Chapter 1: Operations and Supply Chain Management

Question 1

 Operations and supply chain management

Answer 1

is defined as the design, operation, and improvement of the systems that create and deliver the firm’s primary products and services

Question 2

Operations

Answer 2

refers to manufacturing and service processes that are used to transform the resources employed by the firm into products desired by customers

Question 3

Supply chain

Answer 3

refers to processes that move information and material to and from the manufacturing and service processes of the firm

Question 4

Planning

Answer 4

consists of the processes needed to operate an existing supply chain strategically

Question 5

Sourcing

Answer 5

involves the selection of suppliers that will deliver the goods and services needed to create the firm’s product

Question 6

Making

Answer 6

is where the major product is produced, or the service is provided

Question 7

Delivering

Answer 7

is also referred to as a logistics process

Question 8

Returning

Answer 8

involves processes for products received back from customers who had problems with the product(s)

Question 9

Intangible process

Answer 9

can’t measured or weighed (service)

Question 10

Tangible good

Answer 10

has a physical dimension

Question 11

 Product-service bundling

Answer 11

refers to a company building service activities into its product offerings for its customers

Question 12

 Efficiency

Answer 12

means doing something at the lowest possible cost

Question 13

Effectiveness

Answer 13

means doing the right things to create the most value for the customer

Question 14

Value

Answer 14

could be defined by dividing value by price

Question 15

Benchmarking

Answer 15

is a process in which one company studies the processes of another company to identify best practices

Question 16

Days sales outstanding

Answer 16

is how many days it takes for the business to receive cash for sale of product

Question 17

Cash cycle conversion

Answer 17

= Days sales outstanding + Days inventory – payable period

Question 18

Cash conversion cycle time

Answer 18

is a formula used to define how long it takes a company to convert the money spend on raw materials into the profit it receives from the sale of a product

Question 19

Receivables turnover

Answer 19

= Annual credit sales/ Average accounts receivable

Question 20

Inventory turnover

Answer 20

COGS/ Average Inventory Value; measures the average number of times inventory is sold and replaced during the fiscal year

Question 21

Asset turnover

Answer 21

= Revenue (or sales)/ Total assets; this is the amount of sales generated for every dollar’s worth of assets

Question 22

Just in Time

Answer 22

is an integrated set of activities designed to achieve high-volume production using minimal inventories of parts that arrive exactly when they are needed

Question 23

Total Quality Control

Answer 23

which aggressively seeks to eliminate causes of production defects

Question 24

business process reengineering

Answer 24

approach seeks to make revolutionary changes as opposed to evolutionary changes

Question 25

Six Sigma

Answer 25

is a statistical term to describe the quality goal of no more than 3.4 defects out of every million units

Question 26

Sustainability

Answer 26

is the ability to maintain balance in a system

Question 27

Triple bottom line

Answer 27

– a business strategy that includes social, economic, and environmental criteria

Question 28

Business analytics

Answer 28

the use of current business data to solve business problems using mathematical analysis