SOLUTIONS MANUAL for Operations and Supply Chain Management 10th Edition by Roberta S. Russell
and Bernard W. Taylor
SOLUTIONS MANUAL for Operations and Supply
Chain Management 10th Edition by Roberta S. Russell
and Bernard W. Taylor
,SOLUTIONS MANUAL for Operations and Supply Chain Management 10th Edition by Roberta S. Russell
and Bernard W. Taylor
Answers to Questions
1.1. The operations function involves organizing work, selecting processes, arranging layouts, locating
facilities, designing jobs, measuring performance, controlling quality, scheduling work, managing
inventory, and planning production. Operations interacts with marketing in product development,
forecasting, production planning, and customer service. Operations and finance interact in capital
budgeting, cost analysis, production and inventory planning, and expansion and technology plans.
Operations and human resources work together recruiting, training and evaluating workers, designing
jobs and working with unions. IT and operations work together daily on e-commerce, enterprise resource
planning and supply chain management systems.
1-2. a. Operations at a bank involves transferring funds, processing funds, providing checks, cashing checks,
preparing monthly statements, reconciling statements, approving loans, loaning money, keeping track
of loan payments, approving credit cards, and more.
b. Operations at a retail store involves purchasing goods, stocking goods, selling goods, keeping track of
inventory, scheduling workers, laying out the store, locating the store, forecasting demand, and more.
c. Operations at a hospital involves preparing the rooms, scheduling doctors, nurses and other workers,
processing paperwork, ordering supplies, caring for patients, maintaining the facility, laying out the
facility, ensuring quality and more.
d. Operations at a cable TV company involves taking orders, installing equipment, maintaining
equipment, keeping the shows on the air, scheduling work, processing statements and payments, and
more.
1.2. Inventions during the industrial revolution brought workers together under one roof in a factory setting
where division of labor and interchangeable parts encouraged the formation of separate worker and
management jobs. Ideas from the scientific management era made work more efficient. Human relations
theorists emphasized the importance of the human element in operations management. The management
science era saw many advances in quantitative techniques and their application. The quality revolution
focused management on meeting customer expectations and emphasized quality over quantity. The
Internet brought numerous opportunities to do work faster and better. It also opened doors to new markets
worldwide. Today’s successful companies compete worldwide for both market access and production
resources.
1.3. Competitiveness is the degree to which a nation can produce goods and services that meet the test of
international markets. A country’s competitiveness is measured by its GNP, import/export ratio, and
increases in productivity. Industry competitiveness can be measured by the number of major players in the
industry, average market share, and average profit margin. Measures of a firm’s competitiveness include
market share, earnings per share, revenue growth, and profit margins. The Internet has opened new
avenues of trade so that more firms compete for a larger, global market. The ease with which consumers
,SOLUTIONS MANUAL for Operations and Supply Chain Management 10th Edition by Roberta S. Russell
and Bernard W. Taylor
can compare products and prices online has also increased competitiveness.
1-5. Student answers will vary. The information can be accessed directly from the Internet or through the
hyperlinks provided in Chapter 1 of the text’s homepage located at www.wiley.com/college/russell.
1-6. Student answers will vary.
1-7. Students can begin this assignment by accessing Fortune’s homepage and referring to the Fortune 500 or
Global 500 by industry. The leaders in each industry are listed and there is usually some discussion of
industry concerns. Individual data on companies can be found at Hoover’s website (www.hoovers.com).
1-8. Student answers will vary.
1-9. Student answers will vary.
1-10. Student answers will vary. The information can be accessed directly from the Internet or through the
hyperlinks provided in Chapter 1 of the text’s homepage located at www.wiley.com/college/russell.
