SECTION A : Compulsory Essay Question (40 marks)

1. Identify any of the FIVE (5) sources of failure and provide examples of them in operations.
What are the THREE (3) methods that operations can use to detect failure in quality?
Explain these THREE (3) methods and discuss which would be more suitable in detecting
failure in :
a) Products
b) Services. [40 marks]

SECTION B : Answer any TWO (2) questions from this section. (60 marks)

1. Discuss the THREE (3) types of demand / capacity strategies that you would favour using in
a resort hotel like Genting. Explain THREE (3) advantages of the use of the above strategies
in relation to a resort hotel like Genting. [30 marks]

2. Outline FIVE (5) challenges an organisation would face when it chooses to move from the
traditional approach of quality towards a philosophy of Total Quality Management (TQM).
Identify and provide any FIVE (5) methods in which organizations can use to overcome
these challenges. [30 marks]


3. Discuss the THREE (3) benefits of each of the following supply chain strategies:-
a) Long term partnering with few suppliers
b) Joint ventures
c) Keiretsu
d) Vertical integration [30 marks]


4. What are the roles of work-in-progress (WIP) in a batch process design? Outline and explain
THREE (3) drawbacks of WIP in the batch process design. [30 marks]




























SECTION A : Compulsory Essay Question

1. Identify any of the FIVE (5) sources of failure and provide examples of them in operations.
What are the THREE (3) methods that operations can use to detect failure in quality?
Explain these THREE (3) methods and discuss which would be more suitable in detecting
failure in :
a) Products
b) Services. [40 marks]

Marking scheme
To mention any of the FIVE (5) sources of failure: (3 marks each failure, 1 mark for example)
Students are required to only provide one example.
- Machinery (e.g breaking down)
- Technology (e.g lacking maintenance causing it to be unreliable)
- staff (e.g not trained, skilled or inexperience)
- customers (e.g provided the wrong information resulting in the wrong product or service
delivered, wrong specifications)
- materials (e.g problem with supplier, delivery)
The transformation process itself (e.g too many steps/micro-operations, lack of communication or
coordination, lack of management, pricing too high).
Customers can also be a source of failure by providing the wrong information to the company
[20 marks]
Defining the methods and explaining which type of methods to be used in detecting failure in
products and services. (18 marks)
Products (Any of the 3 methods at 3 marks
each) with elaboration of each
- Machine diagnostics checks
a) Sequence of checks designed to
expose failures
- Feedback sheets
- Phone surveys
- Focus group
- Mystery shoppers
[3 x 3 = 9 marks]
Services (Any of the 3 methods at 3 marks
each) with elaboration of each
- In-process checks
- Feedback sheets
- Point of departure interviews
- Phone surveys
- Questionnaire
- Focus groups

[3 x 3 = 9 marks]

Conclusion (2 marks)
Some mention about recovery of failure by offering apology to customer and taking ownership of
the failure.

SECTION B : Answer any TWO (2) of the questions in this section.

1. Discuss the THREE (3) types of demand / capacity strategies that you would favour
using in a resort hotel like Genting. Explain THREE (3) advantages of the use of the
above strategies in relation to a resort hotel like Genting. [30
marks]
Marking scheme

For 15 marks, students have to define any of the following capacity strategies : (4 marks each, 1
mark for example)
Level capacity plan
a. The Capacity remains Level regardless of demand, Same number of staff; same
processes, Same output in each period

b. Example cashier counter, staff in the restaurant, staff in the lobby area of hotel
Chase capacity plan
a. Matches capacity closely to varying levels of demand, Different staff numbers (over
that time period).working different hours (overtime, p/t, sub-contract)with
different amounts of machines / equipment
b. Example opening more counters for check in during peak time, restaurants hiring
more part time employees during peak times
Demand management
a. Transfer customer demand from peak times to quiet times, Involves different
marketing / sales, Involves raising or lowering the price, Alternate advertising and
alternate products/services
b. Example running room promotions off season, promotions in restaurants
Mixed capacity plan
a. Combination of the above three plans, Complex with increased variables whereby
Part time staff is needed. Most flexible but most complex
b. Example managing demand over the year. The implementation of different
strategies in a years span peak and low seasons.

