which, Where, and When).
____A graphical representation that identifies the business processes in business process modeling.
____Uses five symbols to model any process and allows direct transformation into executable form. Each business process consists of two or more subjects which exchange messages.
____: A type of flowchart used for business process modeling used for modeling, analyzing, and redesigning business processes. An EPC is an ordered graph of events and functions, providing connectors
___A conceptual fact-based modeling method that aims to integrate the different dimensions of knowledge: data, rules, processes, and semantic
Extended business modeling language (xBML):
Business process model and notation (BPMN):
Subject-oriented business process management (S-BPM):
Event-driven process chain (EPC)
Cognition-enhanced natural language information analysis method (CogNIAM):
nk discs with no data contained on them. Which improvement initiative would R Beck most likely adapt to reduce or eliminate the blank discs?
Lean production
Business excellence framework
Six Sigma
Business process re-engineering
6 sigma
____is a data-driven approach for identifying and removing the causes of defects and minimizing variability in manufacturing and business processes.
____which is often known simply as “___,” is a production practice and methodology that focuses on reduction of the seven wastes (overproduction, waiting time, transportation, processing, inventory, motion, and scrap) in manufacturing products.
_____is a systematic approach or methodology for analyzing business activities or processes with a view to improving the organization’s alignment with strategic goals and/or its effectiveness, efficiency, competitiveness, etc. Designs workflows & processes
The ____Framework is a set of specific practices of managing the organization and achieving results,
_____contains a set of standards that companies can implement for continual improvement
Six Sigma
Lean manufacturing,
Business process re-engineering (BPR)
Business Excellence (BE)
ISO 9001
Just-in-time production is also called:
kaizen.
lean manufacturing.
activity-based management.
backflush costing.
Lean Manufacturing
Which of the following methodologies would be most effective for a company that wants to reduce its rate of defective products?
Sensitivity analysis
Variable costing
Six Sigma
Breakeven analysis
6 sigma
Which of the following terms refers to a willing adoption of one organization’s culture over the other after a merger or acquisition?
Integration
Separation
Assimilation
Deculturation
Assimilation
MERGERS
. ____occurs when the acquired company willingly adapts and embraces the acquiring entity’s culture.
____occurs when the companies combine the two cultures into one new, composite culture.
___is the situation where the two companies remain as two distinct entities.
___is the situation where the acquiring company forces or imposes its culture on an unwilling acquired firm.
Assimilation
Integration
Separation
Deculturation
Strategic planning addresses both internal and external environment factors. Which of the following is not a component of the internal environment?
Competitive advantages
Opportunities
Strengths
Weaknesses
opportunities
Opportunities and threats make up the external environment. The internal environment consists of strengths, weaknesses, and competitive advantages.
Opportunities and threats make up the __environment.
The __environment consists of strengths, weaknesses, and competitive advantages.
external ,
internal
All of the following are characteristics of the strategic planning process except the:
emphasis on both the short and long run.
analysis of external economic factors.
review of the attributes and behavior of the organization’s competition.
analysis and review of departmental budgets.
Analysis and review of departmental budgets
Wong Company utilizes both strategic planning and operational budgeting. Which one of the following items would normally be considered in a strategic plan?
Setting a target of 12% return on sales
Maintaining the image of the company as the industry leader
Setting a market price per share of stock outstanding
Distributing monthly reports for departmental variance analysis
Maintaining the image of the company as the industry leader’
A strategic plan outlines where an organization is headed over the next year or more, how it will get there, and how management will know that goals have been met.
What does business process re-engineering do within an organization?
Only analyzes design workflows
Only designs work processes
Analyzes and designs workflows and processes
Tests and implements processes
Analyze and design workflow
usiness process re-engineering (BPR) identifies processes and workflows, analyzes processes and workflows, and designs processes and workflows
Which of the following decision-making techniques is most useful to a manager who is attempting to increase the profitability of an area, but who has a problem with limited capacity for operation of a critical machine?
