Chapter2: Multiple Choice Questions 1. Which of the following is true about business strategies? a.

An organization should stick with its strategy for the life of the business. b. All firms within an industry will adopt the same strategy. c. Well defined missions make strategy development much easier. d. Strategies are formulated independently of SWOT analysis. e. Organizational strategies depend on operations strategies. The fundamental purpose for the existence of any organization is described by its a. policies b. mission c. procedures d. strategy e. tactics Which of the following activities takes place once the mission has been developed? a. The firm develops alternative or back-up missions in case the original mission fails. b. The functional areas develop their functional area strategies. c. The functional areas develop their supporting missions. d. The ten OM decision areas are prioritized. e. Operational tactics are developed. Which of the following statements about organizational missions is false? a. They reflect a company's purpose. b. They indicate what a company intends to contribute to society. c. They are formulated after strategies are known. d. They define a company's reason for existence. e. They provide guidance for functional area missions. The impact of strategies on the general direction and basic character of a company is a. short ranged b. medium range c. long range d. temporal e. minimal The fundamental purpose of an organization's mission statement is to a. create a good human relations climate in the organization b. define the organization's purpose in society c. define the operational structure of the organization d. generate good public relations for the organization e. define the functional areas required by the organization Which of the following is true? a. Corporate mission is shaped by functional strategies. b. Corporate strategy is shaped by functional strategies. c. Functional strategies are shaped by corporate strategy. d. External conditions are shaped by corporate mission. e. Corporate mission is shaped by functional strategies.

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According to the authors, which of the following strategic concepts allow firms to achieve their missions? a. productivity, efficiency, and quality leadership b. differentiation, cost leadership, and quick response c. differentiation, quality leadership, and quick response d. distinctive competency, cost leadership, and experience e. differentiation, distinctive competency, quality, leadership, and capacity

9. A firm can effectively use its operations function to yield competitive advantage via all of the following except a. customization of the product b. set equipment utilization goals below the industry average c. speed of delivery d. constant innovation of new products e. maintain a variety of product options 10. Which of the following is not an operations strategy? a. response b. low-cost leadership c. differentiation d. technology e. marketing Which of the following is not a key way in which business organizations compete with one-another? a. production cost b. quality c. product duplication d. flexibility e. time to perform certain activities A strategy is a(n) a. set of opportunities in the marketplace b. broad statement of purpose c. simulation used to test various product line options d. plan for cost reduction e. action plan to achieve the mission Which of the following statements best characterizes delivery reliability? a. a company that always delivers on the same day of the week b. a company that always delivers at the promised time c. a company that delivers more frequently than its competitors d. a company that delivers faster than its competitors e. a company that has a computerized delivery scheduling system Which of the following is an example of competing on the basis of differentiation? a. A firm manufactures its product with less raw material waste than its competitors. b. A firm's products are introduced into the market faster than its competitors'. c. A firm's distribution network routinely delivers its product on time. d. A firm offers more reliable products than its competitors. e. A firm advertises more than its competitors. Which of the following statements best characterizes delivery speed? a. a company that uses airlines, not trucks, to move its goods b. a company that delivers frequently c. a company that delivers faster than its competitors d. a company that always delivers on the promised due date e. a company that has a computerized delivery scheduling system
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Which of the following is the best example of competing on low-cost leadership? a. a firm produces its product with less raw material waste than its competitors b. a firm offers more reliable products than its competitors c. a firm's products are introduced into the market faster than its competitors' d. a firm's research and development department generates many ideas for new products e. a firm advertises more than its competitors Which of the following is an example of competing on quick response? a. a firm produces its product with less raw material waste than its competitors b. a firm offers more reliable products than its competitors c. a firm's products are introduced into the market faster than its competitors' d. a firm's research and development department generates many ideas for new products e. a firm advertises more than its competitors Which of the following influences layout design? a. inventory requirements b. capacity needs c. personnel levels d. purchasing decisions e. all of the above influence layout decisions Response-based competitive advantage can be a. flexible response b. reliable response c. quick response d. all of the above e. none of the above Which of these organizations is most apt to have quality standards that are relatively objective? a. a university b. a discount retailer c. a law firm d. a car manufacturer e. a bookstore Which of the following is not an operations decision? a. maintenance b. price c. layout design d. quality e. inventory Which of these companies is most apt to have quality standards that are relatively subjective? a. Chrysler b. Dell Computer c. Sanyo Electronics d. Harvard University e. Whirlpool

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Which of the following will more likely locate near their customers? a. an automobile manufacturer b. an aluminum manufacturer c. an insurance company headquarters d. a medical clinic e. all of the above will tend to locate near their customers Which of the following statements concerning the operations management decision is relevant to services? a. There are many objective quality standards. b. The customer is not involved in most of the process. c. The work force's technical skills are very important. d. Labor standards vary depending on customer requirements. e. Ability to inventory may allow the leveling of the output rates. Which of these organizations is likely to have the most important inventory decisions? a. a marketing research firm b. a lobbying agency c. a management consulting firm d. a restaurant e. a law firm The PIMS program has identified a. the operations decisions all organizations must make b. the distinctive competencies any company needs c. the characteristics of firms with high "ROI" d. the corporate decisions any company needs to make e. all of the above

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27. Which of the following is not one of the five PIMS characteristics of high Return on Investment organizations? a. high product quality b. high capacity utilization c. low investment intensity d. low direct cost per unit e. all of the above are PIMS characteristics 28. Optimizing capacity would be most appropriate for which stage in the product life cycle? a. introduction b. growth c. maturity d. decline e. retirement Standardization is an appropriate strategy in which stage of the product life cycle? a. introduction b. growth c. maturity d. decline e. retirement

