Lagunitas Brewing Company Has Successfully and Methodically Applied Six Sigma

question 40

Multiple Choice

Lagunitas Brewing Company has successfully and methodically applied Six Sigma methods to its value chain, activity by activity, so that the company can

• A)clearly consider what it will take to overtake rivals with the industry's overall best strategy.
• B)make major strides in improving the proficiency with which its strategy is executed without sacrificing innovation.
• C)increase its bargaining power with suppliers and create better seller-supplier collaborations.
• D)assess the extent to which rivals have competitively valuable competencies or capabilities.
• E)construct a business model that entails a value proposition based on quality.

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Definitions:

Direct Materials

The primary raw inputs used in the manufacture of products, which are directly traceable to the production process.

Factory Depreciation

The allocation of the cost of a manufacturing or production plant and its equipment over their useful lives, reflecting the usage and wear and tear of fixed assets.

Variable Overhead

Indirect production costs that fluctuate with the level of output, such as utilities or materials.

Flexible Budget

A budget that adjusts or flexes with changes in volume or activity level, allowing for more accurate cost control.