ch3 - TB جوده

Managing Quality: Integrating the Supply Chain, 6e (Foster)
Chapter 1 Differing Perspectives on Quality
1) Which of the following is not one of Garvin's eight quality

dimensions?
A) reliability
B) performance
C) conformance
D) aesthetics
E) efficiency
Answer: E
Diff: 2
Learning Outcome: Discuss the total cost of quality and compare the
common methods of managing quality
LO: 1.1: Recognize that different dimensions of quality exist.
AACSB: Application of Knowledge
Type: Concept
2) Which of the following is not one of Parasuraman, Zeithamel, and

Berry's dimensions of service quality?
A) tangibles
B) service reliability
C) contiguity
D) responsiveness
E) assurance
Answer: C
Diff: 2
Type: Concept
3) Why is service quality more difficult to define than product quality?
Answer: While services and production share many attributes, services

have more diverse quality attributes than products. For example, a
product like a personal computer is typically evaluated on its merits,
and it makes little difference to the user whether the person that
assembled the computer was in a bad mood. Service settings are more
complex; thus quality is more difficult to define. A customer of a
restaurant, for example, evaluates the quality of the restaurant not
only on the merits of the food, but also on the demeanor of the
employees, the speed of the service, the location of the restaurant, the
pleasantness of the surroundings, and so forth.
Diff: 2
Type: Application
4) ________ refers to the efficiency with which a product achieves its

intended purpose.
A) Performance
B) Features
C) Reliability
D) Conformance
E) Serviceability
Answer: A
Diff: 2
LO: 1.2: Be able to discuss the quality dimensions.
Type: Concept
5) Which of Garvin's dimensions of quality include the "bells and
whistles" contained in products?
A) performance
B) conformance
C) features
D) aesthetics
E) perceived quality
Answer: C
Diff: 2
Type: Concept
6) ________ refers to the propensity for a product to perform

consistently over its useful design life.
A) Conformance
B) Durability
C) Perceived quality
D) Reliability
E) Serviceability
Answer: D
Diff: 1
Type: Concept
7) Which of the following is the most traditional dimension of quality?
A) durability
B) reliability
C) features
D) performance
E) conformance
Answer: E
Diff: 1

Type: Concept
8) ________ is the degree to which a product tolerates stress or trauma

without failing.
A) Serviceability
B) Conformance
C) Durability
D) Performance
E) Reliability
Answer: C
Diff: 1
Type: Concept
9) ________ is the ease of repair for a product.
A) Durability
B) Reliability
C) Conformance
D) Contiguity
E) Serviceability
Answer: E
Diff: 1
Type: Concept
10) ________ are subjective sensory characteristics such as taste, feel,

sound, look, and smell.
A) Intangibles
B) Logistics
C) Aesthetics
D) Tangibles
E) Features
Answer: C
Diff: 1
Type: Concept
11) ________ is based on customers' opinion of products and services.
A) Conformance
B) Aesthetics
C) Durability
D) Performance
E) Perceived quality
Answer: E
Diff: 1
Type: Concept
12) Which of the following choices correctly matches one of Garvin's
dimensions of quality with its definition?
A) reliability—refers to the efficiency with which a product achieves its

intended purpose
B) serviceability—the ease of repair of a product
C) conformance—the degree to which a product tolerates stress or

trauma without failing
D) performance—subjective sensory characteristics such as taste, feel,

sound, look, and smell
E) aesthetics—refers to the propensity for a product to perform

consistently over its useful design life
Answer: B
Diff: 2
Type: Concept
13) In the context of service quality, ________ include the physical

appearance of the service facility, the equipment, the personnel, and
the communication materials.
A) intangibles
B) logistics
C) features
D) tangibles
E) aesthetics
Answer: D
Diff: 1
Type: Concept
14) If you select a physician based solely on reputation, you are basing
your decision on which of the following dimensions of service quality?
A) responsiveness
B) empathy
C) service reliability
D) assurance
E) tangibles
Answer: C
Diff: 2
Type: Application
15) ________ is the willingness of the service provider to be helpful and

prompt in providing service.
A) Assurance
B) Service reliability
C) Responsiveness
D) Empathy
E) Conformance
Answer: C
Diff: 1
Type: Concept
16) Which dimension of service quality refers to the knowledge and
courtesy of employees and their ability to inspire trust and confidence?
A) empathy
B) service reliability
C) tangibles
D) responsiveness
E) assurance
Answer: E
Diff: 1
Type: Concept
17) A service provider that consistently provides caring, individualized

attention to its customers would score high on the ________ dimension
of service quality.
A) assurance
B) responsiveness
C) tangibles
D) service reliability
E) empathy
Answer: E
Diff: 1
Type: Application
18) Performance refers to the efficiency with which a product achieves

its intended purpose.
Answer: TRUE
Diff: 1
Type: Concept
19) Reliability is perhaps the most traditional dimension of quality.
Answer: FALSE
Diff: 2
Type: Concept
20) The advantage of the conformance definition of quality for products

is that it is easily quantified.
Answer: TRUE
Diff: 2
Type: Concept
21) Conformance is the degree to which a product tolerates stress or

trauma without failing.
Answer: FALSE
Diff: 1
Type: Concept
22) Aesthetics are subjective sensory characteristics such as taste, feel,

sound, look, and smell.
Answer: TRUE
Diff: 1
Type: Concept
23) Services have more diverse quality attributes than products.
Answer: TRUE
Diff: 2
Type: Concept
24) High customer involvement plays a major role in the determination

of service quality.
Answer: TRUE
Diff: 1
Type: Concept
25) Service reliability differs from product reliability in that it relates to

the ability of the service provider to perform the promised service
dependably and accurately.
Answer: TRUE
Diff: 1
Type: Concept
26) Responsiveness is the willingness of the service provider to be

helpful and prompt in providing service.
Answer: TRUE
Diff: 1
Type: Concept
27) Empathy refers to the knowledge and courtesy of employees and

their ability to inspire trust and confidence.
Answer: FALSE
Diff: 1
Type: Concept
28) Why are cross-functional teams becoming more common? What

difficulties do they experience?
Answer: The supply chain encompasses many differing functions and

processes. It includes all of the core activities from the raw materials
stage to after-sale service. To execute all of these processes correctly, it
is important to integrate differing functions, expertise, and dimensions
of quality. This need for integration increases the requirement for
flexible, cross-functional problem solving, and employees who can
adapt to rapidly changing markets.
Communications is a major issue for cross-functional teams. Typically,

organizations do not have very effective networks of cross-functional
communication. Concurrent engineering requires cross-functional
teams.
Diff: 2
Type: Application
29) Experience with cross-functional teams has been difficult for many
firms due to ________.
A) poor communication skills
B) lack of quality training
C) increasing redundancy
D) differing corporate goals
E) increasing inflexibility
Answer: A
Diff: 2
LO: 1.3: Communicate the seven different functional perspectives on

quality.
Type: Concept
30) ________ include all of those activities involving interaction with

suppliers.
A) Inbound logistics
B) Core process activities
C) Outbound logistics
D) Upstream activities
E) Downstream activities
Answer: D
Diff: 2

quality.
Type: Concept
31) Which of the following is an upstream activity in supply chain

management?
A) value stream mapping
B) Six Sigma
C) customer support
D) international sourcing
E) shipping and logistics
Answer: D
Diff: 2

quality.
Type: Concept
32) ________ include traditional process improvement as well as value

stream mapping.
A) Core process activities
B) Upstream activities
C) Inbound logistics
D) Downstream activities
E) Outbound logistics
Answer: A
Diff: 3

quality.

Type: Concept
33) Which of the following is a core process activity in supply chain

management?
A) shipping and logistics
B) acceptance sampling
C) value stream mapping
D) supplier qualification
E) customer support
Answer: C
Diff: 3

quality.
Type: Concept
34) ________ involves analyzing processes from a systems perspective

such that upstream and downstream effects of core process changes
can be evaluated.
A) Six Sigma
B) Acceptance sampling
C) Concurrent engineering
D) International sourcing
E) Value stream mapping
Answer: E
Diff: 2

quality.
Type: Concept
35) ________ include customer support and focusing on delivery

reliability.
A) Inbound logistics
B) Downstream activities
C) Core process activities
D) Upstream activities
E) Outbound logistics
Answer: B
Diff: 2

quality.
Type: Concept
36) Which of the following is a downstream activity in supply chain

management?
A) supplier qualification
B) supplier development
C) acceptance sampling
D) international sourcing
E) customer support
Answer: E
Diff: 1

quality.
Type: Concept
37) From an engineering perspective, engineers are primarily interested

in ________.
A) applying mathematical problem-solving skills and models to the

problems of business and industry
B) taking a strategic management approach to solving problems
C) focusing on the perceived quality of products and services
D) ordering new machinery and updating the current machinery to the

latest technology
E) training the workforce to develop and utilize its full potential to meet
the company's objectives
Answer: A
Diff: 2

quality.
Type: Concept
38) Two of the major emphases in engineering are the areas of
________.
A) manufacturing excellence and long-term planning
B) product design and process design
C) employee empowerment and workforce training
D) supplier development and consumer growth
E) marketing and sales
Answer: B
Diff: 2

quality.
Type: Concept
39) All the activities associated with developing a product from concept
development to final design and implementation are known as
________.
A) process design engineering
B) life testing
C) simultaneous engineering
D) product design engineering
E) concurrent design engineering
Answer: D
Diff: 3

quality.
Type: Concept
40) ________ engineering has resulted in the simultaneous

performance of product and process design activities.
A) Stepwise
B) Progressive
C) Incremental
D) Concurrent
E) Discrete
Answer: D
Diff: 2

quality.
Type: Concept
41) The facet of reliability engineering that determines whether a

product will fail under controlled conditions during a specified life is
referred to as ________.
A) life testing
B) reengineering
C) concurrent prototyping
D) value stream mapping
E) statistical process control
Answer: A
Diff: 1

quality.
Type: Concept
42) If a component has a relatively high probability for failure that will
affect the overall function of a product, then ________ is applied so
that a backup system can take over for the failed primary system.
A) redundancy
B) life testing
C) concurrent engineering
D) statistical process control
E) value stream mapping
Answer: A
Diff: 3

quality.
Type: Application
43) Statistical process control is associated with which of the following

perspectives of quality?
A) operations
B) marketing
C) human resources
D) engineering
E) strategic management
Answer: D
Diff: 3

quality.
Type: Concept
44) ________ is an engineering-related contribution to quality

management that is concerned with monitoring process capability and
process stability.
A) Reengineering
B) Statistical process control
C) Redundancy testing
D) Concurrent engineering
E) Life testing
Answer: B
Diff: 2

quality.
Type: Concept
45) During statistical process control, if a process is ________ it will

consistently produce products that meet specification.
A) redundant
B) unstable
C) capable
D) stable
E) concurrent
Answer: C
Diff: 3
quality.
Type: Concept
46) During statistical process control, if a process is ________ it will

only exhibit random or common cause variation instead of nonrandom
special cause variation.
A) redundant
B) unstable
C) capable
D) stable
E) concurrent
Answer: D
Diff: 3

quality.
Type: Concept
47) The ________ perspective on quality is technically oriented,
focusing on statistics and technical specification that are needed to
produce high-quality products.
A) marketing
B) operations
C) engineering
D) strategic management
E) financial
Answer: C
Diff: 2

quality.
Type: Application
48) The operations management view of quality is rooted in the

________ approach.
A) strategic management
B) marketing
C) finance
D) engineering
E) human resource
Answer: D
Diff: 3

quality.
Type: Concept
49) ________ was the first functional field of management to adopt

quality as its own.
A) Engineering
B) Marketing
C) Human resources
D) Finance
E) Operations
Answer: E
Diff: 3

quality.
Type: Concept
50) The systems view is associated with which of the following

perspectives of quality?
A) operations
B) engineering
C) marketing
E) financial
Answer: A
Diff: 3

quality.

Type: Concept
51) ________ refers to the planning processes used by an organization

to achieve a set of long-term goals.
A) SPC
B) Concurrent engineering
C) Product design engineering
D) Value stream mapping
E) Strategy
Answer: E
Diff: 1

quality.
Type: Concept
52) The ultimate goal of strategic quality planning is to help an

organization achieve ________.
A) maximum profitability
B) sustainable competitive advantage

C) an increase in market share
D) cost minimization
E) growth in revenues
Answer: B
Diff: 3

quality.
Type: Application
53) The marketing function trend that concentrates on satisfying and

delivering value to the customer is known as ________.
A) common cause variation
B) customer relationship management
C) customer-centric approach
D) special cause variation
E) change management
Answer: B
Diff: 1

quality.
Type: Concept
54) The marketer focuses on the ________ dimension of products and

services.
A) perceived quality
B) durability
C) conformance
D) reliability
E) performance
Answer: A
Diff: 3

quality.

Type: Concept
55) The primary marketing tools for influencing customer perceptions

of quality are ________.
A) features and aesthetics
B) price and advertising
C) value and conformance
D) durability and reliability
E) manufacturing integrity and serviceability
Answer: B
Diff: 3

quality.
Type: Concept
56) The marketing system involves the interactions between ________.

A) the producing organization, industry trade groups, and the final
consumer
B) the raw material supplier, the producing organization, and the

intermediary
C) the producing organization, the intermediary, and the final consumer
D) the raw material supplier, the producing organization, and the final
consumer
E) the producing organization, the intermediary, and the regulatory

agency
Answer: C
Diff: 3

quality.
Type: Concept
57) The role of marketing in design has been to bring the voice of the
________ into the design process.
A) supplier
B) customer
C) intermediary
D) retailer
E) producer
Answer: B
Diff: 1

quality.
Type: Concept
58) The first theoretical attempt to link quality improvement to

financial results was the ________.
A) Juran cost-benefit analysis
B) Garvin quality matrix
C) Deming value chain
D) 360-degree evaluation
E) law of diminishing marginal returns
Answer: C
Diff: 2

quality.
Type: Concept
59) In his value chain, Deming linked quality improvements to

________.
A) improved product features and improved durability
B) improved organizational performance and reduction in costs
C) increase in efficiency and improved product features
D) improvements in reliability and reduction in costs
E) reduction in defects and improved organizational performance
Answer: E
Diff: 2

quality.

Type: Concept
60) ________ referred to the communication problem when he stated

that "the language of management is money."
A) Deming
B) Shewhart
C) Juran
D) Garvin
E) Crosby
Answer: C
Diff: 2

quality.
Type: Concept
61) According to the ________, there is a point at which investment in

quality improvement will become uneconomical.
A) Deming value chain
B) contingency theory
C) Juran cost-benefit analysis
D) Garvin quality matrix
E) law of diminishing marginal returns
Answer: E
Diff: 2

quality.
Type: Concept
62) Which of the following best defines employee empowerment?
A) It involves moving decision making to the highest level in the

organization.
B) It involves moving decision making to mid-management levels in the

organization.
C) It involves moving decision making upwards in the chain of

command.
D) It involves moving decision making to the lowest level in the

organization.
E) It involves moving decision making outside the borders of the
organization.
Answer: D
Diff: 2

quality.
Type: Concept
63) Electronic data interchange is used to link customer purchasing

systems to supplier enterprise resource planning systems.
Answer: TRUE
Diff: 2

quality.
Type: Concept
64) Value stream mapping and Six Sigma are upstream activities in
supply chain management.
Answer: FALSE
Diff: 2

quality.
Type: Concept
65) Downstream activities include all of those activities involving

interaction with suppliers.
Answer: FALSE
Diff: 2

quality.
Type: Concept
66) Concurrent engineering has resulted in the simultaneous
performance of product design and quality testing.
Answer: FALSE
Diff: 2

quality.
Type: Concept
67) Life testing is a facet of reliability engineering that determines

whether a product will fail under controlled conditions during a
specified life.
Answer: TRUE
Diff: 2

quality.

