Managing Quality: Integrating the Supply Chain, 5e (Foster)

Chapter 3 Global Supply Chain Quality and International Quality Standards

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
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

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
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3) The portion of a firm's environment that has to do with the operating structure that the firm
encounters when globalizing is called the ________ environment.
A) global
B) physical
C) social
D) task
E) economic
Answer: D
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-1
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
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

5) ________ produce their products and ship them internationally.

A) Exporters
B) Licensors
C) Franchisors
D) Importers
E) Retailers
Answer: A
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

6) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

7) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-2
8) Which of the following categories is not a criterion for the Malcolm Baldrige Award?
A) Internet competencies
B) operations focus
C) strategic planning
D) business results
E) leadership
Answer: A
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

9) 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
C) strategic planning
D) operations focus
E) business results
Answer: B
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

10) 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
C) strategic planning
D) leadership
E) customer focus
Answer: D
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

11) Which of the following Baldrige criteria focuses on how a firm assesses the relative
importance of product or service features?
A) operations focus
B) business results
C) customer focus
D) leadership
E) strategic planning
Answer: C
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-3
12) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

13) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

14) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-4
15) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

16) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

17) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

18) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-5
19) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

20) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

21) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

22) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-6
23) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

24) Which of the following is a category of the Baldrige Award?

A) policy development
B) information analysis
C) workforce focus
D) partnerships and resources
E) management system
Answer: C
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

25) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

26) Which of the following is a category of the European Quality Award?

A) policy deployment
B) operations focus
C) information analysis
D) partnerships and resources
E) human resources development
Answer: D
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-7
27) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Describe the advantages and disadvantage of various production strategies
such as lean, Theory of Constraints, JIT, and Six Sigma

28) 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
E) statistical process control
Answer: A
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Describe the advantages and disadvantage of various production strategies
such as lean, Theory of Constraints, JIT, and Six Sigma

29) ________ was fundamental in helping Toyota reduce waste.

A) Genichi Taguchi
B) Kaoru Ishikawa
C) Shigeo Shingo
D) Armand Feigenbaum
E) Philip Crosby
Answer: C
Topic: Quality Improvement: The European Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

30) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-8
31) With ________ inspection, all work is inspected at each stage of the manufacturing process,
and the workers inspect their own work.
A) in-process
B) multi-level
C) dynamic
D) continuous
E) line-stop
Answer: A
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

32) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

33) ________ means that all departments are involved in quality.

A) Vertical deployment
B) Cross-functional deployment
C) Horizontal deployment
D) Multi-level deployment
E) Parallel deployment
Answer: C
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

34) ________ means that all levels of management and workers are actively involved in quality.
A) Vertical deployment
B) Cross-functional deployment
C) Horizontal deployment
D) Multi-level deployment
E) Parallel deployment
Answer: A
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-9
35) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

36) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

37) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

38) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-10
39) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

40) ________ 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

41) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

42) ________ is the European standard for quality that has been expanded worldwide.
A) ISO 9000:2005
B) ISO 9000:2008
C) ISO 9001:2000
D) ISO 9004:2009
E) ISO 14001:2004
Answer: B
Topic: Quality Improvement: The European Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-11
43) The focus of ISO 9000:2008 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
Topic: Quality Improvement: The European Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

44) What is the first step in the registration process for ISO 9000:2008?
A) inquiry
B) client contract
C) phase 1 audit
D) certification audit
E) process audit
Answer: A
Topic: Quality Improvement: The European Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

45) 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
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

46) Through licensing, firms are able to reach international markets without having to establish
international supply chains or marketing arms.
Answer: TRUE
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

47) The benefits of licensing and partnering are that the exporting firm does not have to globalize
to make sales in international markets.
Answer: TRUE
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-12
48) With growing economies in many parts of the world, firms need to globalize to participate in
these markets.
Answer: TRUE
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

49) The social environment of the firm has to do with the operating structure that the firm
encounters when globalizing.
Answer: FALSE
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

50) The physical environment facing globalizing corporations refers to cultural factors such as
language and business customs.
Answer: FALSE
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

51) Market diversity drives the need for culture-specific research and development.
Answer: TRUE
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

52) Importers produce their products and ship them internationally.

Answer: FALSE
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

53) The Baldrige Award is restricted to firms in the manufacturing sector.