Theory of constraints
Economic order quantity
Balanced scorecard
Cost variance analysis
Theory of constraint
The theory of constraints (TOC) is based on the idea that an organization has a single goal that is achieved through a complex system of linked activities. Improvement in individual activities often has little effect on achievement of the overall goal. Therefore, TOC focuses on identifying and addressing variables—called constraints—that have a significant effect on global performance, such as limited capacity for operation of a critical machine.
Which of the following is not a typical characteristic of a just-in-time (JIT) production environment?
Lot sizes equal to one
Insignificant setup times and costs
Push-through systems
Balanced and level workloads
Puah - through system
The just-in-time (JIT) production environment is characterized by production generated by need. This is a “demand-pull” system in which sales occur first and trigger the production of units. Typical features of a JIT system include small lot sizes, low setup times/costs, and balanced workloads.
Traditional production systems, on the other hand, produce products based on expected demand. They produce on a fixed schedule in a “push-through” mode.
In order for a firm to achieve its mission, it must develop a strategy. This involves analyzing the firm’s internal and external environment. External factors include all of the following except:
business cycles.
competitors’ actions.
government regulation.
product mix of the firm.
product mix
The firm’s product mix is an internal factor. It is the only one of the answer choices which is subject to management control and is one of the company’s strengths or weaknesses.
Kanban is:
a technique for managing a just-in-time (JIT) inventory system developed by the Japanese.
a method of evaluating alternative credit policies developed by the Japanese.
a method of determining the economic order quantity expressed in mathematical terms.
a method of developing a relationship between sales and inventory used in forecasting.
a technique for managing a just-in-time (JIT) inventory system developed by the Japanese.
The kanban is a tag attached to the storage container where component parts are kept. As a component is used, a kanban is placed in a box.
Managers determine the number of kanbans needed to be in the box of the component part before a reorder of that part is necessary.
Changes are required in several areas of a manufacturing process to make JIT successful.
(Add/Eliminate) activities that do not add __to a product or a service.
Obtain agreements with suppliers - Do you want to limit or increase Suppliers?
Develop a – A component or a complete product can be produced within one cell rather than being transferred between several departments.
Obtain a flexible, highly trained workforce. The cellular manufacturing environment requires a labor force that is capable of operating several different machines. Implement \_\_\_\_. The streamlined flow of raw materials and components through the production process does not allow for product defects
Reduce ___time – Meeting customer demand on short notice without any finished goods inventory requires the ability to shift production from one product to another with a short setup time.
Eliminate, Value
Limit
True
total quality control
set up
A newly introduced costing method that has recently been adopted at some firms is called ________ costing.
absorption
standard
throughput
variable
Throughput
Throughput costing relegates all product costs except direct materials to period cost (expense) status. It is a newly proposed costing method.
Absorption, standard, and variable costing have been used for several decades.
___costing relegates all product costs except direct materials to period cost (expense) status. It is a newly proposed costing method.
Throughput
The drum-buffer-rope theory:
assumes that within a manufacturing system there is at least one (or a limited number) of constraints created by ___
states that in order to best protect the throughput of a manufacturing operation, the limiting factor of the ____ must be protected.
states that it is important to protect against ___inventory levels (inventory build ups) and the associated carrying costs which can occur at ___ (constraints).
focuses on only the ____ area within a manufacturing firm that is in front of the constraint (bottleneck).
scarce resources.
manufacturing process
inflationary , bottleneck
queuing (waiting)
The drum-buffer-rope system is a tool for managing product flow, inspired by the theory of constraints (TOC). The system focuses on maximizing throughput around the constraint as follows:
_____: The constraint in the system sets the pace (i.e., the “drum”) for production
___: Protective inventory is built into the system to provide slack around the constraint. TOC builds an allowance for problems into the system.
