Fundamentals of Management Canadian 8th Edition Robbins Test Bank

Fundamentals of Management
Canadian 8th Edition Robbins Test

Bank
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Chapter 6 Operations Management
1) Department members in marketing producing new and innovative products are part of the
transformation process.
Answer: TRUE
Diff: 2 Type: TF Page Ref: 129
Skill: Applied
Objective: 6.1 What is operations management, and what is its role?
AACSB: Analytical Thinking
2) Operations management is focused on competitive priorities such as price.

Answer: FALSE
Skill: Recall
3) The transformation process is more evident in service organizations than manufacturing

organizations.
Answer: FALSE
Skill: Recall
4) The output of a taxi service is the movement of customers from one location to another.
Answer: TRUE
Skill: Recall
5) With services, production and consumption happen at the same time.

Answer: TRUE
Skill: Recall
6) Tim Horton's offering double lanes in drive-throughs is a cost saving measure.

Answer: FALSE
Skill: Applied
7) To improve productivity, managers must focus on people instead of operations variables.

232
Copyright © 2017 Pearson Canada Inc.
Answer: FALSE
Skill: Recall
8) Chipotle was able to speed up service by focusing on operations, which in turn provided new
strengths for employees.
Answer: FALSE
Skill: Recall
9) Suppliers have the most power in the value chain because of their ability to dictate prices and
quality.
Answer: FALSE
Skill: Recall
Objective: 6.2 What is the nature and purpose of value chain management?
10) Value chain management is externally focused.

Answer: TRUE
Skill: Recall
11) Focusing on incoming materials and outgoing products is what makes value chain
management effectiveness oriented.
Answer: TRUE
Skill: Recall
12) Close relationships with customers lead to improved logistics.

Answer: FALSE
Skill: Recall
233
13) Value chain management features suppliers, distributors, and manufacturers collectively
adding value to the overall process.
Answer: TRUE
Skill: Recall
14) Improved procurement allows greater access to materials, services, and information.
Answer: FALSE
Skill: Recall
15) Supply chain elements for a service include customers, information, transportation, and
inventory.
Answer: FALSE
Skill: Recall
Objective: 6.3 How is value chain management done?
16) Capacity and operational design are elements of facility management.

Answer: TRUE
Skill: Recall
17) IKEA offering well-designed products at substantially lower prices is part of their business
model.
Answer: TRUE
Skill: Recall
18) Boeing's outsourcing of the manufacture of the Dreamliner is an example of value chain
collaboration.
Answer: TRUE
Skill: Applied
234
19) Air Canada using a new way of boarding Boeing Dreamliners is an example of value chain
coordination.
Answer: FALSE
Skill: Applied
20) Hospitals using RFID as a way of reducing theft and loss is an example of value chain
technology investment.
Answer: TRUE
Skill: Recall
AACSB: Information Technology
21) Canadian lamb processors working with farmers to increase lamb production is an example
of value chain leadership.
Answer: FALSE
Skill: Recall
22) Traditional functional job roles in marketing and customer service are integral to successful
value chain management.
Answer: FALSE
Skill: Recall
23) Employee reluctance to be flexible in their jobs is an organizational barrier that can impede
successful value chain management.
Answer: FALSE
Skill: Recall
24) Value chain partners have to ensure they do not trust each other too much.
Answer: TRUE
Skill: Recall
235
25) Remote diagnostics are used by organizations to control costs.
Answer: FALSE
Skill: Recall
Objective: 6.4 What are some contemporary issues in managing operations?
26) Technology will enable longer product life cycles and more variety and choices.
Answer: FALSE
Skill: Applied
27) Sharing financial performance measures can be an important step in achieving quality.
Answer: TRUE
Skill: Recall
28) Performance is one of the most important service quality dimensions.

Answer: FALSE
Skill: Recall
29) Defect rate relates to the product quality conformance dimension.

Answer: FALSE
Skill: Applied
30) The town of Ajax, Ontario is the first municipality in Ontario to use the Six Sigma quality
standard.
Answer: FALSE
Skill: Recall
236
31) Cost, time, and scale make up the triple constraint.
Answer: FALSE
Skill: Recall
32) A PERT network is a visual way to monitor a project's progress.

Answer: TRUE
Skill: Recall
33) An activity can have more than one predecessor.

Answer: TRUE
Skill: Recall
34) Slack time exists only on the critical path.

Answer: FALSE
Skill: Applied
35) Lean manufacturing is concerned with the timing and flow of parts while just-in-time
production is ensuring that production is using very little excess inventory.
Answer: FALSE
Skill: Applied
36) Converting raw materials into finished goods is a result of ________.

