Exam Questions
If a supply chain has 80 inventory days of supply, 60 days of sales outstanding, and 45 days of payables, its cash-to-cash cycle time is:
(80 inventory days + 60 days of sales outstanding - 45 days of payables = 95)
What can an organization leverage in order to enable customers and suppliers to participate in product development?
CRM and SRM together
Pilferage contributes to which of the following costs?
Carrying costs
Which is the biggest impediment to reaching Stage 3 of supply chain network technology optimization, the integrated enterprise, for an organization that has held the majority of market share in its industry for many years but has slowly lost ground to high-quality foreign competition?
Company egocentrism
Which third-party logistics provider (3PL) contract clauses need to be robust because 3PLs will likely see details on supplier and manufacturer costs?
Confidentiality clauses
Transportation management systems (TMS) include load tendering and delivery scheduling. These functions can automatically schedule shipments with carriers, provided the location has which of the following?
Configuration for advance shipment notifications (ASNs)
design for the environment (DFE)
Considering health, safety, and environmental aspects of a product during the design and development phase of product development.
What is true of labor laws?
Country and local labor laws can differ significantly.
A manufacturer wants to engage in coordinated risk management with its supply chain partners. What is the best practice if it decides to focus on crisis communication planning?
Create joint contingency plans.
Which of the following does not describe product design for maximum supply chain flexibility?
Create many product variations.
Which of the following could best help promote organizational adoption of new design and development collaboration efforts?
Create simple graphics that make the goals easy to understand at a glance.
Capacity control is most closely related to which of the following activities?
Daily input/output
Which of the following will filter the output of an analysis into role-specific information so that a decision support system (DSS) can make sense of voluminous data?
Dashboard
What contract term specifies how orders will be placed?
Delivery requirements
An automobile company has identified a five-year trend in the price of gasoline, with prices consistently increasing year over year. How can it respond to capitalize on this trend?
Design and produce vehicles that are more fuel-efficient.
Which of the following design philosophies is most responsible for furniture that comes in kit form to be assembled by the retail customer at home?
Design for logistics
Into which of the following categories would a precision spring for an expensive clock fit if it was the key component that made the clock tell time reliably and needed to be of exacting dimensions and quality?
Direct/core competency material
Choice of a warehouse management system (WMS) should hinge on which of the following areas?
Directed picking, replenishment, and put-away
Which of the following is a preventive action?
Diversifying the customer base
After a "buy" decision has been made, what is the next step in the process of offshoring some manufacturing to a country with low labor costs?
Do a detailed assessment of offshoring requirements.
How can an organization reduce the risk of legal losses?
Document everything possible and maintain a paper trail.
What regulation requires organizations to disclose the use of conflict minerals that are necessary to the functionality or production of a product in the United States?
Dodd-Frank Act of 2010
Which of the following correctly indicates a feature of process-oriented middleware?
Does not require new code for each system to be integrated
What can you learn from watching a person's face for nonverbal cues as you are conveying important information?
Does the person understand and agree or disagree?
The labor-related principles of the United Nations Global Compact include which of the following?
Eradicate employment and occupation discrimination. Eradicate forced and mandatory labor. Eradicate child labor.
Which of the following authorities has issued directives mandating reporting, reduction, and recycling of heavy metals in end-of-life electronics products?
European Union
Which of the following would not be an acceptable measurement of output for an operations plan for use by operations managers?
Euros
What step of the sales and operations planning (S&OP) process comes after evaluating demand levels?
Evaluating supply capability
Which project management Process Group is used to collect data, and which is used to interpret data?
Executing is used to gather data; Monitoring and Controlling is used to interpret data.
A bakery company buys an option for bushels of wheat for €20 per bushel, with a premium of €2 per bushel. When it comes time to purchase wheat, the market price is €21 per bushel. What should the organization do?
Exercise the option even though the net cost will be higher than the market price alone.
Which of the most commonly used Incoterms applies to both sea and inland waterway shipments?
FOB
In a service industry such as an electrical utility supply chain, which of the following is a Tier 1 supplier?
Facility maintenance
organization's senior management develops a balanced scorecard and includes a dashboard. They have developed goals consistent with their overall supply chain strategies and have assigned ownership to functional areas within the business. However, they find that suppliers and customers are not making use of the scorecard. What is the likely cause of this?
Failure to communicate the strategic purpose to partners
A manufacturer creates a new supply plan that is aligned with the corporate strategy, mission, and culture. The manufacturer makes decisions on using centralized vs. autonomous sourcing and plans for future growth. However, soon after the plan is implemented, unforeseen issues begin causing stockouts of crucial supplies, disrupting the manufacturing process and causing massive losses. What is the likely cause of this failure?
Failure to conduct a risk assessment
Which of the following is a typical advantage of using a best-of-breed application instead of an already integrated enterprise resources planning (ERP) module?
Faster to market with innovative functions and services
A U.S. organization is developing a patent on a new product it will sell in several well-developed overseas countries. What is the easiest way for this organization to seek national and international patent protection?
File one international patent application in the U.S.
Which is designed especially for use with pallets?
Forklift
What is the newest set of guidelines from the Global Reporting Initiative (GRI)?
GRI Standards
A nucleus firm in the banking industry uses independent brokers to market new stock issues and has been successful in this channel. After investing some profits in the firm itself, they choose to reward their stockholders by distributing all remaining profits in a special dividend, even though independent brokers are prohibited from owning these shares. Which of the following has this firm forgotten to account for in its creation of financial value?
Gains must be fairly distributed among stakeholder
What must a retailer do to ensure the successful use of continuous replenishment?
Generate point-of-sale data and share it with the supplier daily.
Which of the following would be the most effective method of keeping the demand plan from being consistently biased toward overstated demand?
Hold the demand side of the organization accountable for its request for product.
What is an essential component of an organization's business model?
How it expects to make a profit based on its operations
Zenon International has an organizational strategy that specifies how it will function in its environment, how it will satisfy customers, how it will grow, how it will compete, and how it will achieve its financial objectives. According to the APICS definition of strategy, what elements are missing?
How it will manage the organization and develop business capabilities
Rachel Carson's publication of Silent Spring in 1962 conveyed which of the following key messages?
Human activities often impact the environment with unintended consequences.
In a reverse logistics system, in which direction does information flow?
In both directions between the raw material supplier and the end user
safety stock
In general, a quantity of stock planned to be in inventory to protect against fluctuations in demand or supply.
cycle time
In industrial engineering, the time between the completion of two discrete units of production.
service industry
In its narrowest sense, an organization that provides an intangible product (e.g., medical or legal advice).