Type: Concept
68) If a component has a relatively high probability for failure that will
affect the overall function of a product, then redundancy is applied.
Answer: TRUE
Diff: 2

quality.
Type: Concept
69) If a process is capable, it will consistently produce products that

meet specification.
Answer: TRUE
Diff: 1

quality.
Type: Concept
70) If a process is stable, it will exhibit nonrandom special cause
variation instead of random or common cause variation.
Answer: FALSE
Diff: 2

quality.
Type: Concept
71) Discuss the origins and development of the supply chain

perspective.
Answer: Supply chain management grew out of the concept of the

value chain. The value chain includes inbound logistics, core processes,
and outbound logistics. Supply chain management has moved to the
forefront in recent years due to the opportunities for cost savings along
with quality and service improvements.
Diff: 2
quality.
Type: Concept
72) Describe the relevance of the "systems view" to our understanding

of quality management.
Answer: Operations management utilizes the systems view that

underlies modern quality management thinking. The systems view
involves the understanding that product quality is the result of the
interactions of several variables, such as machines, labor, procedures,
planning, and management. As a result, managers need to understand
that it is the "system" and the interactions between the various
components of the system that is responsible for quality, rather than a
single functional area, such as manufacturing, personnel, or marketing.
Diff: 3

quality.
Type: Concept
73) Discuss the value-added perspective on quality.
Answer: A customer-based perspective on quality that is used by

services, manufacturing, and public sector organizations involves the
concept of value. A value-added perspective on quality involves a
subjective assessment of the efficacy of every step of the process for
the customer. A value-added activity can be pinpointed by asking,
"Would this activity matter to the customer?" In other words, in most
cases, a value-added activity will have economic value to the customer.
Diff: 2

quality.
Type: Concept
74) ________ involves collecting detailed information about a particular

job.
A) Job forecast
B) Job specification
C) Job selection
D) Job sharing
E) Job analysis
Answer: E
Diff: 1
LO: 1.4: Understand why it is important to know that the different

perspectives exist.
Type: Concept
75) ________ is a performance evaluation process in which an

employee's peers, supervisors, and subordinates are involved in
evaluating the worker's performance.
A) Circular evaluation
B) Upward-downward evaluation
C) 360-degree evaluation
D) Broad spectrum evaluation
E) Inward-outward evaluation
Answer: C
Diff: 1
perspectives exist.
Type: Concept
76) The operations management view of quality is rooted in the

marketing approach.
Answer: FALSE
Diff: 2

perspectives exist.
Type: Concept
77) Operations was the first functional field of management to adopt

quality as its own.
Answer: TRUE
Diff: 1
perspectives exist.
Type: Concept
78) The core values of an organization refer to guiding operating

principles that simplify decision making in that organization.
Answer: TRUE
Diff: 2

perspectives exist.
Type: Concept
79) Alignment refers to consistency between different operational

subplans and the overall strategic plan.
Answer: TRUE
Diff: 2
perspectives exist.
Type: Concept
80) The ultimate goal of strategic quality planning is to aid an

organization to achieve sustainable competitive advantage.
Answer: TRUE
Diff: 2

perspectives exist.
Type: Concept
81) The primary marketing tools for influencing customer perceptions

of quality are conformance and reliability.
Answer: FALSE
Diff: 2
perspectives exist.
Type: Concept
82) The pursuit of quality does not safeguard a company against bad
management.
Answer: TRUE
Diff: 1

perspectives exist.
Type: Application
83) According to the contingency theory, there is a point at which

investment in quality improvement will become uneconomical.
Answer: FALSE
Diff: 2
perspectives exist.
Type: Concept
84) According to the economic quality level model, the pursuit of higher
levels of quality will result in lower expenditures.
Answer: FALSE
Diff: 2

perspectives exist.
Type: Concept
85) Employee empowerment involves removing decision-making

responsibilities from the lowest levels in the organization, thereby
freeing up those workers to accomplish more of their primary tasks.
Answer: FALSE
Diff: 2

perspectives exist.
Type: Concept
86) 360-degree evaluation is a performance evaluation process in which

an employee's peers, supervisors, and subordinates are involved in
evaluating the worker's performance.
Answer: TRUE
Diff: 1

perspectives exist.
Type: Concept
87) What is employee empowerment?
Answer: Employee empowerment is of particular interest to HR

managers. Empowering employees involves moving decision making to
the lowest level possible in the organization. For example,
empowerment can involve something fairly minor, such as allowing
employees to replace broken or worn-out tools without management
approval. In more spectacular instances, empowerment has resulted in
the elimination of management as employees do their own scheduling,
design, and performance of work.
Diff: 1

perspectives exist.
Type: Concept
88) What are the three spheres of quality?
A) quality costs, quality benefits, and quality control
B) quality planning, quality execution, and quality control
C) quality control, quality assurance, and quality management
D) quality benefits, quality risks, and quality management
E) quality costs, quality risks, and quality assurance
Answer: C
Diff: 2
LO: 1.5: Define a quality system using the three spheres.
Type: Concept
89) The ________ process is based on the scientific method, which

includes the phases of analysis, relation, and generalization.
A) quality execution
B) quality implementation
C) quality assurance
D) quality management
E) quality control
Answer: E
Diff: 2
Type: Concept
90) What are the three phases included in the quality control sphere?
A) analysis, relation, and generalization
B) investigation, experimentation, and discovery
C) investigation, relation, and collaboration
D) analysis, synthesis, and discovery
E) investigation, experimentation, and generalization
Answer: A
Diff: 3
Type: Concept
91) In the ________ phase of quality control, a process is divided into

its fundamental pieces.
A) synthesis
B) analysis
C) experimentation
D) generalization
E) relation
Answer: B
Diff: 2
Type: Concept
92) The ________ phase of quality control involves perceiving how

interrelationships apply to the larger phenomenon of quality being
studied.
A) generalization
B) synthesis
C) relation
D) experimentation
E) analysis
Answer: A
Diff: 2

Type: Concept
93) Which of the following activities is related to quality control?
A) creating a quality organizational culture
B) concurrent engineering
C) providing employee recognition
D) off-line experimentation
E) performing acceptance sampling
Answer: E
Diff: 2
Type: Concept
94) ________ refers to activities associated with guaranteeing the

quality of a product or service.
A) Quality control
B) Quality assurance
C) Quality management
D) Quality implementation
E) Quality execution
Answer: B
Diff: 1
Type: Concept
95) Which of the following activities is related to quality assurance?
A) providing leadership and support
B) reducing process variability
C) facilitating organizational communication
D) performing acceptance sampling
E) experimental design
Answer: E
Diff: 3
Type: Concept
96) Which of the following activities is related to quality management?
A) measuring process performance
B) providing employee recognition
C) off-line experimentation
D) design team formation and management
E) developing and maintaining control charts
Answer: B
Diff: 3
Type: Concept
97) The three spheres of quality are quality control, quality assurance,
and quality management.
Answer: TRUE
Diff: 1
Type: Concept
98) The relation phase of quality control involves perceiving how

interrelationships apply to the larger phenomenon of quality being
studied.
Answer: FALSE
Diff: 2
Type: Concept
99) Reducing process variability and performing acceptance sampling
are activities related to quality assurance.
Answer: FALSE
Diff: 2
Type: Concept
100) Providing employee recognition and planning for quality

improvement are activities related to quality management.
Answer: TRUE
Diff: 1
Type: Concept
101) An operations perspective on quality involves a subjective
assessment of the efficacy of every step of the process for the
customer.
Answer: FALSE
Diff: 2
Type: Application
102) Explain the three spheres of quality.
Answer: The three spheres of quality are quality control, quality

assurance, and quality management.
The quality control process is based on the scientific method, which

includes the phases of analysis, relation, and generalization.
Quality assurance refers to activities associated with guaranteeing the

quality of a product or service. Often, these activities are design-
related.
The management processes that overarch and tie together the control
and assurance activities make up quality management.
Diff: 2
Type: Concept
103) ________ involves the processes that overarch and tie together
the quality control and assurance activities.
A) Quality management
B) Quality execution
C) Quality implementation
D) Quality testing
E) Quality development
Answer: A
Diff: 2
LO: 1.6: Understand how the three spheres complement each other.
Type: Application
104) Which of the following descriptions best matches the relationship
of the spheres of quality to each other?
A) The spheres occur in a sequential order starting with quality

management
B) The spheres are unrelated to one another
C) The spheres of quality assurance and quality control overlap with

quality management, but not with one another
D) Quality management overlaps with quality assurance, while quality

control is unrelated
E) All three spheres are related to one another and possess overlapping
functions
Answer: E
Diff: 2
Type: Application
105) Quality development involves the processes that overarch and tie
together the quality control and quality assurance activities.
Answer: FALSE
Diff: 2
Type: Concept
106) Quality management is the only quality sphere that overlaps with
either of the other two spheres of quality control and quality
assurance; quality control and quality assurance are unrelated.
Answer: FALSE
Diff: 1
Type: Application
107) The activities performed within each of the spheres of quality do

not overlap because they are mutually exclusive and unrelated to one
another.
Answer: FALSE
Diff: 1
Type: Concept
108) How do the spheres of quality assurance and quality control

complement one another?
Answer: Quality assurance is utilized to ensure quality of products,

services, and processes. QA activities are primarily design-related and
include product testing efforts. Quality control, or QC, is focused
primarily on how well the quality processes outlined in quality planning
are working to ensure quality. QC activities are primarily monitoring
efforts and can include process optimization and performance
measurements. The quality control efforts to enhance processes affect
quality assurance's ability to detect quality issues, while quality
assurance's detection of design issues may also lead to process
improvements implemented and later utilized by quality control.
Diff: 2
Type: Application
109) A ________ perspective on quality involves a subjective
assessment of the efficacy of every step on the process for the
customer.
A) cultural
B) value-added
C) operations
E) financial
Answer: B
Diff: 1
LO: 1.7: Understand the value-added perspective on quality.
Type: Concept
110) ________ theory presupposes that there is no theory or method

for operating a business that can be applied in all instances.
A) Value-added
B) Collaborative
C) Cost-benefit
D) Contingency
E) Stochastic
Answer: D
Diff: 2
LO: 1.8: Discuss differing cultural perspectives on quality.
Type: Concept
111) The contingency approach to quality helps settle the different

perceptions concerning the definition of quality.
Answer: TRUE
Diff: 1
LO: 1.8: Discuss differing cultural perspectives on quality.
Type: Concept
Chapter 4 Strategic Quality Planning

1) Which of the following is not an example of a strategic content
variable?
A) time
B) leadership
C) quality costs
D) generic strategies
E) product development
Answer: E
Diff: 2
LO: 4.1 Understand the differences between strategy content and

process.
Type: Concept
2) ________ refers to the variables, definitions, components, and

concepts that are included in the strategy.
A) Content
B) Process
C) Prototype
D) Paradigm
E) Criterion
Answer: A
Diff: 2
process.
Type: Concept
3) ________ consists of the steps for developing strategy within an

organization.
A) Prototype
B) Criterion
C) Process
D) Content
E) Paradigm
Answer: C
Diff: 2

process.
Type: Concept
4) Which of the following is not an example of a strategic process?
A) forced-choice model
B) leadership
C) Hoshin planning
D) supply chain strategy
E) product development
Answer: B
Diff: 2

process.
Type: Concept
5) Strategy process answers the question of what is to be contained in

the strategic plan, and strategy content consists of the steps used to
develop the strategy.
Answer: FALSE
Diff: 2

process.
Type: Concept
6) Hoshin planning is a strategic content variable that results in

cascading action plans desired to achieve corporate goals.
Answer: FALSE
Diff: 3

process.
Type: Concept
7) The two dimensions of strategic planning are content and process.
Answer: TRUE
Diff: 1
process.
Type: Concept
8) Strategic planning implies planning for the short term.
Answer: FALSE
Diff: 2
process.
Type: Concept
9) What are content variables? Provide examples of the content

variables that are considered in the strategic planning process?
Answer: Content variables outline key considerations when developing

a strategic plan. These considerations are either explicitly or implicitly
addressed in the strategic planning processes. Examples of key content
variables in the context of quality planning are time, leadership, quality
costs, generic strategies, order winners, and quality as a core
competency.
Diff: 2
process.
Type: Application
10) ________ involves a power-sharing relationship between two or

more individuals where the power is distributed unevenly.
A) Leading
B) Empowerment
C) Planning
D) Organizing
E) Controlling
Answer: A
Diff: 1
LO: 4.2 Discuss strategy content and strategic considerations in quality.
Type: Concept
11) ________ goals are those goals that pertain to achieving a higher
end that benefits not just the individual but the group.
A) Substantive
B) Deterministic
C) Congruent
D) Superordinate
E) Hierarchical
Answer: D
Diff: 1
Type: Concept
12) ________ is derived from a leader’s possession of special

knowledge.
A) Power of expertise
B) Reward power
C) Coercive power
D) Referent power
E) Legitimate power
Answer: A
Diff: 2
Type: Concept
13) If a leader grants raises or promotions to subordinates in return for

some desirable action, the leader has ________.
A) coercive power
B) legitimate power
C) reward power
D) power of expertise
E) referent power
Answer: C
Diff: 2
Type: Concept
14) If the leader has power to punish the follower for not following
rules or guidelines, the leader has ________.
A) power of expertise
B) referent power
C) legitimate power
D) coercive power
E) reward power
Answer: D
Diff: 2
Type: Concept
15) ________ often results in unintended responses, and causes the
follower to rebel and attempt to even the power relationship.
A) Reward power
B) Coercive power
C) Legitimate power
D) Power of expertise
E) Referent power
Answer: B
Diff: 2

Type: Concept
16) If a leader is charismatic or charming and is followed because he or

she is liked, then the leader has ________.
A) referent power
B) coercive power
C) power of expertise
D) legitimate power
E) reward power
Answer: A
Diff: 2

Type: Concept
17) A case of ________ power is the mentor who is admired by his or

her protégés who want to be like the mentor.
A) reward
B) referent
C) legitimate
D) coercive
E) power of expertise
Answer: B
Diff: 2
Type: Concept
18) ________ is derived from the positions that different people hold
within an organization.
A) Power of expertise
B) Coercive power
C) Referent power
D) Reward power
E) Legitimate power
Answer: E
Diff: 2
Type: Concept
19) Which of the following is a knowledge skill exhibited by a leader?
A) assertiveness
B) image building
C) identifying opportunities
D) evaluation skills
E) risk taking
Answer: E
Diff: 2
Type: Concept
20) Which of the following is a communication skill exhibited by a

leader?
A) time management
B) assessing the climate

C) ethics
D) evaluation skills
E) conflict management
Answer: E
Diff: 2
Type: Concept
21) Which of the following is a planning skill exhibited by a leader?
A) developing competence
B) structuring
C) risk taking
D) identifying opportunities
E) assertiveness
Answer: B
Diff: 2
Type: Concept
22) Which of the following is a vision skill exhibited by a leader?