A) operations management
B) value chain management
C) the transformation process
D) supply chain management
E) competitive advantage
Answer: C
Diff: 1 Type: MC Page Ref: 129
Skill: Recall
237
37) Which of the following can be both an output and an input for a product?
A) capital
B) materials
C) people
D) equipment
Answer: D
Skill: Applied
AACSB: Reflective Thinking
38) Which of the following is most likely to be the output of finance employees.
A) high rates of return on investments
B) new and innovative projects
C) well-trained employees
D) accounting reports
Answer: D
Skill: Recall
39) Which organizations transfer inputs into outputs?

A) manufacturing organizations only
B) service organizations only
C) manufacturing and service organizations
D) neither organization transfers inputs into outputs
Answer: C
Skill: Recall
40) The output of an extended warranty on a piece of equipment you purchased is ________.
A) peace of mind
B) a part of the product
C) consumer loyalty
D) a guarantee to repair or replace your product if it should break down
Answer: D
Skill: Recall
238
41) Which of the following is a feature of a good?
A) delays are more challenging
B) it cannot be produced independently of the customer
C) it is experienced by the customer
D) it can be stored in inventory
Answer: D
Skill: Recall
42) Which of the following is a feature of a service?

A) It is tangible.
B) Ownership is transferred.
C) Quality can be measured by defects.
D) Production and consumption happen at the same time.
Answer: D
Skill: Recall
43) Boeing produces airplanes for Air Canada and other airlines. To Air Canada, the Boeing
Dreamliner is a (n) ________.
A) service
B) product
C) intangible good
D) tangible service
Answer: B
Skill: Applied
44) Boeing produces airplanes for Air Canada and other airlines. To passengers on an Air
Canada flight, the Boeing Dreamliner is a (n) ________.
A) service
B) product
C) intangible good
D) tangible service
Answer: A
Skill: Applied
239
45) The Chipotle employee who ensures the supply of napkins and cutlery behind the counter is
well stocked so that customers can be served promptly is also known as a(n) ________.
A) expediter
B) linebacker
C) mise en place
D) ace in their place
Answer: B
Skill: Recall
46) Value chain management is ________ oriented and ________ oriented.

A) internally; effectiveness
B) externally; effectiveness
C) internally; efficiency
D) externally; efficiency
Answer: B
Skill: Recall
47) ________ is focused on incoming materials and outgoing products.

A) Operations management
B) Value chain management
C) Supply chain management
D) Logistics management
Answer: B
Skill: Recall, Applied
48) Product availability is influenced the most by ________.

A) suppliers
B) manufacturers
C) distributors
D) customers
Answer: C
Skill: Recall
240
49) Price and quality is influenced the most by ________.
A) suppliers
B) manufacturers
C) distributors
D) customers
Answer: A
Skill: Recall
50) Value is influenced the most by ________.

A) suppliers
B) manufacturers
C) distributors
D) customers
Answer: D
Skill: Recall
51) Enhanced customer order management is achieved due to which of the following value chain
management activities?
A) acquiring needed resources
B) managing service and information
C) developing close relationships with customers
D) managing every step of the process
Answer: D
Skill: Recall
52) Capacity is associated with which supply chain management element?

A) facilities
B) inventory
C) production
D) transportation
E) suppliers
Answer: A
Skill: Recall
241
53) Forecasting demand is associated with which supply chain management element?
A) customers
B) inventory
C) suppliers
D) production
E) facilities
Answer: A
Skill: Recall
54) Controlling quality is associated with which supply chain management element?
A) customers
B) facilities
C) production
D) inventory
E) suppliers
Answer: C
Skill: Recall
55) Monitoring quality is associated with which supply chain management element?
A) customers
B) facilities
C) production
D) inventory
E) suppliers
Answer: E
Skill: Recall
56) Scheduling is associated with which supply chain management element?

A) facilities
B) inventory
C) production
D) transportation
E) information
Answer: C
Skill: Recall
242
57) Technology is associated with which supply chain management element?
A) production
B) information
C) suppliers
D) transportation
E) inventory
Answer: B
Skill: Recall
58) A factory outlet store is an example of ________.

A) customers
B) facilities
C) production
D) inventory
E) suppliers
Answer: B
Skill: Applied
59) Reducing supply chain risk often involves ________.

A) increased costs
B) decreased costs
C) decreased inventory
D) fewer suppliers
Answer: A
Skill: Recall
60) A business model looks at profit generation from ________.

