Operations Management Test Answer 2015

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Which of the following statements is/are true?

i) The 'Six Sigma' methodology developed by Motorola is about reducing time to market.
ii) The 'Capability Maturity Model' relates specifically to software engineering.
a. Both (i) and (ii) are true.    
b. Only (i) is true.
c. Only (ii) is true.
d. Neither is true.

Which of the following statements is/are true?

i) A manufacturing organization's responsibility for its product ceases once it has been delivered to a retailer.
ii) 'Service integration' refers to organizations forming partnerships to link their services.
a. Both (i) and (ii) are true.
b. Only (i) is true.
c. Only (ii) is true.
d. Neither is true.

Which of the following terms relates to ensuring that different elements of product development are undertaken at the same time rather than consecutively?
a. 'Just-in-time' production
b. 'Lean production'
c. 'Simultaneous engineering'
d. 'Concurrent development'

What does the term 'kaizen' refer to?
a. Continuous improvement
b. Introducing a flatter management structure
c. Work ethics
d. Up-skilling employees

Which of the following refers to an approach to reducing production costs developed by Toyota?
a. Raw production
b. Lean production
c. Base production
d. Mass production

A 'balanced ________' is a tool for evaluating organisational performance across the full range of factors.
a. scorecard.
b. ledger.
c. matrix.
d. healthcheck.

If a company is commissioned to build a bridge, it will use computer modeling as part of the design process. Which of the following would be benefits of computer modeling in this scenario?

i) It is cheaper than building physical models.
ii) It allows parameters to be rapidly adjusted and tested.
iii) It guarantees that the finished product will perform as intended.
a. None of the above
b. i only
c. ii only
d. iii only
e. i and ii only
f. i and iii only
g. ii and iii only
h. All of the above

A company with 12 employees used to produce 600 units per week. Now with 16 employees, it produces 960 units per week.  How much has each employee's productivity increased?
a. 10%
b. 15%
c. 20%
d. 25%

What does the term 'distribution chain' refer to?
a. A way of organizing staff to make distribution more effective.
b. A series of organizations involved in taking a product from the manufacturer to the consumer.
c. The retail outlets at which a product is sold.
d. A factor that hinders distribution.

Which of the following is NOT a reason for selling products via wholesalers?
a. Higher prices can be charged by doing so than by selling directly to consumers.
b. Transport costs for the manufacturer are reduced.
c. The wholesalers have greater sales expertise.
d. The manufacturer does not have to store unsold stock.

Which of the following initiatives would a company expect to reduce its defect rate?

i) Increased training of staff
ii) Introducing simultaneous engineering
a. Both (i) and (ii)
b. Only (i)
c. Only (ii)
d. Neither (i) nor (ii)

A situation where there is one intermediary organization between the manufacturer and the consumer is known as:
a. three-level channel
b. two-level channel
c. one-level channel
d. zero-level channel
Which one of the Maslow's hierarchy of needs would primarily be addressed by introducing 'team-based management'?
a. Physiological
b. Social/belonging
c. Security
d. Self-actualization

Which of the following elements of 'marketing mix' relates to distribution?
a. Product
b. Place
c. Pricing
d. Promotion

Which of the following is NOT characteristic of a primary industry?
a. Products tend to be sold directly to consumers.
b. It often has a significant impact on the local environment.
c. A low percentage of people in developed countries tend to be engaged in it.
d. Productivity can be dramatically increased through mechanization.

Which of these is NOT generally associated with a 'Just-In-Time' approach to production?
a. Reduced motivation among workers.
b. Reduced storage costs.
c. Improved cash flow.
d. Increased vulnerability to the reliability of suppliers.

If a company invests in new equipment to make its production process more efficient, which of the following will be considered 'opportunity costs'?

i) The cost of the new equipment.
ii) The anticipated additional revenue.
iii) The alternative improvements for which the capital might have been used.
iv) The interest that could have been earned on the capital.
a. i and ii only
b. i and iii only
c. i and iv only
d. ii and iii only
e. ii and iv only
f. iii and iv only

Which of the following describes the term 'time-based management'?
a. Monitoring staff productivity with a stop-watch.
b. Using IT-based tools to manage diaries.
c. Prioritizing schedule above cost and quality.
d. Reducing the time taken to develop, launch and manufacture a product.

Which of the following is NOT part of the role of an industrial engineer?
a. Making processes more efficient.
b. Improving the consistency of manufacturing quality.
c. Making products easier to manufacture.
d. Monitoring productivity

A 'Just-In-Time' approach to production involves ________.
a. closely monitoring the employees' hours.
b. faster delivery of products to customers.
c. minimising the amount of unused stock.
d. prioritising 'schedule' above other variables.