1-11. The WTO is an international organization that works to establish and enforce rules of trade between
nations. WTO agreements are ratified by the governing bodies of the nations involved. WTO’s dispute
settlement process interprets agreements and rules on violations, thereby avoiding political or military
conflict. The group promotes free trade and more recently, has helped developing nations enter the trade
arena on more equitable grounds. Currently, there are 147 member nations. Membership is achieved by
meeting certain environmental, human rights, and trade criteria, agreeing to abide by the rules of the
organization, and being approved by two-thirds of the existing membership. See www.wto.org
1-12. Student answers will vary. Access www.executiveplanet.com
1-13. Student answers will vary. Access www.transparency.org
1-14. Student answers will vary. Access http://www.usdoj.gov/criminal/fraud/fcpa.html for basic information.
1-15. Students will find a variety of answers for this question. In general, it is easy to find mission or vision
statements, but more difficult to find evidence of the mission or vision being applied.
1-16. Strategy formulation consists of four basic steps: (1) Defining a primary task—what is the purpose of the
firm? What is the firm in the business of doing? (2) Assessing core competencies—what does a firm do
better than anyone else? (3) Determining order winners and order qualifiers—what wins orders in the
marketplace? What qualifies a product or service to be considered for purchase? (4) Positioning the firm—
what one or two important things should the firm choose to concentrate on? How should the firm compete
in the marketplace?
Student answers will vary. Most start-ups try too much too soon. It’s often difficult to stick with what you do
, SOLUTIONS MANUAL for Operations and Supply Chain Management 10th Edition by Roberta S. Russell
and Bernard W. Taylor
best.
1-17. Core competencies are the essential capabilities that create a firm’s sustainable competitive advantage.
They have usually been built up over time and cannot be easily imitated. For example, First National Bank,
one of our local banks, is known as a risk taker. Its core competence is its ability to size up the potential of
investment opportunities. Through its familiarity with local businesses and its experience in loan making,
the bank has developed the ability to predict which loans are worth taking extra risks.
Bonomo’s, a successful retail store, is known for having just the right item in stock for special occasions.
The store stocks a variety of stylish women’s clothing, but not too much of each style. They specialize in
knowing individual customers and even keep track of evening wear purchases so that no one else at a
particular party will be wearing the same dress.
Toyota emphasizes superior quality at a price below its competitors with its Lexus line of automobiles. To
establish a special reputation for quality over the lifetime of the car, the company set up separate sales and
service facilities. When it is time for servicing, Lexus owners can have their vehicle picked up and
delivered to their home or place of business. The car returns the same day, washed and vacuumed, often
with a gift certificate inside for a night on the town complements of the dealer.
1-18. While the answers to this question vary considerably, most students feel competent in the technical areas of
their major, but uncomfortable with their communication skills (both oral and written) and their ability to
make decisions. This opens the way for more project-oriented assignments from the instructor. The question
also helps students prepare for the inevitable interview question—what are your strengths and weaknesses?
1-19. Order qualifiers are characteristics of a product or service that qualify it to be considered for purchase by a
customer. An order winner is the characteristic of a product or service that wins orders in the marketplace—
the final factor in the purchasing decision.
1-20. a. Most companies approach quality in a defensive or reactive mode; quality is confined to minimizing
defect rates or conforming to design specifications. To compete on quality, companies must view
quality as an opportunity to please the customer, not just as a way to avoid problems or to reduce
rework costs. The manufacturer of Rolex watches competes on quality.
b. Companies that compete on cost relentlessly pursue the elimination of all waste. The entire cost
structure is examined for reduction potential, not just direct labor costs. High volume production and
automation may or may not provide the most cost-effective alternative. Wal-Mart competes on cost.
c. Flexibility includes the ability to produce a wide variety of products, to introduce new products and to
modify existing products quickly, and, in general, to respond to customer needs. National Bicycle
Industrial Company competes on flexibility.
d. Competing on speed requires a new type of organization characterized by fast moves, fast adaptations,
and tight linkages. Citicorp competes on speed.
e. Competing on dependability requires a stable environment, adequate resources, high standards for
performance, and tight control. Maytag competes on dependability.
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