A firm's process strategy is its approach to transforming resources into goods and services. |
True |
Intermittent processes are organized around processes. |
True |
In process-focused facilities, utilization of facilities is low. |
True |
The typical full-service restaurant uses a product-focused process. |
False |
Harley-Davidson, because it has so many possible combinations of products, utilizes the process strategy of mass customization. |
False |
The assembly line is a classic example of a repetitive process. |
True |
The tool that calculates which process has the lowest cost at any specified production volume is a crossover chart. |
True |
The term focused processes refers to the quest for increased efficiency, whether in goods or services, that results from specialization. |
True |
A job shop is an example of a(n): |
D |
Three of the four types of processes are: |
C |
Which of the following industries is most likely to have low equipment utilization? |
E |
A product-focused process is commonly used to produce: |
C |
Which one of the following products is most likely made in a job shop environment? |
B |
Which of the following products is likely to be assembled on a repetitive process line? |
A |
An assembly line is an example of a: |
C |
Arnold Palmer Hospital uses which focus? |
A |
One of the similarities between process focus and mass-customization is: |
D |
Frito-Lay is to ________ focus as Harley Davidson is to ________ focus. |
B |
High fixed costs and low variable costs are typical of which approach? |
E |
Goods made to order are typical of ________ and ________ approaches while goods made to forecast are typical of ________ and ________ approaches. |
A |
Align Technology uses a ________ approach to produce clear plastic removable aligners. |
A |
Which of the following companies use a mass customization approach? |
E |
Harley Davidson: |
D |
Which of the following is FALSE regarding repetitive processes? |
B |
Which of the following phrases best describes product focus? |
D |
Which of the following phrases best describes process focus? |
A |
Which of the following characteristics best describes repetitive focus? |
B |
A quasi-custom product: |
E |
Process A has fixed costs of $1000 and variable costs of $5 per unit. Process B has fixed costs of $500 and variable costs of $15 per unit. What is the crossover point between process A and process B? |
A |
Process X has fixed costs of $10,000 and variable costs of $2.40 per unit. Process Y has fixed costs of $9,000 and variable costs of $2.25 per unit. Which of the following statements is TRUE? |
C |
The crossover point is that production quantity where: |
D |
Product focused processes: |
D |
Why is Harley-Davidson identified as a repetitive manufacturer, not a mass customizer? |
While Harley-Davidson's motorcycles variety, they are not as individualized as Dell's personal computers. The variety comes from choices in predefined modules, and there is apparently no place for a customer to get customization that would go beyond what is available in these modules. |
What is the link between focused processes and specialization? What kinds of focus are possible? |
Focused processes are a means of obtaining increased productivity through forms of specialization. Focus can take several forms, including concentrating on specific classes of customers, working only with products in selected product families, specializing in a specific service, or working with a narrow range of technology. |
How are modules useful in manufacturing processes? |
Modules are parts or components of a product previously prepared. By using modules, the final product can be quickly assembled. Using a different combination of modules allows for quasi-customization. |
What is mass customization? |
Mass customization is rapid, low-cost production of goods and services that fulfill increasingly unique customer desires. It brings us the variety of products traditionally provided by the process focus, with low costs associated with standardized high volume production (the product focus). |
**Identify the four basic process strategies, and describe them in a complete sentence or two each. |
Process focus is a job shop—high variety and low volume; repetitive focus is an assembly line—relatively standardized products with options from modules; product focus is for high volume, low-variety, products, such as oil refining and flour milling; and mass customization is for high volume, high variety. |
In an affluent society, how do we produce a wide number of options for products at low cost? Hint: Focus on how to address some of the major challenges of mass customization. |
For mass customization, products should be built-to-order. Product design must be imaginative. Process design must be flexible and able to accommodate changes in both design and technology. Inventory management requires tight control. Tight schedules are needed that track orders and material from design through delivery. Responsive partners in the supply chain can yield effective collaboration. |
A product is currently made in a process-focused shop, where fixed costs are $9,000 per year and variable costs are $50 per unit. The firm is considering a fundamental shift in process, to repetitive manufacturing. The new process would have fixed costs of $90,000, and variable costs of $5. What is the crossover point for these processes? For what range of outputs is each process appropriate? |
The crossover is at 1800 units annually. For volumes under 1800, the process focus is cheaper; for volumes over 1800 units, the repetitive focus is cheaper. |
Big John's Manufacturing currently produces its lead product on a machine that has a variable cost of $0.32 per unit, and fixed costs of $75,000. Big John is considering purchasing a new machine that would drop the variable cost to $.28 per unit, but has fixed costs of $150,000. What is the cross-over point between the two machines? |
1,875,000 units |
The local convenience store makes personal pan pizzas. Currently, its process makes complete pizzas, fully cooked, for the customer. This process has a fixed cost of $20,000, and a variable cost of $1.75 per pizza. The owner is considering a different process that can make pizzas in two ways: completely cooked (as before), or partially cooked and then flash frozen for the customer to finish heating at home. This alternate process has a fixed cost of $24,000, but a lower variable cost (because much less energy is used in baking) of $1.25 per pizza. |
(a) the crossover is 8,000 units (b) for production quantities of 8,000 or larger, the new, more flexible process has a lower cost. |
A firm is about to undertake the manufacture of a product, and it is weighing the process configuration options. There are two intermittent processes under consideration, as well as a repetitive focus. The smaller intermittent process has fixed costs of $3,000 per month and variable costs of $10 per unit. The larger intermittent process has fixed costs of $12,000 per month and variable costs of $2 per unit. A repetitive focus plant has fixed costs of $50,000 per month and variable costs of $1 per unit. |
