Exam 17: Global Production, Outsourcing, and Logistics

The benefits of making all or part of a product in-house seem to be greatest when the firm _____.

A flexible machine cell is used to perform a standardized operation.

Briefly describe the Six Sigma methodology.

Concentration of production is not favored when important exchange rates are expected to remain relatively stable.

Decentralization of production is appropriate when location externalities are important.

Lowering the costs is one of the objectives of the production and logistics function of an international firm.

How has the adoption of just-in-time inventory systems, computer-aided design, and computer-aided manufacturing impact firms' associations with suppliers?

What is logistics? Discuss the relationship between production and logistics.

_____ allows the company to produce a wider variety of end products at a unit cost that at one time could be achieved only through the mass production of a standardized output.

Before a firm is allowed access to the European marketplace, the European Union requires that the quality of the firm's manufacturing processes and products be certified under a quality standard known as _____.

The firm that sources from independent suppliers has fewer subunits to control.

Explain make-or-buy decisions with an example.

Deming, the proponent of total quality management, suggested that management shouldn't attempt to train employees in new skills.

Make-or-buy decisions are decisions that concern the components to be used in a production process.

Maintaining high minimum efficient scale allows a firm to hedge against currency risks.

Describe the major arguments put forth by Edward Deming.

Describe the concept of minimum efficient scale. Discuss the implications of minimum efficient scale.

Central to the concept of economies of scale is the idea that the best way to achieve high efficiency, and hence low unit costs, is through the _____.

The objectives of logistics are to manage a firm's global supply chain at the lowest possible cost and in a way that best serves customer needs.

An advantage of buying component parts, or even an entire product, from independent suppliers is that _____.