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Waste has no relationship to the value a customer might obtain from a product.
Deming's 14 points can be implemented individually or in groups depending upon the company
Quality improvement is led by middle management.
A well-designed quality improvement program should be supported by catchy slogans and banners.
Management should expect a good quality program to show large initial benefits
Company teams and departments should be encouraged to compete in order to improve.
Any good quality program should heavily inspect final products to ensure quality
Suppliers should be chosen if they quote the lowest price for their goods or services.
Once a good quality system is in place and working, it should be kept the same in order to continuously succeed.
Training" is the improvement of job-related skills, and "Education" is the broadening of general knowledge that leads to innovation
Deming's 14 point program for quality improvement applies to manufacturing industry, but not the service industry due to differences in management structures.
Quality can be used to differentiate products
Continuous improvement is based on the philosophy that any aspect of an organization can be improved.
Kaizen is similar to TQM in that both are focused on continuous improvement.
Generally, the employees producing the product or providing the service are to blame for quality problems
Approximately 85% of quality problems have to do with material and processes
Quality circles have not been shown to be cost effective.
Quality circles empower employees to improve productivity by finding solutions to work-related problems in their work area
Customer expectation is the standard against which the service is judged
Deming supported the concept that one must depend on inspection to achieve quality
Focusing on outcome is an effective way to improve a process or an activity.
The four major axioms of TQM are: commitment to quality; extensive use of scientific tools, technologies, and methods; total involvement in the quality undertaking; and continuous improvement.
Total quality involves managing an enterprise to maximize customer satisfaction in the most efficient and effective way possible by totally involving people in improving the way work is done.
Quality as defined by the customer" is
a user-based definition of quality
All of the following costs are likely to decrease as a result of better quality
A. customer dissatisfaction costs
B. inspection costs
C. scrap costs
D. warranty and service costs
Inspection, scrap, and repair are examples of
internal costs
ISO 9000 seeks standardization in terms of
procedures to manage quality
Which of the following is true about ISO 14000 certification?
A. It is not prerequisite for ISO 9000 certification.
B. It deals with environmental management.
C. It offers a systematic approach to pollution prevention.
D. It originated in Europe.
Total quality management emphasizes
a commitment to quality that goes beyond internal company issues to suppliers and customers
A successful TQM program incorporates all of the following except
centralized decision-making authority
"Kaizen" is a Japanese term meaning
continuous improvement
Based on his 14 Points, Deming is a strong proponent of
training and knowledge
Total quality management establishes an organization-wide focus on:
A. quality
B. developing a quality-oriented corporate culture
C. intensive use of management and statistical tools
The philosophy of zero defects is
consistent with the commitment to continuous improvement
Which of the following is not a typical inspection point?
after a costly process
A good description of "source inspection" is inspecting
. one's own work, as well as the work done at the previous work station
A firm spending money on employee training is an example of which of the following costs of quality:
prevention costs
Deming's 14 points of management include all of the following
A. Create consistency of purpose for continual improvement of product and service
B. Drive out fear
D. Eliminate work standards and numerical quotaS
Major axioms of TQM include all of the following EXCEPT
Continuous innovation
Total Quality Management (TQM) starts with the __________.
design of the product.
Which of the following is the most important category (as evaluated in terms of weightings used by the outside assessors) of the Malcolm Baldrige National Quality Award Program?
Which of the following statements is NOT one of Deming's 14 Points for Management?
Institute and emphasize work standards and numerical quotas.
In TQM, value is defined as
the customer's evaluation of the quality and timeliness traits of a product, divided by the costs incurred
In TQM philosophy _________________determine the quality level that the firm offers:
Operating employees
TQM philosophy stresses the idea that everyone has to trust that customers want quality ____________________________.
and are willing to pay a premium for it
Deming stressed that ______________must be present in order for a firm to assure quality
both good design and effective production methods
Deming used his 14 points for management to emphasize the critical role of _________in TQM
Deming saw __________________as the real obstacle to TQM.
Deming views _________________as a major source of problems for all Operations Management processes and most firms.
Often firms rely on compliance to established standards as a measure of corporate quality. Which of the following is an established standard?