A) decision making
B) identifying opportunities
C) risk taking
D) conflict management
E) time management
Answer: B
Diff: 2
Type: Concept
23) ________ means that leaders provide funding, slack time, and
resources for quality improvement efforts to be successful.
A) Cost evaluation
B) Task management
C) Time management
D) Commitment to quality
E) Task structuring
Answer: D
Diff: 1

Type: Concept
24) Commitment to quality is measured ________.
A) in decades
B) in quarters
C) in budget-cycles
D) annually
E) monthly
Answer: A
Diff: 2

Type: Concept
25) In the forced-choice model, the organization’s position is

determined by examining ________.
A) major future programs
B) major technological forces
C) key government issues
D) explicit strategies of competitors
E) broad economic assumptions
Answer: A
Diff: 2

Type: Concept
26) In the forced-choice model, the environmental assessment is

completed by examining ________.
A) the forecast of operational needs
B) explicit strategies of competitors
C) the statement of mission
D) interrelated set of financial and nonfinancial objectives
E) major future programs
Answer: B
Diff: 2
Type: Concept
27) The acronym TQEM stands for total quality ________.
A) environmental management
B) engineering and management
C) employee management
D) energy management
E) evaluation and management
Answer: A
Diff: 2
Type: Concept
28) The plan-do-check-act cycle is associated with ________.
A) W. Edwards Deming
B) Walter Shewhart
C) Joseph Juran
D) Armand Feigenbaum
E) Kaoru Ishikawa
Answer: A
Diff: 2
Type: Concept
29) Which of the following is not a factor considered during supply

chain strategic planning?
A) suppliers
B) service
C) logistics
D) prices
E) products
Answer: D
Diff: 2
Type: Concept
30) Which of the following is not a factor considered during supply

chain strategic planning? (See Figure 4-5, page 100 in text.)
A) define types of sources items
B) organize improvement of teams and projects

C) identify optimal state for the supply chain
D) implement teams and improvement projects
E) all of the above
Answer: E
Diff: 2
Type: Concept
31) Which of the following is one of the primary reasons that quality
efforts have not led to gains in bottom-line results?
A) companies price high quality items too low
B) low cost items are not profitable
C) quality and profitability are negatively correlated
D) quality is the only variable that affects profitability
E) many companies implement quality incorrectly
Answer: E
Diff: 3
Type: Application
32) Reducing waste and improving environmental performance, which
are consistent with lean and quality management philosophies, are
linked to what business practice or variable?
A) leadership
B) sustainability
C) productivity
D) consistency
E) pricing
Answer: B
Diff: 2

Type: Concept
33) Which of the following would be an example of a leader with

referent power?
A) a leader who punishes rule-breakers
B) a newly appointed leader in a position of power
C) a manager who offers perks and privileges
D) an admired mentor
E) a professor in a classroom
Answer: D
Diff: 3

Type: Application
34) Leading involves a power-sharing relationship between two or more

individuals where the power is distributed unevenly.
Answer: TRUE
Diff: 2
Type: Concept
35) If a leader has power to punish the follower for not following rules
or guidelines, the leader has referent power.
Answer: FALSE
Diff: 2
Type: Concept
36) A leader with coercive power grants raises and promotions to
employees.
Answer: FALSE
Diff: 2
Type: Concept
37) Referent power is derived from personal charisma or charm.

Answer: TRUE
Diff: 2
Type: Concept
38) Legitimate power is derived from the position an individual holds in

an organization.
Answer: TRUE
Diff: 2
Type: Concept
39) Superordinate goals pertain to achieving a higher end that benefits

not just the individual but the group.
Answer: TRUE
Diff: 2
Type: Concept
40) Conflict management is an example of a knowledge skill exhibited

by a leader.
Answer: FALSE
Diff: 3

Type: Concept
41) Assertiveness is an example of a communication skill exhibited by a

leader.
Answer: TRUE
Diff: 2
Type: Concept
42) Acceptance of diversity is an example of a vision skill exhibited by a
leader.
Answer: FALSE
Diff: 2
Type: Concept
43) The trait dimension of leadership deals with variables, such as
height, productivity, and intelligence.
Answer: TRUE
Diff: 2
Type: Concept
44) Nothing can damage a quality improvement effort faster than

management’s failure to consider implementing changes that
employees recommend.
Answer: TRUE
Diff: 2
Type: Application
45) Commitment to quality means that leaders provide funding, slack

time, and resources for quality improvement efforts to be successful.
Answer: TRUE
Diff: 2
Type: Concept
46) Commitment to quality is measured in budget cycles.
Answer: FALSE
Diff: 2

Type: Concept
47) A low-cost orientation is based on continual learning and

production competence.
Answer: TRUE
Diff: 2

Type: Concept
48) Simplification of processes results in flows that are of lower

productivity.
Answer: FALSE
Diff: 3
Type: Application
49) Sustainability is the ability to meet the needs of the current
generation without compromising the ability of future generations to
meet their needs.
Answer: TRUE
Diff: 1
Type: Concept
50) The acronym TQEM stands for Total Quality Engineering and
Management.
Answer: FALSE
Diff: 2
Type: Concept
51) TQEM systems involve a holistic systems view of the processes

causing environmental degradation.
Answer: TRUE
Diff: 2
Type: Concept
52) What are the factors involved in quality improvement?
Answer: Quality improvement is a planned managerial activity. It

involves identifying potential improvements, prioritizing potential areas
for improvement, and planning the implementation of projects and
improvements.
Diff: 2
Type: Concept
53) What sort of consequences can ensue if management sets numeric

goals for quality improvement?
Answer: According to Donald Wheeler, a quality expert, when numeric

goals for quality improvement are set, one of three things will occur:
People will achieve the goals and incur positive results.
People will distort the data.
People will distort the system.

There are many practical examples that could be drawn from public
policy.
Diff: 2
Type: Application
54) Discuss the importance of leadership as a key strategic variable for

quality management.
Answer: Leadership is a key strategic variable for quality management.

A leader organizes, plans, controls, communicates, teaches, advises,
and delegates. Leading involves a power-sharing relationship between
two or more individuals where the power is distributed unevenly.
Leadership is the process by which a leader influences a group to move

toward the attainment of superordinate goals. Superordinate goals are
those goals that pertain to achieving a higher end that benefits not just
the individual but the group.
Diff: 2
Type: Application
55) Explain the five powers exhibited by a leader.

Answer: Power of expertise: Sometimes a leader has special knowledge
(or is perceived to have special knowledge). This type of power tends to
have very narrow parameters in that the followers will follow only
within the confines of the leader’s expertise.
Reward power: If a leader has rewards that he or she can bestow on

subordinates in return for some desirable action, the leader has reward
power. This is often the case in the granting of raises, promotions,
rewards, recognition, or a variety of other incentives.
Coercive power: If the leader has power to punish the follower for not
following rules or guidelines, the leader has coercive power. Such
power often results in unintended responses, such as the follower
giving up or circumventing the leader’s rule surreptitiously.
Referent power: If a leader is charismatic or charming and is followed

because he or she is liked, then the leader has referent power. A case
of referent power is the mentor who is admired by his or her protégés
who want to be like the mentor.
Legitimate power: As a result of the positions that different people hold

within an organization, the manager has the obligation to request
things of subordinates, and the subordinates have the duty to comply
with the request. This is the exercise of legitimate power.
Diff: 3
Type: Concept
56) Explain the four important skills that effective leaders exhibit.
Answer: The four important skills for leaders are knowledge,

communication, planning, and vision. The different phases identify skill
sets that are needed by managers.
In Phase 1, knowledge helps the leader accept risk and moderate the
stress associated with the risk by using coping mechanisms or healthy
outlets.
In Phase 2, the leader must be able to communicate with other leaders

and subordinates.
In Phase 3, the leader must be able to plan and make decisions.
Finally, in Phase 4, the leader must be able to formulate a coherent

vision of the future toward which to plan.
Diff: 2

Type: Concept
57) What is the relationship between quality and ethics?
Answer: Quality is not only good business, it is also good ethics. It is

unethical to ship defective products knowingly to a customer. Reliable
products and low defect rates reflect an ethical approach of
management’s care for its customers.
Companies focusing on their customers often develop a set of ethics

that includes valuing employees. This is reflected in education, training,
health, wellness, and compensation programs that show empathy for
the employees. Increasingly, environmental friendliness is seen as an
ethical concern.
Diff: 2
Type: Concept
58) Give reasons why the effects of quality on business results are
mixed.
Answer: The effects of quality on business results are mixed; some

firms have been wildly successful with their quality efforts, and other
companies have been unsuccessful in gaining bottom-line results. There
are two primary reasons for this.
First, many variables affect profitability besides quality. You might

produce the highest-quality, obsolete product in the world. If you
produce a high-quality product or service that no one wants to buy,
quality management systems likely will not save you.
Second, many companies implement quality incorrectly. That you can

claim you are implementing quality does not guarantee you will be
successful. Quality improvement takes a long time, and many firms
desire quick returns on investment for quality training programs.
Diff: 2
Type: Application
59) Explain the relationship between quality and cost.
Answer: A fundamental difference exists between a low-price strategy,

which is based on competitive pricing, and a low-cost orientation that is
based on continual learning and production competence. Because of
the possible relationship between pricing and low-cost structure, we
anticipate that quality will tend to provide a competitive advantage
relative to other competitors by allowing firms with a high-quality
strategy to incur lower costs they can pass along to the customers.
Diff: 2
Type: Concept
60) What are the three broad categories of the PAF paradigm?
A) performance, appraisal, and functional costs
B) process, assessment, and failure costs
C) prevention, appraisal, and failure costs

D) performance, assessment, and failure costs
E) process, appraisal, and functional costs
Answer: C
Diff: 2
LO: 4.3 Analyze quality costs.
Type: Concept
61) ________ costs are costs that limit the occurrence of defects and
imperfections.
A) Process
B) Assessment
C) Prevention
D) Failure
E) Appraisal
Answer: C
Diff: 2
Type: Concept
62) ________ costs include costs such as training, quality planning,
process engineering, and other costs associated with quality
beforehand.
A) Prevention
B) Process
C) Appraisal
D) Assessment
E) Failure
Answer: A
Diff: 2
Type: Concept
63) Which of the following is considered a prevention cost?
A) cost of troubleshooting
B) laboratory acceptance testing
C) warranty
D) supplier quality assurance
E) on-site performance tests
Answer: D
Diff: 2

Type: Concept
64) ________ costs are associated with the direct costs of measuring
quality.
A) Failure
B) Appraisal
C) Assessment
D) Prevention
E) Process
Answer: B
Diff: 2

Type: Concept
65) ________ costs include lab testing, inspection, test equipment and
materials, and losses due to destructive tests.
A) Assessment
B) Failure
C) Prevention
D) Appraisal
E) Process
Answer: D
Diff: 2
Type: Concept
66) Which of the following is considered an appraisal cost?
A) supplier assessment
B) cost of troubleshooting
C) process waste
D) robust design
E) product quality audits
Answer: E
Diff: 2
Type: Concept
67) ________ failure costs are those associated with online failure.
A) Indirect
B) Generic
C) External
D) Internal
E) Direct
Answer: D
Diff: 1
Type: Concept
68) ________ failure costs are associated with product failure after the
production process.
A) External
B) Indirect
C) Direct
D) Generic
E) Internal
Answer: A
Diff: 1
Type: Concept
69) Failure after the customer takes possession of the product results in
a(n) ________ failure cost.
A) indirect
B) generic
C) external
D) internal
E) direct
Answer: C
Diff: 2
Type: Concept
70) Which of the following is considered a failure cost?
A) on-site performance tests

B) warranty
C) supplier quality assurance
D) robust design
E) product quality audits
Answer: B
Diff: 2
Type: Concept
71) Using the ________, quality costs can be modeled to show the
trade-offs between these costs.
A) law of diminishing marginal returns
B) order-winning criterion
C) forced-choice model
D) supply chain strategy
E) PAF paradigm
Answer: A
Diff: 2
Type: Concept
72) Using the law of diminishing marginal returns, quality costs can be
modeled to show the trade-offs between these costs. This trade-off
model is called the ________.
A) order-winning criterion
B) supply chain model
C) PAF paradigm
D) forced-choice model
E) Lundvall-Juran model
Answer: E
Diff: 2

Type: Concept
73) The Lundvall-Juran quality cost model states that ________.
A) as quality increases, customer satisfaction increases
B) as expenditures in inspection and control activities increase, quality

conformance decreases
C) as design and manufacturing costs increase, quality increases
D) as expenditures in prevention and appraisal activities increase,

quality conformance increases
E) as inspection costs increase, customer satisfaction decreases
Answer: D
Diff: 2

Type: Concept
74) Appraisal costs include costs such as training and quality planning.
Answer: FALSE
Diff: 2

Type: Concept
75) Appraisal costs are associated with the direct costs of measuring
quality.
Answer: TRUE
Diff: 2
Type: Concept
76) Supplier monitoring is an example of a preventive cost.
Answer: FALSE
Diff: 2
Type: Concept
77) Failure costs are categorized into tangible failure costs and
intangible failure costs.
Answer: FALSE
Diff: 2
Type: Concept
78) Internal failure costs are the costs associated with online failure.
Answer: TRUE
Diff: 2
Type: Concept
79) External failure costs are associated with product failure after the
production process.
Answer: TRUE
Diff: 2
Type: Concept
80) Warranties and concessions are examples of failure costs.
Answer: TRUE
Diff: 2

Type: Concept
81) Increasing prevention and appraisal costs could result in a

significant increase in failure costs.
Answer: FALSE
Diff: 2
Type: Concept
82) The Lundvall-Juran quality cost model states that as expenditures in
appraisal activities increase, quality conformance should decrease.
Answer: FALSE
Diff: 3
Type: Concept
83) Explain the three categories of quality costs.
Answer: The PAF paradigm 9 translates quality costs into three broad
categories, which are then subdivided into other categories. The three
categories are prevention, appraisal, and failure costs (hence the
acronym PAF).
Prevention costs are those costs associated with preventing defects and
imperfections from occurring. Prevention costs are the most subjective
of the three categories of costs. Prevention costs include costs such as
training, quality planning, process engineering, and other costs
associated with assuring quality beforehand.
Appraisal costs are associated with the direct costs of measuring

quality. These can include a variety of activities such as lab testing,
inspection, test equipment and materials, losses because of destructive
tests, and costs associated with assessments for ISO 9000:2015 or other
awards.
Failure costs are roughly categorized into two areas of costs: internal
failure costs and external failure costs. Internal failure costs are those
associated with online failure, whereas external failure costs are
associated with product failure after the production process.
Diff: 3
Type: Concept
84) What is the Lundvall-Juran Quality Cost Model?
Answer: Using the law of diminishing marginal returns, quality costs

can be modeled to show the trade-offs between these costs. This trade-
off model is called the Lundvall–Juran model.
The Lundvall–Juran model is a simple economic model. It states that as
expenditures in prevention and appraisal activities increase, quality
conformance should increase. For example, the more we spend on
training and developing our employees, the more benefit we should
get.
Diff: 2
Type: Concept
85) If a product is regional or is marketed to a particular segment of the
population, then the generic strategy in use is ________.
A) quality
B) cost
C) differentiation
D) flexibility
E) focus
Answer: E
Diff: 2
LO: 4.4 Understand the role of quality in the competitiveness of the

firms.
Type: Application
86) The key to the Hill model for strategic quality planning is reaching
consensus on the ________.
A) order-winning criterion
B) Lundvall-Juran model
C) supply chain model
D) PAF paradigm
E) forced-choice model
Answer: A
Diff: 2

firms.
Type: Concept
87) ________ is built upon a foundation of long-term commitment to

quality and continual process improvement.
A) Core competency
B) Process engineering
C) Task management
D) Quality control
E) Employee empowerment
Answer: A
Diff: 2

firms.
Type: Concept
88) Which generic strategy is being utilized if a customer perceives

uniqueness of a high-status product or service?
A) quality
B) cost
C) differentiation
D) flexibility
E) focus
Answer: C
Diff: 2

firms.
Type: Application
89) An example of a generic focus strategy would be targeting baby-

boomers by marketing fitness clubs for seniors.
Answer: TRUE
Diff: 2
firms.
Type: Application
90) Differentiation is achieved by a competitor if the consumer merely

perceives the product or service to be unique.
Answer: TRUE
Diff: 1
firms.
Type: Application
91) The order winning criterion cannot be applied to service strategy.
Answer: FALSE
Diff: 2

firms.

