Ops Mgmt C - Process Mgmt

Question 1

Business process mgmt is supported by

Answer 1

approaches, techniques, and measures

Question 2

The tool used when a manufacturer compares its procedures against the check-in process for a major airline is known as

Answer 2

benchmarking

Question 3

Prevention costs are

Answer 3

the costs of production process changes that reduce the rate at which product defects occur

Question 4

Inspection costs are

Answer 4

tests to make sure products meet quality standards

Question 5

Internal failure costs are

Answer 5

reworking or scrapping defective products

Question 6

External failure costs are

Answer 6

costs related to selling defective products, which results in product liability claims, warranty and repair expenses, loss of customer satisfaction, and damage to the company’s reputation

Question 7

Process mgmt is

Answer 7

the process of planning and monitoring the operations of a business process

Question 8

Off-shore operations are when

Answer 8

an organization incorporates outside of the original jurisdiction of the primary operations

Question 9

An example of an off-shore operation is

Answer 9

a US company incorporating in Japan

Question 10

Main goals of off-shoring are

Answer 10

competitive pressure and cost reduction

Question 11

Shared services is

Answer 11

combining efforts of two departments that share the same resources

Question 12

Operational planning results in

Answer 12

budget data to be used in planning day-to-day ops

Question 13

Strategic planning is performed at

Answer 13

the highest level of mgmt and focuses on long-term goals

Question 14

Data collection is most critical in the implementation of an improvement initiative at

Answer 14

all stages; before, during, and after implementation

Question 15

Six Sigma is

Answer 15

a methodological approach to eliminating defects with the goal to achieve 6 std. dev. from the desired target of quality

Question 16

Business process re-engineering (BPR) is

Answer 16

a systematic approach or methodology for analyzing business activities or processes with a view to improving the org’s alignment with strategic goals and/or its effectiveness, efficiency, competitiveness, etc.

Question 17

3 questions to answer to check on implementing business process re-engineering (BPR)

Answer 17

• the effort focused on critical business processes
• desired improvement’s ambition
• receptiveness of senior mgmt

Question 18

The role of IT in BPR is

Answer 18

the major facilitator for new ways of sharing information within a specific org and outside of the org

Question 19

If a business has intracompany service transfers from a cost center to a profit center, under stable economic conditions, the best transfer price to be most conducive to evaluating whether both divisions have met their responsibilities is

Answer 19

Standard VC

Question 20

Business process modeling tools include:

Answer 20

• use case diagrams
• activity diagrams
• business process modeling notation
• extended business modeling language
• unified modeling language

Question 21

Lean Production aka Lean manufacturing is

Answer 21

the set of tools that assist in the identification and elimination of waste to improve quality while reducing production costs

Question 22

Main purpose of outsourcing is to

Answer 22

reduce costs

Question 23

Other reasons to outsource include:

Answer 23

• focus on core business
• improve quality
• capacity mgmt

Question 24

BPR is

Answer 24

the search for and implementation of radical change in business processes to achieve breakthrough results

Question 25

BPR does what within an org?

Answer 25

analyzes and designs workflows and processes

Question 26

Learning curve is

Answer 26

a graphical description of the learning process that shows the impacts of learning over a # of practice opportunities on work behaviors

Question 27

Basic assumption of the learning curve model is

Answer 27

the DL required for the n+1st unit will always be less than the labor required for the n unit

Question 28

JIT production environments typically feature:

Answer 28

• small lot sizes
• low setup times/costs
• balanced workloads
• demand-pull system

Question 29

Traditional production systems feature:

Answer 29

• products produced based on expected demand
• a fixed schedule
• a push-through system

Question 30

Cost of conformance =

Answer 30

prevention costs + appraisal costs

Question 31

Cost of nonconformance (failure) =

Answer 31

internal failure + external failure

Question 32

JIT is aka

Answer 32

Lean manufacturing

Question 33

Drum Buffer Rope theory:

Answer 33

• assumes a limited # of constraints created by scarce resources
• states that to protect throughput, the limiting factor must be protected
• states that it is important to protect against inventory build up and associated carrying costs which can occur at bottlenecks
• focuses on only the queuing area in front of the bottleneck

Question 34

A newly introduced costing method that has recently been adopted at some firms is called _____ costing

Answer 34

throughput

Question 35

Throughput costing is

Answer 35

a type of variable costs that assigns only DM costs to products and treats all other production costs as period costs

Question 36

3 basic measurements used by the theory of constraints (TOC) are

Answer 36

throughput contribution, inventory aka investments, and operational expenses

Question 37

The technique to effectively measure improvements in product quality as a result of internal failure costs would be

Answer 37

tracking the # of products reworked

Question 38

Mgmt of a company would perform _______ to compare and contract its financial info to published info reflecting optimal amounts

Answer 38

bechmarking

Question 39

If a business moves from a traditional manufacturing philosophy to a JIT system, then their inventory turnover will ______ and their inventory as a % of total assets will ______

Answer 39

increase; decrease

Question 40

Kanban is

Answer 40

a technique for managing JIT inventory systems developed by the Japanese which involves a communication device (card, sign, or empty bin) which is returned to the previous work area to signal the need for additional units demanded

Question 41

Benchmarking is

Answer 41

the comparison of existing activities with the best levels of performance in other, similar organizations

Question 42

Companies that adopt JIT systems often experience

Answer 42

a reduction in the # of suppliers

Question 43

Rework costs should be regarded as a cost of quality in a manufacturing company’s quality control program when they are

Answer 43

caused by internal failure

Question 44

The costs of a company’s quality control system are divided into 4 parts

Answer 44

prevention costs, appraisal costs, internal failure costs, and external failure costs

Question 45

Examples of prevention costs, appraisal costs, internal failure costs, and external failure costs include

Answer 45

Prevention - training
Appraisal - inspection
Internal Failure - reworking
External Failure - warranties

Question 46

Benefit of JIT system usually includes

Answer 46

elimination of nonvalue-adding operations

Question 47

JIT system will generally:

Answer 47

• decrease the # of suppliers
• minimize the standard delivery qty
• increase the # of deliveries required

Question 48

Value chain is

Answer 48

any part of an entity that enhances the quality or usefulness of the product or service in the eyes of the customer

Question 49

Business functions considered part of a company’s value chain include:

Answer 49

customer service, marketing, and R&D

Question 50

Accounting is not part of a company’s value chain. Fact or Fiction?

Answer 50

FACT