A. ISO 9000
C. QS 9000
D. Malcolm Baldridge National Quality Award
Levels of scrap, number of hours of inspection labor, and the amount of rework are all example of _____________.
measures of internal production quality
The number of Engineering Change Notices are examples of
measures of design quality
To achieve truly world-class quality such as Six Sigma Quality, we need to focus on
the processes
ISO 9000 defines a set of internationally accepted standards for
business quality
ISO has been implemented in
A. banks
B. consulting companies
C. manufacturing plants
Quality System Requirements QS-9000 is the supplier quality standard issued jointly by
several automotive and heavy truck companies
The ISO 14000 standards focus on
environmental systems and procedures
The major difference between ISO9000 and QS9000 is:
US automotive manufacturing firms use QS9000
ISO9000 is the most appropriate certification for
A. Manufacturing firms
B. Hospitals
C. Universities
. The first corporation to win the MBNQA for it entire organization was
One reason for OCC to make an item, rather than buy it, is to utilize surplus labor.
The Make-Buy decisions facing OCC should be reviewed periodically.
The need for special expertise is one reason for buying rather than making
Purchasing only takes place in manufacturing environments, such as OCC, but not service environments
One reason for OCC to use few suppliers is to allow the suppliers to gain economies-of-scale (such as Ford did for its operations when it built the River Rouge Facility)
If OCC only uses one supplier, the cost of switching to another supplier is low.
A big advantage for OCC to use only a few suppliers is that trust is built with compatible business cultures
All of the suppliers used by OCC are located in close proximity to OCC, which allowed on-time deliveries and reduction of inventories.
Since OCC is a custom motorcycle builder, its suppliers have little impact on the success of OCC.
The only timing issue critical in the production of the Liberty Bike was to have it completed in time for the Michigan Birch Run Bike Show.
One reason for OCC to use few suppliers is to allow the suppliers to gain economies-of-scale (such as Ford did for its operations when it built the River Rouge Facility
Which one of the following statements about purchasing is true?
Purchasing has an impact on the quality of the goods and services sold.
In the make-or-buy decision, one of the reasons for making is
to obtain technical or management ability
assure adequate supply in terms of quantity
One key to effective supply chain management is to make suppliers "partners" in the firm's strategy.
Activities of supply chain managers are generally limited to the operations function.
In the make-or-buy decision, which of the following is not a reason for buying?
B. to obtain desired quality
C. patents or trade secrets
The objective of supply chain management is to build a chain of suppliers that focuses on maximizing value to the ultimate customer
Which one of the following is a purchasing strategy
A. negotiation with many suppliers
B. vertical integration
C. keiretsu
E. long-term relationships with few suppliers
When using the low-cost strategy for supply chain management, the firm should invest aggressively to reduce production lead-time
A disadvantage of the "few suppliers" strategy is
the high cost of changing partners
The purchasing approach that holds the suppliers responsible for maintaining the necessary technology, expertise, and forecasting ability plus cost, quality, and delivery competencies is
many suppliers
Supply chain includes purchasing, procurement and other activities needed to acquire raw materials and components for production
Which of the following supply-chain strategies creates value by allowing suppliers to have economies of scale?
long-term partnering with a few suppliers
Outsourcing of core competencies produces supply chains where each of the partnering organizations focuses on what it does best.
Which of the following best describes vertical integration?
to produce goods or services previously purchased
A fried chicken fast-food chain that acquired feed mills and poultry farms has performed
backward vertical integration
A reduction in inventory cost is one reason for making rather than buying.
A rice mill in south Louisiana purchases the trucking firm that transports packaged rice to distributors. This is an example of:
forward vertical integration
Japanese manufacturers often take a middle ground between purchasing from a few suppliers and vertical integration. This approach is called:
With the many-supplier strategy, the order usually goes to the supplier that offers the best quality.
The Japanese concept of a company coalition of suppliers is
The three major stages of vendor selection, in order, are
vendor evaluation, negotiations, and vendor development ?????