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Cost minimization is an appropriate strategy in which stage of the product life cycle? a. introduction b. growth c. maturity d. decline e. retirement Which of the following preconditions does not affect the formulation of an OM strategy? a. knowledge of each product's life cycle b. external economic and technological conditions c. the company's employment benefits d. competitors' strengths and weaknesses e. knowledge of the company's strategy

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32. Competitive product improvements and options are best introduced in the _____ stage in the product life cycle. a. introduction b. growth c. maturity d. decline e. incubation 33. Which of the following changes does not result in strategy changes? a. change in the company's financial situation b. a company's adoption of new technology c. change in the product life cycle d. change in the competitive environment e. change in job scheduling techniques The acronym SWOT stands for a. Special Weapons for Operations Timeliness b. Services, Worldwide Optimization, and Transport c. Strengths Worldwide Overcome Threats d. Strengths, Weaknesses, Opportunities, and Threats e. None of the above Which of the following is a key external factor that should be taken into account by a corporate strategy? a. economic conditions b. political conditions c. legal environments d. competition e. financial resources All of these preconditions affect an operations management strategy except a. external economic and technological conditions b. competitors' strengths and weaknesses c. accounting policies d. knowledge of the company's strategy e. knowledge of each product's life cycle

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Which of the following statements is true about operations strategy? a. It should support the corporate strategy. b. It should help achieve the operation's mission. c. It should be integrated with the other functional areas' strategies. d. It should promote competitive advantage. e. All of the above are true. The two internal elements of SWOT analysis are a. weaknesses and threats b. opportunities and threats c. strengths and opportunities d. strengths and weaknesses e. strengths and threats Which of these organizations is likely to have the most complex inventory decisions? a. a marketing research firm b. a stock brokerage firm c. a management consulting firm d. a computer manufacturing company e. a high school The three steps of the operations manager's job, in order, are a. develop the strategy, establish the organizational structure, find the right staff b. develop the strategy, find the right staff, establish the organizational structure c. find the right staff, establish the organizational structure, develop the strategy d. find the right staff, develop the strategy, establish the organizational structure e. establish the organizational structure, find the right staff, develop the strategy

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41. When developing the operations strategy for a new manufacturing organization, one of the most important considerations is that a. it requires minimal capital investment b. it utilizes as much automation as possible c. it utilizes an equal balance of labor and automation d. it supports the overall competitive strategy of the company e. none of the above 42. The "new standards of global competitiveness" include all of the following except a. quality b. maquiladora c. timeliness d. customization "Coca-Cola" is described in the textbook as a _______ product. a. global b. domestic c. service d. none of the above Cost cutting in international operations can take place because of a. lower taxes and tariffs b. lower wage scales c. lower indirect labor costs d. less stringent regulations e. all of the above
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Which of the following is not a reason for globalizing operations? a. reduce costs b. improve supply-chain c. stockholder approval ratings d. attract new markets Multinational organizations can shop from country to country and cut costs through a. lower wage scales b. lower indirect labor costs c. less stringent regulations d. lower taxes and tariffs e. all of the above The term maquiladora is most synonymous with a. cheap labor zones b. Chinese forced labor camps c. free trade zones d. areas that do not meet U.S. standards for workplace safety and pollution e. none of the above Which of the following represent reasons for globalizing operations? a. reduce costs b. improve supply-chain c. attract new markets d. attract and retain global talent e. all of the above are valid Which of the following does not represent reasons for globalizing operations? a. reduce costs b. improve supply-chain c. reduce responsiveness d. attract and retain global talent NAFTA seeks to a. substitute cheap labor in Mexico for expensive labor in the United States b. curb illegal immigration from Mexico to the United States c. phase out all trade and tariff barriers between the United States and Mexico d. phase out all trade and tariff barriers between the United States, Canada, and Mexico

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51. Which of the following are typical of the Critical Success Factors used for international facility location decisions? a. political and legal factors b. availability of technology c. economic factors d. culture and ethics e. all of the above 52. Which of the following is true regarding Critical Success Factors (CSFs)? a. The list of critical success factors is the same from one organization to another. b. Use of CSFs is one method of determining the country in which to locate a new facility. c. The critical success factors must be weighted equally. d. Critical Success Factors are relevant for strategic planning, but not for Global Operations.

53. Which of the following are not typical of the Critical Success Factors used for international facility location decisions? a. political and legal factors b. location planning c. economic factors d. culture and ethics e. technology 54. Which of the following represent issues of culture and ethics in international operations? a. bribery b. supplier punctuality c. employee stealing d. protection of intellectual property rights e. all of the above are culture and ethics issues

55. Which of the international operations strategies involves high cost reductions and high local responsiveness? a. International strategy b. Global strategy c. Transnational strategy d. Multidomestic strategy 56. Which of the international operations strategies involves low cost reductions and low local responsiveness? a. International strategy b. Global strategy c. Transnational strategy d. Multidomestic strategy Which of the international operations strategies uses import/export or licensing of existing products? a. International strategy b. Global strategy c. Transnational strategy d. Multidomestic strategy e. None of the above Which of the international operations strategies uses the existing domestic model globally? a. International strategy b. Global strategy c. Transnational strategy d. Multidomestic strategy e. None of the above Nestl is described in the textbook as a ______ firm. a. domestic b. global c. subsidiary d. transnational The acronym MNC stands for a. Mexican National Committee (for international trade) b. Maquiladora Negates Competition c. Maytag-Nestl Corporation d. Multinational Corporation
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Chapter2: Multiple Choice Answers 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. c b c c c b c b b d c e b d c a c e d d 21. 22. 23. 24. 25. 26. 27. 28. 29. 20. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. b d d d d c e c c d c b e d d c e d d a 41. 42. 43 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. d b b e c e c e c d e b b e c a a d d d