OPER 1503

Benchmarking is:

A practice where companies attempt to learn and apply the best practices of other companies.

Sustainable sourcing is a process of purchasing goods and services that takes into account the short-term impact on people, profits, and the planet.

False

The Total Cost of Ownership Concept does NOT include quantitative factors.

False

The availability of low-cost domestic supplier alternatives has led to the shift away from outsourcing and offshoring.​

False

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

The traditional approach to purchasing and supply management is to build relations with suppliers to jointly pull costs out of the product or service and expect suppliers to contribute innovate ideas that continually add value to a firm's products and services.

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

There is a definitive and prescriptive set of supply chain measures that result in one best way to measure supply chain performance.​

False

New Paradigm

Firm in a supply chain focuses activities in its area of specialization and enters voluntary and trust based relationships with supplier and customer firm

Old Paradigm

Gained synergy as a vertically integrated firm encompassing the ownership and coordination of several supply chain activities

Centralized Purchasing

Purchasing department located at the firm's corporate office makes all the purchasing decisions

Inventory Turnover can be calculated by:

Ratio of cost of goods sold over average inventory cost

Supply Chain

The flow of products and services. ~Raw materials ~Component and intermediate manufacturers ~Final Product Manufacturers ~Wholesalers and distributors

One standard which is measured in environmental supplier certification is:

The suppliers' greenhouse gas emissions

A seven-step approach to supplier development might include identifying critical suppliers not meeting performance requirements.

True

Building Trust, Shared Vision and Objectives, Personal Relationships, Mutual Benefits and Needs are key factors that contribute to a lasting supplier partnership.

True

Foreign suppliers located farther away may be able to deliver goods faster than domestic suppliers due to more efficient transportation and logistical systems

True

One definition of supply chain management is "The planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activity."

True

Procurement credit cards can be used for small purchases excluding meals, lodging, and travel expenses.

True

Purchasing and supply management has a major impact on product and service quality.

True

Small events such as weather and traffic problems which can impact deliveries are a part of supply chain risk.

True

Successful supplier relationships involve equal decision-making control.

True

The development of relationships with suppliers brings about changes that must be managed in order for a company to stay focused on their core businesses.

True

The key to the success of any company is the quality of its employees.

True

The purchase order is NOT a legally binding contract until it is accepted by the supplier.

True

Today's emphasis on supplier quality has shifted from detecting defects at the time of receipt or use to prevention early in the materials-sourcing process.

True

Trends in supply chain management include a change or realignment of the competitive strategies employed among at least some of the participating firms.

True

​ Generally, firms outsource noncore activities while focusing on core competencies.

True

One of the most value enhancing activities performed by a supplier, for a key customer, which minimizes carrying costs and can avoid stockouts:

VMI Vendor Manage Inventory

VMI stands for

Vendor-Managed Inventory

Supplier Management

improve performance through supplier evaluation and supplier certification

Lean Systems

improve the flow of materials to reduce inventory levels

Demand Management

match demand to available capacity

Ethics and sustainability

recognizing suppliers' impact on reputation and carbon footprint

Six Sigma

to improve quality compliance among suppliers

Benefits derived from implementing e-procurement systems include all of the following EXCEPT: A) Creates numerous additional job opportunities in the purchasing department B) Tracking bids and transactions is easier and faster C) ncreases the accuracy in communication between buyers and suppliers D) Allows buyers to submit bids and suppliers to respond to those bids in real time

A) Creates numerous additional job opportunities in the purchasing department

In designing an ethical and sustainable strategy a firm might make use of which of the following? A) Use of a performance metric to gauge the success of the firm's efforts. B) All of these C) Hire more supervisors to address problems quickly. D) Create many short term relationships with suppliers

A) Use of a performance metric to gauge the success of the firm's efforts.

Successful strategic supplier alliances can result in which of the following? Selected Answer: A) Access to new technologies and knowledge B) Higher return on investment C) All of these D) Better market penetration.

C) All of these

A company using a weighted-criteria evaluation system has established these 3 categories and the appropriate weight in parentheses: Quality(0.30), Delivery(0.20), Cost(0.50). The scores for each category are shown below. Which of the following companies has the highest total score?

