Operations management: Test 2

T/F The goal of a good purchasing system is to ensure efficient information transitions between the materials users, the purchasing personnel, and the suppliers.

T

T/F The procedures for public procurement differ from the private sector.

T

T/F Total Cost Ownership is made up of all costs associated with the acquisition, use, and maintenance of a good or service.

T

T/F Unless an organization has a firm grasp of the key issues surrounding supplier relationships, it cannot reap the benefits of such relationships.

T

T/F 80% of the effects come from 20% of the causes is referred to as the Benelli principle.

F

All of these are advantages of the e-procurement system EXCEPT: a. Accuracy b. Credibility c. Mobility d. Cost Savings

B

Firms can use total cost analysis to: a. See how efficiently management is using its total assets to generate profits b. Select the most cost-effective supplier c. Show how many times a firm's inventory is utilized and replaced over an accounting period d. Brainstorm and isolate the causes of a problem

B

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: a. CRM b. SRM c. ISO 9000 d. SCSS

B

When an item is in short supply accompanied by rising prices, a firm might find it beneficial to: a. Discontinue buying the product and focus more on cheaper products. b. Align itself with one of the suppliers to ensure a continued supply of the scarce item. c. Purchase the item from a manufacturer who cuts corners and provides a product below market price. d. All of these

B

Which of the following is NOT a key tenant of an SRM system? a. Automation b. Lean operations c. Visibility d. Integration

B

Which of the following would be a good reason to outsource (buy) versus making? a.To utilize existing capacity within a company's own firm b.A firm lacks the technology or expertise to produce an item c.To have more direct control over the design and production of an end item d.No competent supplier presently produces the needed item

B

According to the textbook, Supplier Recognition Programs: a. Are generally not very effective b. Are used by 90% of companies c. Encourage suppliers to keep their performance high d. Are difficult to implement

C

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: a. Human resources and job design b. Selling and marketing products c. Coordination and collaboration with channel partners d. Program evaluation and review techniques.

C

The components of Time Series include. a. Trend variation b. Time variation c. Both A and D d. Random variation

C

The weighted-Criteria Evaluation System does NOT include. a. Selecting key dimensions of performance b. Classify vendors based on a total score c. Choosing a supplier based on the lowest score d. Assigning different weights to different criteria

C

Which of the following is not a forecasting technique? a. Quantitative b. Time-series models c. CPFR d. Qualitative

C

Which of the following is not a foundational element of supply chain management? a. Operations b. Logistics c. Inventory d. Integration

C

Which type of requisition is used for materials and standard parts that are requested on a recurring basis? a. Open requisition b. Blanket requisition c. Traveling requisition d. Recyclable requisition (Cyc-Rec)

C

In general, European companies prefer suppliers: a. Who employ the most people b. Whose headquarters are in a developing county c. Who are in the United States d. Who have ISO 9001 certifications

D

Which of the following is not a factor in CPFR? a. Cost b. Trust c. Internal change difficulty d. Forecasting

D

Which of the following is not a qualitative forecasting technique? a. Delphi method b. Jury of executive opinions c. Consumer survey d. Cause and effect

D

T/F ISO 14000 benefits include reducing waste, pollution, and energy consumption.

T

T/F 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

T/F A pull system uses customer orders to forecast.

F

T/F A pull system uses forecasting to determine how much product to produce.

F

T/F It is illegal for corporations to provide their suppliers appreciation banquets to award performance.

F

T/F Real value of CPFR (Collaborative Planning Forecasting Replenishment) is sharing inventory with other firms

F

T/F Purchasing can be broadly classified into two categories: merchants and industrial buyers.

T

Blanket or open-end purchase orders are suitable for buying? a. Office supplies b. Computers c. Custom built components d. Heavy equipment

A

Which of the following NOT a reason firms are expanding their supply bases to include foreign suppliers? a. Lower shipping rates due to lower tariffs b. Lower product cost c. Better product quality d. Overseas supplier holding the patent to the product

A

Which of the following is a reason that single sourcing is considered risky/bad? a. There could be supplier interruptions due to political instability b. It could establish close relationships with the supplier c. Larger orders make quantity discounts more likely d. Decreases the item to item quality variability of items purchased

A

Which of the following statements is FALSE? a. Centralized purchasing is where individual, local purchasing departments, such as at the plant level, make their own purchasing decisions. b. Electronic procurement systems can aid a company in saving both time and money. c. More than 50% of each sales dollar typically goes towards covering supply chain costs. d. If a firm lacks the technology to make a required component they will need to consider buying/outsourcing.

A

T/F Transactional SRM, allows the company to analyze the complete supplier base.

F

T/F Vertical integration is when a firm owns/buys their suppliers and/or customers

F

T/F Internal control is crucial to prevent abuse of purchasing funds.

T

T/F Successful supplier relationships involve equal decision-making control.

T

T/F NAFTA and the WTO are trade organizations seeking to reduce tariff and non-tariff barriers among its member countries

T

T/F Automating procurement activities can lead to significant cost savings as buyers move toward managing processes by exception.

T

T/F Cost savings is an advantage of using an e-procurement system.

T

T/F Erratic demand forecasts is referred to as the bullwhip effect

T