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CMA Intermediate · Operations Management and Strategic Management · Introduction to Operations Management

A firm's customers consider product quality a minimum requirement to be considered as a supplier, but the final purchase is decided by which supplier offers the lowest price. In operations strategy terms, quality and price are respectively:

Quality is the order qualifier and price is the order winner. Quality is only the minimum needed to be considered by customers, while the lowest price is what finally wins the order among suppliers who all meet the quality standard.

  1. AOrder winner and order qualifier
  2. BOrder qualifier and order winnerCorrect
  3. CBoth order winners
  4. DBoth order qualifiers

Explanation

Quality is the entry threshold that must be met to be considered, so it is an order qualifier. Price decides the final choice among qualified suppliers, so it is the order winner. Option A reverses the roles, which is the key mistake.

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