Operations chapter 11
Local optimization is a supply-chain complication best described as: A. optimizing one's local area without full knowledge of supply chain needs. B. obtaining very high production efficiency in a decentralized supply chain. C. the prerequisite of global optimization. D. the result of supply chains built on suppliers with compatible corporate cultures. E. the opposite of the bullwhip effect.
A
What is a supply chain designed to optimize both forward and reverse flows? A. closed-loop supply chain B. bullwhip-loop supply chain C. reverse-loop supply chain D. open-loop supply chain
A
What is transferring a firm's activities that have traditionally been internal to external suppliers? A. outsourcing B. keiretsu network C. vertical integration D. make-or-buy
A
What organizational function has the opportunity to most affect net income? A. purchasing B. accounting C. human resources D. marketing
A
Which of the following is NOT true about reverse logistics as compared to foward logistics? A. Speed is often very important. B. Distribution costs are less directly visible. C. Forecasting is more uncertain. D. Pricing is dependent on many factors.
A
Which of the following statements is NOT true regarding the bullwhip effect? A. The bullwhip effect occurs as order are relayed from retails, to distributors, to wholesalers, to manufacturers, with fluctuations decreasing at each step in the sequence. B. Bullwhip fluctuations in the supply chain increase the costs associated with inventory, transportation, shipping and receiving. C. Inaccurate information results in distortions and fluctuations, causing what is known as the bullwhip effect. D. Bullwhip fluctuations in the supply chain decrease customer service and profitability
A
Which of the following statements is true regarding cross-sourcing? A. Cross-sourcing uses one supplier for a component and a second supplier for another component, where each supplier acts as a backup for the other. B. Cross-sourcing describes suppliers who become part of a company coalition. C. Cross-sourcing develops the ability to produce goods or services previously purchased or actually buying a supplier or distributor. D. Cross-sourcing enhances technological skills.
A
Which of the following strategies is part collaboration, part purchasing from few suppliers, and part vertical integration? A. keiretsu networks B. joint ventures C. horizontal integration D. virtual companies
A
A fried chicken fast-food chain that acquired feed mills and poultry farms has performed which of the following? A. horizontal integration B. backward integration C. current transformation D. forward integration E. job expansion
B
A response strategy requires suppliers be selected based primarily on A. cost. B. capacity, speed, and flexibility. C. product development skills. D. being willing to share information.
B
A supply chain ends with A. distributors. B. a satisfied customer. C. suppliers. D. manufacturers
B
The advantage of having few suppliers is to A. look for short-term attributes. B. form a long-term relationship. C. take advantage of diseconomies of scale. D. pursue low cost
B
Three criteria for designing distribution networks to meet customer expectations are: A. low cost, product choice and service. B. rapid response, product choice, and service. C. low cost, rapid response and product choice. D. rapid response, low cost, and service
B
What is developing the ability to produce goods or services previously purchased or actually buying a supplier or a distributor? A. horizontal integration B. vertical integration C. outsourcing D. virtual companies
B
What is transferring a firm's activities that have traditionally been internal to external suppliers? A. make-or-buy B. outsourcing C. vertical integration D. keiretsu network
B
Which negotiation strategy bases price on a published, auction, or index price? A. supply-based price model B. market-based price model C. cost-based price model D. competitive bidding
B
Which of the following statements is NOT true? A. An effective supplier management program and an effective distribution management program may make the difference between supply chain success and failure. B. Finding the optimal number of facilities represents a critical and static decision. C. Top-notch supply chain performance requires good downstream management, just as it does good upstream management. D. Packaging and logistics are important distribution decisions, because the manufacturer is usually held responsible for breakages and serviceability.
B
A disadvantage of the "few suppliers" sourcing strategy is: A. the lack of cost savings for customers and suppliers. B. possible violations of the Sherman Antitrust Act. C. the high cost of changing partners. D. the suppliers are less likely to understand the broad objectives of the procuring firm and the end customer. E. the risk of not being ready for technological change.
C
Prior to embarking on supply chain design, operations managers must first consider A. what kind of distribution network to have. B. how to manage supply chain inventory. C. "make-or-buy" and outsourcing decisions. D. how to select suppliers.
C
What is transferring a firm's activities that have traditionally been internal to external suppliers? A. keiretsu network B. vertical integration C. outsourcing D. make-or-buy
C
Which of the following best describes backward integration? A. develop the ability to produce products that complement the original product B. develop the ability to produce the specified good more efficiently than before C. produce goods or services previously purchased D. sell products to a supplier or a distributor E. build long-term partnerships with a few suppliers
C
Which of the following is the first stage of supplier selection? A. negotiations B. contracting C. supplier evaluation D. supplier development
C
Which of the following mitigation tactics is NOT designed to reduce the risk of information loss or distortion? A. training of supply chain partners on the proper interpretations and use of information B. redundant databases C. alternate sourcing D. secure IT systems
C
Which of the following statements is NOT true? A. Reverse logistics involves the processes of sending returned products back up the supply chain for resale, repair, reuse, remanufacture, recycling, or disposal. B. "Closed-loop supply chain" is sometimes used as a synonym for "reverse logistics." C. A closed-loop supply chain is a designed to optimize only reverse flows. D. A closed-loop supply chain prepares for returns prior to product introduction
C
Which of the following strategies is part collaboration, part purchasing from few suppliers, and part vertical integration? A. horizontal integration B. virtual companies C. keiretsu networks D. joint ventures
C
Which organization has developed principles and standards to be used as guidelines for ethical behavior? A. Institute for Vendor Management B. Institute for Purchasing Management C. Institute for Supply Management D. Institute for Procurement Management
C
A lawnmower assembly plant uses a variety of nuts, bolts, screws, and other fasteners in its operation. Its supplier delivers these items directly to the point of use on the assembly line and ensures that there are always sufficient quantities of fasteners to maintain the production schedule. This is an example of A. single stage control of replenishment. B. postponement. C. e-procurement. D. vendor-managed inventory.