A) customers
B) products and services
C) strategies
D) supply chains
Answer: C
Skill: Recall
243
61) Which of these strategies would be ineffective at protecting a supply chain from disruption?
A) reducing suppliers
B) reducing inventory
C) reducing capacity
D) decreasing distance between locations
Answer: D
Skill: Applied
62) Why would value chain partners agree to something they don't value?
A) information sharing
B) open communication
C) collaboration
D) coordination
E) Customers value it.
Answer: E
Skill: Recall
63) BMW's apprenticeship program is concerned most with ________.

A) technology investment
B) leadership
C) organizational processes
D) coordination and collaboration
E) employees / human resources
Answer: D
Skill: Recall
64) Amazon uses robots in its warehouses to benefit from which requirement for successful
value chain management?
B) leadership
C) organizational processes
E) employees / human resources
Answer: A
Skill: Applied
244
65) Better demand forecasting is possible because of the relationship between ________.
A) manufacturers and suppliers
B) manufacturers and customers
C) suppliers and distributors
D) customers and distributors
E) customers and suppliers
Answer: E
Skill: Recall
66) The human resource requirement least associated with value chain success is ________.
A) job design
B) orientation
C) training
D) hiring
Answer: B
Skill: Recall
67) Flexible employee behaviours most supportive of successful value chain management are
________.
A) working in teams
B) focusing on fewer tasks
C) communicating via social media
D) organizing social activities
Answer: A
Skill: Recall
68) Employee privacy concerns are likely to be which type of obstacle to successful value chain
management?
A) organizational barriers
B) cultural attitudes
C) required capabilities
D) people
Answer: A
Skill: Recall
245
69) How can a company overcome a corporate culture bias against sharing proprietary
information?
A) use of patents and trademarks
B) sharing only some information
C) hiding key capabilities
D) providing inaccurate information about processes
Answer: A
Skill: Applied
70) What is the biggest obstacle to successful value chain management in terms of the people
working for an organization?
A) lack of time and energy
B) how they work
C) who they work with
D) why they work for the organization
Answer: A
Skill: Recall
71) A senior executive that indicates "if it ain't broke, don't fix it" is is an example of which
obstacle to successful value chain management.
D) people
Answer: A
Skill: Applied
246
72) When Boeing decided to stop outsourcing some of the production of its Dreamliner airplane
due to production issues, it was likely due to which of the obstacles to successful value chain
management?
D) people
Answer: C
Skill: Applied
73) Apple's battery life decreases within the first year of use which indicates an issue in which
product quality dimension?
A) conformance
B) perceived quality
C) performance
D) features
E) durability
Answer: E
Skill: Applied
74) The simplicity of design of Apple products applies to which dimension of product quality?
A) aesthetics
B) courtesy
C) features
D) flexibility
E) conformance
Answer: A
Skill: Applied
247
75) Apple's original decision not to enable Adobe Flash with their products is likely related most
to which product quality dimension?
A) performance
B) perceived quality
C) serviceability
D) features
E) flexibility
Answer: A
Skill: Applied
76) Steve Jobs once said "Flash is the number one reason why Macs crash". Apple's original
decision to prohibit Flash usage on their devices is related to which service quality dimension?
A) timeliness
B) courtesy
C) consistency
D) accuracy
E) convenience
Answer: C
Skill: Applied
77) A management consultant charges rates that are prohibitive for many small businesses and
associations. This is a problem with which service quality dimension?
A) timeliness
B) courtesy
C) consistency
D) convenience
E) completeness
Answer: D
Skill: Applied
248
78) Variability in service delivery relates most closely to which service quality dimension?
A) timeliness
B) courtesy
C) completeness
D) convenience
E) accuracy
Answer: E
Skill: Applied
79) If Tim Horton's dedicated one drive-through lane to coffee purchases only and the other lane
to all purchases, this would achieve which service quality dimension?
A) courtesy
B) completeness
C) consistency
D) convenience
E) accuracy
Answer: D
Skill: Applied
80) The Samsung Galaxy has a display that wraps around the side edges. Using your knowledge
of product quality, which dimension is Samsung targeting?
A) durability
B) conformance
C) serviceability
D) performance
E) aesthetics
Answer: E
Skill: Applied
249
81) Product warranties for smart phones are supporting which product quality dimension?
A) performance
B) features
C) durability
D) conformance
E) perceived quality
Answer: C
Skill: Applied
82) Quality improvement initiatives are NOT possible without which of the following?
A) monitoring
B) self-directed work teams
C) empowered employees
D) training
Answer: A
Skill: Recall
83) The higher the sigma, the fewer the ________.