Type: Concept
92) Core competencies diminish with use.
Answer: FALSE
Diff: 1

firms.
Type: Concept
93) Core competency is built on the foundation of a long-term
commitment to quality and continual process improvement.
Answer: TRUE
Diff: 1

firms.
Type: Concept
94) The forced-choice model is only useful for companies that are
experienced in strategic planning.
Answer: FALSE
Diff: 1

firms.
Type: Concept
95) Explain the importance for the Hill model in reaching a consensus
on the order-winning criterion (OWC).
Answer: The key to the Hill model is reaching consensus on the OWC.
The process for doing this involves segmenting the business into
smaller markets that can each be identified with an order-winning
criterion. This provides an understanding of the markets the company is
serving. Products are chosen for each market, and marketing provides
sales forecasts for the identified markets.
Diff: 2

firms.
Type: Concept
96) Explain quality as a core competency.
Answer: Core competence consists of communication, involvement,

and a deep commitment to working across organizational boundaries.
Core competencies do not diminish with use. Unlike physical assets,
which do deteriorate over time, competencies are enhanced as they
are applied and shared. For firms operating in rapidly evolving markets
or industries, the ability to change can be more important than the
actual changing technology of the moment. Hence organizations
producing outstanding products or services with a good understanding
of processes are better positioned to operate in the changing market
because they can introduce new products rapidly with fewer quality-
related holdups. Therefore, core competency is built on the foundation
of a long-term commitment to quality and continual process
improvement.
Diff: 2

firms.
Type: Application
97) Explain the forced-choice model of strategic planning.
Answer: The forced-choice model of strategic planning is one of several

strategic planning models that could be adapted to demonstrate
integrated quality planning. It is selected here because of its simplicity
and its usefulness for firms that are beginning strategic planning. It is
generic and is used simply for explanation purposes. It is particularly
useful for companies that are relatively inexperienced in strategic
planning.
Diff: 2
firms.
Type: Concept
98) Kanri refers to ________.
A) quality control
B) employee empowerment
C) product development
D) management control
E) quality conformance
Answer: D
Diff: 2
LO: 4.5 Plan quality improvement using Hoshin planning.
Type: Concept
99) A method for strategic quality planning where a three- to five-year

plan is developed along with the current year’s objectives is called the
________.
A) logistics model
B) PAF paradigm
C) sustainability process
D) Hoshin planning process
E) forced-choice model
Answer: D
Diff: 2
Type: Concept
100) Catchball is the term used to describe the ________ nature of the
Hoshin planning process.
A) simple
B) complex
C) interactive
D) iterative
E) competitive
Answer: C
Diff: 2
Type: Concept
101) Which of the following is the first step in the Hoshin planning
process?
A) product management action plans
B) senior management action plans

C) product management development of one-year goals
D) senior management development of one-year goals
E) development of three- to five-year goals
Answer: E
Diff: 2
Type: Concept
102) Kanri is the term used to describe the interactive nature of the
Hoshin planning process.
Answer: FALSE
Diff: 2
Type: Concept
103) Catchball involves reporting from teams and feedback from

management.
Answer: TRUE
Diff: 2
Type: Concept
104) Explain the Hoshin planning process.
Answer: Hoshin is Japanese for a compass, a course, a policy, or a plan.

This is to indicate a vision or purpose to an existence. Kanri refers to
management control. In English, this is generally referred to as policy
deployment. Hoshin has been used in Japan since the 1960s as a means
of implementing policy. Implicit in the Hoshin Kanri is the use of the
basic seven tools of quality, the new tools of quality, and quality
function deployment.
In the Hoshin process, the company develops a three- to five-year plan,
and senior executives develop the current year’s Hoshin objectives.
Then the process of catchball occurs. Catchball is the term used to
describe the interactive nature of the Hoshin planning process.
Catchball involves reporting from teams and feedback from
management. The development of the Hoshin plan results in the
cascading of action plans that are designed to achieve corporate goals.
Diff: 2
Type: Concept
Chapter 6 The Voice of the Market
1) Toyota developed the world-class production system known as

________.
A) business process reengineering
B) just-in-time
C) total quality management
D) benchmarking
Answer: B
Diff: 2
LO: 6.1 Discuss the different types of benchmarking.
Type: Application
2) The sharing of information between companies so that both can

improve is called ________.
A) reengineering
B) baselining
C) benchmarking
D) interfacing
E) data mining
Answer: C
Diff: 1
Type: Concept
3) The goal of ________ benchmarking is to identify and to observe the

best practices from one or more benchmark firms.
A) product
B) strategic
C) process
D) financial
E) functional
Answer: C
Diff: 2
Type: Concept
4) ________ benchmarking allows initiator firms to assess their

competitive position by comparing products and services with those of
target firms.
A) Functional
B) Strategic
C) Product
D) Performance
E) Process
Answer: D
Diff: 2
Type: Concept
5) The process of dismantling competitors’ products to understand the

strengths and weaknesses of their designs is referred to as ________.
A) benchmarking
B) reengineering
C) baselining
D) inverse production
E) reverse engineering
Answer: E
Diff: 2
Type: Concept
6) ________ benchmarking involves observing how others compete.
A) Strategic
B) Product
C) Performance
D) Functional
E) Process
Answer: A
Diff: 2
Type: Concept
7) A benchmarking effort that is limited to studying the purchasing
department of another firm is referred to as ________ benchmarking.
A) functional
B) performance
C) process
D) strategic
E) product
Answer: A
Diff: 3

Type: Application
8) ________ is based on the concept of 5w2h.
A) Business process benchmarking
B) Statistical process control
C) Total quality management
D) Business process reengineering
E) Reverse engineering
Answer: A
Diff: 2

Type: Concept
9) In the ________ process of business process benchmarking, the

inputs are aligned together to form the product or service.
A) reconstruction
B) control
C) reengineering
D) transformation
E) conversion
Answer: E
Diff: 2
Type: Concept
10) The ________ process of business process benchmarking results in

outputs that are eventually sold to customers.
A) transformation
B) conversion
C) control
D) reconstruction
E) reengineering
Answer: B
Diff: 2
Type: Concept
11) In the conversion process, the feedback loop that involves

gathering, analyzing, and using the data to adjust the process is called
the ________ process.
A) control
B) reengineering
C) reconstruction
D) development
E) transformation
Answer: A
Diff: 2
Type: Concept
12) What is the first step in Xerox’s 10-step process to benchmarking?
A) determine the current performance gap
B) identify whom to benchmark
C) decide what to benchmark
D) develop action plans

E) project future performance levels
Answer: C
Diff: 2
Type: Concept
13) Which of the following steps in Xerox’s 10-step process to

benchmarking helps companies prioritize which areas are the first
candidates for change and improvement?
A) determine the current performance gap

B) plan and conduct the investigation
C) identify whom to benchmark
D) decide what to benchmark
E) develop action plans
Answer: A
Diff: 2
Type: Concept
14) Which of the following steps in Xerox’s 10-step process to
benchmarking involves predicting whether the performance gap for the
benchmarked processes will narrow or widen in the coming years?
A) develop action plans
B) determine the current performance gap
C) plan and conduct the investigation
D) project future performance levels
E) implement specific actions and monitor progress
Answer: D
Diff: 2
Type: Concept
15) Which of the following types of benchmarking does not require
direct interaction between the initiator firm and the target firm?
A) functional
B) product
C) performance
D) financial
E) process
Answer: D
Diff: 1

Type: Concept
16) ________ benchmarking often includes reverse engineering in

order to develop new design ideas.
A) Product
B) Strategic
C) Process
D) Financial
E) Functional
Answer: A
Diff: 2

Type: Concept
17) ________ benchmarking to assess overall competitiveness can be

accomplished by gathering and comparing business results using online
databases such as Lexis/Nexis.
A) Functional
B) Strategic
C) Product
D) Financial
E) Process
Answer: D
Diff: 2
Type: Application
18) Which of the following is not one of the purposes of benchmarking?
A) learning from success
B) national leadership
C) stealing ideas
D) beating industry standards
E) best-in-world
Answer: C
Diff: 3
Type: Concept
19) A benchmark is an organization recognized for its exemplary

operational performance.
Answer: TRUE
Diff: 1
Type: Concept
20) Toyota developed the world-class production system known as

business process reengineering.
Answer: FALSE
Diff: 2

Type: Concept
21) Openness can create a competitive advantage through creating

psychological barriers to competition.
Answer: TRUE
Diff: 2

Type: Concept
22) The first step a benchmarking firm must take is to document

current performance.
Answer: TRUE
Diff: 2
Type: Concept
23) In a benchmarking relationship, the initiator firm is the firm that is
being studied.
Answer: FALSE
Diff: 2
Type: Concept
24) In performance benchmarking, the initiator firm focuses its

observation and investigation on business processes.
Answer: FALSE
Diff: 2
Type: Concept
25) Financial benchmarking involves direct interaction between the

initiator firm and the target firms.
Answer: FALSE
Diff: 2
Type: Concept
26) Dismantling competitors’ products to understand the strengths and

weaknesses of their designs is called reverse engineering.
Answer: TRUE
Diff: 2
Type: Concept
27) Strategic benchmarking involves observing how others compete.
Answer: TRUE
Diff: 1

Type: Concept
28) In functional benchmarking, a company focuses its benchmarking

efforts on a single function to improve the operation of that function.
Answer: TRUE
Diff: 1

Type: Concept
29) The 5w2h concept is labeled as such because a business process

benchmarking project should result in the answers to five questions.
Answer: FALSE
Diff: 1
Type: Concept
30) The 5w2h questions should be viewed in the context of a process.
Answer: TRUE
Diff: 2
Type: Concept
31) The conversion process results in outputs that are eventually sold
to customers.
Answer: TRUE
Diff: 2
Type: Concept
32) In the control process, the inputs are aligned together to form the
product or service.
Answer: FALSE
Diff: 3
Type: Concept
33) The first step in Xerox’s 10-step process to benchmarking is

identifying whom to benchmark.
Answer: FALSE
Diff: 2
Type: Concept
34) Determining the current performance gap helps the company

prioritize which areas are the first candidates for change and
improvement.
Answer: TRUE
Diff: 2

Type: Concept
35) Explain the process of benchmarking.
Answer: Benchmarking is the sharing of information between

companies so that both can improve. The first step a benchmarking
firm must take is to document current performance. This activity will
allow the company to pinpoint its goals and find a company (inside or
outside the industry) that already excels at what it is trying to
accomplish, study what it does, and gather ideas for improvement.
Benchmarking is useful for externally validating an organization’s
approach to its business. If the managers in a firm are unsure that they
are pursuing a useful plan of action, benchmarking can help them
understand how what they are doing stacks up against the masters.
Diff: 1

Type: Concept
36) Differentiate between an initiator firm and a target firm. Are these
static roles?
Answer: There are two parties to each benchmarking relationship: an

initiator firm and a target firm. The initiator firm initiates contact and
studies another firm. The target firm is the firm that is being studied
(also called a benchmarking partner). These are not static roles. Often
the target firm enters into a reciprocal agreement to observe the
initiator firm.
Diff: 2
Type: Application
37) Describe the concept of performance benchmarking.
Answer: Performance benchmarking allows initiator firms to assess

their competitive position by comparing products and services with
those of target firms. Performance issues may include cost structures,
various types of productivity performance, speed of concept to market,
quality measures, and other performance evaluations.
Diff: 2
Type: Concept
38) Describe the concept of functional benchmarking.
Answer: In functional benchmarking, a company focuses its

benchmarking efforts on a single function to improve the operation of
that function. An example of functional benchmarking occurs in
purchasing. Often purchasing managers use their networks to share
information about the purchasing function in many different
organizations.
Diff: 2
Type: Concept
39) Describe the concept of 5w2h.
Answer: Business process benchmarking is based on the concept of

5w2h developed by Alan Robinson. The 5w2h concept is labeled as such
because a business process benchmarking project should result in the
answers to seven questions. Five of these questions begin with the
letter “w” (who, what, when, where, and why) and the remaining two
questions begin with the letter “h” (how and how much). The 5w2h
concept is a good starting point because it focuses the participants in
the benchmarking process on the “nuts and bolts” of what is being
done.
Diff: 2
Type: Concept
40) Describe the conversion process and the control process in business
process benchmarking.
Answer: The 5w2h questions should be viewed in the context of a

process. In a broad sense, inputs include the equipment, people,
machines, materials, and design that combine to form a product or
service. The inputs are combined in what is known as the conversion
process. In the conversion process, we align the inputs together to form
the product or service. The conversion process results in outputs that
are eventually sold to customers.
The first feedback loop results from gathering data from the process.
This is known as the control process. The control process involves
gathering, analyzing, and using the data to adjust the process. This is
often the result of using process control charts.
Diff: 3
Type: Concept
41) State Xerox’s formal 10-step process to benchmarking.

Answer: Xerox was an early adopter of benchmarking and has used
benchmarking effectively to improve processes. This approach includes
a formal 10-step process to benchmarking:
Decide what to benchmark.
Identify whom to benchmark.
Plan and conduct the investigation.
Determine the current performance gap.
Project future performance levels.
Communicate benchmarking findings and gain acceptance.
Revise performance goals.
Develop action plans.
Implement specific actions and monitor progress.
Recalibrate the benchmarks.
Diff: 3

Type: Concept
42) Return on assets (ROA) and return on investments (ROI) are

examples of ________.
A) structural measures
B) market share data
C) productivity ratios
D) quality measures
E) financial ratios
Answer: E
Diff: 1
LO: 6.2 Assess what type of benchmarking is most appropriate for a
particular situation.
Type: Concept
43) ________ are useful in measuring the extent to which a firm

effectively uses the scarce resources that are available to the firm.
A) Quality measures
B) Financial ratios
C) Productivity ratios
D) Market share data
E) Structural measures
Answer: C
Diff: 2

Type: Concept
44) ________ are important for monitoring and tracking the

effectiveness of a company’s cycle times, waste-reduction measures,
and value-added measures.
A) Customer-related measures
B) Productivity ratios
C) Quality measures
D) Operating results
E) Structural measures
Answer: D
Diff: 2

Type: Concept
45) Reject rates, capability analysis, and performance information are

examples of ________.
A) structural measures
B) market share data

C) productivity ratios
D) financial ratios
E) quality measures
Answer: E
Diff: 2

Type: Concept
46) ________ include objectives, policies, and procedures followed by a
firm.
A) Productivity ratios
B) Quality measures
C) Market share data
D) Structural measures
E) Operating results
Answer: D
Diff: 2

Type: Concept
47) ________ dictates that decisions are made based on the sound
collection and analysis of data.
A) Strategic benchmarking
B) Baselining
C) Business process reengineering
D) Management by fact
E) Reverse engineering
Answer: D
Diff: 2

Type: Concept
48) ________ is defined as the fundamental rethinking and redesign of

business processes.
A) Process redesign
B) Benchmarking
C) Baselining
D) Reverse engineering
E) Restructuring
Answer: A
Diff: 2

Type: Concept
49) Which of the following best defines the breadth factor of process
redesign?
A) It refers to organizational elements such as responsibilities,

measurements, information technology, and skills.
B) It refers to the monitoring of key internal firm performance

measures over time to identify trends such as improvement in
managerial decision making.
C) It refers to the impact of the process redesign to the entire

organization.
D) It refers to the dismantling of competitors’ products to understand

the strengths and weaknesses of their designs.
E) It refers to the sharing of information between companies so that
both can improve.
Answer: C
Diff: 2

Type: Concept
50) Which of the following best defines the depth factor of process
redesign?
A) It refers to organizational elements such as responsibilities,
B) It refers to the monitoring of key internal firm performance

measures over time to identify trends such as improvement in
C) It refers to the impact of the process redesign to the entire

organization.
D) It refers to the dismantling of competitors’ products to understand

the strengths and weaknesses of their designs.
E) It refers to the sharing of information between companies so that

both can improve.
Answer: A
Diff: 2


Type: Concept
51) ________ requires the monitoring of key internal firm performance

measures over time to identify trends such as improvement to inform
A) Baselining
B) Benchmarking
C) Process redesign
D) Reverse engineering
E) Restructuring
Answer: A
Diff: 2
Type: Concept
52) The ________ process involves identifying measures, establishing

time frames for future data collection, gathering data, and analyzing
data on an ongoing basis to identify performance trends and changes.
A) restructuring
B) baselining
C) reengineering
D) reverse engineering
E) benchmarking
Answer: B
Diff: 2

Type: Concept
53) The concept of ________ implies that you must have something to
offer the target firm in return for sharing information.
A) reciprocity
B) baselining
C) process redesign
D) interfacing
E) restructuring
Answer: A
Diff: 1