Answer: FALSE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

54) The Baldrige criteria are nonprescriptive and adaptable.

Answer: TRUE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-13
55) The Baldrige criteria specify which tools, techniques, or organization a company should use
to improve.
Answer: FALSE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

56) The Baldrige criteria permit goal-based diagnosis.

Answer: TRUE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

57) Each of the seven major Baldrige Award categories is divided into items and areas to
address.
Answer: TRUE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

58) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

59) Customer focus involves developing an internal environment conducive to full participation
and personal growth, including human resources development.
Answer: FALSE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

60) For a firm applying for the Baldrige Award, the first step is eligibility determination.
Answer: TRUE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

61) The main purpose of a Baldrige site visit is to collect additional information on each of the
seven evaluation criteria.
Answer: FALSE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-14
62) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

63) 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
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

64) The number of applicants for the Baldrige Award has decreased due to the lack of legitimacy
of the award criteria.
Answer: FALSE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

65) In the full-Baldrige approach, the scores required to win the state awards are higher than
those for the national awards.
Answer: FALSE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

66) The Baldrige-lite approach uses the Baldrige criteria but with a simplified process or
application.
Answer: TRUE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

67) The top level in the multilevel approach includes the Baldrige-lite approach.
Answer: FALSE
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-15
68) The Deming Prize is awarded to individuals and groups who have contributed to the field of
quality control.
Answer: TRUE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

69) Information analysis is a category of the Baldrige Award.

Answer: FALSE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

70) Customer focus and workforce focus are categories of the Deming Prize.
Answer: FALSE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

71) Leadership and strategy are categories of the European Quality Award.
Answer: TRUE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

72) The first view of lean manufacturing is a philosophical view of waste reduction.
Answer: TRUE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Describe the advantages and disadvantage of various production strategies
such as lean, Theory of Constraints, JIT, and Six Sigma

73) Lean manufacturing is a productive system whose focus is on optimizing processes through
the philosophy of continual improvement.
Answer: TRUE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Describe the advantages and disadvantage of various production strategies
such as lean, Theory of Constraints, JIT, and Six Sigma

74) Kaoru Ishikawa was fundamental in helping Toyota to reduce waste.

Answer: FALSE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-16
75) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

76) The visibility technique used by the Japanese is called andon, or warning lights.
Answer: TRUE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

77) With in-process inspection, all work is inspected at each stage of the process, and the
workers inspect their own work.
Answer: TRUE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

78) The N=2 technique is an alternative to acceptance sampling.

Answer: TRUE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

79) Horizontal deployment means that all levels of management and workers are actively
involved in quality.
Answer: FALSE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

80) 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
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

81) Organizing by getting rid of the unnecessary materials is called seiri.

Answer: TRUE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-17
82) Cleaning plant and equipment to eliminate dirtiness that can hide or obscure problems is
called seiso.
Answer: TRUE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

83) Standardizing locations for tools, files, equipment, and other materials is called shetsuke.
Answer: FALSE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

84) Quality circles are natural work teams made up of workers who are empowered to improve
work processes.
Answer: TRUE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

85) ISO 9004:2009 is the European standard for quality that has been expanded worldwide.
Answer: FALSE
Topic: Quality Improvement: The European Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

86) The highest level of the European Quality Award is the award for the most accomplished
applicant in a given year.
Answer: TRUE
Topic: Quality Improvement: The European Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

87) 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
Topic: Quality Improvement: The European Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

88) The first step in the registration process for ISO 9000:2008 involves a phase 1 audit.
Answer: FALSE
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-18
89) 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.
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

90) 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.
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

91) 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.
Topic: Managing Quality for the Multinational Firm (MNF)
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

92) 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.
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-19
93) 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.
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

94) 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."
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-20
95) 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.
Topic: The Baldrige Performance Excellence Program
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

96) 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.
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Describe the advantages and disadvantage of various production strategies
such as lean, Theory of Constraints, JIT, and Six Sigma

97) 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.
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

98) 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.
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-21
99) 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.
Topic: Quality Improvement: The Japanese Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

100) How does the ISO 14000 series differ from ISO 9000:2000?
Answer: ISO 9000:2008 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 9000:2008, 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 9000:2000 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.
Topic: Quality Improvement: The European Way
Learning Outcome: Discuss the total cost of quality and compare the common methods of
managing quality

3-22