Chapter 10 Quizzes

Which of the following companies launched Six Sigma? a. Motorola b. Panasonic c. Toyota d. Hewlett Packard e. Walmart

a. Motorola

All of the following are good examples of visual managment except what? a. Watching customers complain about poor service b. Delineating where items should reside in the work environment when they are not in use c. Using kanban systems to signal inventory replenishment d. Presenting work steps through pictures e. Illustrating normal and abnormal outcomes to a work step

a. Watching customers complain about poor service

What does the Lean principle of 5S dictate? a. A safe and orderly work environment is also an efficient work environment b. Statistics drive improvement in warehouse operations c. Five phases of order fulfillment operations is most efficient d. Japanese ways of doing business are always more efficient than American methods e. Warehouses must have five degrees of redundancy in operations given uncertainty in satisfying customers

a. A safe and orderly work environment is also an efficient work environment

For a consumer goods company seeking to reduce the distance to U.S. population from a single location using a center-of-gravity approach, which city would offer the best choice for this facility? a. Cincinnati, Ohio b. Topeka, Kansas c. Dallas, Texas d. Buffalo, New York e. Denver, Colorado

a. Cincinnati, Ohio

What inventory method rotates inventory in order to minimize your risk of owning out-of-fashion merchandise. a. First-in first-out (FIFO) b. Last-in first out (LIFO) c. Reverse-logistics d. Inside-out inventory e. Reverse-to-active (RTA) storage

a. First-in first-out (FIFO)

Which of the following is NOT a classic warehouse layout principle? a. Minimize distance b. Maximize aisle space c. Create a smooth flow d. Use a single story e. None of the above; that is, they are all classic principles of warehouse design.

b. Maximize aisle space

Warehouses let you separate production from consumption, enabling you to take advantage of Production Economies of scale. TrueFalse

true

Which order fulfillment performance metric examines the orders picked, packed, and shipped perfectly? a. On-time delivery b. Order accuracy c. Order cycle time d. Perfect order completion e. Order fill rate

b. Order accuracy

A visual signal that indicates an incorrect quantity of parts is about to be shipped to customers, allowing the operator to correct the problem before it is detected by a customer is an example of what? a. Kaizen b. Poka yoke c. Value stream remedy d. Heijunka e. Muda

b. Poka yoke

What form of warehousing is owned by the firm? a. Public b. Private c. Contract d. Multi-client e. Third-party

b. Private

A cross-dock operation that receives truckload volumes of finished goods from a variety of consumer goods manufacturers and ships truckload volumes of assorted products to nearby retailers would be an example of a warehouse facility that serves which two purposes for the manufacturers? a. Supply mixing and inbound consolidation b. Product mixing and outbound consolidation c. Supply mixing and product mixing d. Product mixing and long-term storage e. Inbound consolidation and equipment utilization

b. Product mixing and outbound consolidation

Which of the following is a relatively new function performed in many warehouses? a. Receipt of goods b. Product processing for final assembly c. Transferring products to storage d. Order picking e. Order staging for shipment

b. Product processing for final assembly

What does the Square Root of N Rule show? a. 80% of sales comes from 20% of customers b. Safety stock rises as the number of stocking locations goes up c. Transportation costs increase when logistics is outsourced d. Customer loyalty increases with additional warehouse locations e. customer service levels increase with more inventory

b. Safety stock rises as the number of stocking locations goes up

What do we call the mathematical expression that predicts the relationship between the number of warehouses and the amount of safety stock inventory that a company can expect to maintain? a. Portfolio Effect b. Square Root of N Rule c. Center-of-Gravity Effect d. Pareto Rule e. Greenhut Effect

b. Square Root of N Rule

What is the name given to information applications that coordinate the activity within a warehouse facility? a. Online merchandising network b. Warehouse management system c. Ship-and-save system d. Quick response mechanism e. Enterprise resource plan

b. Warehouse management system

What do we call a warehouse that uses automated forklifts that move up and down each aisle putting pallets in assigned racks? a. A cross dock b. A customs warehouse c. An automated warehouse d. A warehouse management system e. A flexible warehouse

c. An automated warehouse

What is the tool called that is used to help identify the optimal location for a DC based on the locations and sales volumes of customers? a. Mix-and-match model b. Supply chain map c. Center-of-gravity model d. Diffusion model e. Centrifuge model

c. Center-of-gravity model

Which kind of warehouse allows a company to keep imported merchandise for a certain period of time without paying duties or tariffs? a. Distribution center b. Duty-free shop c. Customs warehouse d. Raw materials warehouse e. Consolidation warehouse

c. Customs warehouse

Which order fulfillment performance metric measures the time from order placement to customer receipt of delivery? a. On-time delivery b. Order accuracy c. Order cycle time d. Perfect order completion e. Order fill rate

