Chapter 13: Global Operations and Supply Chain Management: Service

Chapter 13: Global Operations and Supply Chain
Management
A production system is a system that businesses use to create the goods and services
or to produce the products.
TRUE
The production system of a hair and nail salon would be called a manufacturing
system.
FALSE
In operations management, the acquisition of goods and services is referred to as

logistics.
FALSE
One advantage of global procurement is that the firm can maximize its flexibility by
allocating its orders among suppliers in a dynamic way and the firm has access to
more suppliers that can generally provide lower costs than domestic suppliers.
TRUE
When a firm has been making goods and services in-house, and then decides to buy
these goods and services from suppliers is referred to as offshoring.
FALSE
The practice of producing components and raw materials in-house AND purchasing
them from suppliers is referred to as a supply-chain malfunction.
FALSE
When the demand is equal or lower than the minimum efficient scale, multiple
production facility locations are preferred.
FALSE
When considering the one-versus-many location for production facilities for

components and raw materials some of the most important considerations are: fixed
costs, minimum efficient scale and its comparison to demand, and the value-to-weight
ratio.
TRUE
The three major considerations for deciding the location of production facilities for
products are: does the product serve the needs of all customers around the world,
proximity to market and proximity to suppliers, and the effect on product’s image
being produced in that location.
TRUE
A supply chain encompasses all the activities associated with the flow and
transformation of goods and services from raw material to the end user.
TRUE
A production system in which services dominate the value of the product is known as
a(n) _____ system.
Service
The production systems of Honda Motor Company, the Boeing Company, and
Toshiba Corporation, would be called _____ systems.
Manufacturing
Most of the activities in operations management can be grouped into the following
business functions EXCEPT:
selling
procurement
production
logistics
research and development
Determining which components and raw materials should be produced in-house and
which components and raw materials should be acquired from suppliers is known as
the _____ decision.
Make-or-Buy
Of the following, which is NOT an advantage of global procurement?

The firm does not rely upon suppliers on important dimensions such as quality,
delivery, and cost.
If global suppliers are selling to many companies in the same industry but in different
countries, these suppliers can achieve economies of scale and lower costs.
The firm can focus upon the production stages and components with the most value
added.
The firm does not need to invest the money that is associated with making.
The firm can maximize its flexibility by allocating its orders among the suppliers in a
dynamic way.
Of the following, which is NOT a disadvantage of global procurement?
The firm relies upon suppliers on important dimensions such as quality, delivery, and
cost.
Buying from suppliers could unintentionally lead suppliers becoming competitors.
The firm may need to compete for the attention of suppliers.
The firm has to invest the money that is associated with making products.
The profits that the company could earn by producing the goods and services in-house
now go to the suppliers.
When the firm doing the outsourcing and the supplier that will provide the outsourced
goods and services are located in the same country, it is called _____.
Domestic Outsourcing
When the firm has been buying goods and services from suppliers, and then decides
to make these goods and services in-house, it is called _____.
Insourcing
Of the following, which is NOT an advantage of making?
The firm has more control over deliveries.

Knowledge of the product may provide efficiency advantages over potential suppliers.
The firm has more control over quality.
It secures the supply source.
People producing the component or raw material have the incentive to improve
their product.
Of the following, which is NOT a disadvantage of making?
The people producing the component or raw material do not have the incentive to
improve their product.
The firm would incur both fixed and variable costs.
The firm has less control over quality.
It requires the company to have expertise in the production of the component or raw
materials what will be made.
The firm may not be able to gain the economies of scale that can be gained by a
supplier that is able to pool the activity of a large number of firms.
Of the following, which is NOT a consideration for the one-versus-many production

facilities decision?
The local culture
The value-to-weight ratio
The notion of the minimum efficient scale and its comparison to demand
The infrastructure that the company offers
Fixed costs
Collections of computer hardware and software arranged to transmit information from

one place to another are known as _____.
Telecommunication Network
ERP systems aim to
represent each business function by a module.
_____ refers to the property of ERP systems to simultaneously operate in multiple

languages.
Multi-language
A Japanese user of Sony's ERP system can view the company's financial information
in Japanese yen, while a British user of the system is able to see the same information
in British pounds. This ERP system is _____.
multi-currency
The production process may consist of one or more transformations which could be
all of the following EXCEPT:
esteem
physiological
locational
physical
psychological
______ is responsible for the acquisition of goods and services in the production
process.
Procurement
Which of these is responsible for the transformations required by the production

process?
Production
______ refers to the management of the direct resources that are involved in the
production system of a business organization.
Operations management
Tipton Manufacturing is based in Lexington, Kentucky. The company does not make
the gears it uses in its products, it purchases them from a supplier in Hong Kong.
Tipton Manufacturing is practicing ______.
Global outsourcing

Chapter 13: Global Operations and Supply Chain Management: Service

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Chapter 13: Global Operations and Supply Chain Management: Service

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Chapter 13: Global Operations and Supply Chain

In operations management, the acquisition of goods and services is referred to as

When considering the one-versus-many location for production facilities for

Of the following, which is NOT an advantage of global procurement?

Of the following, which is NOT a disadvantage of global procurement?

Of the following, which is NOT an advantage of making?

The firm has more control over deliveries.

Of the following, which is NOT a disadvantage of making?

Of the following, which is NOT a consideration for the one-versus-many production

Collections of computer hardware and software arranged to transmit information from

ERP systems aim to

represent each business function by a module.

_____ refers to the property of ERP systems to simultaneously operate in multiple

Which of these is responsible for the transformations required by the production

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