____: a “pull” system such as kanban to trigger product flow
Drum
Buffer
Rope
Madi and Molly, Inc., produces lumber, with an average pine tree having 61% of its trunk producing construction grade lumber. Of the remaining 39%, 22% is used for producing wood products for a local furniture manufacturer, and 17% goes to waste. Therefore, Madi and Molly’s lumber usage rate is 83%. In 20X1 the local furniture manufacturer closed, leaving no viable prospects for Madi and Molly to sell the 22% of the wood allocated to the furniture manufacturer. What improvement initiative should Madi and Molly implement to have its lumber usage rate rise back above 80%? You can assume that an increase in the lumber usage rate will replace 100% of the revenue lost from the furniture manufacturer.
Lean production
Business excellence framework
Six Sigma
Business process re-engineering
Lean PRoduction
Which of the following decision-making techniques is most useful to a manager who is attempting to increase the profitability of an area, but who has a problem with limited capacity for operation of a critical machine?
Theory of constraints
Economic order quantity
Balanced scorecard
Cost variance analysis
Theory of constraints
TOC focuses on identifying and addressing variables—called constraints—that have a significant effect on global performance, such as limited capacity for operation of a critical machine.
The economic order quantity model (EOQ) provides a formula for determining the quantity of a particular inventory item that should be ordered in order to minimize inventory costs.
Which of the following describes an off-shore operation?
A U.S. company incorporates in Japan.
A Japanese company produces right off the Japanese shore.
It is an internal department.
It is a cost-saving process.
A U.S. company incorporates in Japan.
The organization will be considered off-shore if it:
incorporates under offshore company ___.
incorporates as a nonresident.
does not trade within the offshore jurisdiction.
Does not meets nominal tax expenses.
laws
Non-resident
Trade
False - they do meet nominal tax expense
Gram Co. develops computer programs to meet customers’ special requirements. How should Gram categorize payments to employees who develop these programs?
By direct costs and value-adding costs
By direct costs only
By value-adding costs only
By neither direct costs nor value-adding costs
Both
Direct costs are costs that relate directly to and are traceable to products. The payments Gram makes to employee programmers can be traced to the programs so they are direct costs.
Value-adding costs are those costs that are necessary to production and add value to the product. Clearly, the employee programmers’ efforts are value-added costs.
What is the role of IT in business process re-engineering?
It is the major facilitator for new ways of sharing information within a specific organization and outside of the organization.
It only creates the systems that work the processes and workflows.
It is the minor facilitator for creating the systems that work the process and workflows.
It maintains the process management piece of the project.
It is the major facilitator for new ways of sharing information within a specific organization and outside of the organization.
IT is the major facilitator for coming up with new forms of working and sharing information within a specific organization, and also with organizations outside of the original organization. They are a key department to keep processes, workflows, and communications working.
A JIT inventory system will generally:
___the number of suppliers,
____the standard delivery quantity, and
____the number of deliveries required.
decrease
minimize
increase
The time frame for strategic planning is:
annual.
daily.
long term.
monthly.
long term
Strategic planning is necessary if a firm expects to accomplish its mission. The strategic planning must consider internal and external factors and is long term and ongoing in nature.
What is the main purpose of outsourcing?
To improve management
Better training
To reduce costs
To increase personnel
reduce cost
Outsourcing to other countries helps reduce costs. A corporation in the United States will outsource to Japan because Japan will pay employees much less wages for the same work.
All of the following are characteristics of the strategic planning process except the:
emphasis on both the short and long run.
analysis of external economic factors.
review of the attributes and behavior of the organization’s competition.
analysis and review of departmental budgets.
analysis and review of departmental budgets.
Which one of the following statements best describes material requirements planning (MRP)?
