SCM Exam 2 EOT Questions

The International Organization for Standardization (ISO) built its quality certification ISO 9000 on which core principles? a. Automated Storage/Retrieval System (AS/RS) b. Automated Manifest Systems (AMS) c. Total Quality Management (TQM) d. Business Continuity Planning (BCP)

c. Total Quality Management (TQM)

A kaizen event is a one-time event for any given process.

False

Constantly getting better through continuous improvement is an important step on the lean journey.

True

Field failures are a post-transaction component of total cost.

True

In the process capability ratio, if the upper and lower specification limits are greater than the process variability, you can be pretty confident that the process can achieve your desired quality level.

True

Multifunction workers are generally more satisfied with their jobs than those trained to work in only a single job.

True

The relationship between icebergs and supply management is that the price you pay is just the tip of the iceberg—the true cost is hidden below the surface.

True

Tiering means that you switch from buying parts to purchasing complete modules from suppliers. True or False?

True

Suppliers that sell paper clips and copy paper are: d. Leverage e. Critical b. Strategic c. Replaceable a. Irrecplaceable

c. Replaceable

Using reverse analysis, what is the estimated cost (sum of labor, material and overhead) for this supplier to produce these chemicals? "A supplier gives you a price of $400 for a barrel of specialized chemicals. Included in this price is a per barrel set up charge of (tooling) $40.50. The industry they are part of operates at 10% profit and 5% SGA; both profit and SGA are a percentage of the selling price." a. $299.50 b. $340.00 c. $360.00 d. $400.00 e. None of the above

a. $299.50

Which of the following are tools that you can use to identify improvements and opportunities in you newly mapped process? a. 5S and the eight wastes b. Dynamic process control c. Weighted factor model d. Equipment positioning

a. 5S and the eight wastes

The number of meals served by a restaurant during lunchtime is an example of what? a. Capacity b. Hurdle Rate c. Inventory d. Infinite Loading

a. Capacity

If the bottleneck still exists, consider making investments to improve either how the bottleneck process works or to increase its capacity. This describes which of the five focusing steps of Theory of Constraints? a. Elevate b. Identify c. Exploit d. Repeat e. Subordinate

a. Elevate

Multiple factors influence your decision to either sole source or multiple source. Which of the following is NOT one of the three questions you should ask to help determine the right strategy to use? b. How technologically complex is the item being purchased? c. How many qualified suppliers are there? a. Which supplier has the highest performance? d. What is your company's buying philosophy?

a. Which supplier has the highest performance?

A control chart that measures variables measures what? a. Characteristics that can be measured on a continuum of value like weight and volume b. Characteristic that has a discrete value and can be counted c. Characteristics that are soft and pliable d. Characteristics that can be controlled

b. Characteristic that has a discrete value and can be counted

During the simplify stage of the 5S process, you: a. Put everything away at the end of the day b. Create logical places where everything goes c. Employ standard procedures to maintain workplace order d. Get rid of things you don't need

b. Create logical places where everything goes

Bookmark question for later "Beginning," "Middle," and "End" refers to ___? a. Structure, outputs and resources b. Inputs, outputs and flows c. Outputs, resources and flows d. Resources, flows and inputs

b. Inputs, outputs and flows

One of the scary things about implementing lean is: a. It is really hard to implement for services b. It requires management to give up some control c. It is usually more harmful for the environment d. It requires managers to undermine deeply rooted culture

b. It requires management to give up some control

Which of the following are potential sources of variation in the Ishikawa cause-and-effect diagram? a. Prices, and materials and measurements b. Materials, measurements and environment c. Environment, prices and materials d. Measurements, environment and prices

b. Materials, measurements and environment

Which of the following is not a characteristic of strategic alliances? b. Minimal potential for value co-creation a. Joint planning via teams e. Interdependent c. Share resources d. Shared risk/rewards

b. Minimal potential for value co-creation

Creating a positive work environment creating longevity in employee retention describes which lean operation competitive advantage? a. Low inventory b. Respect for all employees c. The customer rules d. Continuous improvement e. Zero-waste

b. Respect for all employees

Given the following information, is purchasing performing well in buying iron castings? Sept 20, 2015Dec 31, 2015Price Paid To Supplier$52.50$53.20% Increase=(53.20-52.50)÷52.501.333% (increase)Iron Castings from PPI127.20127.5% Increase=(127.5-127.2)÷127.20.236% (increase) a. Fantastic job (i.e. you deserve a promotion) b. Terrible job (i.e. you deserve to get fired) c. Good job (i.e. you can keep job and you'll likely earn a bonus) d. Mediocre job (i.e. you will likely keep job but you won't receive bonus) e. You give up! You have no clue.

b. Terrible job (i.e. you deserve to get fired)

Which of the three processes define and deploy business strategies? a. Operational Processes b. Human Processes c. Strategic Processes d. None of the above e. Enabler Processes

c. Strategic Processes

processes as stories

beginning=inputs middle=flows end=outputs characters=resources plots=structure

Given the following information, calculate the total cost of buying a laser printer from Japan: Total Cost Analysis: Practice Problem LaserJet Printers from Japan Cubes Per Container 2400 Cubes for EACH printer 6 Printers per pallet 20 Price paid to supplier (EACH) $19.00 Each Tariffs 3% of Value Duties 5% of Value Port Security $1,200 Container Ocean Shipping $4,500 Container Inland Transport (Holding area to DC) $500 Container Movement from Port to Holding Area $250 Container Insurance 2.5% of Value Packaging $1 Each Costs in DC (movement and storage) $5 Pallet Quality Control $10.00 Pallet Inventory Carrying Costs 24% per year (assume 120,000 annual usage) Environmental Disposal Fees $1.50 Each Customer field failures (cost to return, etc) 1/2 % fail in the field; value is the price paid Customer Service/warranty $1.00 Shipment to the Customer $5.00 Each a. $7,600.00 b. $20,410.00 c. $51.03 d. $32.03 e. No clue!