[3 x 5 = 15 marks]

Benefits of each strategy would include the following :- (3 marks each)
Level capacity plan (conceptually easy but not suitable for perishable goods/services)
Chase capacity plan (flexible, good for perishable goods, but potentially costly and with HR
and ethical issues over staffing)
Demand management (again introduces flexibility but changing price / service / advertising
may cause unpredictable results)
Mixed capacity plan (most flexible but most complex) [3 x 4 = 12 marks]

Conclusion (1 mark each)
i) There are differing capacity strategies that are suitable for an operation. They may change
across different time periods.
ii) Throughout a day, there may not be any huge change in demand, so you could employ a
level capacity plan. However during a different time scale (over a year), there is a peak
before and during the start of the first time. To meet this need/demand, theyd have to
increase their capacity (perhaps employ someone else from admin in this role or give
overtime to the staff).
iii) So for the same operation, the capacity strategy can change for different time scales.
[1 x 3 = 3 marks]

2. Outline FIVE (5) challenges an organisation would face when it chooses to move from the
traditional approach of quality towards a philosophy of Total Quality Management (TQM).
Identify and provide any FIVE (5) methods in which organizations can use to overcome
these challenges. [30 marks]

Marking scheme

Introduction this is the base of building into the philosophy of TQM (any mention of the below at
1 mark each)
o TQM helps organizations gain competitive advantage
o TQM involves everyone in the organization
o TQM involves the entire value chain
o TQM is a form of change
o TQM is about doing things right the first time around [1 x 2 = 2 marks]


Students are required to compare and contrast the traditional Quality Management (QM) to Total
Quality Management (TQM). They also have to discuss on the challenges faced when implementing
Total Quality Management (TQM). (any 5 challenges identified at 3 marks each)
These barriers / challenges link to move away from :
A culture of secrecy to one based on open communication
Control of staff by management to a culture of empowerment
Focus on meeting targets rather than focusing on customers
Inspection and firefighting
Seeking stability not continuous improvement
Adversarial not co-operative relationships
A blame culture

Other challenges include : a change of culture, dealing with those who are resistant to change.
[5 x 3 = 15 marks]

Methods that organizations can use to overcome the challenges (any 5 methods at 2 marks each)
1. incorporating training for all employees
2. Staff reward scheme formation
3. upgrading the existing equipment / IT
4. relooking at the HR policies with regards to the recruitment and selection of skilled
employees
5. implementing the buddy or mentor-mentee system to encourage knowledge sharing
6. appointing a team that can spearhead change in the organisation
7. relooking at existing processes to detect any errors in the operations of it
[2 x 5 = 10 marks]

Conclusion (any 3 points below at 1 mark each)
Recognition that the process of change can typically take 5-6 years for it to become self
sustaining
The need for top management commitment along with the role of champion or change agent
The existence of vested interests and an in-build resistance to change
The existence of cynism from those working in the organization who have undergone
change initiatives before
Training
The existence of an organizational culture that may not be conducive to change (e.g. rigidly
hierarchical structures) [3 x 1 = 3 marks]


3. Discuss the THREE (3) benefits of each of the following supply chain strategies:-
e) Long term partnering with few suppliers
f) Joint ventures
g) Keiretsu
h) Vertical integration [30 marks]

Marking scheme
Introduction - Define the use of supply chain strategy (any 1 point for 2 marks)
Students are required to mention the importance of having a supply chain strategy. Answers can be
from any of the following points :-
Ensuring that the product arrives in the best quality and on time
Substantial inventory deployed in the traditional channel can be eliminated
Firms can benefit from a good collaboration by sharing information and technology that will
be of mutual benefit. [2 marks]

Benefits with definition of each (1 mark for definition & 2 marks for each benefit)
a) Long term partnering with few suppliers