(a) at 1125 units, the large job shop becomes cheaper than the small job shop; (b) at 38,000 units, the repetitive shop is cheaper than the larger job shop. |
Kirstin is thinking about opening a Chinese restaurant and needs to buy a rice cooker. Machine A has fixed costs of $100 and variable costs of $1/pound. Machine B has fixed costs of $500 and variable costs of $.1/pound. If Kirstin plans to sell 100 pounds of rice, which machine should she choose? What is the cross-over point? |
Machine A costs 100 + 1(100) = $200 Machine B costs $500 + .1(100) = $510 Thus she should buy machine A. Crossover occurs when 100+V = 500 + .1V, or V = 444.4 pounds of rice |
When selecting new equipment and technology, decision makers look for flexibility—the ability to respond with little penalty in time, cost, or customer value. |
True |
What have restaurants such as Steakhouses and Stacked Restaurants replaced their traditional paper menus with? |
E |
Which of the following is true regarding the concept of flexibility? |
D |
Why do modern operations managers look for flexibility in their equipment? |
Flexibility in equipment provides managers with the ability to respond to changes in demand with little penalty in time, cost, or customer value. And in this age of rapid technological change and short product life cycles, adding flexibility to the production process can be a major competitive advantage. |
A value-stream map includes both (1) inventory quantities, and (2) symbols for customers and suppliers. |
True |
Service blueprinting is a process analysis technique that focuses on the customer and the provider's interaction with the customer. |
True |
Activity times should not be included in a service blueprint. |
False |
A flowchart with the addition of a time axis becomes a process chart. |
False |
Time-function mapping is a flowchart with time added to the horizontal axis. |
True |
Flowcharts use distance, but not time, to show the movement of material, product, or people through a process. |
False |
Value-stream mapping: |
E |
One fundamental difference between a process chart and a flowchart is that: |
C |
Service blueprinting: |
D |
What is a drawing of the movement of material, product, or people? |
A |
Describe Value-stream mapping. Explain how it is different from process mapping. |
Value-stream mapping is a variation on time-function mapping or process mapping. The most fundamental difference between them is that Value-stream mapping is not confined to the organization itself. In particular, in its analysis of where value is added, it extends the analysis to the organization's supply chain. Value-stream mapping takes into account not only the process but also the management decisions and information systems that support the process. |
Identify the five major tools of process analysis and design. Describe them in a sentence or two each. |
A flowchart is a schematic or drawing of the movement of material, product, or people. Time-function mapping is a flow chart, with the addition of time on the horizontal axis. Value-stream mapping shows how to add value in the flow of materials and information through the entire production process. Process charts use symbols, time, and distance to provide an objective and structured way to analyze and record the activities that make up a process. Service blueprinting focuses on the customer and the provider's interaction with the customer. |
Professional services typically require low levels of labor intensity. |
False |
An example of the postponement strategy for improving service productivity is having the customer wait until you have sufficient time to serve the customer. |
False |
Which of the following are all strategies for improving productivity in services? |
A |
Which of the following is not one of the strategies for improving service productivity? |
E |
In mass service and professional service, the operations manager should focus extensively on: |
D |
In the mass service and service factory quadrants of the service process matrix, the operations manager could focus on all of the following except: |
E |
Provide an example of the focus strategy for improving service productivity. |
The focus strategy refers to restricting the offerings. Examples will vary, but a restaurant with a limited menu would be one example. |
Provide an example of the postponement strategy for improving service productivity. |
The postponement strategy refers to customizing the product at delivery, not at production. Examples will vary, but a home builder might leave some tasks unfinished until the house is sold, so that the buyer can make those final decisions. Carpeting, paint colors, cabinet doors, and some appliance choices might be good examples. Another example would be cars or vans. |
Process control is the use of information technology to monitor and control a physical process. |
True |
One use of camera-and-computer-based vision systems is to replace humans doing tedious and error-prone visual inspection activities. |
True |
Automated storage and retrieval systems are commonly used in distribution facilities of retailers. |
True |
Flexible manufacturing systems, because of easily changed control programs, are able to perform such tasks as manufacturing one-of-a-kind parts economically. |
True |
Which of the following is TRUE regarding vision systems? |
D |
The use of information technology to monitor and control a physical process is known as: |
A |
Which of the following technologies could enable a cashier to scan the entire contents of a shopping cart in seconds? |
D |
Which of the following provides automatic placement and withdrawal of parts and products into and from designated places in a warehouse? |
D |
Computer-integrated manufacturing (CIM) includes manufacturing systems that have: |
A |
Which one of the following technologies is used ONLY for material handling, NOT actual production or assembly? |
D |
A system using an automated work cell controlled by electronic signals from a common centralized computer facility is called: |
C |
"Operators simply load new programs, as necessary, to produce different products" describes: |
C |
Identify the typical elements in a process control system. |
Sensors collect data, which are read on a periodic basis. Measurements are digitized and transmitted to a computer. Computer programs read the file and analyze the data. Output is produced in the form of signals, diagrams, charts, messages, etc. |
Identify nine areas of technology that enhance production and productivity. |
(1) machine technology, (2) automatic identification systems (AIS), (3) process control, (4) vision systems, (5) robots, (6) automated storage and retrieval systems (ASRSs), (7) automated guided vehicles (AGVs), (8) flexible manufacturing systems (FMSs), and (9) computer-integrated manufacturing (CIM) |
Production technology has had a major impact on services, but as yet there has been little reduction in service labor requirements. |
False |
Optical checkout scanners and ATMs are examples of technology's impact on services. |
True |
Advances in technology: |
D |
Successful process redesign focuses on departmental areas where small, continuous improvements can be made. |
False |
Process redesign: |
E |