A planning system that is used to determine the amount and timing of the optimal inventory level
A software tool that is used to forecast the ordering quantities of inventories that tend to be subject to a variable and continual demand
A planning system that is used to determine the amount and timing of inventories that are dependent on the demand for finished goods
A software tool that is used to forecast the schedule of material purchases that tend to be subject to a variable and continual demand
A planning system that is used to determine the amount and timing of inventories that are dependent on the demand for finished goods
MRP refers to the use of a computerized information system to schedule and order inventories of raw materials and other components used in manufacturing
Tale Company has two competitors in one of its major product segments. Recently one of those firms had its major product in that segment subjected to severe restrictions by a governmental regulatory body. These restrictions are likely to continue indefinitely. This action and its effect on Tale is an example of:
external environment.
internal environment.
missed opportunity.
None of the answer choices are correct.
external environment.
The serious reduction in a competitor’s ability to continue operation in the product segment is a component of Tale’s external environment. It presents an opportunity for Tale to increase its market share and profitability.
ocess-based management (PBM) focuses on internal processes; which of the following is not an example of such a process?
Customer satisfaction
Product quality
Security
New employee hiring
New employee hiring
Hiring employees is a process completed by the human resources department; it is not considered an internal process that process-based management (PBM) would focus on.
____means that the service is internal; it is the exact opposite of outsourcing. Combining the efforts of two departments that share the same resources
Shared services
Which of the following is a financial measure of success in a balanced scorecard?
Market share
Sales growth
Cycle time
Staff morale
The balanced scorecard views an organization from four perspectives:
learning and growth (i.e., employee training, staff morale);
business/Internal processes (operational efficiency, cycle times),
customer satisfaction (market share),
financial measures (traditional financial data, such as sales growth).
Which of the following is not a test to determine if an organization is using business process re-engineering (BPR)?
The effort focused on critical business processes
The receptiveness of senior management.
The desired improvement’s ambition
The effort focused on project management
/there are three questions that need to be answered to see if an organization is implementing BPR:
Is the effort focused on critical business processes that, if they are changed, can have a major impact on performance?
How ambitious is the desired improvement?
How receptive is senior management to change?
The performance of a standard cost center should be evaluated by comparing:
actual costs with fixed (static) budget costs.
actual costs with flexible budget costs.
flexible budget costs with fixed (static) budget costs.
actual contribution of the cost center with budgeted contribution of the cost center.
actual costs with flexible budget costs.
Cost center reports should compare controllable actual costs (i.e., costs for which the center maintains responsibility) to flexible budget costs.
Cost centers are generally not evaluated on the center’s contribution or fixed cost.
___accounting breaks the company into responsibility centers according to the ability of individuals to control various activities. Accounting reports are then prepared for each responsibility center consistent with the assignment of responsibility
Three types of cost centers
____centers: Subdivisions of a business that are assigned responsibility for the incurrence and proper utilization of costs
____centers: Subdivisions responsible for both costs and revenues
_____centers: Subdivisions responsible for costs, revenues, and profitable utilization of invested capital
Responsibility
Profit
Cost
Investment
When is data collection most critical in the implementation of an improvement initiative for a hospital attempting to improve emergency-room care patient satisfaction?
Before the initiative begins
During the initiative
After completion of the initiative
all correct
Organizations must collect data before, during, and after the implementation to reach a desired target.
By performing a SWOT or gap analysis, the organization can first establish a baseline of where it stands and where it needs to go, and also determine if the initiative will fit into the organization as a whole
____ analysis: Strategic plan formation involves an analysis of the enterprise SWOT qualities: internal strengths and weaknesses (resources) and external opportunities and threats (environment
_____: These internal factors focus on areas where the company has a comparative advantage because of internally created resources.
____: These internal factors are the opposite of strengths; they represent areas where the company is weak or its competitors have comparative advantages over the company’s internally created resources.
_____: These are external factors that involve matching the environment to the organization. Should be prioritized.
____External in nature, these factors can arise from a competitor or from changes in market demographics.
Strengths, weaknesses, opportunities, and threats (SWOT)
Strength
Weakness
Opportunities
Threat