A) processes
B) defects
C) standards
D) complaints
Answer: B
Skill: Recall
84) What is the main benefit of Six Sigma and ISO 9000/9001?
A) reputation
B) simplicity
C) quality work processes
D) revenue generation
Answer: C
Skill: Recall
250
85) Which of the following is a goal of project management?
A) the project completed one month early while going over budget by less than 5%
B) the project completed under budget and on time with modified specifications
C) the project completed according to specifications, on time and within budget
D) the project completed on time and with improved specifications for a small cost overage
Answer: C
Skill: Applied
86) What are the three elements of the triple constraint?

A) cost, time, scope
B) cost, time, scale
C) time, scale, scope
D) cost, scale, scope
Answer: B
Skill: Recall
87) Which of the following is unlikely to be included in a project charter?

A) objectives
B) constraints
C) tradeoffs
D) scope
Answer: C
Skill: Recall
88) A Gantt chart is used primarily for ________.

A) scheduling
B) planning
C) evaluating
D) monitoring
Answer: A
Skill: Applied
251
89) A Gantt chart is able to tell a project manager which of the following?
A) the cost of the total project
B) if a task is over budget
C) who is assigned to a task
D) if a task is behind schedule
Answer: D
Skill: Applied
90) Which of the following would be used to manage a complex project?

A) lean
B) just-in-time
C) Gantt
D) PERT
E) PMP
Answer: D
Skill: Recall
91) Which of the following is TRUE about the critical path?

A) It has slack time in it to ensure project success.
B) A delay on the path may not delay the project.
C) It is the longest time possible to finish a project.
D) It is the shortest time possible to finish a project.
Answer: D
Skill: Applied
92) Events are also known as ________.

A) activities
B) milestones
C) accomplishments
D) mini projects
Answer: B
Skill: Recall
252
93) Which of the following best represents a point of time in a PERT diagram?
A) critical path
B) the start of an activity
C) the end of an activity
D) activities
Answer: C
Skill: Applied
94) A delay of two weeks in an activity that isn't on the critical path would result in how long of
a delay to the project?
A) two weeks
B) one week
C) It cannot be determined.
D) none
Answer: D
Skill: Applied
95) The length to complete a project is equal to ________.

A) the combined time of all the activities
B) the critical path
C) the critical path less the slack time
D) the combined time of all the activities less the slack time
Answer: B
Skill: Applied
96) To get a project back on time, a good project manager must ________.
A) shorten all activities
B) reduce slack time
C) increase resources to all activities
D) increase resources to activities on the critical path
Answer: D
Skill: Applied
253
97) An activity without a predecessor is ________.
A) not on the critical path
B) the first activity in a project
C) one without slack time
D) one with less resources applied to it
Answer: B
Skill: Applied
98) How many predecessors can an activity have?