What can cause poor payables processing in an organization?
In-house cash flow shortages
Which information technology steps can translate a policy for retailer-specific delayed packaging for generic products into a functioning practice?
Information infrastructure design
What are the Process Groups, in the correct order, as defined in the PMBOK® Guide?
Initiating, Planning, Executing, Monitoring and Controlling, Closing
An organization is looking to use the balanced scorecard™, and it has identified metrics that measure from the customer perspective, the business process perspective, and the financial perspective. Which perspective is the organization missing?
Innovation and learning perspective
Where on a balanced scorecard would you list a seminar on financial management for nonfinancial managers that was developed for the sales managers?
Innovation and learning perspective
Which is a characteristic of a successful alliance?
Interdependence
In today's world, supply chains can be described as moving toward which characteristics?
Interdependence, collaboration, and playing a strategic role
Which of the following levels of technology integration is described as various systems that feed into each other, creating some capacity for integration of the data?
Interfacing technology
Which of the following can best promote acceptance of custom scorecards for use in rating suppliers?
Involving suppliers in the selection of measurements to use
The costs of an organization's initial customer marketing and relationship building consistently result in expenses in excess of the revenues that are generated. Which of the following describes this situation?
It is sustainable if some customers can be retained long term.
Which of the following statements about product design for service is true?
It may compete with the design goal of minimizing development costs.
In order to integrate triple bottom line thinking into a business, what must occur beforehand?
It must be integrated into the business model from the start.
Which of the following statements about a trading partner agreement between strategic partners in a supplier relationship management (SRM) strategy is correct?
It should be mutually beneficial for both partners.
Organizations can use ISO 31010 to improve their risk management processes in which way?
It supplies information on the selection and application of risk assessment techniques.
Which of the following is true of (SOA)?
It uses extensible, universally available, descriptive standards.
There are a variety of reasons why an organization takes a continuous improvement (CI) approach to supply chain management (SCM). Which of the following is not a reason to adopt CI?
It's an objective way to focus blame on certain entities in a process.
Which method of inventory valuation is banned by the International Financial Reporting Standards (IFRS)?
LIFO
Which of the following would tend to reduce the amount of safety stock needed at a particular location?
Less frequent ordering
Planning and execution are:
Level 2 SCOR process types
A manufacturer is engaging in supplier segmentation in order to create a responsive supply chain. The manufacturer often redesigns products, looking to continuously improve and remain at the forefront of product design. What type of segmentation would work best for the manufacturer if they want to determine which suppliers can best contribute to their product design processes?
Level of innovation
Which basic operations strategy assumes the risk of stockouts in exchange for protection against high costs for overtime and capacity maximization?
Level production
A warehouse regularly handles products with strict expiration dates, and it wants a materials-handling system that will help with product rotation to avoid spoilage. Which system would work best to achieve that goal?
Live racks-loaded from the rear and use gravity to move product to the front of the rack, where picking occurs
What is the correct order of steps for integrating the supply chain? (Note that these steps do not reflect the entire process.)
Locate in the right countries and geographic locations; develop an effective export-import strategy; select warehouse locations; select transportation modes and carriers,Select the right number of partners. Develop state-of-the-art information systems.
Which supply chain strategy could provide the dual benefits of better sustainability and faster delivery to customers?
Locating final assembly closer to key customers
Which type of inventory is a period expense and thus must be expensed on the income statement in the period in which it was purchased rather than being listed on the balance sheet?
Maintenance/repair/operations (MRO)
spend management
Managing the outflow of funds in order to buy goods and services
An organization wants to automatically email coupons to customers after determining which products the customers may be interested in based on patterns and preferences. What customer relationship management technology tool should they use to generate the emails once product interest is determined?
Marketing automation
Which of the following could be subject to alteration as the result of decisions made in an executive sales and operations planning (S&OP) meeting?
Marketing plans
What is the focus of strategic and business planning?
Marshalling resources and determining actions to support the organizational mission and goals
One of the international locations of an organization has an ambitious culture that is more oriented toward work and achievement. What is this indicative of
Masculine culture
A motorcycle manufacturer redesigns a line of bikes to allow customers to put together a variety of gas tank styles, fenders, motors, and wheels to create models for different purposes. This exemplifies which of the following?
Mass customization
What is a major source of data for the material requirements plan?
Master production schedule
Which of the following is an input to the material requirements plan (MRP)?
Master production schedule
Which of the following is true of service-oriented architecture (SOA)?
Messages must be descriptive rather than prescriptive.
What is the "voice of the customer" (VOC)?
Method of customer research
Which countries can realize benefits under the North American Free Trade Agreement (NAFTA) of 1994?
Mexico, Canada, and the United States
Which ordering system would be most appropriate for a manufacturer that requires the flexibility to order across varying time periods but has limited storage space and a firm maximum for on-hand inventory?
Min-max system
conflict minerals
Minerals mined in conditions of armed conflict and human rights abuses, and that are sold or traded by armed groups.
Which of the following is a process change that would improve the time to market of customer relationship management (CRM) activities?
Minimizing the number of tasks that need to be performed sequentially
Which of the following is an objective of production activity control (PAC)?
Minimizing work in process
A power supply that can be used with different end cables in countries with different electrical infrastructures is an example of which of the following design strategies?
Modular design
A supply chain partner organization that measures supply chain sales, shipments, and stockouts is adhering to which of the following collaborative principles?
Monitor performance.
The sales and operations plan (S&OP) includes which of the following?
Monthly production figures by product family
Which of the following is a problem associated with having multiple versions/vendors of enterprise resources planning (ERP) systems?
Multiple incompatible sources for the same data
Which is the best supply chain for an organization that has some small expensive items and some bulky inexpensive items?
Multiple supply chains
Which would improve economies of scale in recycling?
National recycling standards that supersede local standards
The return SCOR process impacts which income statement element?
Net sales
interplant demand
One plant's need for a part or product that is produced by another plant or division within the same organization.
Just-in-Time (JIT) "cells" are laid out to accommodate which of the following?
One product family with similar manufacturing processes
Which Chinese supplier would have the lowest customs risk?
One with an AA rating-AA ratings are used for customs purposes in China, making that the best indicator of the level of customs risk for a Chinese supplier.
A manufacturer is preparing to release a new product to the market in four months, just before the holiday season that ends three months later. In test releases, the product has shown to be extraordinarily popular, and the organization is projecting sales to grow at a pace that greatly outstrips production capacity as it currently stands. It takes four months to set up a new facility for production of this product. What capacity growth staging strategy would be best if the organization wants to ensure that it can meet demand for this holiday season?
