Operations Management: Creating Value Along the Supply Chain 2nd Canadian Edition by Roberta S. Russ

AACSB: Reflective Thinking
 
 
63. What are interchangeable parts and their advantages?
 
Answer:
 
Difficulty: Medium
Learning Objective: Discuss the key factors that have contributed to the evolution of operations and the initiation of supply chain management.
Section Reference: 1.2 The Evolution of Operations and Supply Chain Management
Interchangeable parts are those which can be used in more than one product. The introduction of interchangeable parts by Eli Whitney (1790s) allowed the manufacture of firearms, clocks, watches, sewing machines, and other goods to shift from customized one-at-a-time production to volume production of standardized parts. This meant the factory needed a system of measurements and inspection, a standard method of production, and supervisors to check the quality of the worker’s production.
Blooms: Comprehension
AACSB: Reflective Thinking
 
 
64. What is productivity and how is it measured?
 
Answer:
 
Difficulty: Easy
Learning Objective: Calculate and interpret productivity measures used for measuring competitiveness.
Section Reference: 1.4 Productivity and Competitiveness
Solution: Productivity is the ratio of output to input. Output can be expressed in units or dollars. Single factor productivity compares output to individual inputs, such as labour hours, investment in equipment, or material usage. Multifactor productivity relates output to a combination of inputs, such as labour + capital. Total factor productivity compares the quantity of goods and services produced with all the inputs used to produce them.
Blooms: Comprehension
AACSB: Reflective Thinking
 
65. What can lead to increases in productivity?
 
Answer:
 
Difficulty: Medium
Learning Objective: Calculate and interpret productivity measures used for measuring competitiveness.
Section Reference: 1.4 Productivity and Competitiveness
Solution: Productivity increases when firms become more efficient, expand, achieve breakthroughs that enable output increases to occur with reduced inputs, downsize while maintaining output with fewer inputs, and retrench with output and inputs decreasing but inputs decreasing at a faster rate than output.
Blooms: Comprehension
AACSB: Reflective Thinking
 
 
66. What are some important considerations to make when using the productivity measure?
 
Answer:
 
Difficulty: Medium
Learning Objective: Calculate and interpret productivity measures used for measuring competitiveness.
Section Reference: 1.4 Productivity and Competitiveness
Solution:
There are many ways in which productivity statistics can be misleading. Examining the formula for productivity, output/input, it becomes apparent that productivity can be increased in different ways. For example, a country or firm may increase productivity by decreasing input faster than output. Thus, although the company may be retrenching, its productivity is increasing. Seldom is this avenue for increasing productivity sustainable (see Example 1.1).
Productivity statistics also assume that if more input were available, output would increase at the same rate. This may not be true, as there may be limits to output other than those on which the productivity calculations are based. Furthermore, productivity emphasizes output produced, not output sold. If products produced are not sold, inventories pile up and increases in output can actually accelerate a company’s decline. Finally, productivity is a relative measure, which is why statistics provided in government reports typically measure percentage changes in productivity from month to month, quarter to quarter, year to year, or over a number of years.
AACSB: Reflective Thinking
Blooms: Comprehension