In supplier evaluation, most companies will use the same list of criteria and the same criteria weights
A carpet manufacturer has delivered carpet directly to the end consumer rather than to the carpet dealer. The carpet manufacturer is practicing
drop shipping
direct shipping
The need for special technical expertise is one reason for buying rather than making
Which of the following best describes stockless purchasing?
the supplier maintains the inventory for the customer
big advantage for OCC to use only a few supplies is that trust comes with compatible business cultures
Internet purchasing can be used
A. to communicate order releases to suppliers
B. to replace electronic data interchange (EDI)
C. for comparison shopping
D. as part of an integrated enterprise resource planning (ERP) system
Which of the following distribution systems offers quickness and reliability when emergency supplies are needed overseas?
air freight
If OCC uses only one supplier, the cost of switching from that supplier to another is low
Which of the following distribution systems offers the most flexibility?
Which one of the following performance measures is not true of a world class firm?
long lead time
Constant information sharing between supply-chain partners improves efficiencies in planning, in material movements and in the transfer of funds.
A major advantage of vertical integration is
greater control
All of the suppliers used by OCC were located in the proximity to its facility, which allowed on-time deliveries and reduction of inventories
The most frequent reason that firms seek global sources is:
to find lower prices
to combat intensified global competition
Electronic data interchange systems provide value by:
A. reducing the number of personnel involved
reducing inventory needs
increasing production runs
Integrated supply chains are better suited to meet the demands of stable environments
Supply chain includes the entire network of organizations involved in
A. converting raw materials and information into products and services
B. consuming the products and services
C. disposing of the products and services
Recent advances in communications, computers and graphics technologies have reduced the need for supply-chain partnerships
Supply chain strategy focuses on:
A. sourcing decisions
B. required performance characteristics
C. supply-base segmentation
The downstream supply chain brings together the following sets of partners
A. production planning
B. logistics
C. sales
Supply chain includes warehousing and distribution, transportation and retail channels
Growth of supply-chain management as a central focus of operations management results from the advent of:
A. dynamic markets
B. collaborative networks
C. a focus on core competencies
The upstream supply chain brings together the following sets of partners
A. production planning
B. suppliers
D. purchasing
Downstream suppliers typically provide raw materials, components and services, e.g., warehousing
The overall objective of inventory management is balancing the cost of inventory again the cost of providing reasonable levels of customer service.
Which is a type of inventory?
A. Finished goods
B. Raw materials
D. Work in progress
The most expensive type of inventory is raw materials.
Manufacturing firms are decreasing their inventories, and retail firms are increasing their inventories
By definition, textbooks are never raw material inventory
A major challenge in inventory management is to maintain a balance between inventory investment and customer service.
High levels of WIP are a good indicator of a firm's effectiveness
A BOM's level one is subordinate to a level four.
The demand for MicroSoft X-Boxes would be considered dependent demand.
Items like tires inventoried by an automobile manufacturer for use in production of automobiles have independent demand.
Which of the following would generally be a motive for a firm to hold inventories?
A. to decouple or separate parts of the production process
B. to provide a stock of goods that will provide a selection for customers
C. to take advantage of quantity discounts
The two most basic inventory questions answered by the typical inventory model are:
when and how many
Which of the following is generally found in JIT environments?
. Pull Systems
Which one of the following is a benefit of the implementation of JIT?
A. cost reduction
C. work in process reduction
D. quality improvement
E. reduction in process delays
ABC analysis is based upon the principle that
there are usually a few critical items, and many items which are less critical
The purpose of safety stock is to
control the likelihood of a stockout due to the variability of demand during lead time
The proper quantity of safety stock is typically determined by
setting the level of safety stock so that a given stockout risk is not exceeded
Which of the following is a function of inventory?
A. to separate parts of the production process
B. to protect the firm from fluctuations in demand and provide selection for customers
C. to take advantage of quantity discounts
D. to hedge against inflation
Which of the following illustrates an activity that does not add value?
accumulating parts in front of the next work center
Which of the following statements regarding pull system is true?
problems become more obvious
Which of the following is a function of inventory
A. to separate parts of the production process
B. to isolate the firm from fluctuations in demand
C. to take advantage of quantity discounts
D. to hedge against inflation
Which of the following would not generally be a motive for a firm to hold inventories?