Definition - Buyer forms longer term relationships with fewer suppliers
Benefits (any 3 benefits at 2 marks each)
Create value through economies of scale and learning curve improvements
Suppliers more willing to participate in JIT programs and contribute design and
technological expertise
Suppliers are more willing to change with the company i.e. with the
implementation of TQM
The expectation that both the purchaser and supplier collaborate thus becoming
more efficient and reducing prices over time.
The relationships yield contracts that extend through the product life cycle
[1 + (2 x 3) = 7 marks]


b) Joint ventures
Definition - Formal collaboration whereby there is cooperation without diluting brand or
conceding competitive advantage
Benefits (any 3 benefits at 2 marks each)
a. Formal collaboration which would help
i. Enhance skills
ii. Reduce costs
b. Transfer and technology sharing
c. Supply of inventory is secure
d. A better way to deal with suppliers as there is a contract signed and the suppliers
may not run off with the trade secrets.
[1 + (2 x 3) = 7 marks]

c) Keiretsu
Definition - A middle ground between few suppliers and vertical integration whereby the
supplier becomes part of the company coalition. This may extend through several levels
of the supply chain
Benefits (any 3 benefits at 2 marks each)
a. Often provide financial support for suppliers through ownership or loans
b. Members expect long-term relationships and provide technical expertise and
stable deliveries
c. More tiers of the suppliers are involved in the coalition and the organization will
be able to obtain input from each tier.
d. Consistent supply is guaranteed.
e. Easier to choose which supplier in which tier to choose from.
f. Organizations get first hand info with regards to the problems that suppliers might
face in obtaining a particular raw material
[1 + (2 x 3) = 7 marks]
d) Vertical integration
Definition - Developing the ability to produce goods or service previously purchased or
to actually buy a supplier or distributor. Integration may be forward, towards the
customer, or backward, towards suppliers
Benefits (any 3 benefits at 2 marks each)
a. Can improve cost, quality, and inventory
b. Can offer a strategic opportunity for the operations manager by providing timely
delivery
c. Lower transaction costs
d. Synchronization of supply and demand along the chain of products
e. Lower uncertainty and higher investment
f. Ability to monopolize market throughout the chain by market foreclosure

[1 + (2 x 3) = 7 marks]



4. What are the roles of work-in-progress (WIP) in a batch process design? Outline and explain
THREE (3) drawbacks of WIP in the batch process design. [30 marks]

Marking scheme
Students are expected to provide the following :
Introduction definition of WIP [3 marks]
o Work-in-progress constitutes part-finished products, customers (or the surrogates of
customers) or information. [3 marks]

Roles of WIP in batch processing : [2 marks each]
o As the range of products or services on offer share the same processes and systems
then, in batch, partly finished products and services wait to enter and wait between
one stage and the next as other products and services are being processed. In this way,
products and services wait for processes to become available.
o The advantage of this is that the utilization of capacity is increased as processes (staff
or equipment) do not wait for products or services. Also in back office systems,
information can be collected and then processed at the same time, thus offering
efficiency in this step of the delivery system.
o It shifts the time of job processing to when the computing resources are less busy,
o It avoids idling the computing resources with minute-by-minute manual intervention
and supervision,
o By keeping high overall rate of utilization, it better amortizes the cost of a computer,
especially an expensive one.
o The performance increases as there is always inventory for the raw materials buffer
stock [6 x 2 = 12 marks]
Drawbacks of WIP (students are to provide any 3 for 5 marks each)
o Time lost switching between batches machine may need to be reset
o Production will have to come to a halt in some places such as food manufacturing
whereby the same machines could be used to produce different parts of the finished
goods
o At some places, machines may have to be maintained / cleaned first before the
beginning of the production.
o Sometimes, suppliers of certain parts may not be able to deliver on time which will
result in a delay of the production of the final good
o Not all machines will be working all the time. In some case, different parts may
require the same machine.
o Need to keep stock of raw materials
o There are many incomplete / semi completed parts laying that take up space
o Can be costly because space may have to be rented to store these unfinished parts
o In some cases, the unprocessed or incomplete parts may go missing or faulty
o Challenging to keep stock as different parts start out production at different times
o Potentially de-motivating for staff / employees
o Same process which can be very routine for the employees
o Long waiting time as in waiting for each batch to finish production
o Final product quality must be satisfied with each batch (no blending)
o Many checks to be done at each stage of the production so that the final product is at
the best quality
[3 x 5 = 15 marks]