D
Prior to embarking on supply chain design, operations managers must first consider A. how to select suppliers. B. what kind of distribution network to have. C. how to manage supply chain inventory. D. "make-or-buy" and outsourcing decisions.
D
What is a long-term purchase commitment to a supplier for items that are to be delivered against short-term releases to ship? A. advanced shipping notice B. drop shipping C. postponement D. blanket order
D
What is the practice of keeping a product generic as long as possible before customizing? A. backward integration B. keiretsu C. vendor-managed inventory D. postponement E. forward integration
D
When determining the optimal number of facilities, logistics-related costs do NOT usually include which of the following costs? A. facility B. inventory C. transportation D. purchasing
D
Which of the following describes using one supplier for a component and a second supplier for another component, where each supplier acts as a backup for the other? A. outsourcing B. dual-sourcing C. backup-sourcing D. cross-sourcing E. parallel-sourcing
D
Which of the following is NOT one of the benefits accrued from a centralized purchasing function? A. Devote more resources to the supplier selection and negotiation process. B. Maintain professional control over the purchasing process. C. Leverage purchase volume for better pricing. D. Increase the duplication of tasks
D
Which of the following mitigation tactics could reduce economic risk? A. multiple transportation modes and warehouses B. subcontractors on retainer C. franchising and licensing D. purchasing contracts that address price fluctuations
D
With regard to the cost-based price model negotiation strategy, which of the following is true? A. Potential suppliers each submit quotations as to price, delivery, and so on. B. Prices float based on what the customer is willing to pay. C. Prices are based in some way upon market standards agreed to by both supplier and purchaser. D. Prices are based upon supplier costs.
D
Japanese manufacturers often pursue a strategy that is part collaboration, part purchasing from a few suppliers, and part vertical integration. What is this approach called? A. kaizen B. samurai C. poka-yoke D. kanban E. keiretsu
E
Which of the following describes using one supplier for a component and a second supplier for another component, where each supplier acts as a backup for the other? A. outsourcing B. dual-sourcing C. parallel-sourcing D. backup-sourcing E. cross-sourcing
E
Which of the following devices represents an opportunity for technology to improve security of container shipments? A. devices that identify truck and container location B. devices that measure radiation or temperature C. devices that sense motion D. devices that can communicate the breaking of a container lock or seal E. All of the above
E
Trucking A. is increasingly using computers to manage its operations. B. is one of the least flexible transportation modes. C. is the least used transportation mode for manufacturing goods. D. does not play a role in multimodal shipping
a
Which of the following statements is NOT generally an implication stemming from an increase in the number of facilities? A. decreased total logistics cost B. increased customer satisfaction C. increased facility costs D. quicker response
a
Which of the following statements is NOT true? A. An increased sales effort may help a firm reach its profit goals more easily than would effective cost cutting. B. A supply chain includes suppliers; manufacturers and/or service providers; and distributors, wholesalers, and/or retailers who deliver the product and/or service to the final customer. C. Supply chain management describes the coordination of all supply chain activities, starting with raw materials, and ending with a satisfied customer. D. The objective of supply chain management is to coordinate activities within the supply chain to maximize the supply chain's competitive advantage and benefits to the ultimate consumer.
a
Supply chain managers outsource logistics to meet three goals: A. drive down inventory investment, improve delivery reliability and speed, and provide better market response. B. drive down inventory investment, lower delivery costs, and improve delivery reliability and speed. C. lower delivery costs, improve delivery reliability and speed, and provide better market response. D. drive down inventory investment, lower delivery costs, and provide better market response.
b
Which of the following statements is NOT true regarding channel assembly? A. Channel assembly treats distributors more as manufacturing partners than as distributors. B. Channel assembly sends individual components, modules, and finished products, to the distributor. C. Channel assembly represents one way to implement postponement. D. Channel assembly postpones final assembly of a product so the distribution channel can assemble it.
b
The advantage of having many potential suppliers is their willingness to A. provide innovations. B. participate in JIT. C. offer lower prices in the short term. D. provide technical expertise.
c
The advantage of having many potential suppliers is their willingness to A. provide technical expertise. B. participate in JIT. C. offer lower prices in the short term. D. provide innovations.
c
What is developing the ability to produce goods or services previously purchased or actually buying a supplier or a distributor? A. outsourcing B. virtual companies C. vertical integration D. horizontal integration
c
Which of the following could reduce distribution risk? A. cross-country diversification B. secure IT systems C. careful selection, monitoring and effective contracts with penalties D. use multiple suppliers
c
Which of the following strategies is part collaboration, part purchasing from few suppliers, and part vertical integration? A. horizontal integration B. virtual companies C. keiretsu networks D. joint ventures
c
Airfreight A. is the best way to transport natural gas. B. represents about 10% of the tonnage shipped in the United States. C. is the oldest means of freight transportation. D. is a fast-growing mode of shipping.
d