One-step lead strategy
Which of the following statements about a customer data warehouse (CDW) is correct?
One-to-one marketing cannot be achieved without using a CDW.
An organization's product is in decline and losing market share. Which of the following is most likely to generate innovative ideas on how to develop the next-generation product?
Ongoing use of unstructured voice of the customer (VOC) initiatives
What would be the best tool to use to balance a set of complex priorities for a supply chain that includes cost minimization, resilience, and time to market?
Operations research
Which inventory order system places orders at varying times based on the average demand during the lead time?
Order point system(In an order point system, the time between replenishment orders is not fixed but varies based on the actual demand during the reorder cycle.)
Lot-for-lot replenishment is most appropriate for which types of orders?
Orders in a Just-in-Time (JIT) shop
Which of the following describes mass marketing?
Organizations advertise based on the shared values of multiple segments.
An organization has outdated equipment for a core competency, and it has cash flow issues delaying updates to the equipment. What action might free up some cash to help them make these investments right away?
Outsource a non-core competency activity where the vendor will incur capital expense.
What is true of the cost effects of increasing the number of warehouses?
Overall system costs increase up to a certain point, and then decrease.
Two independent sales distributors want to pursue distributor integration in order to gain flexibility without needing to carry excess stock. What is the most likely obstacle to this arrangement?
Ownership of inventory
Which of the following variables are typically monitored when shipping perishable products?
Packages adjacent to and above perishable items that may leak, spill, or contaminate the items Transit times Temperature
Which of the following is a risk to an organization's recent bulk purchase of soft-wood shipping pallets from an international source?
Pest prohibitions
What is an internal risk to the supply chain?
Poor labor relations
What strategy can be used to reduce the bullwhip effect?
Postponement
When the demand manager serves as a communications focal point, who is he or she likely to communicate with regarding changes in tactics needed to meet demand or business objectives?
Product and brand managers
Which of the following is the primary focus of master scheduling (MS)?
Production amounts for individual products
Which of the following is true of projects?
Projects are one-time, unique sets of events.
Which element of a balance sheet does the source supply chain process impact?
Property, plant, and equipment
Which is a category of operational metrics in the manufacturing industry?
Quality
In the ideal world of supply chain inventory, which of the following should never be at rest in a warehouse?
Raw materials
Which would help reduce interorganizational suboptimization and thus total costs?
Reducing total supply chain inventory dwell time
Which of the following is the primary limiter on the spread of radio frequency identification (RFID)?
Relatively high RFID tag prices
Which is a reverse logistics best practice for an organization that places a strategic priority on efficient, cost-effective returns processing and has the infrastructure to do this at high levels of customer satisfaction?
Retain the functions, but restrict returns processing to selected facilities.
What metric assesses the magnitude of an investment relative to a company's working capital position versus revenue generated from a supply chain?
Return on working capital
What processes are used in master planning?
Sales and operations planning and resource planning
Which of the following benefits of a customer data warehouse (CDW) can result from the strategic allocation of human and technology resources according to customer channel preferences and purchasing patterns?
Sales productivity
Which of the following would best achieve the goals of improving forecast accuracy, reducing the frequency of supply-demand mismatches, and minimizing the non-selling time of headquarters sales staff?
Sales staff are required to make brief demand planning inputs each day noting changes.
What three factors determine cash flow for an organization?
Sales, after-tax operating profit margins, and capital requirements
Which of the following is true of a situation in which an organization has long lead times when matching customer orders to supply?
Salespersons should work to educate customers on lead time issues to set expectations.
In which type of customer segmentation are customers grouped by income?
Segmentation by demographics
In regard to technology, collaborative planning, forecasting, and replenishment (CPFR) may be said to depend fundamentally upon which of the following?
Shared data
What does capacity requirements planning generally refer to?
Short-term assessment of labor, plant, and equipment availability
According to the Supply Chain Council (SCC) guidelines, which of the following has the most complete risk definition?
Skilled labor shortages of up to 10% at a Mexico plant for the first two quarters of the year
According to the triple bottom line model, what three components must work together to create a sustainable business model?
Social, economic, environmental
Which of the following is true of radio frequency identification (RFID) and its associated EPCglobal Network?
Some RFID tags can be rewritten with new information and reused.
Which of the following is another name for the "one size fits all" type of design?
Standardization
Which of the following is a type of assistance marketing could provide to a supply chain manager when one product in a product family is having significant supply lead time problems?
Substitution
Which of the following is a preventive action that would be the most effective way to mitigate the risk of fraud and corruption on the part of suppliers?
Supplier co-management
Which is the best option for an organization that wants to highlight information on its environmental performance?
Sustainability scorecard
automatic identification and data capture (AIDC)
Technologies that collect data about objects and then sends the data to a computer without human intervention. Examples include radio frequency wireless devices and terminals, bar code scanners, and smart cards.
Which of the following is a potential risk of using a third-party logistics provider (3PL)?
The 3PL employee represents the firm to the client, and the 3PL may have contracts with the firm's competitors.
kaizen
The Japanese term for improvement; refers to continuing improvement involving everyone—managers and workers.
order fulfillment lead time
The average amount of time between the customer's order and the customer's receipt of delivery; this includes every manufacturing or processing step in between.
electronic document
The electronic representation of a document that can be printed.
According to Jordan Lewis, author of Partnerships for Profit, which of the following could be a negative indicator when selecting a potential strategic partner?
The firm's management is not introspective.
global trade management
The management and optimization of shipments across international borders to improve operating efficiencies and cash flows; includes ensuring compliance with all international regulations and documentation and streamlining and accelerating the movement of goods.
A manufacturer of luxury boats gets a request from a customer to upgrade the seats on a boat in work-in-process inventory. There is a demand time fence for the hull and engines and a planning time fence for the furnishings. Which of the following is the minimum requirement to make this change?
The master scheduler should make the change if it doesn't delay the final schedule.
inventory turnover
The number of times that an inventory cycles, or "turns over," during the year.
cost of quality
The overall costs associated with prevention activities and the improvement of quality throughout the firm before, during, and after production of a product.
demand shaping
The practice of using the four Ps (product, pricing, placement, and promotion) and other market variables to influence the demand of a product or service so that demand better matches available supply. See: four Ps.
demand planning
The process of combining statistical forecasting techniques and judgment to construct demand estimates for products or services (both high and low volume; lumpy and continuous) across the supply chain from the suppliers' raw materials to the consumer's needs.
Which of the following is a likely outcome of asking suppliers to participate in an organization's product design effort?