Company B: Quality(70), Delivery(90), Cost(80

Which of the following is a trend in ethical and sustainable sourcing? A) Using suppliers who are reducing their carbon footprint B) Discontinuing purchases from firms that use unacceptable labor practices C) Sourcing from firms in underdeveloped nations D) All of these

D) All of these

Which of the following is important in developing successful relationships in a partnership? A) Commitment by top management B) Interpersonal relationships between employees of the companies C) Mutual/compatible needs that result in a win-win situation for the partners D) All of these

D) All of these

One benefit from benchmarking sourcing practices is: A) Lower prices of goods and services, use of fewer buyers and lower administrative costs. B) Larger market for products, economies of scale in purchasing and production, and lower labor costs. C) Savings in energy consumption and materials, lower distribution costs, and improved corporate image among regulators, customers and community. D) Allows firms to potentially leapfrog the experience-gaining stage by trying things that have worked well for other companies.

D) Allows firms to potentially leapfrog the experience-gaining stage by trying things that have worked well for other companies.

When using a Weighted Criteria Evaluation System to evaluate suppliers, all of the following are true EXCEPT: A) Multiply the dimension ratings by their respective important weights and then sum to get an overall weighted score B) The weights for all dimensions must sum to 1 C) Evaluate each of the performance measures on a rating between zero and one-hundred D) Select the key dimensions of performance based on what is important to the consumer

D) Select the key dimensions of performance based on what is important to the consumer

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

The Ethical Trading Initiative (ETI) does NOT include

Workers receive a 30 minute break for an 8 hour shift

Provide a list of four ways companies can motivate their suppliers to improve.

1. Develop supplier recognition/awards programs 2. Create supplier development programs 3. Create an internal certification program 4. Motivate suppliers to get a quality certification like ISO 9000 5. Utilize Supplier Relationship Management software 6. Utilize a performance metrics system

A company using a weighted-criteria evaluation system has established these 5 categories and the appropriate weight in parentheses: Quality (0.25) Responsiveness (0.10) Delivery (0.20) Cost (0.25) Technology (0.20) Company X received the following ratings in each of the five categories: Quality(90), Responsiveness(90), Delivery(80), Cost(80), Technology(90). What is their total score?

85.5

SRM software should be capable of: Automating transactional processes A) Automating transactional processes B)Making information flow between partners more visible C) Integration of the supply chain making it possible to monitor multiple departments and processes both internally and externally D All of these

D) all of these

Which of the following is NOT a step suggested in the Supply Chain Sourcing Strategy Framework?

Distribute free samples of all purchased products to the end-user for detailed evaluation and feedback on supply chain development

Reduced bullwhip effect

Erratic demand forecasts causing excess safety stock, which cause production planning problems

Supplier relationship management (SRM):

Facilitates collaboration between an organization and its trading partners

A SRM strategy refers to a situation wherein a supplier's employee is permanently housed in the purchasing department of the buyer's organization.

False

A supply chain performance measurement system focuses on meeting sales or cost figures.

False

According to the textbook, environmental and social impacts are considered outside of supply chain management.

False

Ethical sourcing policies should NOT include determining where all purchased goods come from and how they are made.

False

Green purchasing is a practice of purchasing products that contain a special green dye.

False

Green purchasing refers to suppliers planting trees for a designated dollar amount in a negotiated contract.

False

In a weighted-criteria evaluation system the weights of all the performance dimensions must add up to total more than 1.00 and less than 100.

False

It is considered unethical for a firm to intentionally buy from women-owned business

False

It is critical that customers and suppliers develop stronger relationships and partnerships based on a tactical rather than a strategic perspective.

False

Many large firms are moving to in-house vertically integrated structures where they have more control over each business unit.

False

Reverse logistics activities include the return of defective and damaged items to the manufacturer, and the recycling of used packaging.

False

Trends in supply chain management include expansion of the supply chain and decreasing supply chain visibility.

False

Strategic Partnerships

Successful and trusting relationships with top-performing suppliers

According to the textbook, 'integration' is one of the four supply chain elements.

True

Decentralized purchasing is the practice where individual, local purchasing departments throughout a single corporation make their own, individual purchasing decisions to fulfill their individual local needs.

True

Global sourcing is a requirement and no longer a luxury for most firms.

True

In the manufacturing sector, the percentage of purchases to sales averages 55 percent.

True

Supply management is a broader concept than purchasing.

True

​ Reasons for buying items instead of making them can include cost advantage, insufficient capacity, lack of expertise, and quality.

True