c. Order cycle time

MyEducator Home Page Main Menu Previous Page Next Page 10.6Warehouse Ownership Now that you've been on a "virtual" warehouse tour, you know that warehousing is a complicated, specialized, and potentially expensive business. You may not want to do this yourself. In fact, you may want to focus on what your company does best—that is, your core competency—and outsource your warehousing needs to a third-party specialist. If you choose to run your own warehousing, you are engaged in private warehousing. You might make this choice to enjoy the highest level of operational control and security. For instance, De Beers, the world's largest diamond miner and marketer, has run its own private warehouse in London, England since 1889. You can't blame De Beers for wanting to secure its highly valuable merchandise. Private warehousing also makes sense when the scale and scope of your operations enables you to obtain needed economies and achieve distinctive customer service levels. When you turn to an outside expert (a public warehouse or 3PL), you can get very creative in setting up the operating arrangement. For instance, you might own the facility and invite someone like DHL or UPS to manage it for you. United Technologies' Carrier division does just that in its Monterrey, Mexico air conditioner manufacturing operation. Or, you may simply use the warehouse company's facilities. If so, you only pay for the space and services you use. This is kind of like going to a restaurant and ordering off a menu. In fact, we sometimes call this menu pricing. Going this route gives you maximum flexibility. You can use more or less space over time and change your choice of service options. You can also usually exit the operation more easily than when you own and operate the warehouse yourself. Of course, when you "share" space in a public warehouse, you need to ask, "Is my 'landlord' really good?" and "What kind of 'roommates' might I get stuck with?" A grocer learned the hard way how important it is to inquire about "roommates" before signing the service contract. The grocer began hearing complaints from consumers about bad-tasting bottled water bought at the company's stores. When the number and intensity of complaints increased, an investigation revealed that the water had been stored in a 3PL warehouse near a supply of fresh rubber tires. The plastic bottles had absorbed the fumes seeping from the tires, leading to the strange-tasting water. To make the right decision about ownership—as well as level of automation—you need to carefully consider your needs and then perform a total cost analysis. As always, your biggest challenge in doing a total cost analysis is to identify your relevant costs and gather accurate data so you can run the numbers. For warehousing decisions, the most important criterion is typically volume of product you will handle over time. Figure 10-9 makes cost comparisons for different warehouse operations and indicates your likely choice based on the tradeoff between fixed and variable costs. Remember, higher volumes justify higher fixed cost—that is, you can spread the costs of ownership and automation over a larger number of units handled. Figure 10-9: Cost Comparisons for Different Warehouse Options Try Again 10.6 Quick Check--Warehouse Ownership Points: 5 Graded on Nov 08 at 16:27 Submission #1: Graded on Nov 08 at 16:29 Submission #2: Graded on Nov 08 at 16:29 Submission #3: Submission Score: 3 / 5 (60.00%) Grade Time: Nov 08 at 16:29 Submitted On: Nov 08 at 16:29 Which alternative provides value-added warehousing and logistics services by a comprehensive third-party logistics (3PL) firm? a. New millennium warehousing b. Common warehousing c. Private warehousing d. Contract warehousing e. Substantiated warehousing 0 / 1 (0.0%) Which scenario below would suggest building your own private warehouse as opposed to using public warehouse space in a particular location? a. Space is required for product storage only and there are low customer service requirements b. There are low throughput volumes and low market density c. There are high customer service requirements and a need for a regional sales headquarters d. There is fluctuating demand and low market density e. Your products require no special materials handling and have low security needs

c. There are high customer service requirements and a need for a regional sales headquarters

Which of the following is a popular value-added service performed in modern warehousing? a. Mass customization b. Final Assembly c. Repair d. All of the above e. Only A and B

d. All of the above

Which order fulfillment performance metric measures the percentage of orders delivered without changes, damage, or invoice errors? a. On-time delivery b. Order accuracy c. Order cycle time d. Perfect order completion e. Customer satisfaction

d. Perfect order completion

What is the most common platform used in the shipping and handling of bundled products in a supply chain? a. Plastic pallets b. Plastic totes c. Metal racks d. Wooden pallets e. Steel bins

d. Wooden pallets

Cross-docking can achieve which of the following? a. Reduced warehousing cost b. Reduced inventory investment c. Improved inventory flow and velocity d. Improved synchronization between supply and demand e. All of the above

e. All of the above

Which of the following technologies would you likely find in a modern warehouse? a. AS/RS system b. Radio frequency system c. Pick-to-light systems d. Conveyor belts e. All of the above f. Only B and D

e. All of the above

What type of warehouse serves as a regional distribution point, where truckloads ship freight inbound with the local deliveries via less-than-truckload transportation? a. Liquidation warehouse b. Distribution center c. Customs warehouse d. Raw materials warehouse e. Breakbulk warehouse

e. Breakbulk warehouse

The warehouse activity that converts generic products into a wide assortment of unique items is called: a. Form postponement b. Mass customization c. Delayed gratification d. Order selection e. Only A and B

e. Only A and B

Which of the following is a principle of efficient product placement in the warehouse? a. Products that are common to many orders should not be placed near one another b. Fast moving products should be placed in remote storage areas c. You should use zig-zag routing for order retrieval d. Be sure to stack high-value, fragile products e. Place fast-moving items in dedicated slots

e. Place fast-moving items in dedicated slots

Which of the following is not a good reason for warehousing? a. Allows economies-of-scale in transportation and production b. Enables smoother coordination of supply and demand c. Supports customer service requirements d. Allows firm to take advantage of quantity purchase discounts e. To keep inventories for the sake of obsolescence

e. To keep inventories for the sake of obsolescence

Cost is the only significant consideration that a company must factor into its decision to own and operate a warehouse, as opposed to hiring an outside firm. TrueFalse

false

Just like in the movies, warehouses tend to be dark, dingy, and cavernous places to work. TrueFalse

false

The item fill rate for an item that is shipped complete 6 times out of 10 orders, and ships 55 units out of the 100 requested in the 10 orders, is 60 percent. TrueFalse

false

A "smart" WMS won't let the picker move to the next item until picking mistakes have been corrected. TrueFalse

true

Grain silos and chemical storage tanks represent forms of warehousing. TrueFalse

true