Type: Concept
54) Productivity ratios are useful in measuring the extent to which a

firm effectively uses the scarce resources that are available to the firm.
Answer: TRUE
Diff: 2

Type: Concept
55) Customer satisfaction measures are poor indicators of financial

performance.
Answer: FALSE
Diff: 1

Type: Concept
56) Cycle times and waste-reduction measures are examples of

operating results of benchmarking data.
Answer: TRUE
Diff: 2
Type: Concept
57) Quality measures include objectives, policies, and procedures

followed by a firm.
Answer: FALSE
Diff: 1
Type: Concept
58) Management by fact dictates that decisions are made based on the
sound collection and analysis of data.
Answer: TRUE
Diff: 1

Type: Concept
59) To begin the management process of benchmarking, a strategy

statement outlining the goals and strategies to be used is developed.
Answer: TRUE
Diff: 2

Type: Concept
60) It is best to obtain training from organizations that are experienced
with benchmarking and its potential legal liabilities.
Answer: TRUE
Diff: 2

Type: Concept
61) Restructuring is defined as a fundamental rethinking and
redesigning of business processes.
Answer: FALSE
Diff: 1

Type: Concept
62) Breadth refers to the impact of the process redesign to the entire
organization.
Answer: TRUE
Diff: 1

Type: Concept
63) Depth of the process redesign refers to organizational elements

such as responsibilities, measurements, information technology, and
skills.
Answer: TRUE
Diff: 1

AACSB: Information Technology
Type: Concept
64) Baselining requires the monitoring of key internal firm performance

measures over time to identify trends such as improvement to inform
Answer: TRUE
Diff: 2

Type: Concept
65) Baselining is a methodology utilized to inform managerial decision-

making by assessing process redesign impacts.
Answer: TRUE
Diff: 2

Type: Concept
66) Because process redesign affects multiple levels in a firm, abrupt

organizational changes are reflected in baselining results.
Answer: TRUE
Diff: 2
Type: Concept
67) The concept of interfacing implies that you must have something to
offer the target firm in return for sharing information.
Answer: FALSE
Diff: 2
Type: Concept
68) Business process maps are used to identify the exact performance
measures and metrics needed from the target firm.
Answer: TRUE
Diff: 3
Type: Concept
69) Differentiate between financial ratios and productivity ratios of

benchmarking data.
Answer: Financial ratios such as return on assets (ROA) or return on

investments (ROI) are probably the easiest to obtain and compare. For
many financial ratios, all that is needed is an income statement of a
firm and a balance sheet. Many of these statistics are available in
annual reports and on the Internet.
Productivity ratios are useful in measuring the extent to which a firm

effectively uses the scarce resources that are available to the firm.
These include single-factor, multifactor, and total-factor productivity
measures.
Diff: 3

Type: Application
70) Explain the importance of using customer-related results as

benchmarking data.
Answer: Customer-related results include customer satisfaction,

customer dissatisfaction, and comparisons of customer satisfaction
relative to competitors. These measures may be in the form of
retention, gains, losses, customer-perceived value, competitive awards,
competitive customer ratings, and independent organization
evaluations. Customer satisfaction measures are important for gauging
the effectiveness of quality improvement because they are good
indicators of financial performance.
Diff: 2

Type: Concept
71) Give examples of quality measures and structural measures of

benchmarking data.
Answer: Quality measures include conformance-based quality

information such as reject rates, capability information, performance
information, or other measures. These quality measures also can
include scrap and rework measures, percentage of defectives, field
repairs, costs of quality, and many other metrics. The quality measures
also may include data concerning the performance of processes and
time-related statistics.
Structural measures include objectives, policies, and procedures

followed by a firm. They may include safety, production, accounting,
financial, engineering, and other types of structural measures that are
used in determining competitiveness.
Diff: 3

Type: Application
72) Explain the use of performance measures or indicators in
performance improvement.
Answer: A major consideration in performance improvement involves

the creation and use of performance measures or indicators.
Performance measures or indicators are measurable characteristics of
products, services, processes, and operations the company uses to
track and improve performance. The measures or indicators should be
selected to best represent the factors that lead to improved customer,
operational, and financial performance. A comprehensive set of
measures or indicators tied to customer and/or company performance
requirements represents a clear basis for aligning all activities with the
company’s goals. Through the analysis of data from the tracking
processes, the measures or indicators themselves may be evaluated
and changed to better support such goals.
Diff: 2

Type: Concept
73) Explain the process of managing the benchmarking effort.
Answer: Like other quality management efforts, benchmarking is a

managed process. Therefore, management must have an
understanding of the benchmarking process, the participants involved,
and the objectives of the exercise.
Managing the benchmarking process involves establishing, supporting,

and sustaining the benchmarking program. To begin the management
process, a strategy statement outlining the goals and strategies to be
used is developed. With the strategy statement in place, management
sets expectations for performance relating to the benchmarking
project. At a minimum, the expectations for benchmarking are that this
is an ongoing process that serves as a basis for improvement (not a
one-time event) and that specific deliverables are to be identified by
management that must be fulfilled.
Diff: 2

Type: Concept
74) Explain the importance of training in benchmarking.
Answer: Training is a key to success in all quality management

approaches. This is especially true for benchmarking. Participants must
have project management skills and be familiar with benchmarking
approaches and protocols. Benchmarking carries with it legal liabilities
that should be addressed during the training.
Training should include managerial training, cross-functional
benchmarking skills training, team training, and documentation training
(flowcharting). Many of these training courses are available from many
different consulting organizations. It is best to obtain training from
organizations that are experienced with benchmarking. Many
companies have established external training arms that can be hired by
competing firms.
Diff: 2

Type: Concept
75) Define process redesign. State the two factors that are critical to
achieving success through process redesign.
Answer: Process redesign is defined as a fundamental rethinking and

redesign of business processes.
Such change is often accompanied by the automation of business

processes. Two factors are critical to achieving success through process
redesign:
Breadth refers to the impact of the process redesign to the entire

organization.
Depth refers to organizational elements such as responsibilities,

Diff: 2
Type: Concept
76) Explain the concept of baselining.
Answer: A methodology that can be applied in assessing business

process redesign impacts is baselining. Baselining requires the
monitoring of key internal firm performance measures over time to
identify trends such as improvement (or decline) to inform managerial
decision making. The baselining process involves identifying measures,
establishing time frames for future data collection, gathering data, and
analyzing data on an ongoing basis to identify performance trends and
changes.
Diff: 1

Type: Concept
77) State the four key problems with benchmarking.
Answer: Benchmarking is not a simple activity, and it can be difficult to

implement any of these tools and concepts. There are four key
problems with benchmarking:
There may be substantial difficulty obtaining cooperation from other

firms in your own industry. Most organizations have much less clout.
The thing to remember is reciprocity. To be effective, you must have
something to offer the target firm in return for sharing information.
The predominance of functional benchmarking with firms in

noncompeting industries makes it difficult to benchmark with these
firms. It takes much ingenuity to identify benchmarks properly from
noncompeting firms.
Your efforts will be wasted unless you fully understand your own
processes before you benchmark someone else. Using tools such as
business process maps, it is possible to identify the exact performance
measures and metrics needed from the target firm.
Benchmarking is time-consuming and costly.
Diff: 2

Type: Concept
78) What is the formula used to calculate scrap efficiency?
A) scrap/cost of goods sold
B) (cost of goods sold – scrap)/scrap
C) cost of goods sold/scrap
D) (scrap – cost of goods sold/scrap
E) cost of goods sold × scrap
Answer: C
Diff: 2
LO: 6.3 Compute single-, multi-, and total factor productivity.
Type: Concept
79) If the cost of goods sold reported by Champion Cooling Co. is equal
to $600,000 and the scrap cost amounts to $50,000, what is their scrap
efficiency?
A) 8.33
B) 30.0
C) 12.0
D) 18.5
E) 22.8
Answer: C
Diff: 2

AACSB: Analytical Thinking
Type: Application
80) Champion Cooling Co. signed an exclusive contract with a scrap

metal dealer that is willing to pay 33 cents a pound for scrap copper. If
the cost of goods sold reported by Champion amounts to $100,000 and
the scrap cost is equal to $20,000 for their 3030 pounds of scrap
copper, what is Champion’s scrap efficiency?
A) 7.60
B) 5.00
C) 6.26
D) 9.33
E) 3.18
Answer: B
Diff: 2
Type: Application
81) Ajax Carpet Cleaning promises to clean 100 square feet of carpet for
$15.00. Their work standard for such a job is $5.00 for labor and $2.00
for cleaning supplies. Since they use the customer’s electricity, there
are no other inputs in to the cleaning process. What is their labor
productivity?
A) 3.00
B) 7.50
C) 20.00
D) 10.0
E) 50.0
Answer: A
Diff: 3
Type: Application
82) Make-Do, a national automotive painting service, paints cars for

$199. Their work standard for such a job is $20.00 for labor and $30.00
for paint. They consume $10 worth of supplies and $3 of energy during
their service. What is their total factor productivity?
A) 3.16
B) 9.95
C) 5.83
D) 13.6
E) 18.24
Answer: A
Diff: 3
Type: Application
83) Ajax Carpet Cleaning promises to clean 100 square feet of carpet for
$20.00. Their work standard for such a job is $5.00 for labor and $2.50
for cleaning supplies. Since they use the customer’s electricity, there
are no other inputs in to the cleaning process. What is their labor
productivity?
A) 20.0
B) 4.00
C) 8.00
D) 2.50
E) 40.0
Answer: B
Diff: 3

Type: Application
Use the following information to answer the question(s) below.
A company has gathered the following financial information for itself

and a competing firm. The company wishes to compare productivity for
the two firms:
Firm A Firm B
Labor $ 25,000 $ 20,000
Plant and Equipment $ 120,000 $ 150,000
Energy $ 7,500 $ 15,000
Materials $ 240,000 $ 200,000
Sales $ 480,000 $ 520,000

84) Calculate the labor productivity of Firm A.
A) 19.2
B) 24.0
C) 20.8
D) 26.0
E) 9.6
Answer: A
Diff: 3
Type: Application
85) Calculate the plant and equipment productivity of Firm B.
A) 26.00
B) 2.60
C) 19.20
D) 3.47
E) 34.67
Answer: D
Diff: 3

Type: Application
86) Calculate the energy productivity of Firm A.
A) 34.67
B) 64.00
C) 19.20
D) 27.43
E) 69.33
Answer: B
Diff: 3
Type: Application
87) Calculate the materials productivity of Firm B.
A) 3.47
B) 10.40
C) 19.20
D) 6.80
E) 2.60
Answer: E
Diff: 2
Type: Application
88) Calculate the total factor productivity for Firm A.
A) 19.20
B) 3.31
C) 1.22
D) 14.77
E) 8.68
Answer: C
Diff: 3
Type: Application
89) Calculate the total factor productivity for Firm B.
A) 14.86
B) 1.35
C) 2.60
D) 34.67
E) 20.28
Answer: B
Diff: 2
Type: Application
90) Which measure provides the most complete picture of firm

productivity?
A) firm materials output
B) the ratio of firm output to a single input
C) multiple factor productivity
D) single-factor productivity
E) total factor productivity

Answer: E
Diff: 1
Type: Concept
91) The higher a firm’s scrap efficiency ratio, the less efficient is the use
of its materials.
Answer: FALSE
Diff: 2
Type: Application
92) Firm A has a total factor productivity of 10.0 while Firm B has a total
factor productivity of 8.0. Therefore, Firm B is the more productive firm
and utilizes its resources most efficiently.
Answer: FALSE
Diff: 2
Type: Application
93) The scrap efficiency can be calculated by dividing the cost of scrap
by the cost of goods sold.
Answer: FALSE
Diff: 2
Type: Concept
94) The scrap efficiency formula normalizes the cost of scrap based on
the volume of business that a firm does.
Answer: TRUE
Diff: 2

Type: Concept
95) The cost of goods sold to scrap ratio is a multiple factor ratio.
Answer: FALSE
Diff: 3
Type: Concept
96) Total factor productivity is less sensitive to differences in costing
conventions and accounting practices.
Answer: TRUE
Diff: 2
Type: Concept
97) How is a scrap efficiency ratio calculated?

Answer: Consider the computation of scrap in which a company
computes the ratio of cost of goods sold to scrap. The formula for this
computation is:
Scrap Efficiency = Cost of Goods Sold/ Scrap
This formula normalizes the cost of scrap based on the volume of

business that a firm does. The resulting ratio is the proportion of the
material inputs to production that is wasted as scrap. The higher the
ratio, the more efficient is the use of these materials.
Diff: 2
Type: Concept
98) The benchmarking principle of ________ states that you must be
willing to provide the same level of information that you request.
A) preparation
B) exchange
C) completion
D) understanding and action
E) use
Answer: B
Diff: 2
LO: 6.4 Understand the ethical issues associated with benchmarking
AACSB: Ethical Understanding and Reasoning

Type: Concept
99) Which of the following is not one of the potential legal issues
described in the benchmarking principle of legality?
A) price fixing
B) dealing arrangements
C) bid rigging
D) bribery
E) unethical behavior
Answer: E
Diff: 2

Type: Concept
100) If a firm follows a strict code of conduct, then ethical abuses will
never occur.
Answer: FALSE
Diff: 2
Type: Application
101) Extending one company’s benchmarking study findings to another
without the first company’s permission would be a violation of the
principle of use.
Answer: TRUE
Diff: 2
Type: Application
102) To contribute to efficient, effective, and ethical benchmarking,
individuals abide by benchmarking principles.
Answer: TRUE
Diff: 2
Type: Concept
1) ________ allows foreign firms to sell in restricted markets while

using the design of the original designer.
A) Exporting
B) Franchising
C) Licensing
D) Importing
E) Partnering
Answer: C
Diff: 2
LO: 3.1 Understand the importance of quality in global economics.
Type: Concept
2) By changing their ________ environment, firms locate themselves

near to or far away from natural resources.
A) economic
B) task
C) physical
D) global
E) social
Answer: C
Diff: 1
Type: Concept
3) The portion of a firm’s environment that has to do with the operating
structure the firm encounters when globalizing is called the ________
environment.
A) global
B) physical
C) social
D) task
E) economic
Answer: D
Diff: 2
Type: Concept
4) The ________ environment facing globalizing corporations refers to
cultural factors such as language, business customs, customer
preferences, and patterns of communication.
A) task
B) social
C) physical
D) global
E) economic
Answer: B
Diff: 2

Type: Concept
5) ________ produce their products and ship them internationally.
A) Exporters
B) Licensors
C) Franchisors
D) Importers
E) Retailers
Answer: A
Diff: 1

Type: Concept
6) By licensing, a U.S. firm can allow foreign firms to sell in restricted

markets while using the design of the original designer.
Answer: TRUE
Diff: 2
Type: Concept
7) Through licensing, firms are able to reach international markets
without having to establish international supply chains or marketing
arms.
Answer: TRUE
Diff: 2
Type: Concept
8) The benefits of licensing and partnering are that the exporting firm
does not have to globalize to make sales in international markets.
Answer: TRUE
Diff: 2
Type: Concept
9) With growing economies in many parts of the world, firms need to

globalize to participate in these markets.
Answer: TRUE
Diff: 1
Type: Concept
10) The social environment of the firm has to do with the operating
structure that the firm encounters when globalizing.
Answer: FALSE
Diff: 2
Type: Concept
11) The physical environment facing globalizing corporations refers to

cultural factors such as language and business customs.
Answer: FALSE
Diff: 1
Type: Concept
12) Market diversity drives the need for culture-specific research and
development.
Answer: TRUE
Diff: 2
Type: Concept
13) Importers produce their products and ship them internationally.
Answer: FALSE
Diff: 2