A) one
B) none
C) two
D) unlimited
Answer: D
Skill: Applied
99) If a project manager had an extra person to apply to an activity, which activity should be
chosen to shorten the project?
A) the longest activity
B) the hardest activity
C) any activity not on the critical path
D) any activity on the critical path
Answer: D
Skill: Applied
100) If you have to submit a team project via email to your professor, which activity is a
predecessor to doing a final edit of the document?
A) editing each of the various parts prior to compiling into one
B) doing a spell check on the document
C) saving the file on your hard drive
D) compiling the various parts into one document
Answer: D
Skill: Applied
254
101) Which activity cannot be done at the same time by a team member as you are preparing a
one-page executive summary for a team project?
A) verifying APA sources for the bibliography
B) doing a final edit of the complete document
C) preparing the table of contents
D) verifying the method of submission
Answer: B
Skill: Applied
102) Boeing's use of a global network of suppliers to build a technologically advanced aircraft in
10% of the time compared to manufacturing it alone is an example of ________.
A) just-in-time production
B) technology investment
C) lean manufacturing
D) a business model
Answer: C
Skill: Applied
103) Boeing's use of a global network of suppliers to build the Dreamliner is an example of
________.
A) offshoring
B) nearshoring
C) reshoring
D) insourcing
Answer: A
Skill: Recall
255
104) Boeing's carbon-fibre composites provided many benefits: reduced weight leading to 20
percent fuel reduction; ability to withstand higher pressure and suffer less corrosion; and higher
cabin humidity leading to a more comfortable interior cabin. The fact that the composites also
reduced assembly time by 75 percent is an example of a benefit of ________.
A) just-in-time production
B) coordination and collaboration
C) lean manufacturing
D) outsourcing
Answer: C
Skill: Applied
105) Glidan is one of the world's largest t-shirt manufacturers. When the company's growth
outpaced the supply of textiles, the company established manufacturing in Barbados. This is an
example of ________.
A) offshoring
B) nearshoring
C) reshoring
D) insourcing
Answer: A
Skill: Applied
106) Joe Fresh (Loblaws) decided to locate some of its production back in Canada after a factory
collapsed in Bangladesh. This is an example of ________.
A) offshoring
B) nearshoring
C) reshoring
D) insourcing
Answer: C
Skill: Applied
256
Refer to the Scenario below to answer any questions that follow.
Starbucks Scheduling Challenges
Starbucks' CEO Howard Schultz has vowed to provide store employees with more consistent
weekly schedules and longer notice of upcoming shifts. Starbucks is eliminating the practice
dubbed "clopening," which requires employees to shut down a store at night only to return early
the next morning to help open it.
Over the last two years, labour costs have been increasing for employers of low-skill workers.
This leads managers to tend toward understaffing than overstaffing. Also, many stores require
employees to find their own replacements when they are sick.
To assist with scheduling, Starbucks uses Kronos state-of-the-art software that forecasts store
traffic and helps managers set staff levels accordingly. However, the software doesn't make
scheduling workers four weeks in advance instead of the common practice of one week in
advance. According to a Kronos executive, the best predictor of store demand is the sales data
from one year ago that day.
107) The managerial practice of understaffing will impact which service quality dimension the
most?
A) Production and consumption happen at the same time.
B) Quality is based on customer perceptions.
C) Ownership of the service is not transferred to the customer.
D) Customers are much more involved.
E) Time is more important and delays are more challenging.
Answer: E
Skill: Applied
108) The Kronos software is aimed at improving which supply chain management element?
A) customers
B) production
C) inventory
D) information
E) facilities
Answer: B
Skill: Applied
257
109) Forecasting demand with state-of-the-art software tracking a combination of previous
month's and previous year's sales is an example of which requirement for successful value chain
management?
A) coordination and collaboration
B) organizational processes
C) leadership
D) human resources
Answer: B
Skill: Applied
110) Managers blocking changes to scheduling enhancements would be an example of which

