Question 1

Production and materials-management functions need not be changed in response to unanticipated customer demands as they do not affect response time.

Accepted Answer

Unanticipated customer demands can lead to changes in production and materials-management functions, such as increasing or decreasing production levels and adjusting inventory levels, in order to meet the new demand and maintain timely response times.

Question 2

Poor commercialization occurs when there is definite customer demand for a new product, but the product is not well adapted to customer needs because of factors such as poor design and poor quality.

Accepted Answer

Poor commercialization can occur when there is a gap between customer demand and the product's design and quality, leading to a mismatch between what the customer wants and what the product offers.

Question 3

Customer focus is a function of only the lower levels of an organization.

Accepted Answer

Customer focus is critical at all levels of an organization, from frontline employees to top executives. It is a company-wide initiative that requires everyone's commitment and contribution to being customer-centric.

Question 4

The "sigma" in the Six Sigma name refers to the Greek letter that statisticians use to represent a standard deviation from the mean.

Accepted Answer

The statement is true.

Question 5

In order to achieve superior innovation, top management is responsible for facilitating cooperation while R&D is responsible for effectively collaborating with marketing and production to develop new products.

Accepted Answer

Cooperation and collaboration between top management, R&D, marketing, and production are crucial for successful innovation. Top management plays a key role in setting the tone for a collaborative culture, while R&D must work effectively with other departments to bring new products to market.

Question 6

Pay for performance based on individual accomplishment of goals tends to:
A) increase per-unit costs.
B) decrease employee productivity.
C) increase employee productivity.
D) have little effect on employee productivity.
E) facilitate teamwork.

Accepted Answer

Pay for performance based on individual accomplishment of goals incentivizes employees to work harder and be more productive in order to achieve their goals and receive the associated rewards. This has been shown to increase employee productivity.

Question 7

One of the primary roles of research and development (R&D) in achieving superior efficiency is:
A) facilitating cooperation among functions.
B) limiting customer defection rates by building brand loyalty.
C) designing products for ease of manufacture.
D) instituting training programs to build skills.
E) implementing pay for performance.

Accepted Answer

R&D plays a critical role in designing products for ease of manufacture, which can lead to improved efficiency in production processes. This involves designing products with the production process in mind, which can help reduce waste, minimize the need for rework, and streamline overall manufacturing processes. By designing products that are easier to produce, companies can achieve greater efficiency, reduce costs, and improve their overall competitiveness.

Question 8

The marketing strategy that a company adopts:
A) has little impact on the company's efficiency and cost structure.
B) aims at attaining superior efficiency of the company's operations.
C) should not consider the impact the strategy has on the company's cost structure.
D) aims at automating much of the work in the production process.
E) refers to the position that the company takes concerning a product's pricing and distribution.

Accepted Answer

The marketing strategy of a company refers to the position that the company takes concerning a product's pricing and distribution. It does not necessarily have a direct impact on the efficiency or cost structure of the company's operations. Therefore, option A and B are incorrect. Option C is also incorrect because the impact on cost structure should be considered in any marketing strategy. Option D is irrelevant as it refers to the production process, which is separate from marketing.

Question 9

Distinctive competencies shape the which of the following strategies that a company can pursue?
A) Business level
B) Functional level
C) Corporate level
D) Global level
E) Industry level

Accepted Answer

The answer of Distinctive competencies shape the which of the...

Question 10

Company A has a product that hasn't hit the market yet but has already constructed efficient manufacturing facilities and has lowered costs through learning effects. It has a marketing team in place that has initiated an aggressive advertising campaign with sales promotions that have stimulated demand for the product and accumulate sales volume. Which of the following is true of Company A?
A) This strategy would help Company A move down the experience curve quickly.
B) This strategy would hinder Company A's move down the experience curve and allow rival companies to have a cost advantage.
C) This strategy would allow Company A to decrease product volume and market share.
D) This strategy would not allow Company A to reach superior efficiency.
E) This strategy would enable Company A to ride up the experience curve and gain a competitive advantage over its rivals.

Accepted Answer

By constructing efficient manufacturing facilities and stimulating demand through aggressive marketing, Company A can increase production volume, which helps it move down the experience curve quickly, reducing costs and gaining a competitive advantage.

Question 11

To achieve superior responsiveness to customers, firms must first routinely seek better ways to satisfy customer needs and then develop a competency in listening to its customers, focusing on its customers, and investigating and identifying their needs.

Accepted Answer

The answer of To achieve superior responsiveness to customers, firms...

Question 12

Learning effects are cost savings that result from:
A) automation.
B) knowledge acquired by doing.
C) sound product planning tactics.
D) diseconomies of scale.
E) outsourcing.

Accepted Answer

Learning effects refer to the cost savings that result from knowledge and experience gained by doing a specific task repeatedly. As workers become more skilled and efficient, productivity increases, and costs decrease. Therefore, option B, knowledge acquired by doing, is the best choice.

Question 13

One of the primary roles of human resources in achieving superior efficiency is:
A) scheduling meetings among various value creation functions.
B) adopting aggressive marketing to ride down the experience curve.
C) designing products for ease of manufacture.
D) using information systems to automate processes.
E) implementing self-managing teams.