The product quality could be improved without significantly increased costs.
sole source
The situation where the supply of a product is available from only one organization
marketing research
The systematic gathering, recording, and analyzing of data about problems relating to the marketing of goods and services.
demand pull
The triggering of material movement to a work center only when that work center is ready to begin the next job.
electronic commerce (e-commerce)
The use of computer and telecommunication technologies to conduct business via electronic transfer of data and documents.
project management
The use of skills and knowledge in coordinating the organizing, planning, scheduling, directing, controlling, monitoring, and evaluating of prescribed activities to ensure that the stated objectives of a project, manufactured good, or service are achieved
inventory valuation
The value of the inventory at either its cost or its market value.
According to Hofstede's cultural dimensions, what is true of high power distance cultures?
These cultures tend to have less equal distribution of power.
Which of the following correctly describes Incoterms?
They are not legally binding in contracts of carriage. They identify which party assumes risk at certain points in the transportation process.
How can reverse logistics generate revenue?
Through service contracts and extended warranties
An automotive repair shop wants to implement an order system to correct issues with slow-moving inventory. Which ordering system would work best to address the issues?
Time-phased order point system
Which of the following would you select to pull several trailers conveying pallets?
Tow tractor with trailer
When conducting a supplier certification process for an ISO (International Organization for Standardization) standard, which of the following is necessary when asking a supplier to commit to a process defined in a formal agreement?
Trust that the information will not be used to their competitive disadvantage
Which of the following is least likely to produce a positive effect on accountability for managers involved in a manufacturing software improvement project?
Tying results to the stock price of the firm
What is true of U.S. employees overseas?
U.S. extraterritorial laws exist to control their behavior.
For U.S. companies exporting products to all countries except Canada, companies must file electronic export information online if the export is valued at:
US$2,500 or more.
Which is not considered waste in the Toyota Production System?
Underproduction
What should an organization do if it wants to ensure that imports and exports make it through customs without unnecessary delays?
Use a customs house broker with proven expertise.
Which of the following is a method of replacing physical inventory with better information?
Use postponement centers.
Process benchmarking does which of the following?
Uses a checklist of qualitative features from world-class organizations
A mining process produces a slurry of liquid and mineral debris as waste. Finding an asphalt manufacturer who can use it as an ingredient in new asphalt is an example of what?
Waste exchange
A partner organization that restructures some of its internal methods to align with the supply chain network before automating has asked which of the following key business questions?
What business processes must change?
When setting supply chain strategy at a firm that isn't the nucleus firm, which of the following is the most important to focus on?
What's good for the final customer
A logistics chain may benefit from adding warehouses in which of the following instances?
When small-scale customers require fast, frequent shipments that are more readily accommodated by a decentralized system of warehouses
What lesson can be learned from studying a humanitarian and disaster relief supply chain?
When social and physical infrastructure breaks down, long-term relationships based on trust become invaluable.
When would shifting costs from an organization to its suppliers be a good idea from a long-term perspective?
When supply chain total cost goes down
inventory accuracy
When the on-hand quantity is within an allowed tolerance of the recorded balance. This important metric usually is measured as the percent of items with inventory levels that fall within tolerance.
What is the best reason why a supply chain manager would decide to use a trailer or railcar for temporary storage?
When the product needs to be stored but is scheduled to be moved again shortly
Holding a brainstorming session for an improvement team is usually an effective means of creating:
a process map or flow process chart.
In order for a key performance indicator to be a true supply chain metric, it must measure:
a process that crosses nodes
What is a SWOT analysis?
a tool used to analyze an organization's current state and opportunities.
In the internet, the client of the client/server model is represented by:
a web browser
Which mode of carrying packaged goods requires the least durable packaging?
air
Which mode of transportation is most appropriate for carrying small, highly valuable, fragile or perishable cargo?
air
Which two modes of transportation have poor accessibility as a tradeoff?
air and water
An organization working to minimize surprises and get buy-in by key people for a new alliance should first:
align internally by identifying key issues and stakeholders.
An example of a supplier performance reporting mechanism is:
an automated performance alert.
Processes in Level 4 of the SCOR model are determined by:
an industry or a specific firm.
Pipeline inventory is the products that:
are in transit between locations.
Which of the following countermeasures against theft of intellectual property is most likely to be effective?
asking distributors to look for counterfeits and inform the organization
Which of the following production strategies allows for mass customization without long lead times?
assemble to order
Which tool or technique formally connects the strategies and overall objectives of a business to goals and measurements that go beyond just financial metrics?
balanced scorecard
Which of the following is a benefit associated with customer segmentation?
better ROI (return on investment) on promotion budgets
What is the focus of a rough-cut capacity check?
bottlenecks
supplier certification
certification procedures verifying that a supplier operates, maintains, improves, and documents effective procedures that relate to the customer's requirements."
Which of the following items makes up the majority of rail cargo in the United States and Great Britain?
coal
A company wants to get each member of its extended supply chain to understand the benefits of collaborative lean manufacturing. Which of the following would provide this shared understanding?
conceptual model
A warehouse management system (WMS) should:
coordinate bulk discounts with maximum pallet capacities.
Which of the following warehouse operations assumes no storage of incoming goods before reshipping?
cross docking
You are purchasing an item online and receive the following automated message: "Other customers like you have also ordered X. Would you like to learn more about this product now? If so, click here." This is an example of:
cross-selling
Which of the following is true of the people or metrics involved in supply chain management?
current supply chain performance is better quantitatively benchmarked against the firm's desired performance than qualitatively benchmarked.
Grouping customers according to distinct values or needs refers to the tactic of:
customer segmentation.
What demand-side activity is an input into strategic planning?
demand management
Target costing is:
designing a product to meet a specific cost objective.
Companies outsourcing customer relationship management (CRM) should:
develop an exit strategy.
Which of the following stages of the product life cycle is an ideal opportunity in which to create a sense of customer ownership of a product or service?
development
According to the APICS Dictionary, 16th edition, which is a general business strategy?
differentiation
In the majority of situations, the benefit-cost impact of a logistical failure is:
directly related to the importance of the service to the customer.
In a supply chain, distributors can refer customers to other distributors who have needed product on hand. This best describes a:
distributor integration network
Which of the following is the correct term for the situation in which a firm exports a product at a lower price than it sells for in the country in which the firm operates?
dumping
In an organization that uses cross-functional teams for managing supply from its external resources, the supply chain manager's role should involve:
educating functional team members on cultural sensitivities.
If a company looks internally to determine how a supply chain process can be done less expensively and in less time and use fewer resources, it is:
efficient.
Establishing clear ground rules for collaboration and conflict resolution benefits both alliance participants by:
encouraging participants to redefine problematic connections rather than break them.