obstacle to value chain management?
A) people
B) required capabilities
C) cultural attitudes
D) organizational barriers
Answer: D
Skill: Applied
258
Refer to the Scenario below to answer the questions that follow.
The Big Project (Scenario)
The School of Business has developed a new strategic plan. As part of the plan, a major capital
project will refurbish the building and classrooms, including a new corporate branding initiative
thanks to a generous donation from a local business. Faculty offices will be grouped by
functional area instead of by seniority, so that students have convenient access to the faculty of
their discipline, such as HR, accounting, or marketing. The project will take three months to
complete and is being done over the summer to inconvenience as few students as possible. A
wide consultation process was conducted to ensure feedback was obtained from various
stakeholders.
111) The grouping of the offices by functional area is an example of a(n) ________.
A) good
B) service
C) input
D) transformation process
Answer: B
Skill: Applied
112) Which element of the supply chain is most involved in the capital project?
A) customers
B) production
C) suppliers
D) facilities
Answer: D
Skill: Recall
113) Some faculty are against the plan to move offices into functional hubs. They are happy with
the way offices have always been allocated. Their resistance is likely most attributed to which
obstacle to successful value chain management?
C) people
D) required capabilities
Answer: A
Skill: Recall
259
114) The grouping of the offices by functional area applies best to which service quality
dimension?
A) timeliness
B) consistency
C) convenience
D) completeness
E) accuracy
Answer: C
Skill: Recall
115) The school landing a major corporate donor was a predecessor to which of the following
activities?
A) establishing a final budget for the capital project
B) engaging in a wide consultation process
C) development of a new floor plan
D) establishing a draft capital budget
Answer: A
Skill: Applied
260
Shrinking the Supercentre (Scenario)
Walmart is making some major changes to their average store, dropping as many as 2,500 items.
These changes have concerned some suppliers who worry about lost sales. As Walmart has
grown, managing inventory has become unruly and stores are not always neat and well stocked.
Walmart is leveraging technology to provide on-time data to help decide which products stay on
shelves and where to remove clutter.
Part of the change means less inventory in backrooms and dropping some products altogether.
Walmart is also more than doubling the width of aisles, making it more navigable for multiple
carts. Employees are starting to restock during the day, when customers are most likely to
complain about missing items. They are experimenting with lowering shelves by about a foot to
make it easier for shoppers to see around the store. That minor change could eliminate hundreds
of millions of dollars in annual sales of gum, candy and magazines. To counteract that, Walmart
is also negotiating with suppliers to spend more money to earn a spot on shelves, pay additional
fees to store their products in warehouses, and give Walmart more time to pay for the goods.
116) Walmart's collaboration with suppliers is meant to provide improved procurement as well
as ________.
A) enhanced customer order management
B) improved product development
C) improved logistics
D) improved transportation
Answer: C
Skill: Recall
117) Walmart will have to balance ________ with lowering inventory with their changes to the
stores.
A) monitoring supplier quality
B) meeting customer demand
C) product design
D) capacity
Answer: B
Skill: Applied
261
118) Walmart's pressure on suppliers for increased fees is part of their ________.
A) leadership
B) organizational culture and attitudes
C) information management
D) business model
Answer: D
Skill: Recall
119) Walmart using sales data from point-of-sale terminals to trigger reordering stock
instantaneously is an example of which value chain management strategy?
A) organizational processes
B) technology investment
C) coordination and collaboration
D) leadership
E) human resources
Answer: B
Skill: Applied
120) Meeting the goal of higher customer satisfaction through restocking shelves during the day
is an example of achieving quality through ________.
A) planning
B) organizing
C) leading
D) controlling
Answer: A
Skill: Applied
262
Refer to the Scenario below to answer the question that follows.
Departmentalization at Art & Craft Depot (Scenario)
John is president of a chain of stores called Art & Craft Depot. He is aware that the structure of
his organization must change in order to compete more effectively in today's global marketplace.
However, he is not sure which structure would work best for his company. His company is
currently organized under the following departments: accounting, human resources, sales,
purchasing, and distribution. However, there are other choices available. He has considered
reorganizing around their primary product groups: silk flowers, art supplies, craft supplies,
pottery, and fabric. However, equally important are the different types of clients they serve,
including homemakers, artists, interior decorators, industrial display contractors, and art schools.
The business is growing, and they now have stores in six provinces across Canada. Furthermore,
his customers seldom shop for just one type of item. For example, a customer who buys flowers
will frequently purchase a vase and other supplies that are required to create a full floral
arrangement. This means that individual customers often shop in several merchandise areas of
the store.
121) Who is the key value chain partner in this scenario?

A) manufacturer
B) distributor
C) customer
D) supplier
Answer: D
Skill: Recall
263
The Blackberry Challenge (Scenario)
Wendy's fast food chain invested more than three years searching in excess of 30 growers to
procure blackberries for a new salad being added to its menu in summer 2016. Supplying 6500
North American restaurants will demand more than 2 million pounds of blackberries. Customer
demand for fresh ingredients and healthier fare leads large chains to enhance their supply chain
management practices. Fast food chains need rapid, repeatable preparation processes, and fresh
ingredients make for a tremendous challenge.
Most blackberry producers sell to grocery stores, leaving little supply for restaurants. The two
growers selected by Wendy's had to plant extra bushes, which take three years to produce mature
fruit. To maintain consistency, Wendy's sends their 6500 franchisees instruction cards dictating
how the berries should be washed, cut, and placed on the salads. Slicing fresh fruit requires
added prep time, which requires changes to worker safety procedures such as wearing chain mail
mesh gloves. The added prep work must also be factored into service times.
122) Which value chain management benefit is Wendy's hoping to achieve in this scenario?
A) improved procurement
B) improved logistics
C) improved product development
D) enhanced customer order management
Answer: A
Skill: Recall
123) Which requirement for successful value chain management has Wendy's demonstrated in
this scenario?
B) leadership
C) organizational culture and attitudes
E) human resources
Answer: D
Skill: Applied
264
124) Providing instruction cards to franchisees is an achieving quality through which
management function?
A) planning
B) organizing
C) leading
D) controlling
Answer: B
Skill: Recall
125) Guidelines for washing and cutting blackberries fits best with which product quality
dimension?
A) performance
B) features
C) perceived quality
D) conformance
E) aesthetics
Answer: D
Skill: Recall
126) Identify the differences between goods and services.

