Sample Questions for Chapter 6

True/False
Indicate whether the statement is true or false.
____

1. The decision of what goods and services to offer and how to position them in the marketplace is mainly an
operational decision.

____

2. In general, the designs of both goods and services follow a similar path. The critical differences lie in the
detailed product and process design phases.

____

3. The design of a customer benefit package (CBP) focuses on the operational choices that the firm must make
in order to provide the CBP.

____

4. The design of a service cannot be done independently from the process by which the service is delivered.

____

5. The process by which the service is created and delivered is, in essence, the service itself.

____

6. The design of a manufactured good focuses primarily on its physical characteristics.

____

7. Japan's Genichi Taguchi argued that any variation within the specification limits is equally good in terms of
quality and long-run cost.

____

8. Suppose that a manufacturing specification of a dimension is 1.0 0.05. The permissible range of variation
from 0.95 to 1.05 is called the tolerance.

____

9. The "goal post model" of conforming to specifications by specifying a nominal dimension and a tolerance is
the basis for calculating the Taguchi loss function.

____ 10. In the Taguchi loss function, as one deviates further from the target value, the loss increases in a linear
fashion.
____ 11. Reliability is formally expressed as a probability between 0 and 1.
____ 12. Reliability does not apply to services processes.
____ 13. Redundancy is the use of backup components in a design.
____ 14. A parallel system has no redundancy.
____ 15. To find the reliability of a complex system, one must first convert the parallel components into equivalent
series components in order to compute the reliability of the entire system.
____ 16. Quality function deployment is focused primarily on developing a viable quality control plan.
____ 17. Customer requirements that are expressed in the customer's own language is called the "voice of the
customer."

____ 18. The roof of the house of quality shows the relationship matrix between customer requirements and the
technical features.
____ 19. Prototype testing is an important step in the initial choice of a customer benefit package.
____ 20. Service design must be addressed from two perspectives
encounter.

the service delivery system and the service

____ 21. The House of Quality shows the interrelationships between any pair of technical features.
____ 22. Failure mode and effects analysis provides a basis for improving designs.
____ 23. Product simplicity encourages the use of standard parts and components.
____ 24. Design for Environment (DfE) is the explicit consideration of environmental concerns during the design of
goods and services and processes, and include such practices as designing for recycling and disassembly.
____ 25. In designing a service delivery system, good job and process design can usually overcome a poor location.
____ 26. The servicescape refers to the place where a service is located.
____ 27. A kiosk at an airport that allows passengers to check their baggage would be an example of a lean
servicescape environment.
____ 28. Estate planning is an example of a low-contact system.
____ 29. A service encounter design focuses on the interaction, directly and indirectly, between the service provider(s)
and the customer.
____ 30. A check processing operation would be an example of a low-contact system.
____ 31. Customer contact requirements are either technical or behavioral in nature.
____ 32. Ensuring that hotel staff at the front desk address a guest by name is an example of a servicescape
requirement.
____ 33. Service recovery is the process of correcting a service upset and satisfying the customer.
____ 34. Service guarantees provide a reward or compensation as a response to a service upset and are offered to
customers after a service upset has occurred.
____ 35. The customer benefit package at LensCrafters is weighted more toward the primary good, which is eyewear.
Multiple Choice
Identify the choice that best completes the statement or answers the question.
____ 36. Which of the following is not a principal dimension of a servicescape?
a. spatial layout and functionality

b. signs, symbols and artifacts

c. facility location
d. ambient conditions
____ 37. A bank provides four sequential services to its customers. Over the last quarter, the reliability of each of these
services was 92%, 97%, 95% and 90%. What is their overall reliability?
a. 0.9700
b. 0.9350
c. 0.7630
d. 0.7400
____ 38. A system design consisting of several parallel components that function independently of each other and
where the system fails only if all the parallel components fail is an example of
a. simplification
b. redundancy
c. deployment
d. sustainability
____ 39. The text presents an integrative case study of LensCrafters. Which statement is correct?
a. LensCrafters primary product is eyewear.
b. Each store has very different layout and servicescape.
c. Each store has a visible low contact area.
d. Low cost makes a long drive to a LensCrafters store worthwhile.
____ 40. The final step in using the House of Quality involves identifying those technical features that meet any of the
following criteria except
a. have the strongest relationship to customer requirements
b. have the highest quality
c. have poor competitive performance
d. will be strong selling points
____ 41. Which of the following is not a principal issue in service encounter design?
a. facility location
b. customer contact behavior and skills
c. service provider selection, development and empowerment
d. service recovery and guarantees
____ 42. Which of the following is not one of the six customer attributes that impact the design and configuration of a
customer benefit package?
a. Time
b. Information
c. Exchange
d. Reliability
____ 43. Prior to designing and configuring a customer benefit package, a firm should understand and develop its
____.
a. detailed goods, services and process design
b. process and service encounter design
c. strategic mission and competitive priorities
d. marketplace evaluation
____ 44. Which of the following steps is not the same for both goods and services?
a. detailed goods, services and process design

