MKT 460 Test 1
The bullwhip effect is the result of companies producing excessive defective products; defective items are whipped back from the end customer toward the manufacturer of the defect.
False
Which of the following is TRUE?
Performance metrics and personal business relationships are both keys to building successful partnerships.
Direct benefits of ISO 14000 include:
Reduction of pollution emissions
Which of the following is a reason small value purchases are handled differently?
To control unnecessary administrative costs
Which of the following is NOT a reason for supplier recognition programs?
To select the best suppliers
What type of major cost category is considered in the cost associated with placing and receiving the order?
Transaction Cost
Which type of requisition is used for materials and standard parts that are requested on a recurring basis?
Traveling requisition
According to the text, the goal of a good performance evaluation system is to provide metrics that are:
Understandable, easy to measure, focused on value-added results
In general, European companies prefer suppliers:
Who have ISO 9001 certification
According to the textbook, conditions which must be present for successful supply chain management include:
a. Cooperation among firms
Before supplier relationship management (SRM), buyers typically spent 40% of their time on expediting orders. After SRM implementation buyers spent about:
10% of their time on expediting orders
The term Supply Chain Management and the field of study it represents today seems to have emerged in the:
1980's
Company X received the following ratings in each of the five categories: Quality(90), Responsiveness(90), Delivery(80), Cost(80), Technology(85). What is its total score?
81.0
The following is an example of the bullwhip effect:
Barkley's incorrectly anticipates consumer demand resulting in stockouts at several popular retailers
Which of the following is NOT important in developing a successful strategic alliance?
Developing efficient processes that will remain unchanged for the duration of the partnership
As firms seek to improve the products they offer to the market, companies are seeking help from their suppliers in new product design and development through:
Early supplier involvement
According to the textbook, Supplier Recognition Programs:
Encourage suppliers to keep their performance high
The Hormel company awards their Hormel Food Corporation's No. 1 Award to their top supplier. How often do they give this award?
Every 5 years
Which of the following can happen as a result of the bullwhip effect?
Excessive costs for each firm in a supply chain
A SRM strategy refers to a situation wherein a supplier's employee is permanently housed in the purchasing department of the buyer's organization.
F
Transactional SRM, allows the company to analyze the complete supplier base.
F
A follow up is consider a reactive approach to speed up an overdue shipment
False
According to the textbook, in the 1950's and 1960's, mass production techniques focused on creating supplier partnerships, improving process design and flexibility, and improving product quality.
False
Merchants primary task is to purchase raw materials for conversions
False
Supply chain management activity includes managing the various compensation and benefit programs within an organization.
False
The foundation elements of supply chain management are Supply. Operations, Customer Service, Logistics.
False
The possibility of events like strikes, assembly line breakdowns, and natural disasters are all reasons a company should favor using a single supplier.
False
The universally accepted definition of supply chain management is "the management and integration of the parties involved in producing the end items coveted by consumers."
False
Trends in supply chain management include expansion of the supply chain and decreasing supply chain visibility.
False
While most public procurement is focused on goals like those of purchasing departments in the private sector, U.S. federal government purchases must comply with the:
Federal Acquisition Regulation
The benefits of implementing an effective supplier certification program include all of the following EXCEPT:
Increasing supplier base
According to the text, key ingredients for developing successful supply partnerships include all of the following EXCEPT:
Individualized objectives
Which of the following is NOT a key tenant of an SRM system?
Lean operations
Customer relationship management, distribution network, transportation management, and service response logistics are all important issues that are most closely related to:
Logistics
Which of the following refers to the measurement of the impact of change in purchase spend on a firm's profit before taxes, assuming gross sales and other expenses remain unchanged?
Profit-leverage effect
Total Cost of Ownership does NOT consider which of the following factors?
Purchase order costs
According to the SCM profile Honda ___________ based on a supplier relations index developed by Planning Perspectives.
Ranked near the top in 2015
Inventory Turnover can be calculated by:
Ratio of cost of goods sold over average inventory cost
When a product is purchased which is complicated or highly technical a ______________may be issued instead of a request for quotation
Request for proposal
According to the text, one of the most basic and successful approaches to protecting trade secrets is:
Requiring employees and vendors to sign non-disclosure agreements
Streamlining the processes and communications between the buyer and supplier using software applications that enable these processes to be managed more efficiently and effectively can be referred to as:
SRM
Summers, Inc. needs to generate a list of good/services purchased per supplier. Which type software program can the manager consult to obtain this information?
