Chapter 9

Question 1

system

Answer 1

An interconnected and coordinated set of elements and processes that converts inputs to desired outputs

Question 2

value chain

Answer 2

All the elements and processes that add value as raw materials are transformed into the final products made available to the ultimate customer.

Question 3

outsourcing

Answer 3

Contracting out certain business functions or operations to other companies.

Question 4

value webs

Answer 4

Multidimensional networks of suppliers and outsourcing partners.

Question 5

offshoring

Answer 5

Transferring a part or all of a business function to a facility (a different part of the company or another company entirely) in another country.

Question 6

reshoring

Answer 6

Bringing previously offshored operations back to their original location.

Question 7

supply chain

Answer 7

A set of connected systems that coordinates the flow of goods and materials from suppliers all the way through to final customers.

Question 8

supply chain management (SCM)

Answer 8

The business procedures, policies, and computer systems that integrate the various elements of the supply chain into a cohesive system

Question 9

inventory

Answer 9

Goods and materials kept in stock for production or sale.

Question 10

inventory control

Answer 10

Determining the right quantities of supplies and products to have on hand and tracking where those items are.

Question 11

procurement

Answer 11

The acquisition of the raw materials, parts, components, supplies, and finished products required to produce goods and services.

Question 12

materials requirements planning (MRP)

Answer 12

Planning system that works backward from a company’s sales forecasts to make sure it has enough of everything required to build goods or perform services in a timely manner, taking into account the firm’s inventory levels and production capacity.

Question 13

enterprise resource planning (ERP)

Answer 13

Planning system that expands the MRP concept to address the needs of the entire organization, from manufacturing to sales to human resources.

Question 14

How does SCM help companies?

Answer 14

Manage risks, Respond to customer needs, Manage business relationships, Promote sustainability through their supply chains

Question 15

production and operations management

Answer 15

Overseeing all the activities involved in producing goods and services.

Question 16

productivity

Answer 16

The efficiency with which an organization can convert inputs to outputs

Question 17

lean systems

Answer 17

Systems (in manufacturing and other functional areas) that maximize productivity by reducing waste and delays.

Question 18

just-in-time (JIT)

Answer 18

Inventory management in which goods and materials are delivered throughout the production process right before they are needed.

Question 19

customized production

Answer 19

The creation of a unique good or service for each customer.

Question 20

mass production

Answer 20

The creation of identical goods or services, usually in large quantities.

Question 21

mass customization

Answer 21

A manufacturing approach in which part of the product is mass produced and the remaining features are customized for each buyer.

Question 22

capacity planning

Answer 22

Establishing the overall level of resources needed to meet customer demand.

Question 23

critical path

Answer 23

In a PERT network diagram, the sequence of operations that requires the longest time to complete.

Question 24

Gantt Chart

Answer 24

Shows the order in which tasks must be completed

Question 25

Major decisions in operations management

Answer 25

Lean system design, Mass production, Facilities location and design, Forecasting and capacity planning, Scheduling

Question 26

scalability

Answer 26

The potential to increase production by expanding or replicating a business’s initial production capacity.

Question 27

Challenges in delivery of services

Answer 27

Perishability, Location constraints, Scalability, Performance variability, Customer involvement and service provider interaction

Question 28

quality

Answer 28

The degree to which a product or process meets reasonable or agreed-upon expectations.

Question 29

quality control

Answer 29

Measuring quality against established standards after the good or service has been produced and weeding out any defective products.

Question 30

quality assurance

Answer 30

A strategic approach of companywide policies, practices, and procedures to ensure that every product meets quality standards.

Question 31

total quality management (TQM)

Answer 31

An approach to quality assurance that encompasses every aspect of a company’s operations.

Question 32

statistical process control (SPC)

Answer 32

The use of random sampling and tools such as control charts to monitor the production process

Question 33

Six Sigma

Answer 33

A rigorous quality management program that strives to eliminate deviations between the actual and desired performance of a business system.

Question 34

ISO 9000

Answer 34

A globally recognized family of standards for quality management systems.

Question 35

Four major tool assuring quality

Answer 35

Continuous process improvement, Statistical process control (SPC), Six Sigma, ISO 9000

Question 36

Industry 4.0

Answer 36

The digital transformation of manufacturing, moving from automated factories to smart factories that emphasize the use of cyber-physical systems.