Exam 9: Production and Operations Management

Mini-Case Sparky Weyer, president and CEO of Minimotors, Inc., a growing manufacturer of small (some of them downright tiny) electric motors used in a variety of power tools and appliances told potential investors, "These are exciting times for our company. We've made a lot of changes over the past two years that have really improved our operations and lowered our costs. Now we are ready to expand into new markets. Minimotors is on its way to becoming a global player." Sparky was meeting with potential financial backers in an effort to obtain funding for some expensive new machinery he wanted to purchase. "You may have heard about some of the ways we've cut costs," Sparky continued. "We've developed a new arrangement with several of our biggest suppliers. They've agreed to make more frequent deliveries tied directly to our production schedules. This will help us reduce our inventory costs dramatically. We've also greatly reduced the number of defective motors we produce by carefully keeping tabs on all of our manufacturing processes. In fact, we have set a goal of reducing our defects to 3.4 parts per million. The main purpose of my meeting with you today is because we want to install some sophisticated new machinery and software that will allow us to quickly design and produce motors to the exact specifications of our customers. The machinery is computer-controlled and can produce custom-designed products at very little increase in cost compared to our mass-produced motors. We feel this flexibility and quick response time will give us a tremendous competitive advantage and help us attract new customers. Installing the new equipment and training our workers to use it properly will be a complex project, but I'm confident that once we get everything up and running we'll be able to strengthen our position as the leading maker of high-quality electric motors." -While Minimotors has focused on improving production efficiencies, global customers are inquiring about its environmental policies. In light of its strategy to serve customers in the EU, Sparky has requested two of its lead engineers to investigate what it would take to meet the environmental standards of its socially responsible customers. The engineers should investigate ________ as best practices for managing a firm's impact on its environment.

Tops and Lids Hat Company produces its hats and caps according to customers' requests. What process does Tops and Lids most likely use?

Firms often use a(n) ________ when working on a major project involving the production of a large item such as an airplane, ship, or bridge.

Fuzzy Fabrics, Inc. is a specialty manufacturer that produces custom blankets according to customer specifications. Fuzzy Fabrics should probably use an intermittent process in production.

Lean manufacturing is a strategy of producing standardized products that have no frills or extra features in order to keep prices low.

Which of the following statements best describes the distinction between production management and operations management?

Facilities layout will depend upon the processes that are to be accomplished in the firm's operation.

Quality control is a continual process of checking to make certain that there is consistency in the quality of products being produced.

One strategy U.S. manufacturers have employed in order to become more competitive is

Recent developments in information technology will discourage companies from allowing employees to telecommute.

In manufacturing, a(n) ________ is used to produce large quantities of a few types of products.

ISO 14001 is a collection of the best practices for managing an organization's impact on the environment.

Which of the following statements describes past processes that existed in manufacturing that negatively affected a firm's competitive advantage?

The U.S. is still manufacturing intensive. Only 55% of U.S. jobs come from the service sector.

A process manufacturing layout is frequently used in operations that serve different customers' different needs.

The process layout simplifies production by using the same sequence of processes regardless of the design of the item being produced.

Pieces and Parts, Inc., is a major supplier of components used by Game Guys, Inc.. Game Guys is looking to implement a just-in-time inventory system. Pieces and Parts should benefit from this approach, since JIT systems greatly simplify the task of suppliers.

Mass customization is tailoring products to meet the needs of a large number of individual customers.

As the service industries became a larger part of U.S. GDP, companies have become more concerned about measuring productivity in the service sector.

One limitation of materials requirement planning (MRP) is that it is not a computer-based approach.