If an organization owning a brand is looking to establish an ongoing relationship with a supplier but does not desire an alliance, it should:
establish prices, discounts, and delivery timing cooperatively.
patent assertion entity (PAE)
focus on aggressive litigation ... asserting that their patents cover inventions not imagined at the time they were granted."
A company is effective if it:
focuses on and meets its customers' needs and wants while still meeting its cost objectives.
Many Japanese companies build keiretsu to:
form cooperative relationships, usually through ownership of stock in member companies.
McDonald's, a global fast food chain, offers unique menus in different countries or regions that appeal to the tastes of local communities. This is an example of:
glocalization
When evaluating bids from carriers, the logistics employee needs to consider capacity constraints such as:
handling, liability concerns, and conflicts of interest.
Supply chain efficiency can be risky if a firm:
has eliminated stock buffers and relies on Just-in-Time (JIT) delivery.
pull system
in production, the production of items only as demanded for use or to replace those taken for use.
total cost of ownership (TCO) .
in supply chain management, [this] is the sum of all the costs associated with every activity of the supply stream
You are the supply chain manager, and, based on recent research, you are anticipating changes in the market. Which of the following would be most important to develop?
innovation
By allowing it to focus on core competencies
integral
Which can be seen as a lubricant that keeps the supply chain flexible even though it is also a buffer that hides flaws in the supply chain that might otherwise be corrected?
inventory
cycle stock
inventory that "depletes gradually as customer orders are received and is replenished cyclically when supplier orders are received."
Which of the following statements about the matrix chart are true?
it can show the relationships between two or more groups of information. It can show strengths of relationships between variables. It shows how variables interact and respond with each other.
The integrated enterprise stage of supply chain evolution is significantly different from the prior stage in that:
its business processes are facilitated by organization-wide technology.
What supply chain function do customers usually take for granted?
logistics
Supply chain participant priorities often conflict. Which of the following groups sets a priority on high production output and low production costs?
manufacturers
An organization is looking to expand sales of its product line into a new market. What process should it undertake to identify the best new market area to move into?
market research
Supply chain managers can be useful as intermediaries between manufacturing professionals and which area that is often otherwise underrepresented in production planning?
marketing
An advantage of using quality function deployment (QFD) over design for quality is that, in QFD, quality of design is:
measured relative to competitor product features.
A true supply chain metric is one that:
measures a process that crosses tiers.
A company invites key business customers to participate in the performance evaluations of its account managers. This is an example of:
measuring customer satisfaction.
Which of the following design strategies is the polar opposite of integral design?
modular design
For an assemble-to-order product, the master production schedule is likely to focus on scheduling which of the following?
modules
In a supplier relationship management (SRM) environment, a framework of performance metrics should be established to:
monitor and identify opportunities for improvement.
In the customer-driven business model, strategic pricing:
must be continually analyzed to ensure that it is attractive to customers but still profitable to the business.
A manufacturer is planning component orders for a new product that requires several parts with differing lead times. How can it ensure that the necessary parts arrive at the work center at the same time?
offsetting
As customers begin to assume that products and services will be of high quality, the competitive differentiator becomes:
price or value.
Which will likely have the most impact on a customer's perceived value of a product or service and may impact other strategic decisions because customers tend to use it as an order qualifier?
pricing
efficiency focused sc
proactively managing customer demand and use time series forecasting to predict future demand
risk and emv formula
prob x impact
Creation of brand image is a concern related to:
promotion
Supply chain participant priorities often conflict. Which of the following groups sets a priority on short order lead times and quick delivery turnaround times?
retailer
If you wanted to know the operation(s) that would be performed on a particular component at a specific workstation, where would you look?
route sheet
Which is true of the benefits of segmentation?
segmentation can generate a mutual dependency among buyers and sellers.
Which of the following would best solve a problem in which expert labor needed for technical support is more costly and difficult to acquire in some parts of the country than in others?
service-related distributor integration
A dock receipt is issued by which of the following entities?
ship agent
The value of inventory on the balance sheet is most often based on:
standard cost
A relational database links tables:
that share a common data element.
Average actual cycle time is:
the average speed at which the supply chain delivers products to customers.
Lean supply chains strive to reduce:
the need for working capital.
Which of the following smoothing constants would yield the same result as a naive forecast?
1
The main focus of the SCOR model is on:
the supply chain's management processes
A method to determine the best mode of transportation for shipping specific product types is to compare:
the value of an item per cubic foot or meter versus the amount packed per cubic foot or meter.
As measured by millions of tons, which of the following modes of transportation moves the most cargo in the United States?
truck
When a restaurant pursues a chase production strategy, at the points of highest and lowest load, capacity key performance indicators for hourly labor and perishable inventory should show that there is:
ust the right amount of capacity at both the highest and lowest loads.
make to order company customer service ratio
usually some comparison of the number of jobs or dollars shipped in a given time period (e.g., a week) and the number of jobs or dollars that were supposed to be shipped in that time period
Total lead time can be determined from the information in which of the following?
work center file, routing file
The sum of the demand for an item for the past 12 months is 960 units. The demand in May for the past three years was 92 units, 91 units, and 99 units. What is the seasonal index for May?
1.175
Which Altman Z-score would indicate that a publicly financed organization is at risk of bankruptcy but would be just a watchlist score if it were for a private organization?
1.5
An organization is using a periodic review system to handle ordering. The organization uses 125 units per week over the course of 5 working days. It orders every 5 days, with a lead time duration of 2 days. It maintains a safety stock of 100 units. At the time of ordering, there are 170 units on hand. What is the order quantity?
105
passive tag
A RFID tag that does not send out data and is not self-powered. See: radio frequency identification (RFID) tag.
collaborative planning, forecasting, and replenishment (CPFR)
A collaboration process whereby supply chain trading partners can jointly plan key supply chain activities from production and delivery of raw materials to production and delivery of final products to end customers.
International Financial Reporting Standards (IFRS)
A common global language for business affairs so that company accounts are understandable and comparable across international boundaries
reverse logistics
A complete supply chain dedicated to the reverse flow of products and materials for the purpose of returns, repair, remanufacture, and/or recycling.
Which would be classified as work-in-process inventory?
A completely processed item awaiting inspection
upside supply chain adaptability
A discrete measurement of the quantity of increased production a supply chain can achieve and sustain for 30 days.
environmentally responsible business
A firm that operates in such a way as to minimize detrimental impacts on society. See: green manufacturing, green supply chain.
partnership
A form of business ownership that is not organized as a separate legal entity (i.e., unincorporated business), but entailing ownership by two or more persons.
plan-do-check-action (PDCA)
A four-step process for quality improvement.
product family
A group of products or services that pass through similar processing steps, have similar characteristics, and share common equipment prior to shipment or delivery to the customer.
