Supply Chain Exam 1

Plan spans six to eighteen months. Shows the quantity & timing of end items___________

Master production schedule - MPS

When making a decision on which supplier to consider over another it is important to consider

total cost of ownership

Name three primary forecasting techniques

Quantitative, Qualitative, Time Series

According to the textbook what are three of the main reasons to employ Supply chain management?

Reduced Bull Whip effect, SCM reduces safety stock level, SCM reduces costs due to coordinated planning and better sharing of information

What is forwards integration?

Refers to acquiring customer's operations

What is Backwards Integration?

Refers to acquiring sources of supply

Describe what Supplier Relationship management is

Refers to streamlining the processes and communication between buyer and supplier using software applications manage processes more efficiently and effectively

____________ is a long range capacity planning module, checks if aggregate resources are able to satisfy aggregate production. Gross labor hours and machine hours

Resource Requirements Planning

A successful supplier partnership will measures performance metrics, these measure include

Quality, Cost, Delivery, Flexibility

Time series forecasting is based on the ________ that the ________ is an _________ of the past

1) Assumption 2) Future 3) Extension

Name the 3 different types of production strategies:

1) Chase production 2) Level 3) Mixed Production

Name 5 of the 9 of ETI base code clauses

1) Employment is freely chosen 2) No Child Labor 3) Freedom of association and right to collective bargaining are respected 4) Working conditions are safe and hygienic 5) Living wages are paid 6) Working hours are not excessive 7) No discrimination is practiced 8) Regular employment provided 9) No harsh or inhumane treatment is allowed

A forecast is an estimate of ___________ & provides the basis for ___________.

1) Future Demand 2) Planning Decisions

Explain why it is so important to monitor supplier performance, and have a clear understanding of their business practices

1) Supplier performance is critical in maintaining a good relationship 2) Monitor and improve where there are gaps in performance 3) Ensure you retain full control of your supply chain

Performance metrics should be 1)___________, 2) __________, and 3) ___________________

1) Understandable 2) Easy to Measure 3) Focused on Real Value Added Results

Name the seven steps for supplier development

1. Identify critical products & services 2. Identify critical suppliers not meeting performance requirements 3. Form a cross-functional team 4. Meet with top management of supplier 5. Rank supplier development projects 6. Define details of Agreement 7. Monitor status & modify strategies

Good forecasting provides all of the following except: A) Increased inventories B) Reduced costs C) Improved production plans D) Improved customer service levels

A

While most public procurement is focused on goals similar to those of purchasing departments in the private sector, U.S. federal government purchases must comply with the: A) Federal Acquisition Regulation B) Fair Standards and Equitable Purchases Act C) Federal Code of Conduct for Procurement D) Services and Materials Acquisition Act

A

What are the primary contributions of purchasing to overall supply chain management (Select all that apply)? A) Actively seeking better materials and reliable suppliers B)Leveling production capacity in advance of surges in demand C)Completing a time series forecast for 12 month demand picture D) Work closely with and exploiting the expertise of strategic suppliers to improve quality and materials E) Leading the research & development department F) Involving suppliers and purchasing personnel in new product design and development efforts.

A, D, F

Name two companies that we discussed in class that have high inventory turnover ratios?

Amazon and Walmart

What is the effect of these disruptions on an organization?

Any disruption resulting in reduction in service level, product quality, and sales

If you were forecasting candy sales which of the following components would you detect with your time series model: A) Trend variation B) Seasonal variation C) Cyclical variation D) Random variation

B

One of the most value enhancing activities performed by a supplier, for a key customer, which minimizes carrying costs and can avoid stockouts: A) Early supplier involvement scheduling B) Vendor managed inventory C) Strategic inventory planning D) Purchase spend reduction forecasting

B

Promoting diversity by intentionally buying from small firms or ethnic minority businesses. This is an example of: A) Supply base rationalization B) Ethical sourcing C) Sustainable sourcing D) Supply base sourcing

B

Supplier Development includes all EXCEPT which of the following? A) Financial and human resource investments B) Reducing the supply base C) Training of the supplier's personnel D) Working with suppliers to lower the total cost of materials purchased

