MGMT 326
Objectives for Test 2 Material
Spring semester, 2006
Chapter 5 (pages 137-142, 149-150, 153-157, 159-162)
1. Explain the difference between high performance design and consistency. Give an
example of each.
2. Define value and perceived quality.
3. Know that quality includes all product or service characteristics that are important to
customers, not just the core product.
4. Define target value and conformance quality.
5. Define qualitative measures and quantitative measures of quality in services. Give an
example of each.
6. Define prevention, appraisal, internal failure, and external failure costs. Recognize
examples of each.
7. Know the definitions of customer-defined quality and TQM. Know who must participate
in a coordinated TQM effort.
8. Fully explain the TQM philosophy.
9. Answer questions similar to those in the House of Quality exercise, using a House of
Quality that you have not seen before.
10. Know what the Baldrige Award is and why companies try to win it. Know which
category of the Baldrige standards earns the largest number of points.
11. Know what ISO 9000 certification is and why companies try to earn it.
Chapter 6 (pages 172-184, 190-195)
1. Define common cause variation, assignable cause variation, and process in control. Know
what assignable cause variation shows.
2. Define variable and attribute measures. Recognize examples of each.
3. Define k and n, as used in the class notes on statistical process control. Determine k and n
for a sequence of samples.
4. Compute x and R for a sample.
5. Compute x and R for a sequence of samples.
6. Know that according to the Central Limit Theorem, x is normally distributed. Know that
the computations we have done give 99.7% confidence limits for x .
7. Compute control limits for x by two methods. Know when to use each method.
8. Compute control limits for R. Know that R is not normally distributed.
9. Define specification limit, conformance quality, and capable process. Explain why it is
important for a process to be capable. Distinguish between the definitions of in control
and capable.
10. Compute Cp and Cpk. Use the result to determine whether a process is capable. Explain
when Cp can be used and when Cpk must be used.
Chapter 9 (pages 303-307, 315-320)
1. Define capacity, design capacity, and effective capacity. Distinguish between input measures
and output measures of capacity.
2. Compute capacity utilization, using both design capacity and effective capacity.
3. Know why facility location decisions are important.
4. Know that manufacturing facility location decisions are based primarily on costs. Know that
service facility location decisions are based primarily on revenue and profitability.
5. Recognize and understand the meaning of the important facility location factors for both
services and manufacturing.
6. Recognize and understand the meaning of the advantages and disadvantages of "going
global".
Chapter 10 (pages 344-354, 359-361, 366-368)
1. Define process layout and product layout. Recognize examples of each.
2. Know which types of manufacturing processes use a process layout and which use a product
layout.
3. Recognize the characteristics of process layouts and of product layouts (pages 346-348 and
Table 10-1).
4. Explain what an REL chart tells us. Know that REL charts are used to design process layouts.
5. Given a layout and a from-to matrix, set up a table to compute the total ld score for the
layout. Compute distances between departments, ld scores for all departments, and the total
ld score for the layout. Know that a lower ld score corresponds to a more efficient layout,
with less travel or material handling between departments.
6. Recognize the key considerations in office layout.
7. Know the objectives of product layout design.
8. Explain the "other considerations" in product layout design (pages 366-367).
9. Define hybrid layout, group technology, and cell (cellular) layout.