Which of the following scenarios shows proper application of the principles of communicating demand?
A manager thanks a marketing person for properly communicating the results of an underperforming advertising campaign on a timely basis, even though it was bad news.
level of service
A measure (usually expressed as a percentage) of satisfying demand through inventory or by the current production schedule in time to satisfy the customers' requested delivery dates and quantities.
perfect order fulfillment
A measure of an organization's ability to deliver a perfect order. See: perfect order.
customer service ratio
A measure of delivery performance of finished goods or other cargo, usually expressed as a percentage.
return on working capital
A measure of profit on the amount of captial consumed. Calculated as after-tax operating income divided by net working capital.
assemble-to-order (ATO)
A production environment where a good or service can be assembled after receipt of a customer's order.
level production method
A production planning method that maintains a stable production rate while varying inventory levels to meet demand
define, measure, analyze, improve, control (DMAIC) process
A six sigma improvement process composed of five stages: (1) Determine the nature of the problem. (2) Measure existing performance and commence recording data and facts that offer information about the underlying causes of the problem. (3) Study the information to determine the root causes of the problem. (4) Improve the process by effecting solutions to the problem. (5) Monitor the process until the solutions become ingrained.
private trading exchange (PTX)
A trade exchange hosted by a single company to facilitate collaborative e-commerce with its trading partners.
Cycle counting is usually paired with which of the following to minimize the total cost of inventory shrinkage?
ABC inventory classification
Which of the following often accompanies goods that are intended to travel in sealed containers across borders, including goods intended to be admitted only temporarily for use in events such as tradeshows?
ATA Carnet
e-business
Abbreviation for electronic business. Refers to conducting business processes on an electronic network, typically the internet. See: e-commerce.
What are key qualities to look for in software for organizations wanting to remain at Stage 4 of supply chain network technology optimization, the extended enterprise?
Adaptability and scalability
Which of the following statements about strategic alliances and joint ventures (JVs) is true?
Alliances differ from JVs because alliances do not create a new entity.
trade bloc
An agreement between countries intended to reduce or remove barriers to trade within member countries.
safety lead time
An element of time added to normal lead time to protect against fluctuations in lead time so that an order can be completed before its real need date.
cash-to-cash cycle time
An indicator of how efficiently a company manages its assets to improve cash flow.
Globally Harmonized System of Classification and Labelling of Chemicals (GHS)
An international standard, created by the United Nations Economic Commission for Europe (UNECE), for classifying chemicals according to their health, physical, and environmental hazards.
consortia trade exchanges (CTX)
An online marketplace, usually owned by a third party, that allows members to trade with each other. Such sites lower members' search costs and enable lower prices for the buyer.
virtual trading exchange
An online trading exchange that enables both information integration and collaboration between multiple trading partners.
What is a key aspect of campaign management for vulnerable customer campaigns?
Analyzing the customer data to predict customer behaviors
A buyer uses its market dominance to insist upon cost reductions from its suppliers, offering nothing in return. It gives suppliers a week to comply and threatens to terminate contracts. Which of the following could a supplier do to preserve its contract and already narrow profit margins?
Ask for more time to study the problem and present an alternative that could help both parties.
Which is an independent demand item?
Automobile tires for stock in a tire shop
line haul costs
Basic costs of carrier operation to move a container of freight, including drivers' wages and usage depreciation. These vary with the cost per mile, the distance shipped, and the weight moved.
Who bears the risk of loss in a FOB Origin contract once the carrier is on route to its destination?
Buyer
How is the write-off value for inventory calculated?
By following strict accounting guidelines
You work on a continuous improvement (CI) team, and yesterday you attended the first team meeting. Which of the following comments that you heard at the meeting doesn't fit with what you know about CI?
"I'll bet money that it's the old die that's causing those scratches on that component."
break-bulk
"dividing truckloads, railcars, or containers of homogeneous items into smaller, more appropriate quantities for use."
What is the average inventory for a manufacturer that has $14,600,500 in inventory at the start of the period and $8,988,000 at the end of the period, with an annual cost of goods sold of $24,125,000?
$14,600,500 + $8,988,000 = $23,588,500; $23,588,500/2 = $11,794,250.
What is a recommended prerequisite to analyzing the core areas of concern of ISO 26000?
(1) recognize its social responsibility within its sphere of influence and (2) identify and engage with its stakeholders.
If customer demand for smartphones is running at 1,000 units per day and the available manufacturing capacity is 650 minutes per day, then takt time equals:
(650 minutes/1,000 units = .65 minutes; .65 x 60 seconds = 39 seconds per phone).
A company wants to calculate the tracking signal for a certain product. Over a 4-month period, the forecast errors were 0.87, 1.38, -1.48, and -1.36. The resulting MAD is 1.27 units. What is the tracking signal?
-0.46
An organization wants to calculate its inventory turnover rate. It has an annual cost of goods sold of $2,185,000, an average inventory of $346,000, and an inventory at period end of $356,000. What is the inventory turnover for the organization?
. $2,185,000/$346,000 = 6.32 times.
The sales and operations plan as a whole provides a statement of company plans for what period?
12 to 18 months or more
An organization wants to estimate the cost of a machinery breakdown in its production line. It determines the most likely cost to be $12,500, with a low estimate of $4,500 and a high estimate of $18,000. If the organization uses the PERT weighted average to estimate the cost of the breakdown, what is the result?
12,083
Which of the following would be a typical time horizon for sales and operations planning?
12-18 months
According to the ABC system of classifying inventory, the greatest share of revenue will be generated by approximately what percentage of total inventory items?
15%
A manufacturer is calculating the projected available balance (PAB) for a period after the demand time fence. The prior period PAB is 150 units, the master production schedule calls for 220 units, customer orders for the period currently number 103 units, and the forecast is for 107 units. What is the resulting PAB?
150 + 220 = 370; 370 - 107 = 263.
What length of time should an organization use for its demand planning horizon at a minimum, following best practices?
18 months
A manufacturer is calculating the projected available balance (PAB) for a period before the demand time fence. The prior period PAB is 2,135 units, the master production schedule calls for 1,750 units, customer orders for the period currently number 1,061 units, and the forecast is for 1,545 units. What is the resulting PAB?
2,135 + 1,750 = 3,885; 3,885 - 1,061 = 2,824.
Referring to the table below, calculate a forecast for April using the three-month moving average method. Based on your calculation, which of the following statements correctly relates the forecast to the actual April demand of 22?