to minimize holding costs
All of the following statements about ABC analysis are true
A. inventory may be categorized by measures other than dollar volume
B. it categorizes on-hand inventory into three groups
C. it is an application of the Pareto principle
E. it states there are the critical few and the trivial many inventory items
ABC analysis divides on-hand inventory into three classes, generally based upon
annual dollar volume
The two most basic inventory questions answered by the typical inventory model are
when and how many
Most inventory models attempt to minimize
total inventory based costs
The implementation of JIT offers several advantages, including
rework reduction
Characteristics of JIT partnerships with respect to quantities include
suppliers package in exact quantities
Characteristics of JIT partnerships with respect to suppliers include
analysis and support to enable desirable suppliers to become/stay price competitive
Characteristics of just-in-time suppliers do not include
an increase in release paperwork to obtain more detailed records
A characteristic of JIT partnerships with respect to shipping is to
use company-owned or contract shipping to gain control
A characteristic of JIT partnerships with respect to quality is to
help suppliers meet quality requirements
Which of the following is a goal of JIT partnerships?
A. elimination of unnecessary activities
B. elimination of in-plant inventory
C. elimination of in-transit inventory
D. elimination of poor suppliers
Which of the following is a concern expressed by suppliers
production with zero defec
Reduction of in-transit inventory can be encouraged through use of
supplier location near plants
Just-in-time systems make demands on layouts, including
A. distance reduction
B. increased flexibility
C. reduced space and inventory
D. cross-trained, flexible employees
Which one of the following statements is true regarding JIT inventory?
it is the minimum inventory necessary to keep a perfect system running
Which of the following is a benefit of small production lots
A. work-in-process inventory is smaller
C. workstations can be placed closer together
D. manufacturing cycle time is shorter
E. better product distribution (i.e., mix) available for customer demand
Which one of the following statements is true about the kanban system?
the customer workstation signals to the supplier workstation when production is needed
Kanban is associated with all of the following
A. meeting tight schedules
B. reducing setup time
C. reducing batch size
E. signaling when it is time for the next batch
The word "kanban" means
Which one of the following scenarios represents the use of a kanban to reduce inventories?
the "customer" work center signals to the "supplier" workstation that more parts are needed
Which of the following JIT principles is (are) ordinarily applicable in restaurants?
A. close relationship with food suppliers
C. a kitchen set up to minimize wasteful movements
D. lean inventories of food
In the quest for competitive advantage, which of the following is a JIT requirement?
A. small number of job classifications
B. reduced number of vendors
C. reduced space for inventory
D. quality by suppliers
Which one of the following is a requirement of JIT systems?
A. quality deliveries on time
B. low setup time
C. training support
E. employee empowerment
manufacturer took the following actions to reduce inventory. Which of these is generally accepted as a JIT action? They:
A. used a pull system to move inventory
B. produced in ever smaller lots
C. required deliveries directly to the point of use
E. worked to reduce their in-transit inventory
For a supply chain to justify the presence of safety stock, which of the following conditions must be present?
Costs of stockouts must be relatively large
Which of the following types of inventory is used to protect against variations in supply and/or demand?
Safety stock
All of the following are reasons why organizations carry inventory:
B. to decouple operations.
C. level or smooth production.
D. allow production of a family of parts.
As a system improves, it should have ____________inventory on hand
A key factor of establishing cells that are dedicated to producing a family of parts is that
Setup time is greatly reduced or eliminated
As Lean systems are implemented, marketing needs to create policies that encourages _______demand
As Lean Systems thinking is implemented, large expensive machines ________________.
Tend to be replaced by smaller, easer to move machines to allow for continuous improvement
As Lean Systems thinking is implemented, the amount of training that employees receive:
Tends to increase
Continuous improvement requires that employees
A. have the authority to make changes
B. have the necessary tools
C. be empowered to make improvements
Ideally, a JIT system needs suppliers to supply parts with ___% quality levels
In a JIT system, 'waste' is any activity that
Does not add value to the product.
Increased variance in either arrival times or processing times __________ the time a unit spends in the queue
Most of the tools and techniques used in lean systems seek to
eliminate variability from the system
Strictly defined, waste can be best defined as:
Any action that increases costs more than it adds to value
Waste in the system is often reflected by
Increased flow times and increased inventory
Waste of overproduction is caused by
Long process set-ups
Which of the following is a characteristic of lean systems?
D. uniform load scheduling
A. stockless production
B. total quality control
Which of the following systems is built around a primarily pull-based logic?
Just-in-time manufacturing
A production Kanban:
Authorizes a worker to replenish an empty bin

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