B

Supplier relationship management (SRM): A) Improves sales force productivity and boosts customer satisfaction B) Facilitates collaboration between an organization and its trading partners C) Permanently houses a supplier's employee in the purchasing department of the buyer's organization D) All of the these

B

Which of the following is NOT important in developing a successful strategic alliance? A) Developing performance metrics B) Developing efficient processes that will remain unchanged for the duration of the partnership C) Investigating the capabilities and core competencies of the supplier D) Open lines of communication that both promote sharing and secure confidentiality

B

Which strategy relies on a constant output rate and capacity while varying inventory and backlog levels to handle the fluctuating demand pattern? A) Mixed Production Strategy B) The Level Production Strategy C) The Chase Production Strategy D) The Aggregate Production Strategy

B

f you forecasted sales of Introduction to SCM textbook for the month of January at 1000. Actual demand came in at 600. Calculate the forecast error: A) Forecast error = et=At - Ft B) 600- 1000= -400

B

Select the statements that apply to a Push system: A) Disregard manufacturing efficiencies B) Allow plants to operate more efficiently C) Make larger batch sizes D) Prevent customer service issues with inventory

B, C, D

The primary goals of purchasing according to the textbook are (Select all that apply): A) Manage capacity in the production facility B) Ensure uninterrupted flows of raw materials at the lowest total cost C) Develop strategic partnerships with marketing and sales D) Improve quality of the finished goods produced E) Maximize customer satisfaction.

B, D, E

____________is the application of ethical principles to business situations

Business Ethics

What is outsourcing?

Buying materials and components from suppliers instead of making them in-house.

According to the text, one of the most basic and successful approaches to protecting trade secrets is: A) Threat of litigation B) Working with law makers to increase fines and sentences for those that steal trade secrets C) Requiring employees and vendors to sign non-disclosure agreements D) Requiring employees and partners to get ISO 9000 certified

C

Direct benefits of ISO 14000 include: A) Reduced defect rates B) Improved on-time delivery rates C) Reduction of pollution emission D) All of these

C

The Benefits of CPFR include all of the following except: A) Strengthens partner relationships B) Provides analysis of sales and order forecasts C) Eliminates the need for a demand planning forecaster D) Uses point-of-sale data, seasonal activity, promotions, to improve forecast accuracy E) Manages the demand chain and proactively eliminates problems before they appear

C

Which of the following is a reason that single sourcing is considered risky/bad? A)The buyer's required ordering quantities are very low B) Larger orders make quantity discounts more likely C) The limited (finite) capacity of one supplier D) Decreases the item to item quality variability of items purchased

C

Which of the following results from using the chase production strategy? A) The workforce fluctuates in response to the demand pattern B) Finished goods inventories always remain constant C) Both A & B D) None of these

C

A firm's labor and machine resources is know as _____________

Capacity

Short range capacity planning technique that is used to check the feasibility of MRP is known as __________

Capacity Requirements Planning

CPFR stands for

Collaborative Planning Forecasting & Replenishment

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

D

Which of the following MRP terms represents a committed order awaiting delivery for a specific period? A) Projected on-hand inventory B) Time bucket C) Net requirement D)Scheduled receipt

D

Name 3 advantages of Centralized purchasing include

Concentrated volume, Avoid duplication, Specialization

The practice of Business Ethics is known as ____________

Corporate Social Responsibility

For supply chain management to be successful firms must work together to share information on things like........Name 4?

Demand Forecast Production Plans Production changes New Marketing strategies New technologies Purchasing plans Delivery dates

The following are the key drivers of strategic sourcing according to the textbook except: A) development of ethical and sustainable sourcing initiatives B) managing and improving supplier relationships and capabilities C) identification and selection of environmentally and socially conscious supplier D) monitoring and rewarding supplier performance E) Rationalizing the supply base

E

What is the bull whip effect?