20: (21 + 17 + 22)/3 = 60/3 = 20.
An organization implements a cloud computing solution to better address its needs. After two years, the total benefits are $85,000. The total cost to implement the system was $68,000. What is the return on investment (ROI)?
25%(total benefit-total cost/total cost)
Six sigma offers a set of tools for developing solutions when a process measurably fails to meet customer requirements by producing more than how many defects per million?
3.4
If there are 5 people on a project team and 4 additional identified stakeholders, how many communication channels are there?
36(9 (9 - 1)/2 = 36)
A supply chain has seven suppliers each with its own warehouse, one manufacturing warehouse, and three distribution centers each serving six retail stores. How many echelons does this supply chain have?
4
Although it depends upon the type of industry, in most cases supply chain costs can total what percentage of a company's revenues?
50%
What is the fill rate for a product if 200 units are shipped to a customer and stockout frequency is 5% but the customer ordered 400 units?
50%-Fill rate is a percentage of available items to requested items, which can be calculated by dividing the units delivered by the number ordered by the customer
What is the rated capacity for a work site that has 80 hours of available time, a utilization rate of 90%, an efficiency rating of 80%, and a demonstrated capacity of 63.4 hours?
57.6 standard hours(80 x 0.90 x 0.80 = 57.6 standard hours)
Approximately what percentage of U.S. Fortune 500 companies have kidnap and ransom insurance for their key management?
75%
If a workstation rated at 81.2 standard hours of available capacity produced weekly performances of 81.0, 82.5, 78.5, 76.7, and 80.1 hours over the last five weeks, what is the demonstrated capacity?
79.8 hours
An organization forecasts demand for a given month to be 36.82 units. Actual demand for the month is 34 units. What is the forecast error as a percentage?
8.3
An organization forecasts demand for a given month to be 148.86 units. Actual demand is 176 units. What is the forecast accuracy expressed as a percentage?
84.6
business process management
A business discipline or function that uses business practices, techniques, and methods to create and improve business processes.
third-party logistics (3PL)
A buyer and supplier team with a third party that provides product delivery services. This third party may provide added supply chain expertise.
environmentally responsible manufacturing
A collection of manufacturing activities that includes design of the product, facility, manufacturing processes, logistics, and supplier relationships that reduce or eliminate environmental waste through innovation and improvements.
glocalization
A combination of "globalization" and "localization." In a supply chain context, [this] is a form of postponement where a product or service is developed for distribution globally but is modified to meet the needs of a local market.
Web services
A common internet or intranet framework that enables the movement of data from one supply chain application to another, without the requirement for a direct connection between the two applications and without regard to the underlying operating system for those applications.
single-source supplier
A company that is selected to have 100 percent of the business for a part although alternate suppliers are available.
For which of the following companies would implementing supplier relationship management (SRM) probably be most critical?
A company that uses raw materials and prefabricated components to create consumer goods
strategic sourcing
A comprehensive approach for locating and sourcing key material suppliers, which often includes the business process of analyzing total-spend-for-material spend categories.
supplier relationship management (SRM)
A comprehensive approach to managing an enterprise's interactions with the organizations that supply the goods and services the enterprise uses.
legacy systems
A computer application program that is old and interfaces poorly with other applications but is too expensive to replace. It often runs on antiquated hardware.
transportation management system (TMS)
A computer application system designed to manage transportation operations.
inventory optimization software
A computer application that can find optimal inventory strategies and policies related to customer service and return on investment over several echelons of a supply chain.
What are the three essential elements of a performance measurement system?
A criterion, a standard, and a measure
upside supply chain flexibility
A discrete measurement of the amount of time it takes a supply chain to respond to an unplanned 20 percent increase in demand without service or cost penalty.
downside supply chain adaptability
A discrete measurement of the reduction in quantities ordered sustainable at 30 days prior to delivery with no inventory or cost penalties.
keiretsu
A form of cooperative relationship among companies in Japan where the companies largely remain legally and economically independent, even though they work closely in various ways such as financial backing.
value stream mapping
A lean production tool to visually understand the flow of materials from supplier to customer that includes the current process and flow as well as the value-added and non-value-added time of all the process steps
master production schedule (MPS)
A line on the master schedule grid that reflects the anticipated build schedule for those items assigned to the master scheduler.
blanket purchase order
A long-term commitment to a supplier for material against which short-term releases will be generated to satisfy requirements. Often [these] cover only one item with predetermined delivery dates.
customer relationship management (CRM)
A marketing philosophy based on putting the customer first. Involves the collection and analysis of information designed for sales and marketing decision support (in contrast to enterprise resources planning information) to understand and support existing and potential customer needs.
vendor-managed inventory (VMI)
A means of optimizing supply chain performance in which the supplier has access to the customer's inventory data and is responsible for maintaining the inventory level required by the customer.
fill rate
A measure of delivery performance of finished goods or other cargo, usually expressed as a percentage. In a make-to-stock company, this percentage usually represents the number of items or dollars (on one or more customer orders) that were shipped on schedule for a specific time period, compared to the total that were supposed to be shipped in that time period.
kanban
A method of just-in-time production that uses standard containers or lot sizes with a single card attached to each.
risk pooling
A method often associated with the management of inventory risk. Manufacturers and retailers that experience high variability in demand for their products can pool together common inventory components associated with a broad family of products to buffer the overall burden of having to deploy inventory for each discrete product.
quality function deployment (QFD)
A methodology designed to ensure that all the major requirements of the customer are identified and subsequently met or exceeded through the resulting product design process and the design and operation of the supporting production management system.
total waste management (TWM)
A methodology that enables finding solutions to waste issues while keeping in mind financial elements and the business case.
Which is a red flag that could indicate that an organization may be facing supplier lead time risks?
A metric shows that a key supplier may have capacity issues.
information system architecture
A model of how the organization operates regarding information. The model considers four factors: (1) organizational functions; (2) communication of coordination requirements; (3) data modeling needs; and (4) management and control structures.
Which of the following correctly identifies an effect of using moving average forecasts?
A moving average forecast smooths out random variations.
portal
A multiservice website that provides access to data that may be secured by each user's role.
value-added network (VAN)
A network, often supporting EDI, providing services additional to those provided by common carriers.
Global Reporting Initiative (GRI)
A network-based organization that pioneered the world's most widely used sustainability reporting framework.
Under the theory of constraints, after a bottleneck is removed, what happens next?
