Operations Management Chapters 1 & 2 Practice Flashcards

A complete set of practice questions based on the Chapter 1 and Chapter 2 lecture notes covering Operations Management fundamentals, value chains, sustainability, and performance measurement.

What is the definition of Operation Management (OM)?

The science and art of ensuring that goods and services are created and delivered successfully to customers.

What is the difference between a durable good and a non-durable good?

A durable good typically lasts at least $3$ years and does not quickly wear out, while a non-durable good is no longer useful once used or lasts for less than $3$ years.

Define a service encounter.

An interaction between the customer and the service provider.

What are "Moments of Truth"?

Any episodes, transactions, or experiences in which a customer comes into contact with any aspect of the delivery system and has an opportunity to form an impression.

How is Value defined in the context of operations?

The perception of the benefits associated with a good, service, or bundle of goods and services in relation to what buyers are willing to pay for them.

What is a customer benefit package (CBP)?

A clearly defined set of tangible (goods-content) and intangible (service-content) features that the customer recognizes, pays for, uses, or experiences.

Contrast primary goods/services with peripheral goods/services.

A primary good or service is the "core" offering that responds to basic needs, whereas peripheral goods or services are not essential but serve to enhance the primary offering.

What is a variant in a customer benefit package?

A CBP feature that departs from the standard CBP and is normally location or firm specific.

Define Biztainment.

The practice of adding entertainment content to a bundle of goods and services in order to gain competitive advantage.

What is the difference between a value chain and a supply chain?

A value chain is a network describing the flow of materials, goods, services, and finances from suppliers through to the customer; a supply chain is the portion of the value chain focused on the physical movement of goods and supporting information/financial flows.

What are the three categories of key business processes?

1. Value-creation (core) processes, 2. Support processes, and 3. General management processes.

What are distribution centers (DCs)?

Warehouses that act as intermediaries between factories and customers, shipping directly to customers or retail stores.

Define sustainability and its three specific types.

Sustainability is the ability to address current needs and develop long-term strategies to preserve resources for future generations. It includes Environmental, Social, and Economic sustainability.

What is business analytics?

A process of transforming data into actions through analysis and insights in the context of organizational decision making and problem solving.

What is measurement in an organizational context?

The act of quantifying the performance of organizational units, goods and services, processes, people, and other business activities.

Contrast goods quality and service quality.

Goods quality relates to the physical performance and characteristics of a good, while service quality is consistently meeting or exceeding customer expectations (external focus) and service-delivery system performance (internal focus).

What are the five key dimensions used to assess service quality?

Tangibles, Reliability, Responsiveness, Assurance, and Empathy.

What are service upsets or service failures?

Errors in service creation and delivery.

Define processing time and queue time.

Processing time is the time it takes to perform some task, while queue time is the time spent waiting.

Define the two types of flexibility: goods and service design flexibility and volume flexibility.

Design flexibility is the ability to develop customized offerings to meet changing needs, while volume flexibility is the ability to respond quickly to changes in the volume and type of demand.

How is productivity mathematically defined?

The ratio of the output of a process to the input ($\text{Productivity} = \frac{\text{Output}}{\text{Input}}$).

What is operational efficiency?

The ability to provide goods and services to customers with minimum waste and maximum utilization of resources.

What does the Triple Bottom Line (TBL or 3BL) refer to?

The measurement of environmental, social, and economic sustainability.

What is interlinking in performance measurement?

The quantitative modeling of cause-and-effect relationships between external and internal performance criteria.

What is the value of a loyal customer (VLC)?

A metric that quantifies the total revenue or profit each target market customer generates over the buyer's life cycle.

List the seven categories of the Malcolm Baldrige framework.

Leadership, Strategy, Customers, Measurement, Analysis and Knowledge Management, Workforce, Operations, and Results.

What are the four performance perspectives in a balanced framework?

Financial Perspective, Customer Perspective, Innovation and Learnings Perspective, and Internal Perspective.

What is the Service-Profit Chain (SPC)?

A model based on cause-and-effect linkages between internal and external measures that defines the key performance measurements service-based firms should focus on.