Answer: Goods
Tangible—have a physical form.
Can be stored in inventory.
Ownership is transferred.
Can be produced independently of the customer.
Delays can be tolerated.
Quality can be measured by defects or deviations in manufacturing.
Services
Intangible—are experienced.
Production and consumption happen at the same time.
Ownership of service is not transferred to the customer.
Customers are much more involved.
Time is more important and delays are more challenging.
Quality is based on customer perceptions.
Diff: 1 Type: ES Page Ref: 130
Skill: Recall
265
127) Describe the power held by suppliers, distributors, manufacturers, and customers in the
value chain.
Answer: Suppliers provide the needed resources and materials and have the ability to dictate
prices and quality.
Manufacturers assemble those resources into a valuable product or service — their contribution
is critical.
Distributors ensure the product or service is available where and when the customer needs it.
However, in value chain management, customers are the ones with the power.
Skill: Recall
128) Compare and contrast supply chain management and value chain management.
Answer: Value chain management is externally oriented and focuses on both incoming materials
and outgoing products and services. VCM is effectiveness oriented and aims to create the highest
value for customers. Value is provided to customers through transforming raw materials and
other resources into some product or service that end users need or desire when, where, and how
they want it.
Supply chain management is efficiency oriented (its goal is to reduce costs and make the
organization more productive) and internally oriented by focusing on efficient flow of incoming
materials (resources) to the organization. It is the coordination of activities along the supply
chain.
Skill: Recall
129) List and describe the elements of supply chain management.

Answer: Customers — forecasting the quantity and timing of customer demand
Facilities — location, capacity, operational design
Inventory — meeting demand while managing inventory and safety stock
Production — product/service design, controlling quality, scheduling work
Transportation — method of transportation, route, logistics
Information — information sharing, technology
Suppliers — monitoring supplier quality, flexibility, maintaining relationships, evaluating
suppliers
Skill: Recall
266
130) List and describe the six requirements for successful value chain management.
Answer:
1. Coordination and collaboration
Comprehensive and seamless integration among all members of the chain is absolutely
necessary. All partners in the value chain must identify things that they may not value but that
customers do. Sharing information and being flexible as far as who in the value chain does what
are important steps in building coordination and collaboration.
2. Technology investment
Information technology can be used to restructure the value chain to better serve end users. The
key tools include a supporting enterprise resource planning software (ERP) system that links all
of an organization's activities, sophisticated work planning and scheduling software, customer
relationship management systems, business intelligence capabilities, and e-business connections
with trading network partners.
3. Organizational processes
Managers must critically evaluate all organizational processes from beginning to end by looking
at core competencies–the organization's unique skills, capabilities, and resources–to determine
where value is being added. Non-value-adding activities are eliminated.
4. Leadership
Successful value chain management is not possible without strong and committed leadership.
From top organizational levels to lower levels, managers must support, facilitate, and promote
the implementation and ongoing practice of value chain management. Managers must make a
serious commitment to identifying what value is, how that value can best be provided, and how
successful those efforts have been. Also, it is important that leaders outline expectations for what
is involved in the organization's pursuit of value chain management.
5. Employees/human resources
Three main human resources requirements for value chain management are flexible approaches
to job design, an effective hiring process, and ongoing training. Flexibility is the key description
of job design in a value chain management organization.
6. Organizational culture and attitudes
The last requirement for value chain management is having a supportive organizational culture
and attitudes. Those cultural attitudes include sharing, collaborating, openness, flexibility,
mutual respect, and trust. And these attitudes encompass not only the internal partners in the
value chain but external partners as well.
Skill: Recall
267
131) Describe the obstacles to value chain management.
Answer: Organizational barriers are among the most difficult obstacles to handle. These barriers
include refusal or reluctance to share information, reluctance to shake up the status quo, and
security issues. Without shared information, close coordination and collaboration is impossible.
And the reluctance or refusal of employees to shake up the status quo can impede efforts toward
value chain management and prevent its successful implementation. Finally, because value chain
management relies heavily on a substantial information technology infrastructure, system
security and Internet security breaches are issues that need to be addressed.
Unsupportive cultural attitudes–especially trust and control–also can be obstacles to value chain
management. The trust issue is a critical one–both lack of trust and too much trust. To be
effective, partners in a value chain must trust each other. There must be a mutual respect for, and
honesty about, each partner's activities all along the chain. When that trust doesn't exist, the
partners will be reluctant to share information, capabilities, and processes. But too much trust
also can be a problem. Just about any organization is vulnerable to theft of intellectual property–
that is, proprietary information that is critical to an organization's efficient and effective
functioning and competitiveness. Another cultural attitude that can be an obstacle is the belief
that when an organization collaborates with external and internal partners, it no longer controls
its own destiny. However, this just isn't the case.
Required capabilities include such things as coordination and collaboration, the ability to
configure products to satisfy customers and suppliers, and the ability to educate internal and
external partners. These are essential to capturing and exploiting the value chain.
People—without their unwavering commitment to do whatever it takes, value chain management

