1. Having a large number of performance measures is much better than having a selected few.
2. Measuring and reporting performance results can be a motivator for many workers.
3. The only important measurement category in business is financial.
4. Return on assets would normally be classified as a productivity measure.
5. Good customer satisfaction measurement systems are designed to provide information about future buying behavior.
6. Quality measures the degree to which the output of a process conforms to management’s expectations and requirements.
7. Service quality measures are generally based on data collected from observing front-line operations.
8. Reliability is the ability to perform a service dependably and accurately.
9. Assurance is the willingness to help customers and provide prompt recovery to service upsets.
10. Empathy is the caring attitude and individualized attention provided to customers.
11. Measures and indicators of product and service performance that have a strong correlation with customer satisfaction are appropriate to monitor.
12. Most of the five dimensions of service quality pertain to behavioral characteristics, which makes them easier to measure.
13. Errors in service creation and delivery are sometimes called service upsets.
14. Speed is usually measured in clock time, whereas reliability of a time-based measure is usually measured in quantifying the variances in average performances or targets.
15. Queue time is a fancy term for service time variance.
16. Having intensive care nurses on call in case of a dramatic increase in patient demand is an example of design flexibility.
17. Design flexibility is the ability to respond quickly to changes in the volume and type of demand.
18. Productivity is more closely related to effectiveness than efficiency.
19. As output decreases for a constant level of input, productivity also decreases.
20. It costs 3 to 5 times more to keep an existing customer than to acquire a new customer.
21. The “value of a loyal customer” links customer satisfaction and loyalty to a firm’s profitability measures.
22. Any measure a firm chooses to use should provide the basis for making executive-level strategic decisions.
23. Health care and educational organizations were eligible for the Malcolm Baldrige National Quality Award since its inception in 1987.
24. Although the award from the Malcolm Baldrige National Quality Award Framework receives the most attention, the primary purpose of the program is to provide a framework for performance excellence through self-assessment to understand an organization’s strengths and weaknesses, thereby setting priorities for improvement.
25. In the Baldrige Award criteria, the Business Results category focuses on how an organization selects, gathers, analyzes, manages, and improves its data, information, and knowledge assets.
26. The Leadership category of the Baldrige criteria includes how an organization addresses its public and community responsibilities.
27. Employee satisfaction might be considered as a lagging indicator of employee turnover.
28. The balanced scorecard is designed to be linked to an organization’s strategy.
29. The balanced scorecard model uses the same categories as the Baldrige Award.
30. The value chain model is probably the dominant model for operations managers.
31. The service-profit chain model is based on understanding cause-and-effect linkages among performance measures.
32. The quote “Happy employees create happy customers” best characterizes the Service-Profit Chain (SPC) model.
MULTIPLE CHOICE
1. Which one of the following statements is true with regard to the case study BankUSA: Credit Card Division?
a.
Service upsets represented 17 percent of total transactions.
b.
Current performance reports indicate that the credit card division is meeting 99.2 percent of its service requirements.
c.
The correlation between customer satisfaction and operating costs was negatively correlated.
d.
The ultimate (real) service level for this organization is internal performance metrics.
2. Which of the following is true?
a.
The theory of the Balanced Scorecard model of performance is leadership drives the operating system that creates business results.
b.
The Service-Profit Chain focuses on learning, internal business, customers, and financial performance.
c.
Volume flexibility allows the firm to change their learning behavior of employees as conditions change.
d.
In the BankUSA: Credit Card Division case study internal and external performance was negatively correlated.
3. The triple bottom line (TBL or 3BL) refers to the measurement of sustainability in all of the following areas except
a.
economic
b.
social
c.
technological
d.
environmental
4. Customer satisfaction rating increases as time-on-hold waiting decreases is an example of
a.
productivity index
b.
interlinking
c.
value of a loyal customer
d.
operational definitions
5. Interlinking is the quantitative modeling of cause-and-effect relationships between
a.
internal performance criteria
b.
external performance criteria
c.
internal and external performance criteria
d.
competing organizations performances
6. Which of the following is not a key dimension of service quality?
a.
conformance
b.
tangibles
c.
empathy
d.
reliability
7. Which of the following would not be a typical organizational-level financial performance measure?
a.
labor and material costs
b.
revenue and profit
c.
return on assets
d.
earnings per share
8. Which of the following would be a typical operational-level quality performance measure?
a.
customer ratings of goods and services
b.
customer retention
c.
service representative courtesy
d.
product recalls
9. At a basic level, quality should be measured in three areas. Which of the following is not one of those areas?
a.
goods
b.
services
c.
environment
d.
employee
10. Which of the following would be an example of an innovation and learning performance measure?
a.
employee satisfaction
b.
earnings per share
c.
design flexibility
d.
product-related litigation
11. Dell’s ability to provide a wide range of customized computer hardware to accommodate customers’ needs best describes
a.
volume flexibility
b.
design flexibility
c.
cycle time
d.
queue time
12. The number of patent applications and the number of improvement suggestions implemented relate best to which operational performance measure category?
a.
financial
b.
customer and market
c.
innovation and learning
d.
productivity
13. When Bill Gates stated that “Microsoft is always two years away from failure,” he was emphasizing the importance of
a.
innovation and learning
b.
productivity
c.
design flexibility
d.
speed
14. The ability to respond quickly to changes in the amount and type of demand is called
a.
learning
b.
service quality
c.
design flexibility
d.
volume flexibility
15. Productivity is the
a.
quality of output/quantity of input
b.
quality of input/quantity of output
c.
quantity of output/quantity of input
d.
quantity of input/quantity of output
16. In choosing performance measures, an organization might consider all of the following criteria except
a.
Is the measure actionable?
b.
Is the measure based on behavioral performance?
c.
Is the measure important to customers?
d.
Does the measurement support the firm’s mission?
17. Airline revenue per passenger mile and hotel revenue per full-time employee are examples of
a.
reliability
b.
value of a loyal customer
c.
sustainability
d.
productivity
18. Of the four models of organizational performance, which two focus on the “big picture” of organizational performance rather than on operational-level framework?
a.
Malcolm Baldrige National Quality Award Framework and the Value Chain model
b.
Balanced Scorecard and the Service-Profit Chain
c.
Malcolm Baldrige National Quality Award Framework and the Balanced Scorecard
d.
Value Chain model and Service-Profit Chain
19. Of the seven categories of the Malcolm Baldrige National Quality Award criteria, which is least relevant to an operations manager?
a.
Leadership
b.
Workforce Focus
c.
Customer Focus
d.
Measurement, Analysis and Knowledge Management
20. Which category of the Malcolm Baldrige National Quality Award examines how the organization fulfills its ethical, legal, and societal responsibilities, and supports its key communities?
a.
Leadership
b.
Strategic Planning
c.
Customer Focus
d.
Results
