Operations Management Overview Quiz

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Questions and Answers

What is a primary purpose of studying operations management (OM)?

To understand how goods and services are produced (correct)

To establish strong relationships with suppliers

To manage marketing campaigns effectively

To learn about financial investment strategies

Which function is NOT one of the three major functions in an organization alongside operations management?

Operations

Finance

Marketing

Human Resources (correct)

What aspect of manufacturing involves the efficient use of machines, space, and personnel?

Supply-chain management

Industrial engineering (correct)

Quality assurance

Production control

Which of the following is involved in the finance/accounting function?

Receivables Signup and view all the answers

Why is operations management considered a costly part of an organization?

It requires significant investment in technology Signup and view all the answers

What does supply-chain management primarily focus on?

Production and inventory control Signup and view all the answers

Which of the following activities is NOT part of operations management?

Sales promotion Signup and view all the answers

What has contributed to the trend of shorter product development cycles?

Internet and rapid international communication Signup and view all the answers

Which of the following is a future trend in operations management regarding product design?

Mass customization with an emphasis on quality Signup and view all the answers

What drives the shift towards environmentally sensitive production practices?

Environmental issues and increasing disposal costs Signup and view all the answers

How is the sociocultural milieu affecting job specialization in operations management?

It promotes a knowledge and information society that encourages empowered employees. Signup and view all the answers

What future trend is anticipated in production processes as a response to worldwide markets?

Collaborative designs and international alliances. Signup and view all the answers

Which option results in the highest contribution?

Increase Sales Revenue by 50% Signup and view all the answers

What are the basic management functions of Operations Managers?

Planning, Organizing, Staffing, Leading, Controlling Signup and view all the answers

Which critical decision does not involve quality management?

Analyzing customer feedback Signup and view all the answers

In the context of operations management, what does capacity design refer to?

Determining the amount of products to be produced Signup and view all the answers

What is one of the criteria for selecting a facility location?

Proximity to suppliers Signup and view all the answers

What should operations managers consider regarding product design?

Both the products offered and their design Signup and view all the answers

Which of the following contributes to the gross margin calculation?

Sales revenue minus Cost of Goods Sold Signup and view all the answers

Reducing which costs leads to the highest contribution in the example provided?

Production Costs Signup and view all the answers

How is contribution calculated after taxes in the financial example?

Subtotal minus Taxes Signup and view all the answers

What is a critical decision related to supply-chain management?

Should we make or buy this component? Signup and view all the answers

Which factor is important in determining the size of a facility?

How should we arrange the facility? Signup and view all the answers

What aspect is crucial for intermediate and short-term scheduling?

Who is responsible for maintenance? Signup and view all the answers

Which area is NOT directly related to job design?

JIT reordering practices Signup and view all the answers

What is a primary consideration in managing inventory?

Establishing reorder points Signup and view all the answers

Which strategy focuses on improving the use of resources effectively?

Facilities utilization Signup and view all the answers

In the context of operations management, which job role primarily deals with technology and methods?

Operations analyst Signup and view all the answers

What decision is influenced by forecasting demand?

Inventory levels Signup and view all the answers

Which of the following contributes to quality management?

Enhancing customer service Signup and view all the answers

Which of the following options relates to strategic issues in operations management?

Long-term facility planning Signup and view all the answers

Which attribute describes how goods can be treated compared to services?

Goods can be inventoried, while services cannot. Signup and view all the answers

Which factor is crucial for customer contact in the context of services?

Location of the service provider's facility. Signup and view all the answers

In what way does revenue generation differ between goods and services?

Goods revenue is primarily from the tangible product. Signup and view all the answers

Which of the following attributes is typically associated with services?

Difficult to automate. Signup and view all the answers

Which statement about the transportability of goods and services is accurate?

The product in goods is often transportable, while the provider of services usually is. Signup and view all the answers

What is a primary challenge associated with measuring the quality of services?

The intangibility of services makes quality difficult to measure. Signup and view all the answers

Why is it unusual for services to be resold?

The provider is part of the service experience. Signup and view all the answers

What aspect of selling differs between goods and services?

Selling services is often integrated with the production process. Signup and view all the answers

How does automation differ between goods and services?

Goods processes are typically more automated than services. Signup and view all the answers

Which example best illustrates a predominantly service-based offering?

Hospital care. Signup and view all the answers

Study Notes

Operations Management - Chapter 1

Operations Management (OM) is a set of activities creating value from goods and services by transforming inputs into outputs.
Production involves creating goods and services.
Key functions within any organization include marketing (generating demand), production/operations (creating the product), and finance/accounting (tracking performance).
Organizational charts depict the relationships between different departments. Examples provided include commercial banks and airlines.
Operations managers perform fundamental management functions (Planning, Organizing, Staffing, Leading, and Controlling).
Critical decisions include service/product design (defining goods/services), quality management (defining and ensuring quality), process and capacity design (choosing processes and capacities), location (selecting suitable locations), layout design (arranging facilities and flows), human resources and job design (reasonable environments and employee productivity), supply-chain management (determining make/buy decisions, supplier selection, and inventory control), intermediate and short-term scheduling (employee allocation and job prioritization), and maintenance processes.

Productivity

Productivity refers to the ratio of outputs (goods/services) to inputs (labor, capital).
The goal is to improve efficiency through factors like labor, capital, and management.
Improvements in productivity can enhance living standards.
Productivity measurement involves evaluating output relative to input, acknowledging potential variations in quality and externalities.
Productivity variable breakdowns categorize inputs - labor contributes about 10%, capital approximately 32%, and management approximately 52% to productivity improvements. These are variables affecting overall output.

Trends in OM

Shifts in OM focus from local/national to global operations.
Trends include a more global emphasis , just-in-time inventory, supply chain partnerships, rapid product development, alliances, mass customization, and the use of empowered teams that prioritize efficiency in production.
Environmental pressures and sustainability trends are influencing OM strategies. A shift from a low-cost focus to environmentally sensitive processes/production is highlighted.

Key Characteristics of Goods and Services

Goods are tangible, have consistent definitions, are frequently inventoried, and involve minimal customer interaction at point of production.
Services are intangible, are often unique, involve high customer interaction, are less consistent, and are often knowledge-based.

The Heritage of Operations Management

Important contributors and innovations include division of labor (Adam Smith, Charles Babbage), standardized parts (Eli Whitney), scientific management (Frederick Taylor), assembly lines (Henry Ford), Gantt charts, motion studies (Frank and Lillian Gilbreth), quality control (Shewhart, Deming), computers, CPM/PERT, material requirements planning (MRP), computer-aided design (CAD), flexible manufacturing systems (FMS), quality awards, computer-integrated manufacturing, globalization, and the internet.

Examples of Productivity Improvement (Case Studies)

The Los Angeles Motor Pool improved productivity via team assignments, optimized vehicle storage/maintenance procedures, standardized pickup processes, and centralized fleet management. Significant improvements in cost, labor, and equipment efficiency were achieved.
Taco Bell introduced menu improvements, simplified food preparation, outsourced some components, implemented efficient layouts and automation, and empowering employees, thereby reducing preparation times, increasing management spans of control, and improving overall efficiency.

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Description

Test your knowledge on key concepts and trends in operations management. This quiz covers essential functions, manufacturing efficiency, and current trends in production processes. Engage with questions about the role of finance in operations and the impact of sociocultural factors.