Which of the following is an alternative term for the 'Scalar Principle'?
a. Chain of Command
b. Personal ability
c. Unity of Command
d. Span of Control
e. Unity of Direction

Which of the following statements is/are true?

i) 'Job' production is associated with low unit costs.
ii) 'Job' production permits customers to request a particular specification.
a. Both (i) and (ii) are true.
b. Only (i) is true.
c. Only (ii) is true.
d. Neither is true.

Which of the following statements is/are true?

i ) Prototypes should be constructed using the same manufacturing processes as are intended for the final product.
ii) The cost of producing a prototype will generally be higher than the unit cost of the final product.
a. Both (i) and (ii) are true.
b. Only (i) is true.
c. Only (ii) is true.
d. Neither is true.

A factory can produce 1000 units per day but has only been able to produce 800 units due to a lack of skilled staff.  What will its capacity utilization be after a 10% productivity increase?
a. 880 units
b. 900 units
c. 960 units
d. 88%
e. 90%
f. 96%

Which of the following is a potential problem /are potential problems associated with benchmarking?

i) It leads to increased production costs.
ii) Necessary information is difficult to obtain.
iii) Organizations may not be directly comparable.
a. None of the above
b. i only
c. ii only
d. iii only
e. i and ii only
f. i and iii only
g. ii and iii only
h. All of the above

For targets to be effective, they should be 'SMART'.  Which of the following is not part of the acronym 'SMART'?
a. Specific
b. Measurable
c. Achievable
d. Rigid
e. Time-bound
f. They are all parts of the acronym.

Who developed the fourteen key principles for transforming business effectiveness?
a. W. Edwards Deming
b. Frederick Winslow Taylor
c. Walter Shewhart
d. Malcolm Baldridge
e. Woodrow Wilson

Which of the following is/are a reason/reasons for undertaking 'reverse engineering'?

i) To check that a product functions properly.
ii) To determine interoperability.
iii) To examine rival products.
a. None of the above
b. i only
c. ii only
d. iii only
e. i and ii only
f. i and iii only
g. ii and iii only
h. All of the above

Which of the following statements is/are true?

i) A capital intensive production process is one that involves a relatively-high proportion of labor.
ii) Training staff can be an effective method of boosting productivity.
a. Both (i) and (ii) are true.
b. Only (i) is true.
c. Only (ii) is true.
d. Neither is true.

Which two of the following are used to calculate an 'efficiency ratio'?

i) profit margin
ii) expenses
iii) output
iv)revenue
a. i and ii only
b. i and iii only
c. i and iv only
d. ii and iii only
e. ii and iv only
f. iii and iv only

What is the correct expansion of the acronym KPI?
a. Kinds of Product Information
b. Key Performance Indicator
c. Keen Productivity Implementation
d. Keeping People Interested
What process would a design engineer use to ensure a product meets the user's specifications?
a. Stakeholder Mapping
b. Customer Relationship Management
c. Product Attribute Verification
d. Requirements Management

Organizations often outsource elements of their operations in order to improve profitability. Which of the following activities may NOT be outsourced ?
a. Marketing
b. Project management
c. Human Resources
d. Core business
e. Sales

Which of the following is/are typically qualitative measures?

i) Profit margin
ii) Oral customer feedback
iii) Share price
a. None of the above
b. i only
c. ii only
d. iii only
e. i and ii only
f. i and iii only
g. ii and iii only
h. All of the above

Which of the following is/are a disadvantage/disadvantages of gaining a quality award?

i) Loss of administrative time required to prepare and apply for certification.
ii) Increased requirement for record-keeping.
iii) Decreased brand image with customers.
a. None of the above
b. i only
c. ii only
d. iii only
e. i and ii only
f. i and iii only
g. ii and iii only
h. All of the above

What is reducing the number of levels within an organization's hierarchy  known as?
a. Smoothing
b. Delayering
c. De-verticalization
d. Simplifying

Which of the following statements is/are correct?

i) 'Time and Motion' studies seek to improve a process by increasing the number of steps involved.
ii) Decisions should be made only on the basis of quantitative data.
a. Both (i) and (ii) are true.
b. Only (i) is true.
c. Only (ii) is true.
d. Neither is true.

Which of the following is the best characterization of a decentralized organization?
a. The staff are no longer managed.
b. The staff work unsupervised.
c. The staff enjoy significant discretion.
d. The staff are permitted only limited discretion.
e. The staff do not have any discretion.

A factory currently produces 1000 units at a unit cost of $3. If doubling output will decrease production costs by 20%, how much would it cost to produce 2000 units then?
a. $4,800
b. $6,000
c. $5,000
d. $5,200

Which of the following products would be most suited to transportation by an airplane?
a. Canned goods
b. Mail
c. Electrical items
d. Books