SRM
When using a Weighted Criteria Evaluation System to evaluate suppliers, all of the following are true EXCEPT:
Select the key dimensions of performance based on what is important to the end consumer
Firms can use total cost analysis to:
Select the most cost-effective supplier
Customer relationship management, distribution network, transportation management, and service response logistics are all important issues that are most closely related to:
Six sigma
Sony buying trucks to deliver their finished goods inventories to their customers' warehouse
Sony buying trucks to deliver their finished goods inventories to their customers' warehouses
Smoother processes, faster cycle times, reduced new product development, and improved time-to-market are possible benefits from the increased visibility that is offered by SRM software.
T
According to the textbook, a supply chain's end customers are the only true source of income for all supply chain organizations.
True
According to the textbook, supply chains include raw material suppliers, intermediate component manufacturers, end-product manufacturers, wholesale distributors, retailers and end-product consumers
True
According to the textbook, the keys to successful supply chain management include trust, cooperation, collaboration and honest, accurate communications between supply chain partners.
True
Generally, firms outsource noncore activities while focusing on core competencies
True
Highly valued customers with large purchasing budgets who achieve moderate supply chain management success have been known to lower purchasing and inventory carrying costs, and create better quality products with higher levels of customer service.
True
One definition of supply chain management is "Coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers."
True
Procurement credit cards can be used for small purchases including meals, lodging, and travel expenses
True
Purchasing can be broadly classified into two categories: merchants and industrial buyers.
True
Supply chain analytics can be used along the supply chain to schedule production according to expected supplier deliveries
True
The bullwhip effect causes an amplification of the variation in the demand pattern along the supply chain.
True
The goal of a good purchasing system is to ensure efficient information transitions between the materials users, the purchasing personnel, and the suppliers
True
The purchase order is not a legally binding contract until it is accepted by the supplier
True
Trucking companies, airfreight shipping companies, and information system providers can all be considered service providers to the supply chain.
True
a material requisition and a purchase requisition are the same thing
True
When a particular item is in short supply accompanied by rising prices, a firm might find it beneficial to:
b. Align itself with one of the suppliers to ensure a continued supply of the scarce item.
Which of the following statements is true?
b. Strategic partnerships are seen as one of the foundations of supply chain management
Encouraging or helping a firm's suppliers to perform in a desired fashion can be referred to as:
b. Supplier management
which of the following would be considered a third party provider
c. a firm that leases storage warehousing
Lean production is typically associated with which of the following company's production systems?
d. Toyota
if the break-even point in a typical make-buy scenario is 19,000 units and the firm, then the firm should choose to make the units
false
China, which has the largest number of ISO 9001 certificates, issued over 292,000 as of 2017, representing 28.3 percent of the total certificates issued worldwide.
T
ISO 14000 is a family of international standards for environmental management.
T
SRM software should be capable of:
All of these
Which of the following is important in developing successful relationships in a partnership?
All of these
According to the text, which of the following is considered a current trend in supply chain management?
Both A and B
SRM software can automate procurement activities that lead to significant cost savings as purchasing professionals move toward:
Collaborative planning
A company using a weighted-criteria evaluation system has established these 3 categories and the appropriate weight in parentheses: Quality(0.30), Delivery(0.40), Cost(0.30).
Company C: Quality(70), Delivery(95), Cost(60)
Blanket or open-end purchase orders are suitable for buying
Office supplies
Petty cash is being phased out in favor of:
P-card
A form of purchasing that is placed directly to the supplier and suitable when firms use the same components to make standard goods over a relatively long period of time is referred to as:
Planned order release
Field failures, loss of goodwill, a decreased reputation, and warranty costs can all be classified as:
Post-transaction costs
Costs associated with investigating alternative suppliers and investigating alternative delivery options can be classified as:
Pre-transaction costs
The total cost of ownership for Supplier A is $2,670,000. The total cost of ownership for Supplier B is $1,750,000. The total cost of ownership for Supplier C is $2,990,000. Using Total Cost Analysis, it will be more cost-effective to use
Supplier B
An organization's process for evaluating the quality systems of key suppliers in an effort to eliminate incoming inspections can be referred to as:
Supplier Certification
An internal or external event that causes a disruption or failure of supply chain operations is an example of
Supply chain risk
Which of the following can be defined as "The ability to meet the needs of current supply chain members without hindering the ability to meet the needs of future generations".
Sustainability
A seven-step approach to supplier development might include identifying critical suppliers not meeting performance requirements.
T
According to the text, only about half of companies recognize excellent performance with supplier awards and appreciation banquets.