Erratic demand forecasts causing excess safety stock and production planning inefficiencies

___________________is an alliance of organizations seeking to take responsibility for improving working conditions and agreeing to implement ETI Base Code

Ethical Trading Initiative

True of False Sourcing decisions are made on perception

False

True of False: Supplier partnerships are short term working independently to achieve individual company objectives

False

True or False If you felt that recent demand trends were more significant, and thus should be emphasized more in formulating a forecast, then in forecasting demand for the upcoming demand period, you would probably favor using a simple moving average over the conventional weighted moving average

False

True or False Running sum of forecast errors indicates the bias in the forecasts or a tendency of a forecast to be sporadically higher or lower than actual demand

False

True or False the goal of a forecast is to maximize the deviation between actual demand and forecast

False

True or False: Green purchasing is a practice of purchasing products that contain a special green dye

False

True or False: Having a low inventory turnover ratio means the firm is utilizing optimal utilization of space and inventory levels.

False

True or 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

True or False: The trend has moved toward insourcing.

False

What does a high Return on Assets mean for a firm?

Indicates managerial prowess in generating profits with low spending

There are two sources of supply chain risk, Internal and external to an organization.

Internal disruptions, External disruptions

What is Ethical Sourcing?

Is that which attempts to take into account the public consequences of organizational buying or bring about positive social change through organizational buying behavior

Give me 3 of 4 the Qualitative forecast models

Jury of executive opinion, delphi, consumer survey, sales force composite

____________________________________usually covers a year or more, involves the construction of facilities & major equipment purchase

Long-range - Aggregate Production Plan (APP)

Name the 3 different forecast accuracy measures

MAD MAPE MSE

2 Examples of Internal Disruptions

Mismanagement of demand, inappropriate capacity management aka production requirements exceed capacity, RM & Components were not ordered, Product quality

Name 3 reasons to favor multiple suppliers

Need capacity, Spread risk of supply interruption, Create competition, Information, Dealing with special kinds of business

A decrease in purchasing expenditures directly increases profits before taxes is known as

Profit Leverage Effect

Name at least 3 reasons for Making internally

Protect proprietary technology, No competent supplier, Better quality control, Use existing idle capacity, Control of lead-time transportation, and warehousing cost, Lower cost

The practice of obtaining merchandise, capital equipment; raw materials, services, or maintenance, repair, and operating (MRO) supplies in exchange for money or its equivalent is known as

Purchasing

__________ used to check feasibility of MPS. Converts MPS from production needed to capacity required, then compares it to capacity available

Rough Cut Capacity Planning

__________________plan covers a few days to a few weeks. Detailed planning process for components & parts to support the master production schedule

Short-range or MRP

What are the 4 pillars of supply chain management according to Professor Catherine Feather?

Source, Plan, Make, Deliver

A buyer's activities to improve a supplier's performance and/or capabilities based on the following approach is known as

Supplier Development

What is the process to identify best and most reliable suppliers?

Supplier Evaluation and Certification

Achieving win-win competitive performance for the buyer and supplier -- these require a strategic perspective as opposed to a tactical position is an objective for a

Supplier Partnership

3 Examples of External Disruptions

Supplier driven, Political, Environmental, government regulations

What are the different components of total cost of ownership

Unit Price, Tooling/equipment costs, Freight & inventory costs, Tariffs and duties, Currency exchange fees, Payment terms, Maintenance and non performance costs

Name the two quantitative forecasting methods

Time series forecasting, Cause and Effect Forecasting

True or False A pull system is an inventory management process that is at the pulse of customer demand

True

True or False Exponential smoothing is type of weighted average forecast where only 2 data points are needed

True

True or False it is generally recommended to use a combination of qualitative and quantitative forecasting techniques

True

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

True

True or False: 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

True or False: Fair trade product is manufactured or grown by disadvantaged producers in a developing country that receives fair price for their goods

True

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

True

In your own words, what is the main difference between a simple moving average and weighted moving average forecast?

Weighted moving average allows you assign a weight to recent actual demand in order to allow it to influence future forecast more

Define Analytical SRM

allows the company to analyze the complete supplier base

Define transactional SRM

used to track supplier interactions such as order planning, order payment and returns