c. $51.03

In process mapping, the following indicates an activity or a task. a. Oval b. Double arrow c. Box d. Diamond e. Triangle

c. Box

How many calls a customer service agent can handle per hour is an example of what? a. Inventory b. Hurdle Rate c. Capacity d. Infinite Loading

c. Capacity

What is the process capability ratio (Cp)? a. Process used to fill orders for quantities less than a full case requiring orders to be picked from a case or similar container b. Reduces the process variation to achieve near-flawless quality c. Compares acceptable tolerances (normally set by engineers) with the process' actual variation so you can assess the process' ability to achieve required quality levels d. Measures the variation in output and sets control limits based on observations of variations arising from common causes

c. Compares acceptable tolerances (normally set by engineers) with the process' actual variation so you can assess the process' ability to achieve required quality levels

Which of the following is not one of the four identified behaviors you can use to build trust and achieve breakthrough collaboration? d. Show empathy c. Define boundaries e. Develop interpersonal relationships a. Share information b. Invest in alliance partner skills

c. Define boundaries

Which "Quality of Product" dimension would you be assessing when asking the question, "How long will the product perform or last, and under what conditions?" a. Serviceability b. Reliability c. Durability d. Conformance e. Performance

c. Durability

The industry with the highest inventory turns listed below is: a. Tobacco b. Dollar stores c. Fast food d. Grocery e. Beer

c. Fast food

What are the two primary objectives of supplier development? a. Decrease supply options, Improve process capabilities b. Improve strategic focus, Increase supply base c. Improve process capabilities, Increase supply options e. Increase ROI, Decrease supply risk e. None of the above

c. Improve process capabilities, Increase supply options

Making product when you only have demand is an example of this step in the continuous lean journey? a. Continuous improvement b. Identify customer value c. Pull demand through the system d. Map the value stream e. Flow the process

c. Pull demand through the system

Which "Quality of Product" dimension would you be assessing when asking the question, "Does the product consistently perform as it is supposed to over time?" a. Performance b. Conformance c. Reliability d. Serviceability e. Durability

c. Reliability

Which "Quality of Product" dimension would you be assessing when asking the question, "Does the product look, sounds, taste, or smell the way it should?" a. Perception b. Conformance c. Serviceability d. Aesthetics e. Features

d. Aesthetics

What does a successful businesses do to insure that work is finished as expected? a. Create a global standards management process b. Freeze inventory balances c. Globalize d. It defines the workflow of tasks e. Fill rates by orders

d. It defines the workflow of tasks

Which of the following is not one of the steps in W. Edward Deming's PDCA cycle? a. Do b. Act c. Check d. Procrastinate e. Plan

d. Procrastinate

Your job is to constantly improve, aggressively removing one constraint and then moving on to the next. This describes which of the five focusing steps of Theory of Constraints? a. Exploit b. Subordinate c. Elevate d. Repeat e. Identify

d. Repeat

When talking about value co-creation, to collaborate effectively you have to share __________ with your alliance partners. a. Trade secrets b. Stock options c. Managers d. Resources e. None of the above

d. Resources

What do you call the process of determining how many and which suppliers you should buy from as well as defining the type of relationship you should build with each supplier? a. Supplier reconciliation c. Customer based realization d. Supply-base rationalization b. Cost management theory e. None of the above

d. Supply-base rationalization

With respect to control chart logic, processes performed include some variation is called? a. Target b. Quality c. Confidence d. Variability

d. Variability

Which of the following is not a characteristic of transactional relationships? a. Low value co-creation potential e. All of the above ARE characteristics of transactional relationships c. Arms-length d. Long term b. Minimal investment

d. long term

Based on the cost breakdown analysis described in this chapter, if labor costs increase, which of the following will also increase? a. SGA will increase b. Factory cost will increase c. Manufacturing overhead will increase d. Price will potentially increase e. All of the above will increase

e. All of the above will increase

Research has shown that if you invest in which of the following activities, you will end up with an attitude of continuous and constant improvement. a. Create Value for the customer b. Assure quality at the source c. Stick to the rules d. Look out for your own team e. Both a and b

e. Both a and b

There are two primary options for protecting your firm against opportunism. What are they?​ a. Trust & awareness b. Incentives & rewards e. Contracts & Trust c. Contracts & rewards d. Awareness & incentives

e. Contracts & Trust

Not having huge amounts of inventory tying up assets describes which lean operation competitive advantage? a. Continuous improvement b. Respect for all employees c. Zero-waste d. The customer rules e. Low inventory

e. Low inventory

"Structure" refers to ___? a. Middle of a story b. Characters of a story c. Beginning of a story d. End of a story e. Plot of a story

e. Plot of a story

Bookmark question for later Considering "what if" the cost of transportation increases is an example of a . . .? a. Leverage buy b. Forward buy c. Best guess analysis d. Cost driver analysis e. Sensitivity analysis

e. Sensitivity analysis

Tactical actions toward cost management . . .? a. Help you get quick results b. Assure a culture of continuous improvement c. Require you to engage in a thorough spend analysis d. Include launching a P-card program e. All of the above f. A and D only

f. A and D only

The target costing process takes place at the finished good level.

false

Bookmark question for later Which of the following are aspects of Strategic Positioning Analysis? a. Cost driver analysis b. Costs of quality c. Low cost leader strategy d. Differentiator strategy e. All of the above f. A & B only g. C & D only

g. C & D only