Type: Concept
14) What is globalization?
Answer: Globalization means that a firm fundamentally changes the

nature of its business by establishing production and marketing
facilities in foreign countries. We refer to these firms as multinational
corporations. With growing economies in many parts of the world, such
as Mexico, India, Brazil, Eastern Europe, China, and Russia, firms need
to globalize to participate in these markets. However, there are effects
of globalization that firms often overlook. By globalizing, firms
significantly change the physical environment, the task environment,
and the social environment in which they operate.
Diff: 2

Type: Concept
15) Describe the differences between the task environment and the
social environment of a firm.
Answer: The task environment of the firm has to do with the operating
structure that the firm encounters when globalizing. In contrast, the
social environment facing globalizing corporations refers to cultural
factors such as language, business customs, customer preferences, and
patterns of communication.
Diff: 2
Type: Concept
16) Explain the role of exporters in international markets. What are the
difficulties they face?
Answer: Exporters produce their products and ship them

internationally, incurring high shipping costs but avoiding many of the
problems, such as loss of control associated with globalization.
However, success on a multinational scale may be more difficult to
attain for exporters because they never develop the marketing
expertise and logistical capabilities associated with entering foreign
markets. Many times pure exporters are subject to limitations that
resident companies do not have in terms of import tariffs and import
restrictions.
Diff: 2
Type: Concept
17) Which of the following approaches to quality is influenced by a

culture of waste reduction due to limited natural resources and high
importing costs?
A) the Japanese approach
B) the European approach
C) the Chinese approach
D) the American approach
E) the Russian approach
Answer: A
Diff: 2
LO: 3.2 Explain the role of culture in quality approaches.
Type: Concept
18) Which of the following quality approaches is influenced by a culture

of results and focuses on the benefits quality provides to the bottom-
line?
A) the Japanese approach
B) the European approach
C) the Chinese approach

D) the American approach
E) the Russian approach
Answer: D
Diff: 2
Type: Concept
19) The ________ approach to quality is most sensitive to employees

and employee satisfaction as a result of strong unions.
A) Japanese
B) European
C) Chinese
D) American
E) Russian
Answer: B
Diff: 2
Type: Concept
20) Group technology is utilized among which of the following cultures

as a quality method?
A) Japanese
B) European
C) Chinese
D) American
E) Russian
Answer: E
Diff: 2
Type: Concept
21) The European cultural approach to quality is based in waste
elimination and an ethic of consistency.
Answer: FALSE
Diff: 1
Type: Concept
22) Americans have a command-and-control approach to quality based

upon a culture of political and military business management practices.
Answer: TRUE
Diff: 1
Type: Concept
23) How does culture influence the Japanese approach to quality

management?
Answer: With the limited natural resources in Japan due to the small
size of its landmass, many raw materials are imported in to the country
at a premium cost. This creates a cultural ethic that appreciates
precious resources and is determined to reduce waste. Additionally, the
culture values consistency and awards those who conform to quality
standards with the Deming Prize, which is focused on process
improvement and quality business practices.
Diff: 2
Type: Concept
24) How do the Japanese and American approaches to quality

management differ? What factors have shaped those differences and
what evidences the differences in quality values?
Answer: The American approach to quality management is results-
oriented while the Japanese approach is process-oriented. The
differences are apparent in evaluating criteria of the American Baldrige
Award as opposed to the Japanese Deming prize as well. Economic
factors such as high export costs and the physical environment also play
a role in Japan’s focus on eliminating waste and valuing resources.
Americans also have a social environment that is customer-focused and
that is reflected in its approach to quality. Global, cultural, and
environmental factors have shaped the differences in approaches to
quality management in Japan and America.
Diff: 2
Type: Synthesis
25) The ________ for quality was established in 1951 by the Japanese
Union of Scientists and Engineers.
A) Deming Prize
B) Juran Prize
C) Ishikawa Prize
D) Taguchi Prize
E) Baldrige Prize
Answer: A
Diff: 1
LO: 3.3 Compare and contrast American, European, and Japanese

approaches to quality management.

Type: Concept
26) The Deming Prize is awarded to individuals and groups who have
contributed to the field of ________.
A) lean manufacturing
B) quality control
C) sales management
D) just-in-time production
E) strategic planning
Answer: B
Diff: 2
Type: Concept
27) Which of the following is a category of the Deming Prize?
A) information analysis
B) workforce focus
C) strategic planning
D) partnerships and resources
E) customer results
Answer: A
Diff: 2
Type: Concept
28) Which of the following is a category of the European Quality

Award?
A) policy deployment
B) operations focus
C) information analysis
E) human resources development
Answer: D
Diff: 2

Type: Concept
29) The Deming Prize is awarded to individuals and groups who have
contributed to the field of quality control.
Answer: TRUE
Diff: 1

Type: Concept
30) Customer focus and workforce focus are categories of the Deming
Prize.
Answer: FALSE
Diff: 2

Type: Concept
31) Leadership and strategy are categories of the European Quality

Award.
Answer: TRUE
Diff: 2
Type: Concept
32) The highest level of the European Quality Award is the award for
the most accomplished applicant in a given year.
Answer: TRUE
Diff: 2

Type: Concept
33) The European Quality Award focuses on those things that lead to
customer service and improved products, whereas the Baldrige
criterion focuses on employee satisfaction as an outcome of the quality
system.
Answer: FALSE
Diff: 2

Type: Concept
34) The model for the Baldrige consists of ________ interrelated

categories that compose the organizational system for performance.
A) four
B) five
C) six
D) seven
E) eight
Answer: D
Diff: 1
LO: 3.4 Explain the Baldrige award process.
Type: Concept
35) The basis of the Baldrige model is ________.
A) operations management
B) information and analysis
C) accounting and finance
D) statistical process control
E) Six Sigma
Answer: B
Diff: 2
Type: Concept
36) Which of the following categories is not a criterion for the Malcolm
Baldrige Award?
A) Internet competencies
B) operations focus
D) business results
E) leadership
Answer: A
Diff: 1
Type: Concept
37) Which of the following Baldrige criteria is used to evaluate the

extent to which top management is personally involved in creating and
reinforcing goals, values, directions, and customer involvement?
A) workforce focus
B) leadership
D) operations focus
E) business results
Answer: B
Diff: 2
Type: Concept
38) Which of the following Baldrige criteria requires the applicant to

outline what the firm is doing to fulfill its responsibility as a corporate
citizen?
A) business results
B) operations focus
D) leadership
E) customer focus
Answer: D
Diff: 2
Type: Concept
39) Which of the following Baldrige criteria focuses on how a firm
assesses the relative importance of product or service features to the
customer?
A) operations focus
B) business results
C) customer focus
D) leadership
E) strategic planning
Answer: C
Diff: 2
Type: Concept
40) Which of the following Baldrige criteria involves developing an
internal environment conducive to full participation and personal
growth, including human resources development?
A) workforce focus
B) strategic planning
C) measurement, analysis, and knowledge management
D) customer focus
E) leadership
Answer: A
Diff: 2
Type: Concept
41) Which of the following Baldrige criteria examines key aspects such
as customer focus in design, work system, design for services and
products, support processes, and processes relating to partners?
A) workforce focus
B) strategic planning
C) measurement, analysis, and knowledge management
D) business results
E) operations focus
Answer: E
Diff: 2
Type: Concept
42) What is the first step for a firm applying for the Baldrige award?
A) a review of financial statements
B) quality assessment
C) a site-visit by examiners
D) eligibility determination
E) consensus review
Answer: D
Diff: 2
Type: Concept
43) What is the main purpose of a Baldrige site visit?
A) to introduce the selection committee to the top management team

of the contending firm
B) to formally congratulate an award winner
C) to verify and clarify those portions of the Baldrige application having

the greatest impact on the judges’ scores
D) to discuss the outcome of the evaluation process

E) to collect additional information on each of the seven evaluation
criteria
Answer: C
Diff: 3
Type: Concept
44) What is the major reason for the decrease in the number of
applicants for the Malcolm Baldrige Award?
A) decline in the prestige associated with the award
B) high application fee
C) difficulty associated with winning the award

D) lack of legitimacy of the award criteria
E) low focus on quality
Answer: C
Diff: 2
Type: Concept
45) In the ________ approach, the scores required to win the state
awards are lower than those for the national awards.
A) multilevel
B) Baldrige quality
C) Baldrige-lite
D) full-Baldrige
E) consensus
Answer: D
Diff: 2
Type: Concept
46) The ________ approach uses the Baldrige criteria but with a
simplified process or application.
A) Baldrige quality
B) consensus
C) full-Baldrige
D) Baldrige-lite
E) multilevel
Answer: D
Diff: 1
Type: Concept
47) In the multilevel approach, the top level includes the ________
approach.
A) consensus
B) full-Baldrige
C) strategic
D) Baldrige quality
E) Baldrige-lite
Answer: B
Diff: 2

Type: Concept
48) In the multilevel approach, the second level includes the ________
approach.
A) consensus
B) full-Baldrige
C) strategic
D) Baldrige quality
E) Baldrige-lite
Answer: E
Diff: 2

Type: Concept
49) Which of the following is a category of the Baldrige Award?
A) policy development
B) information analysis
C) workforce focus
E) management system
Answer: C
Diff: 2
Type: Concept
50) The Baldrige criteria are nonprescriptive and adaptable.
Answer: TRUE
Diff: 2

Type: Concept
51) The Baldrige criteria specify which tools, techniques, or organization

a company should use to improve.
Answer: FALSE
Diff: 2
Type: Concept
52) The Baldrige criterion that evaluates the extent to which top
management is personally involved in creating and reinforcing goals is
the leadership category.
Answer: TRUE
Diff: 2
Type: Concept
53) Customer focus involves developing an internal environment
conducive to full participation and personal growth, including human
resources development.
Answer: FALSE
Diff: 2
Type: Concept
54) The main purpose of a Baldrige site visit is to collect additional
information on each of the seven evaluation criteria.
Answer: FALSE
Diff: 2
Type: Concept
55) The scoring summary in the feedback report is a synthesis of the

most important strengths and areas for improvement for each of the
seven Baldrige categories.
Answer: TRUE
Diff: 2
Type: Concept
56) The examiners for the Baldrige Award demonstrate their

commitment to its core values by being willing to give up approximately
10% of their year to serve on the board with no compensation.
Answer: TRUE
Diff: 1
Type: Concept
57) In the full-Baldrige approach, the scores required to win the state
awards are higher than those for the national awards.
Answer: FALSE
Diff: 2
Type: Concept
58) The Baldrige-lite approach uses the Baldrige criteria but with a
simplified process or application.
Answer: TRUE
Diff: 2
Type: Concept
59) Information analysis is a category of the Baldrige Award.
Answer: FALSE
Diff: 2

Type: Concept
60) Describe the key characteristics of the Malcolm Baldrige Award.
Answer: The criteria focus on business results. Companies must show

outstanding results in areas such as financial performance, customer
satisfaction, customer retention, product performance, service
performance, productivity, supplier performance, and public
citizenship. The Baldrige criteria are nonprescriptive and adaptable.
Although the focus of the Baldrige is on results, the means for obtaining
these results are not prescribed. The criteria support company-wide
alignment of goals and processes, and permit goal-based diagnosis.
Diff: 1

Type: Concept
61) Explain the seven interrelated categories of the Baldrige Award that
compose the organizational system for performance.
Answer: Category 1 provides the award criteria for leadership. This

category is used to evaluate the extent to which top management is
personally involved in creating and reinforcing goals, values, directions,
customer involvement, and a variety of other issues.
Category 2 focuses on how the company establishes strategic directions

and how it sets its tactical action plans to implement the strategic
plans.
Category 3 addresses customer focus. To be successful in serving the

customer, firms must understand the product and service attributes
that are important to the customer.
Category 4, measurement, analysis, and knowledge management,
relates to the firm’s selection, management, and use of information to
support company processes and to improve firm performance.
Category 5 deals with the workforce focus. The workforce is to be

enabled to develop and use its full potential, aligned with company
objectives.
Category 6 examines key aspects of operations focus. These aspects

include customer focus in design, work system, design for services and
products, support processes, and processes relating to partners.
Category 7 documents the results of the other categories and requires

a series of tables and graphs that demonstrate the operational and
business results of the firm.
Diff: 2

Type: Concept
62) Explain the term “Baldrige-qualified.”
Answer: For the firm applying for the Baldrige award, the first step is
eligibility determination. Once eligibility is established, the applicant
sends the completed application to NIST. The application is then
subjected to first-round review by Baldrige examiners. During this
review, examiners read and score the applications. Judges then review
the scoring to determine which applicants will continue to consensus.
During the consensus phase, between five and eight examiners who
have scored the application participate in a conference call to
determine a consensus score for each of the scoring items.
Once consensus is reached, judges receive a consensus report from the

senior examiner leading the examiner team. Judges then make a site-
visit determination. At this point, applicants scoring sufficiently high are
granted a site visit. In the past, simply the granting of a Baldrige site
visit has been cited as evidence of high-quality processes. These firms
sometimes refer to themselves as “Baldrige qualified.”
Diff: 2
Type: Concept
63) Differentiate between the full-Baldrige approach and the Baldrige-

lite approach.
Answer: A review of the different state award programs reveals three

categories of approaches to state awards. The first approach is the full-
Baldrige approach. In these states, the Baldrige criteria have been
adopted, and firms apply using the Baldrige criteria. In these cases, the
criteria are used, but the scores required to win the state awards are
lower than those for the national awards.
An approach that some other states have taken is the Baldrige-lite

approach. This approach uses the Baldrige criteria but with a simplified
process and/or application.
Diff: 2
Type: Concept
64) The first view of lean manufacturing is a philosophical view of

________.
A) strategic planning
B) waste reduction
C) inventory control
D) product development
E) reengineering
Answer: B
Diff: 2
Learning Outcome: Describe the advantages and disadvantages of

various production strategies such as lean, Theory of Constraints, JIT,
and Six Sigma
LO: 3.5 Communicate the Japanese approach to lean and total quality
control.
Type: Concept
65) A productive system whose focus is on optimizing processes
through the philosophy of continual improvement is called ________.
A) lean manufacturing
B) reengineering
C) benchmarking
D) just-in-time production
Answer: A
Diff: 2

and Six Sigma
control.
Type: Concept
66) ________ was fundamental in helping Toyota reduce waste.
A) Genichi Taguchi
B) Kaoru Ishikawa
C) Shigeo Shingo
D) Armand Feigenbaum
E) Philip Crosby
Answer: C
Diff: 2
control.
Type: Concept
67) Which of the following is not one of Shingo’s seven wastes?
A) waste of stocks
B) waste of funds
C) waste of motion
D) waste of transportation
E) waste of waiting
Answer: B
Diff: 2
control.
Type: Concept
68) With ________ inspection, all work is inspected at each stage of the
manufacturing process, and the workers inspect their own work.
A) in-process
B) multilevel
C) dynamic
D) continuous
E) line-stop
Answer: A
Diff: 2
control.
Type: Concept
69) The N=2 technique is an alternative to ________.
A) in-process inspection
B) acceptance sampling
C) statistical process control
D) benchmarking
E) quality control
Answer: B
Diff: 1
control.
Type: Concept
70) ________ means that all departments are involved in quality.
A) Vertical deployment
B) Cross-functional deployment
C) Horizontal deployment
D) Multilevel deployment
E) Parallel deployment
Answer: C
Diff: 2
control.
Type: Concept
71) ________ means that all levels of management and workers are
actively involved in quality.
A) Vertical deployment
B) Cross-functional deployment
C) Horizontal deployment
D) Multilevel deployment
E) Parallel deployment
Answer: A
Diff: 2
control.
Type: Concept
72) With respect to the five S’s, organizing by getting rid of the
unnecessary files, forms, and other materials is called ________.
A) seiri
B) seiton
C) seiso
D) seiketsu
E) shetsuke
Answer: A
Diff: 2
control.