b. Customer Benefit Package design and configuration

c. market introduction/deployment
d. marketplace evaluation
____ 45. In design specification terminology, permissible variation is called
a. nominal
b. buffer
c. tolerance
d. leeway
____ 46. In design specification terminology, the target dimension is called
a. nominal
b. exceptional
c. bull's-eye
d. goal
____ 47. In a design specification 25 1.5, the value 25 is called the ____, while 1.5 is called the ____.
a. nominal; reliability
b. average; tolerance
c. average; nominal
d. nominal; tolerance
____ 48. Which of the following is not supported by Japan's Genichi Taguchi?
a. optimizing tolerances
b. goal post model
c. quadratic loss function
d. monetary expression of variation
____ 49. Which of the following is not an important element of reliability definition?
a. probability
b. time
c. redundancy
d. operating conditions
____ 50. To improve system reliability, one option is to
a. use better components
b. use more components in series
c. use quality function deployment
d. eliminate redundancy
____ 51. If a redundant component is added to a system, the overall system reliability
a. will decrease
b. will increase
c. will stay the same
d. will double
____ 52. The fundamental planning tool used to implement Quality Function Deployment is the
a. Voice of the customer
b. Technical requirement relationship matrix
c. House of Quality
d. Market and competitive evaluation rating matrix
____ 53. Quality Function Deployment (QFD) starts with

a.
b.
c.
d.

Competitive evaluation
Technical requirements
Voice of the customer
Technical requirement priorities

____ 54. Regarding the first House of Quality, the interrelationship between any pair of technical features is found in
a. the voice of the customer
b. the relationship matrix
c. the roof
d. the basement
____ 55. The process by which a model is constructed to test a good's physical properties or use under actual operating
conditions is called
a. Quality Function Deployment
b. Value engineering
c. Detailed product design
d. Prototype testing
____ 56. Taguchi's loss function is most closely associated with
a. design failure-mode-and-effects analysis
b. reliability calculation
c. tolerance design
d. prototype testing
____ 57. Which of the following is not included in a failure-mode-and-effects analysis (FMEA)?
a. ways in which components might fail
b. calculation of the component reliability
c. consequences of failure
d. how potential failures can be corrected in the design
____ 58. Which of the following is not correct regarding product or process simplification?
a. reduces flexibility
b. reduces opportunity for error
c. speeds up flow time
d. improves reliability
____ 59. Which of the following is not a principal element in service encounter design?
a. Technology and information support systems
b. Customer contact behavior and skills
c. Service provider selection, development and empowerment
d. Service recovery and guarantees
____ 60. Which of the following is not a principal dimension of the servicescape?
a. Ambient condition
b. Process and job design
c. Spatial layout and functionality
d. Signs, symbols and artifacts
____ 61. High customer contact systems would most commonly be found in ____.
a. distribution systems
b. mid office operations
c. front office operations
d. back office operations

____ 62. A(n) ____ is a promise to reward and compensate a customer if a service upset occurs.
a. service guarantee
b. customer contact requirement
c. service recovery
d. empowerment
____ 63. Customer contact, for the purpose of classifying a system as being high-contact or low-contact, is measured
by
a. the percentage of a service provider's workday spent with customers
b. the percentage of time the customer must be in the system relative to the total time it takes
to provide the service
c. the number of service encounters occurring in a given span of time
d. the number of different service providers required to serve one customer
____ 64. Objectives of service guarantees include all of the following except
a. increasing brand image
b. reducing customer risk
c. forcing operational improvement
d. allowing reduced pricing
Short Answer
65. Summarize the process of designing goods and services, and explain where the process differs between goods
and services.
66. Describe the Taguchi loss function. Contrast it to the "goal post" model.
67. Define reliability. Include the four major elements.
68. Explain the basic principles of Quality Function Deployment (QFD). Also, discuss the advantages of using
this methodology.
69. Explain the concept of Design Failure-Mode-and-Effect analysis.
70. Explain the concept of Design for Manufacturability (DFM).
71. Discuss the concept of Design for Environment (DfE).
72. List the five elements of a service delivery system.
73. Discuss the concept of servicescape.
74. Explain service encounter design. Include the principal issues that must be addressed.
75. Differentiate between high customer contact systems and low customer contact systems. Include examples of
each.
76. Explain the importance of service recovery and service guarantees.