T
Automating procurement activities can lead to significant cost savings as buyers move toward managing processes by exception.
T
One operational method for managing inventory is the implementation of a software system which can be referred to as:
a. Material requirements planning (MRP)
which of the following is reverse logistics activity
b. recycling products and components
When developing successful partnerships, it is best to avoid inter-personal business relationships between buyers and suppliers.
F
The continuing cycle of erratic demand causing forecasts to include safety stock which in turn magnify supplier forecasts and cause production planning problems is known as:
Bullwhip effect
Developed in the 1990's as a popular way of developing radically new business processes in an effort to reduce waste and increase performance is referred to as:
Business process reengineering
When calculating Return on Investment, current assets include:
Cash, Accounts Receivable, and inventory
Which of the following statements is FALSE?
Centralized purchasing is where individual, local purchasing departments, such as at the plant level, make their own purchasing decisions.
Benefits derived from implementing e-procurement systems include all of the following EXCEPT:
Creates numerous additional job opportunities in the purchasing department
The primary goals of purchasing include all EXCEPT
Ensure the highest quality raw materials are purchased
As companies outsource more and more parts, it becomes easier to achieve cost savings internally
F
If a company is effectively focusing on its core competencies, its level of outsourcing is likely to decrease.
F
In a Total Cost of Ownership system, certification and training of suppliers would be considered post-transaction costs.
F
It is critical that buyers and suppliers develop stronger relationships and partnerships based on a tactical rather than a strategic perspective.
F
According to the textbook, third-party logistics providers (3LPs) do not offer assistance with helping products clear customs.
False
Many large firms are moving to in-house vertically integrated structures where they have more control over each business unit.
False
Building Trust, Shared Vision and Objectives, Personal Business Relationships, Mutual Benefits and Needs are key factors that contribute to a lasting supplier partnership.
T
Offering an awards program to suppliers both motivates the suppliers to commit to a program of continuous improvement as well as provides role models for other suppliers to follow.
T
Successful supplier relationships involve equal decision-making control.
T
The development of relationships with suppliers brings about changes that must be managed for a company to stay focused on their core businesses.
T
Unless an organization has a firm grasp of the key issues surrounding supplier relationships, it cannot reap the benefits of such relationships.
T
The assembly or production of finished products, producing the right amount of product, and ensuring that finished products meet specific quality, cost, and customer service requirements can all be considered elements of operations.
True
the procedures for public procurement differ from the private sector
True
It is illegal for corporations to provide their suppliers appreciation banquets to award performance.
F
In a weighted-criteria evaluation system the weights of all the performance dimensions must add up to more than 1.00 and less than 100.
F
Which of the following would be a good reason to outsource (buy) versus making?
A firm lacks the technology or expertise to produce an item
Which of the following NOT a reason firms are expanding their supply bases to include foreign suppliers?
Lower shipping rates due to lower tariffs
Which of the following is a reason for favoring single sourcing?
Reduces variability in quality levels
Which of the following is NOT a potential challenge for global sourcing?
Relaxed trade barriers
Which of the following is an advantage of a centralized purchasing department?
Specialization
Which of the following is a reason that single sourcing is considered risky/bad?
There could be suppliers interruptions due to political instability
According to the text, supply chain management will involve cultural change among most or all of the participants.
True
According to the text, the FOUR important elements of the supply chain are:
b. Supply, operations, logistics, integration
Which of the following activities would fall under the foundational element of operation?
c. Demand management
Which of the following activities allows buyers to assume the supplier will meet certain product quality and service requirements?
c. Supplier certification
Which of the following acronyms is NOT paired with its correct "translation?"
c. TLS - Third-party Logistics Services
Supply chain management includes the planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activities. It also includes:
c. Coordination and collaboration with channel partners
According to the textbook, the order of product & service flow is as follows:
d. Raw material supplier, component manufacturer, end product manufacturer, wholesale distributor, retailer, end-product consumer
Which company is experimenting with the management of the final mile of delivery in some markets, using small aerial drones to deliver shoebox-size packages from fulfillment centers?
d. Amazon
A low ROA suggests that management is capable of generating large profits with relativity small investments
false
the total cost of ownership concept does not include quantitative factors
false
Which of the following is NOT a form of countertrade?
kaizen blitz
Cost savings is an advantage of using in e-procurement systems
true
blank check purchase orders, Corporate purchasing cards, Petty cash, and Open-end purchase orders are all possible alternatives to dealing with small value purchases such as those for office supplies.
true