Type: Concept
73) With respect to the five S’s, neatness that is achieved by

straightening offices and work areas is called ________.
A) seiri
B) seiton
C) seiso
D) seiketsu
E) shetsuke
Answer: B
Diff: 2
control.
Type: Concept
74) With respect to the five S’s, cleaning plant and equipment to
eliminate dirtiness that can hide or obscure problems is called
________.
A) seiri
B) seiton
C) seiso
D) seiketsu
E) shetsuke
Answer: C
Diff: 2
control.
Type: Concept
75) With respect to the five S’s, standardizing locations for tools, files,
equipment, and all other materials is called ________.
A) seiri
B) seiton
C) seiso
D) seiketsu
E) shetsuke
Answer: D
Diff: 2
control.
Type: Concept
76) With respect to the five S’s, discipline in maintaining the prior four
S’s is called ________.
A) seiri
B) seiton
C) seiso
D) seiketsu
E) shetsuke
Answer: E
Diff: 2
control.
Type: Concept
77) ________ are natural work teams made up of workers who are
empowered to improve work processes and are used by Japanese
companies to involve employees in improving processes and process
capability.
A) Empowerment task forces
B) Cross-functional teams
C) Horizontal task forces
D) Vertical task forces
E) Quality circles
Answer: E
Diff: 1
control.
Type: Concept
78) The idea behind ________ is that the worst condition a machine
should ever be in is on the day you purchase the machine.
A) quality circles
B) vertical deployment
C) line-stop authority
D) horizontal deployment
E) preventive maintenance
Answer: E
Diff: 2
control.

Type: Concept
79) The first view of lean manufacturing is a philosophical view of waste

reduction.
Answer: TRUE
Diff: 2

and Six Sigma
control.
Type: Concept
80) Lean manufacturing is a productive system whose focus is on
optimizing processes through the philosophy of continual
improvement.
Answer: TRUE
Diff: 2

and Six Sigma
control.
Type: Concept
81) Kaoru Ishikawa was fundamental in helping Toyota to reduce waste.
Answer: FALSE
Diff: 2
control.
Type: Concept
82) The Japanese approach follows the policy that when problems exist
in business, the first reflex is to hide the problems as though they do
not exist.
Answer: FALSE
Diff: 1
control.
Type: Concept
83) The visibility technique used by the Japanese is called andon, or

warning lights.
Answer: TRUE
Diff: 2
control.
Type: Concept
84) With in-process inspection, all work is inspected at each stage of

the process, and the workers inspect their own work.
Answer: TRUE
Diff: 2
control.
Type: Concept
85) The N=2 technique is an alternative to acceptance sampling.
Answer: TRUE
Diff: 1
control.
Type: Concept
86) Horizontal deployment means that all levels of management and

workers are actively involved in quality.
Answer: FALSE
Diff: 2
control.
Type: Concept
87) The idea behind preventive maintenance is that the worst condition
a machine should ever be in is on the day it is purchased.
Answer: TRUE
Diff: 2
control.
Type: Concept
88) Organizing by getting rid of the unnecessary materials is called seiri.
Answer: TRUE
Diff: 1
control.

Type: Concept
89) Cleaning plant and equipment to eliminate dirtiness that can hide
or obscure problems is called seiso.
Answer: TRUE
Diff: 1
control.
Type: Concept
90) Standardizing locations for tools, files, equipment, and other
materials is called shetsuke.
Answer: FALSE
Diff: 1
control.
Type: Concept
91) Quality circles are natural work teams made up of workers who are
empowered to improve work processes.
Answer: TRUE
Diff: 2
control.
Type: Concept
92) Explain the concept of lean manufacturing.
Answer: Lean manufacturing is a productive system whose focus is on

optimizing processes through the philosophy of continual
improvement. The first view of lean is a philosophical view of waste
reduction. This view asserts that anything in the process that does not
add value for the customer should be eliminated. Given this view,
quality problems cause scrap and rework and are wasteful. The second
view of lean is a systems view stating that lean is a group of techniques
or systems focused on optimizing quality processes. An example of this
view is the lean production system refined by the Toyota Motor
Company and spread to the rest of the world.
Diff: 2

and Six Sigma
control.

Type: Concept
93) Explain the five S’s adopted by Japanese firms in an effort to

improve operations.
Answer: The five S’s are a sequential process that companies follow to
literally “clean up their acts.” The S’s are:
Seiri: Organizing by getting rid of the unnecessary. This may include old
files, forms, tools, or other materials that have not been used within
the past two or three years.
Seiton: Neatness that is achieved by straightening offices and work

areas.
Seiso: Cleaning plant and equipment to eliminate dirtiness that can hide
or obscure problems.
Seiketsu: Standardizing locations for tools, files, equipment, and all

other materials. This often involves color coding and labeling areas so
that materials are always found in a standard location.
Shetsuke: Discipline in maintaining the prior four S’s.
Diff: 2
control.
Type: Concept
94) Describe quality circles. How does the use of quality circles improve
quality?
Answer: Quality circles are natural work teams made up of workers
who are empowered to improve processes that they use and are used
by Japanese companies to involve employees in improving processes
and process capability. Using quality circles, Japanese employees
brainstorm quality improvement methods and identify causes of quality
problems.
Diff: 2
control.
Type: Concept
95) Explain the concept of preventive maintenance used by Japanese

manufacturers.
Answer: Japanese manufacturers are known for their approach to
maintenance of equipment and machines. The maintenance technique
taught by the Japanese is preventive maintenance. The idea behind
preventive maintenance is that the worst condition a machine should
ever be in is on the day you purchase the machine. By maintaining
scheduled maintenance and improvement to equipment, machinery
actually can improve with age. With preventive maintenance, heavy
unscheduled maintenance is still performed by shop engineers and
maintenance specialists.
Diff: 2
control.
Type: Concept
96) ________ is the European standard for quality that has been
expanded worldwide.
A) ISO 9000:2005
B) ISO 9000:2015
C) ISO 9001:2000
D) ISO 9004:2009
E) ISO 14001:2004
Answer: B
Diff: 2
LO: 3.6 Discuss ISO 9000:2015 and how it is used in firms.
Type: Concept
97) The focus of ISO 9000:2015 is to ________.
A) encourage the adoption of total quality management in Europe
B) reward European firms that embrace quality management

techniques
C) provide a standardized format for firms to document their quality

systems in order to facilitate trade
D) teach European firms the importance of quality management
E) provide a framework for organizational improvement and change
Answer: C
Diff: 2
Type: Concept
98) What is the first step in the registration process for ISO 9000:2015?
A) inquiry
B) client contract
C) phase 1 audit
D) certification audit
E) process audit
Answer: A
Diff: 2
Type: Concept
99) What is the most important and most difficult step of the ISO
process?
A) selecting a registrar
B) contracting with the client
C) phase 1 audit
D) certification audit
E) process audit
Answer: A
Diff: 2
Type: Concept
100) Which of the following is not a quality management principle

underlying ISO 9000:2015?
A) involvement of people
B) improvement
C) leadership
D) dedication
E) customer focus
Answer: D
Diff: 3
Type: Concept
101) ISO 9004:2009 is the European standard for quality that has been
expanded worldwide.
Answer: FALSE
Diff: 1
Type: Concept
102) The first step in the registration process for ISO 9000:2015
involves a phase 1 audit.
Answer: FALSE
Diff: 1
Type: Concept
103) How does the ISO 14000 series differ from ISO 9000:2015?
Answer: ISO 9000:2015 is a set of standards that provides companies a

format for documenting their quality systems in a series of manuals for
the purpose of facilitating trade through supplier conformance. The
standards originated in Europe. The ISO standard was developed so
that an international standard for documentation of quality systems
could be applied in different cultures. Given the success of ISO
9000:2015, ISO embarked on developing an international standard for
environmental compliance named ISO 14000. ISO 14000 is a series of
standards that provide guidelines and a compliance standard in the
environmental area. ISO 14000 uses the same basic approach as ISO
9000:2015 with documentation control, management system auditing,
operational control, and so on. In addition to these controls, ISO 14000
includes quantified targets, established objectives, emergency and
disaster preparedness, and disclosure of environmental policy.
Diff: 2
Type: Concept

Chapter 5 The Voice of the Customer
1) ________ customers are employees receiving goods or services from

within the same firm.
A) Primary
B) Capital
C) External
D) Secondary
E) Internal
Answer: E
Diff: 1
LO: 5.1 Discuss the basics of customer relationship management.

Type: Concept
2) ________ customers are the bill-paying receivers of a company’s

work.
A) External
B) Internal
C) Primary
D) Secondary
E) Capital
Answer: A
Diff: 1
Type: Concept
3) The ________ customers are the ultimate people the company is

trying to satisfy with its work.
A) capital
B) internal
C) primary
D) external
E) secondary
Answer: D
Diff: 2
Type: Concept
4) ________ customers are also known as end users.
A) External
B) Internal
C) Capital
D) Primary
E) Secondary
Answer: A
Diff: 1
Type: Concept
5) The ________ model shows that a firm’s quality performance is

increasing while customer’s expectations are also increasing.
A) restructured customer-driven quality
B) relative customer-driven quality
C) redesigned customer-driven quality
D) receptive customer-driven quality
E) reactive customer-driven quality

Answer: E
Diff: 2
Type: Concept
6) The view of the customer that asserts that he or she is a valued asset
to be managed is referred to as ________.
A) customer response
B) customer intelligence
C) customer data management

D) reactive customer-driven quality
E) customer-relationship management
Answer: E
Diff: 1
Type: Concept
7) Which of the following is not a design aspect to customer-

relationship management?
A) corrective action
B) guarantees
C) feedback
D) cost
E) complaint resolution
Answer: D
Diff: 2
Type: Concept
8) The ________ process involves the transformation of a negative
situation into one in which the complainant is restored to the state
existing prior to the occurrence of a problem.
A) complaint-reaction
B) complaint-restoration
C) complaint-resolution
D) complaint-response
E) complaint-reversal
Answer: C
Diff: 1
Type: Concept
9) The first component of a complaint-resolution process is ________.
A) contrition
B) correction
C) compensation
D) communication
E) correlation
Answer: C
Diff: 2

Type: Concept
10) The second component of a complaint-resolution process is

________.
A) contrition
B) correction
C) compensation
D) communication
E) correlation
Answer: A
Diff: 2

Type: Concept
11) The process associated with resolving complaints is called the

________ process.
A) complaint-reversal
B) complaint-restoration
C) complaint-reaction
D) complaint-recovery
E) complaint-response
Answer: D
Diff: 2
Type: Concept
12) Which of the following is not a component of an effective

guarantee?
A) conditional
B) meaningful
C) understandable
D) communicable
E) painless to invoke
Answer: A
Diff: 2
Type: Concept
13) Customer ________ is measured as the percentage of customers

who return for more service.
A) approval
B) feedback
C) satisfaction
D) retention
E) response
Answer: D
Diff: 2
Type: Concept
14) What are the three phases of customer-relationship management?
A) satisfaction, feedback, and retention
B) satisfaction, acquisition, and transition
C) response, feedback, and enhancement
D) acquisition, retention, and enhancement

E) response, transition, and acquisition
Answer: D
Diff: 2
Type: Concept
15) The ________ phase of customer-relationship management

involves improving service to the customer through the use of
information systems.
A) acquisition
B) retention
C) enhancement
D) transition
E) response
Answer: C
Diff: 2
Type: Concept
16) Churn reduction involves the reduction in the loss of ________.

A) raw materials
B) suppliers
C) funds
D) products
E) customers
Answer: E
Diff: 2
Type: Concept
17) ________ management involves managing the mountain of
information generated by Web site usage in a way to improve
marketing to key customers.
A) Knowledge
B) Order
C) Sales
D) Campaign
E) Channel
Answer: A
Diff: 1

Type: Concept
18) Internal customers are the bill-paying receivers of a company’s

work.
Answer: FALSE
Diff: 2
Type: Concept
19) External customers are employees receiving goods or services from
within the same firm.
Answer: FALSE
Diff: 1
Type: Concept
20) The external customers are the ultimate people the company is
trying to satisfy with its work.
Answer: TRUE
Diff: 2
Type: Concept
21) Customer-driven quality represents a proactive approach to

satisfying customer needs that is based on gathering data about the
customers to learn their needs and preferences.
Answer: TRUE
Diff: 2
Type: Concept
22) Due to constantly changing customer needs, the reactive approach

to customer-driven quality could lead to problems if customer
requirements increase at a faster rate than quality and service
improvement.
Answer: TRUE
Diff: 2
Type: Concept
23) Customer relationship management involves viewing the customer

as a valued asset to be managed.
Answer: TRUE
Diff: 1
Type: Concept
24) The complaint-resolution process involves the transformation of a

negative situation into one in which the complainant is restored to the
state existing prior to the occurrence of a problem.
Answer: TRUE
Diff: 2
Type: Concept
25) Improving services such as customer service policies, sales

processes, and after-sales services according to customer preferences is
referred to as transactional analysis.
Answer: TRUE
Diff: 2

Type: Concept
26) The process associated with resolving complaints is called the

complaint-response process.
Answer: FALSE
Diff: 2
Type: Concept
27) A guarantee outlines the customer’s rights.
Answer: TRUE
Diff: 1
Type: Concept
28) Guarantees should be designed prior to beginning business.

Answer: TRUE
Diff: 2
Type: Concept
29) To be effective, a guarantee should be unconditional.
Answer: TRUE
Diff: 2
Type: Concept
30) Customer retention is measured as the percentage of customers

who return for more service.
Answer: TRUE
Diff: 1
Type: Concept
31) Amazon’s customized desktops with recommendations for products

based on historical purchases is an example of the customer
enhancement phase of CRM.
Answer: TRUE
Diff: 2

Type: Application
32) The enhancement phase of customer-relationship management

involves improving service to the customer through the use of
information systems.
Answer: TRUE
Diff: 2
Type: Concept
33) Knowledge management involves managing the mountain of
information generated by Web site usage in a way to improve
marketing to key customers.
Answer: TRUE
Diff: 2
Type: Concept
34) Differentiate between internal and external customers.
Answer: Internal customers are employees receiving goods or services

from within the same firm. For example, management information
systems (MIS) technicians and programmers view the users within their
company as internal customers. In contrast, external customers or end
users are the bill-paying receivers of a company’s work. A person that
enters a restaurant and purchases a meal is an external customer.
Diff: 2
Type: Concept
35) Explain the reactive customer-driven quality (RCDQ) model.

Answer: This reactive customer-driven quality (RCDQ) model shows
that a firm’s quality performance is increasing while customers’
expectations also are increasing. Problems occur when customer
requirements increase at a faster rate than quality and service
improvement. This places a firm in a reactive mode that may signal the
need for major process and service redesign. The RCDQ model
demonstrates conceptually and graphically the primary pitfalls and
dangers of RCDQ.
Diff: 2
Type: Concept
36) What are the components and activities associated with the
complaint resolution process?
Answer: The first component is to compensate people for their losses.

This may be as small as an easy return policy with no questions asked.
The second component is contrition. The firm should apologize to the
customer for the mistakes made. Third, the complaint-recovery process
must be designed to make it easy for complainants to reach resolution
to simple complaints.
Diff: 2
Type: Concept
37) What are customer-relationship management systems?
Answer: With business information systems—especially over the

Internet—companies are receiving volumes of customer-related data.
These data include personal, Internet, process, and customer
preference information. As a result, systems have been created to mine
these data to improve customer service and retention. These systems
are called customer-relationship management systems (CRMS). CRMS
use data to manage the three phases of customer-relationship
management. These three phases are acquisition, retention, and
enhancement.
Diff: 2

Type: Concept
38) The approach authorizing major suppliers to make purchases for

their own accounts, resulting in suppliers providing only what is needed
when it is needed, is referred to as ________.
A) single-source managed inventory
B) vendor managed inventory
C) account managed inventory
D) cost managed inventory
E) time managed inventory
Answer: B
Diff: 2
LO: 5.2 Distinguish how managing quality in services is different from

manufacturing.
Type: Concept
39) Which of the following is a diagram tool for managers that depicts a
flowchart of interactions between service providers and customers?
A) process-chain-network diagram
B) precedence-network diagram
C) relationship-network diagram
D) activity-network diagram
E) interaction-network diagram
Answer: A
Diff: 2
manufacturing.
Type: Application
40) ________ is a process for developing relationships with few

suppliers for long-term contracts.
A) Single sourcing
B) Gap analysis
C) Supplier rationalization
D) Segmentation
E) Source loyalty
Answer: A
Diff: 2

manufacturing.
Type: Concept
41) ________ results in the suppliers becoming de facto subsidiaries to

their major customers.
A) Segmentation
B) Gap analysis
C) Strategic alliance
D) Source loyalty
E) Supplier rationalization
Answer: C
Diff: 2

manufacturing.
Type: Concept
42) In ________, suppliers integrate information systems and quality

systems that allow close integration at all levels.
A) segmentation
B) gap analysis
C) annuity relationships
D) strategic alliances
E) supplier rationalization
Answer: D
Diff: 2

manufacturing.
Type: Concept
43) ________ results from agreement between marketing and
operations as to which customers add the greatest advantage and
profits over time.
A) Customer segmentation
B) Customer-relationship management
C) Reactive customer-driven quality
D) Actively solicited customer-feedback
E) Customer rationalization
Answer: E
Diff: 2

manufacturing.