will not be successful. If employees refuse to be flexible in their work—how and with whom
they work—collaboration and cooperation throughout the value chain will be hard to achieve. In
addition, value chain management takes an incredible amount of time and energy on the part of
an organization's employees.
Skill: Recall
268
132) Identify the eight product quality dimensions. How do they differ from service quality
dimensions?
Answer: Product Quality Dimensions
1. Performance—Operating characteristics
2. Features—Important special characteristics
3. Flexibility—Meeting operating specifications over some period of time
4. Durability—Amount of use before performance deteriorates
5. Conformance—Match with pre-established standards
6. Serviceability—Ease and speed of repair or normal service
7. Aesthetics—How a product looks and feels
8. Perceived quality—Subjective assessment of characteristics (product image)
These differ from service quality dimensions that look at timeliness, courtesy, consistency,
convenience, completeness, and accuracy.
Skill: Recall
133) Identify the three key elements involved in PERT network analysis. How can you shorten a
critical path?
Answer: The three key elements are events, activities, and the critical path.
Events are end points that represent the completion of major activities. Sometimes called
milestones, events indicate that something significant has happened (such as receipt of purchased
items) or an important component is finished. In PERT, events represent a point in time.
Activities, on the other hand, are the actions that take place. Each activity consumes time, as
determined on the basis of the time or resources required to progress from one event to another.
The critical path is the longest or most time-consuming sequence of events and activities
required to complete the project in the shortest amount of time.
To shorten a critical path, you must shorten the length of time of an activity on the critical path.
That is the only way to shorten overall project length.
Skill: Applied
269
134) List and explain some of the common terms use to describe outsourcing.
Answer: Outsourcing is commonly referred to as offshoring, which features relocation of an
operational process, such as manufacturing, to another country, typically in India, China,
Malaysia, or other parts of Asia and Africa.
Onshoring is relocating within the same country to low-cost cities.
Nearshoring is usually relocating to a country nearby, perhaps one sharing the same border and a
market with many geographic, economic, and political similarities.
Reshoring features companies who bring back production of goods to the home country.
Skill: Recall
AACSB: Application of Knowledge
270

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Fundamentals of Management

Canadian 8th Edition Robbins Test

2) Operations management is focused on competitive priorities such as price.

3) The transformation process is more evident in service organizations than manufacturing

5) With services, production and consumption happen at the same time.

6) Tim Horton's offering double lanes in drive-throughs is a cost saving measure.

7) To improve productivity, managers must focus on people instead of operations variables.

10) Value chain management is externally focused.

12) Close relationships with customers lead to improved logistics.

16) Capacity and operational design are elements of facility management.

28) Performance is one of the most important service quality dimensions.

29) Defect rate relates to the product quality conformance dimension.

32) A PERT network is a visual way to monitor a project's progress.

33) An activity can have more than one predecessor.

34) Slack time exists only on the critical path.

36) Converting raw materials into finished goods is a result of ________.

39) Which organizations transfer inputs into outputs?

42) Which of the following is a feature of a service?

46) Value chain management is ________ oriented and ________ oriented.

47) ________ is focused on incoming materials and outgoing products.

48) Product availability is influenced the most by ________.

50) Value is influenced the most by ________.

52) Capacity is associated with which supply chain management element?

56) Scheduling is associated with which supply chain management element?

58) A factory outlet store is an example of ________.

59) Reducing supply chain risk often involves ________.

60) A business model looks at profit generation from ________.

63) BMW's apprenticeship program is concerned most with ________.

83) The higher the sigma, the fewer the ________.

86) What are the three elements of the triple constraint?

87) Which of the following is unlikely to be included in a project charter?

88) A Gantt chart is used primarily for ________.

90) Which of the following would be used to manage a complex project?

91) Which of the following is TRUE about the critical path?

92) Events are also known as ________.

95) The length to complete a project is equal to ________.

98) How many predecessors can an activity have?

Starbucks Scheduling Challenges

110) Managers blocking changes to scheduling enhancements would be an example of which

The Big Project (Scenario)

Shrinking the Supercentre (Scenario)

Departmentalization at Art & Craft Depot (Scenario)

121) Who is the key value chain partner in this scenario?

The Blackberry Challenge (Scenario)

126) Identify the differences between goods and services.

129) List and describe the elements of supply chain management.

People—without their unwavering commitment to do whatever it takes, value chain management

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46) Value chain management is oriented and oriented.