Accepted Answer

Implementing self-managing teams is a strategy that human resources can use to achieve superior efficiency. This approach empowers employees, encourages collaboration, and can lead to more innovative and efficient work processes.

Question 14

Self-managing teams:
A) are limited to only very large organizations.
B) require members to coordinate their own activities and make decisions.
C) typically increase the need for supervisors.
D) create a tall organizational structure.
E) show negligible increase in productivity and substantial decrease in product quality.

Accepted Answer

Self-managing teams require members to coordinate their own activities and make decisions, without the need for constant supervision. This allows for more efficient and effective work, as well as increased employee satisfaction and engagement.

Question 15

Six Sigma encompasses the activities necessary to get inputs and components to a production facility, through the production process, and out through a distribution system to the end-user.

Accepted Answer

Six Sigma primarily focuses on process improvement by reducing variability and defects in production and business processes, rather than encompassing the entire supply chain activities from input acquisition through production to distribution.

Question 16

Research suggests that the adoption of which of the following may increase efficiency and lower unit costs relative to what can be achieved by the mass production of a standardized output?
A) Just-in-time manufacturing
B) Quick technology
C) Flexible production technologies
D) Stable production
E) Unscheduled manufacturing

Accepted Answer

Flexible production technologies allow for customization of products, which may lead to better efficiency and lower unit costs compared to mass production of a standardized output. Just-in-time manufacturing can also increase efficiency, but it does not necessarily lead to lower unit costs. Quick technology and unscheduled manufacturing are not recognized concepts in the context of production. Stable production may lead to consistency in quality, but it may not necessarily increase efficiency or lower unit costs.

Question 17

Economies of scale are:
A) unit cost increases associated with learning effects.
B) unit cost reductions due to inferior quality of products.
C) realized when output is reduced to a minimum.
D) realized when the selling price is equal to the cost price of the products.
E) unit cost reductions associated with a large-scale output.

Accepted Answer

Economies of scale refer to the cost advantages that a business can achieve by increasing its production efficiency through larger output. These unit cost reductions are associated with large-scale output and are the result of factors such as spreading fixed costs over a greater number of units and increased bargaining power over suppliers. Therefore, the best choice is E.

Question 18

Self-managing work teams:
A) increase per-unit costs of manufactured items.
B) perform all workplace tasks except the making of hiring decisions.
C) increase the cycle time of manufacturing items.
D) require team members to learn only one task and specialize in that alone.
E) tend to increase productivity and product quality.

Accepted Answer

Self-managing work teams tend to increase productivity and product quality because they empower employees to make decisions, collaborate effectively, and take ownership of their work. This leads to higher levels of engagement, motivation, and innovation, which can enhance overall performance and customer satisfaction. Options A, C, and D are incorrect because they do not reflect the benefits of self-managing work teams, and option B is partially correct but incomplete.

Question 19

Managers should not become complacent about efficiency-based cost advantages because:
A) both learning effects and economics of scale go on forever.
B) the experience curve will bottom out at some point.
C) cost advantages gained from experience effects are not affected by the development of new technologies.
D) unit costs keep reducing as output increases.
E) the experience curve steadily rises after a certain threshold is reached, indicating an increase in unit costs.

Accepted Answer

The experience curve will eventually bottom out, meaning that the cost reductions from learning effects and economies of scale will reach a limit. Beyond this point, additional experience or scale does not significantly reduce costs further.

Question 20

Although important, unfortunately, innovation plays a minor role in achieving competitive advantage.

Accepted Answer

Innovation can play a major role in achieving competitive advantage by allowing a company to create unique products or services, improve efficiency, reduce costs, and differentiate itself from competitors. In many industries, companies that fail to innovate risk being left behind by more innovative competitors.

Quiz 4: Competitive Advantage Through Functional-Level Strategies

Production and materials-management functions need not be changed in response to unanticipated customer demands as they do not affect response time.

Poor commercialization occurs when there is definite customer demand for a new product, but the product is not well adapted to customer needs because of factors such as poor design and poor quality.

Customer focus is a function of only the lower levels of an organization.

The "sigma" in the Six Sigma name refers to the Greek letter that statisticians use to represent a standard deviation from the mean.

In order to achieve superior innovation, top management is responsible for facilitating cooperation while R&D is responsible for effectively collaborating with marketing and production to develop new products.

Pay for performance based on individual accomplishment of goals tends to:

One of the primary roles of research and development (R&D) in achieving superior efficiency is:

The marketing strategy that a company adopts:

Distinctive competencies shape the which of the following strategies that a company can pursue?

To achieve superior responsiveness to customers, firms must first routinely seek better ways to satisfy customer needs and then develop a competency in listening to its customers, focusing on its customers, and investigating and identifying their needs.

Learning effects are cost savings that result from:

One of the primary roles of human resources in achieving superior efficiency is:

Self-managing teams:

Six Sigma encompasses the activities necessary to get inputs and components to a production facility, through the production process, and out through a distribution system to the end-user.

Research suggests that the adoption of which of the following may increase efficiency and lower unit costs relative to what can be achieved by the mass production of a standardized output?

Economies of scale are:

Self-managing work teams:

Managers should not become complacent about efficiency-based cost advantages because:

Although important, unfortunately, innovation plays a minor role in achieving competitive advantage.