Type: Concept
44) A(n) ________ relationship is one in which the customer provides a

long-term, steady income stream to the provider.
A) perpetual
B) annuity
C) active
D) rational
E) passive
Answer: B
Diff: 2

manufacturing.

Type: Concept
45) Customer-initiated contact such as filling out a restaurant complaint

card, calling a toll-free complaint line, or submitting an inquiry via a
company’s Web site, is considered ________.
A) customer rationalization
B) passively solicited customer feedback
C) actively solicited customer feedback
D) reactive customer-driven quality
E) customer segmentation
Answer: B
Diff: 2
manufacturing.
Type: Concept
46) A process-chain-network diagram is a flowchart tool for managers

to use when designing service delivery systems.
Answer: TRUE
Diff: 2
manufacturing.
Type: Concept
47) Many companies use single sourcing as a way to increase the

number of suppliers.
Answer: FALSE
Diff: 1

manufacturing.
Type: Concept
48) Single-sourcing arrangements are developing into strategic alliances

where suppliers become de facto subsidiaries to their major customers.
Answer: TRUE
Diff: 2

manufacturing.
Type: Concept
49) Customer rationalization results from agreement between
marketing and operations as to which customers add the greatest
advantage and profits over time.
Answer: TRUE
Diff: 2

manufacturing.
Type: Concept
50) Annuity relationships result in the customer providing a short-term
income stream to the provider.
Answer: FALSE
Diff: 2

manufacturing.
Type: Concept
51) Customer-initiated contact, such as submitting an inquiry via a
company’s Web site, is considered passively solicited customer
feedback.
Answer: TRUE
Diff: 2

manufacturing.
Type: Concept
52) Active data collections tend to result in lower ratings of quality than
passive data collections.
Answer: FALSE
Diff: 2

manufacturing.
Type: Concept
53) Describe the concept of single sourcing. How is single sourcing

related to strategic alliances?
Answer: Many companies use single sourcing as a way to reduce the
number of suppliers. Single sourcing is a process for developing
relationships with few suppliers for long contract terms. Increasingly,
single-sourcing arrangements are developing into strategic alliances
where the suppliers become de facto subsidiaries to their major
customers. In these arrangements, not only are suppliers single-source
providers, but they also integrate information systems and quality
systems that allow close interaction at all levels.
Diff: 2

manufacturing.
Type: Concept
54) The gap refers to the differences between ________.
A) corrective action and preventive action
B) service quality and product quality
C) empowered employees and employees managed by a hierarchy
D) accurate quality projections and inaccurate quality projections
E) desired levels of performance and actual levels of performance
Answer: E
Diff: 2
LO: 5.3 Implement gap analysis in a service firm using SERVQUAL.

Type: Concept
55) The SERVQUAL instrument was developed by ________.
A) Juran, Deming, and Shewhart
B) Ishikawa and Taguchi
C) Hammer and Champy
D) Parasuraman, Zeithamel, and Berry
E) Feigenbaum, Crosby, and Peters
Answer: D
Diff: 3

Type: Concept
56) Which of the following determinants of service quality involves

consistency of performance and dependability?
A) reliability
B) responsiveness
C) competence
D) access
E) credibility
Answer: A
Diff: 2

Type: Concept
57) Which of the following determinants of service quality concerns the

willingness or readiness of employees to provide service?
A) reliability
B) responsiveness
C) competence
D) credibility
E) courtesy
Answer: B
Diff: 2
Type: Concept
58) Which of the following determinants of service quality means

possession of the required skills and knowledge to perform the service?
A) reliability
B) responsiveness
C) competence
D) access
E) credibility
Answer: C
Diff: 2
Type: Concept

approachability and ease of contact?
A) reliability
B) responsiveness
C) competence
D) access
E) courtesy
Answer: D
Diff: 2
Type: Concept

politeness, respect, consideration, and friendliness of contact
personnel?
A) reliability
B) responsiveness
C) competence
D) credibility
E) courtesy
Answer: E
Diff: 2
Type: Concept
trustworthiness, believability, honesty, and having the customer’s best
interests at heart?
A) reliability
B) responsiveness
C) competence
D) credibility
E) courtesy
Answer: D
Diff: 1
Type: Concept
62) Which of the following determinants include the physical evidence
of the service?
A) tangibles
B) aesthetics
C) features
D) intangibles
E) logistics
Answer: A
Diff: 1

Type: Concept
63) What does segmenting markets involve?
A) distinguishing expected service and perceived service
B) distinguishing customers according to common characteristics
C) analyzing the management perceptions of consumer expectations
D) distinguishing service quality specs and service delivery
E) analyzing the external methods to communicate with customers
Answer: B
Diff: 2

Type: Concept
64) The Gap refers to the differences between desired levels of

performance and actual levels of performance.
Answer: TRUE
Diff: 1

Type: Concept
65) The reliability determinant of service quality concerns the

willingness or readiness of employees to provide service.
Answer: FALSE
Diff: 2
Type: Concept
66) The competence determinant of service quality means possession
of the required skills and knowledge to perform the service.
Answer: TRUE
Diff: 2
Type: Concept
67) The determinant of service quality pertaining to tangibles
encompasses the physical evidence of the service.
Answer: TRUE
Diff: 2
Type: Concept
68) To segment markets means to distinguish customers or markets

according to common characteristics.
Answer: TRUE
Diff: 2
Type: Concept
69) What is gap analysis?
Answer: Typically, the gap refers to the differences between desired

levels of performance and actual levels of performance. This could be
something like the difference between the desired conformance level
versus the existing conformance level in a manufacturing environment.
In services, this is the difference between the expected and the actual
level of service provided. Gaps are important in that once a gap is
identified, it is a candidate for corrective action and process
improvement. The formal means for identifying and correcting these
gaps is called gap analysis. One of the differences studied by gap
analysis identifies the difference between managerial and customer
perceptions of what the customer wants.
Diff: 2
Type: Concept
70) Explain the ten determinants of service quality contributed by

Parasuraman, Zeithamel, and Berry.
Answer: In addition to the gaps model, Parasuraman, Zeithamel, and
Berry contributed a number of important concepts to managing service
quality. These include 10 determinants of service quality:
Reliability involves consistency of performance and dependability.
Responsiveness concerns the willingness or readiness of employees to

provide service.
Competence means possession of the required skills and knowledge to

perform the service.
Access involves approachability and ease of contact.
Courtesy involves politeness, respect, consideration, and friendliness of

contact personnel.
Communication means keeping customers informed in language they

can understand and listening to them.
Credibility involves trustworthiness, believability, and honesty.
Security is the freedom from danger, risk, or doubt.
Understanding/knowing the customer involves making the effort to

understand the customer’s needs.
Tangibles include the physical evidence of the service.
Diff: 3
Type: Concept
71) Gathering data through focus groups and surveys is an example of

a(n) ________ data gathering.
A) active
B) open
C) rational
D) passive
E) closed
Answer: A
Diff: 1
LO: 5.4 Develop a customer service survey using specific examples and
critical incidents.
Type: Concept
72) Gathering data through customer comment cards is an example of

a(n) ________ data gathering.
A) active
B) open
C) rational
D) passive
E) closed
Answer: D
Diff: 1
critical incidents.
Type: Concept
73) ________ includes all supplier-initiated contact with customers.
A) Customer-relationship management
B) Supplier rationalization
C) Single sourcing
D) Customer segmentation
E) Actively solicited customer feedback
Answer: E
Diff: 2
critical incidents.
Type: Concept
74) Phone contacts, focus groups, and survey results are referred to as
________ data.
A) hard
B) soft
C) active
D) passive
E) rational
Answer: B
Diff: 2
critical incidents.
Type: Concept
75) Measurement data such as height, weight, volume, and speed are
referred to as ________ data.
A) active
B) passive
C) rational
D) soft
E) hard
Answer: E
Diff: 2
critical incidents.

Type: Concept
76) ________ data are ranked so that one measure is higher than the
next.
A) Active
B) Discrete
C) Continuous
D) Ordinal
E) Passive
Answer: D
Diff: 2
critical incidents.
Type: Concept
77) ________ data is used to compare employee and customer

perceptions of quality.
A) Hard
B) Soft
C) Active
D) Passive
E) Rational
Answer: B
Diff: 2
critical incidents.
Type: Concept
78) A(n) ________ group allows a supplier to gather feedback from a

group of consumers at one time.
A) access
B) focus
C) service
D) ordinal
E) discussion
Answer: B
Diff: 1
critical incidents.
Type: Concept
79) What is the first step in performing a focus group session?
A) develop questions
B) narrow scope of questions
C) identify purpose
D) select target population
E) run multiple groups
Answer: C
Diff: 2
critical incidents.
Type: Application
80) A(n) ________ consists of a series of items designed to capture

perceptions.
A) survey
B) focus group
C) ordinal data system

D) passive data gathering
E) active data gathering
Answer: A
Diff: 2
critical incidents.
Type: Concept
81) The ________ approach involves obtaining information from

customers about the process they use to receive goods and services.
A) focus group
B) vendor managed inventory
C) knowledge management
D) critical-incident
E) customer-relationship management
Answer: D
Diff: 2
critical incidents.
Type: Concept
82) ________ validity refers to the use of certain terms and whether
terms really measure what it is we want to measure.
A) Criterion
B) Conformance
C) Content
D) Control
E) Construct
Answer: E
Diff: 3
critical incidents.
Type: Concept
83) ________ validity indicates that your measuring instrument has the
ability to predict or agree with constructs external to that which you
are measuring.
A) Criterion
B) Conformance
C) Content
D) Control
E) Construct
Answer: A
Diff: 3
critical incidents.
Type: Concept
84) ________ validity refers to whether the item really measures what
we want to measure.
A) Construct
B) Control
C) Criterion
D) Conformance
E) Content
Answer: E
Diff: 3
critical incidents.
Type: Concept
85) When analyzing the results of a survey, open-ended questions are

analyzed with Pareto analysis using ________ of the various categories
of responses.
A) means
B) numerical responses
C) bar charts
D) simple correlations
E) histograms
Answer: C
Diff: 2
critical incidents.
Type: Concept
86) If survey responses are consistent but they are not measuring the
right thing, the instrument is reliable but it is not valid.
Answer: TRUE
Diff: 3
critical incidents.
Type: Application
87) A continuum of “strongly disagree-disagree-neutral-agree-strongly

agree” on a five-point scale is an example of relatively ranked ordinal
data points.
Answer: TRUE
Diff: 3
critical incidents.
Type: Application
88) Gathering data through focus groups and surveys are examples of
passive data gathering.
Answer: FALSE
Diff: 1
critical incidents.
Type: Concept
89) Actively solicited customer feedback includes all supplier-initiated

contact with customers.
Answer: TRUE
Diff: 2
critical incidents.
Type: Concept
90) Phone contacts and focus groups are referred to as hard data.
Answer: FALSE
Diff: 2
critical incidents.

Type: Concept
91) Soft data are measurement data such as height, weight, volume, or
speed that can be measured on a continuous scale.
Answer: FALSE
Diff: 2
critical incidents.
Type: Concept
92) Ordinal data are ranked so one measure is higher than the next.
Answer: TRUE
Diff: 1
critical incidents.
Type: Concept
93) A focus group allows a supplier to gather feedback from a group of
consumers at one time.
Answer: TRUE
Diff: 1
critical incidents.
Type: Concept
94) Focus groups draw individuals with similar characteristics or

demographics.
Answer: TRUE
Diff: 2
critical incidents.
Type: Concept
95) Criterion validity refers to whether the item really measures what
we want to measure.
Answer: FALSE
Diff: 3
critical incidents.
Type: Concept
96) Construct validity indicates that your measuring instrument has the
ability to predict or agree with constructs external to that which you
are measuring.
Answer: FALSE
Diff: 3
critical incidents.
Type: Concept
97) When analyzing the results of a survey, open-ended questions are

analyzed with Pareto analysis using bar charts of the various categories
of responses.
Answer: TRUE
Diff: 2
critical incidents.
Type: Application
98) Differentiate between soft data and hard data.
Answer: Phone contacts, focus groups, and survey results are referred
to as soft data. As opposed to soft data, hard data are measurement
data such as height, weight, volume, or speed that can be measured on
a continuous scale. Soft data are not continuous and are, at best,
ordinal.
Diff: 1
critical incidents.
Type: Concept
99) What is the function of a focus group?
Answer: A focus group allows a supplier to gather feedback from a

group of consumers at one time. The groups are focused in two ways:
First, focus groups narrowly address a single topic or group of topics.
Second, focus groups draw individuals with similar characteristics or
demographics. This limits the discussion to subjects and market
segments that are of particular interest to the firm.
Diff: 2
critical incidents.
Type: Concept
100) Differentiate between construct validity and content validity.
Answer: Construct validity refers to the use of certain terms and

whether terms really measure what it is we want to measure. For
example, self-reported measures or percentage growth in sales might
not be a valid measure of success in customer satisfaction. Sales
increases may instead reflect favorable market conditions. Content
validity, in contrast, refers to whether the item really measures what
we want to measure. Usually, this includes asking five or six “experts”
to review the instrument and determine whether the instrument is
valid.
Diff: 2
critical incidents.
Type: Concept

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Managing Quality: Integrating the Supply Chain, 6e (Foster)

Chapter 1 Differing Perspectives on Quality

1) Which of the following is not one of Garvin's eight quality

LO: 1.1: Recognize that different dimensions of quality exist.

AACSB: Application of Knowledge

2) Which of the following is not one of Parasuraman, Zeithamel, and

LO: 1.1: Recognize that different dimensions of quality exist.

AACSB: Application of Knowledge

3) Why is service quality more difficult to define than product quality?

Answer: While services and production share many attributes, services

LO: 1.1: Recognize that different dimensions of quality exist.

AACSB: Application of Knowledge

4) ________ refers to the efficiency with which a product achieves its

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

6) ________ refers to the propensity for a product to perform

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

7) Which of the following is the most traditional dimension of quality?

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

8) ________ is the degree to which a product tolerates stress or trauma

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

9) ________ is the ease of repair for a product.

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

10) ________ are subjective sensory characteristics such as taste, feel,

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

11) ________ is based on customers' opinion of products and services.

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

A) reliability—refers to the efficiency with which a product achieves its

B) serviceability—the ease of repair of a product

C) conformance—the degree to which a product tolerates stress or

D) performance—subjective sensory characteristics such as taste, feel,

E) aesthetics—refers to the propensity for a product to perform

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

13) In the context of service quality, ________ include the physical

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

15) ________ is the willingness of the service provider to be helpful and

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

17) A service provider that consistently provides caring, individualized

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

18) Performance refers to the efficiency with which a product achieves

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

LO: 1.2: Be able to discuss the quality dimensions.

AACSB: Application of Knowledge

20) The advantage of the conformance definition of quality for products

LO: 1.2: Be able to discuss the quality dimensions.