A new bottleneck will form elsewhere.
time fence
A policy or guideline established to note where various restrictions or changes in operating procedures take place.
seasonality
A predictable repetitive pattern of demand measured within a year where demand grows and declines.
continuous replenishment
A process by which a supplier is notified daily of actual sales or warehouse shipments and commits to replenishing these sales (for example, by size or color) without stockouts and without receiving replenishment orders. The result is a lowering of associated costs and an improvement in inventory turnover. See: rapid replenishment, vendor-managed inventory.
sales and operations planning (S&OP)
A process to develop tactical plans that provide management the ability to strategically direct its businesses to achieve competitive advantage on a continuous basis by integrating customer-focused marketing plans for new and existing products with the management of the supply chain.
design for quality
A product design approach that uses quality measures to capture the extent to which the design meets the needs of the target market (customer attributes), as well as its actual performance, aesthetics, and cost. See: total quality engineering.
design for manufacture and assembly (DFMA)
A product development approach that involves the manufacturing function in the initial stages of product design to ensure ease of manufacturing and assembly. See: early manufacturing involvement.
make-to-order
A production environment where a good or service can be made after receipt of a customer's order.
make-to-stock
A production environment where products can be and usually are finished before receipt of a customer order.
life cycle analysis
A quantitative forecasting technique based on applying past patterns of demand data covering introduction, growth, maturity, saturation, and decline of similar products to a new product family.
buffer
A quantity of materials awaiting further processing. It can refer to raw materials, semifinished stores or hold points, or a work backlog that is purposely maintained behind a work center.
active tag
A radio frequency identification tag that broadcasts information and contains its own power source.
strategic alliance
A relationship formed by two or more organizations that share information (proprietary), participate in joint investments, and develop linked and common processes to increase the performance of both companies
return on investment (ROI)
A relative measure of financial performance that provides a means for comparing various investments by calculating the profits returned during a specified time period.
rapid replenishment
A replenishment strategy in which the supplier prepares shipments at predetermined intervals and varies the quantity based on recent sales data.
risk register
A report that has summary information on qualitative risk analysis, quantitative risk analysis, and risk response planning. This register contains all identified risks and associated details.
data warehouse
A repository of data that has been specially prepared to support decision-making applications. Syn: decision-support data. See: information data warehouse.
Which is an example of holding inventory in anticipation of future demand?
A retailer orders inventory based on what marketing thinks will be sold.
Which of the following best describes ISO 14000?
A series of environmental standards that help companies minimize harmful effects on the environment and improve environmental performance
ISO 14000 Series Standards
A series of generic environmental management standards, developed by the International Organization for Standardization, that provide structure and systems for managing environmental compliance with legislative and regulatory requirements and affect every aspect of a company's environmental operations.
incoterms®
A series of pre-defined commercial terms published by the International Chamber of Commerce relating to international commercial law. These terms do not cover property rights.
ISO 9000
A set of international standards on quality management and quality assurance developed to help companies effectively document the quality system elements to be implemented to maintain an efficient quality system.
Organization for Economic Cooperation and Development (OECD) Guidelines for Multinational Enterprises
A set of recommendations on responsible business conduct addressed by governments to multinational enterprises (MNEs) operating in or from adhering countries that encourage and maximize the positive impact MNEs can make to sustainable development and enduring social progress.
A kaizen event would bring stakeholders together to design which of the following?
A short-term project to improve a process of limited scale
ISO 31000
A standard adopted by the International Organization for Standardization that outlines principles and a set of guidelines to manage risk in any endeavor.
multicountry strategy
A strategy in which each country market is self-contained.
product differentiation
A strategy of making a product distinct from the competition on a nonprice basis such as availability, durability, quality, or reliability.
global strategy
A strategy that focuses on improving worldwide performance through the sales and marketing of common goods and services with minimum product variation by country.
Technically speaking, which of the following combinations of companies is sufficient to constitute a supply chain?
A supplier, a nucleus firm, and a customer
modular system
A system architecture design in which related tasks are grouped in self-contained packages.
quick-response program (QRP)
A system of linking final retail sales with production and shipping schedules back through the chain of supply; employs point-of-sale scanning and electronic data interchange, and may use direct shipment from a factory to a retailer.
automatic identification system (AIS)
A system that can use various means, including bar code scanning and radio frequencies, to sense and load data in a computer.
radio frequency identification (RFID)
A system using electronic tags to store data about items. Accessing or retrieving this data is accomplished through a specific radio frequency and does not require close proximity or line-of-sight access. See: active tag, passive tag, semi-passive tag.
supply chain event management (SCEM)
A term associated with supply chain management software applications, where users have the ability to flag the occurrence of certain supply chain events to trigger some form of alert or action within another supply chain application
kaizen event
A time-boxed set of activities carried out by the cell team during the week of cell implementation. [It] is an implementation arm of a lean manufacturing program. See: kaizen blitz.
waste hierarchy
A tool that ranks waste management options according to what is most environmentally sound. Gives top priority to preventing waste in the first place and can be applied to various applications.
ANSI Z.10
A voluntary consensus standard on occupational health and safety management systems. It uses recognized management system principles in order to be compatible with quality and environmental management system standards such as the ISO 9000 and ISO 14000 Series.
Which of the following is not true of e-business strategy?
A well-designed e-business strategy should be able to bring a company directly from Stage 2 to Stage 4 of supply chain development
SA8000
A widely recognized international standard for managing human rights in the workplace. It provides an auditable framework for assuring that social accountability is being stewarded by an organization
Understanding process interdependencies and responsibility for each substep and identifying bottlenecks will provide which supply chain ability?
Ability to streamline operations
A small manufacturer in central Oklahoma has identified earthquakes as a new risk since the 2010 opening of their new manufacturing facility, following several years of increased earthquake activity around the state. It does not have the financial flexibility to relocate or redesign the factory. What basic risk response will the organization likely have to employ to address the identified risk?
Accept
Which part of a sender-receiver communication indicates that a message was received but doesn't necessarily mean that it was understood?
Acknowledge
What is the relationship of acquisition cost to the total cost of ownership for most items?
Acquisition cost is a very small portion of the total cost.
What is the most important benefit of supply chain event management (SCEM) software?
Active visibility providing knowledge of existing problems
Which of the following could reduce the likelihood of operations managers ignoring the consensus plan agreed to in a sales and operations planning (S&OP) meeting and following their own plans?
Actively listen to the operations managers' opinions and issues.
From a supply chain management perspective, which of the following would be the preferred source of information to use for calculating inventory days of supply as an input to cash-to-cash cycle time?
Actual inventory level divided by average daily demand
organization is preparing for CRM change. The organization's culture seems ready to embrace differentiation based on customer profitability as far as service packages go but seems resistant to providing a lower level of customer service to less-profitable customers. What should executives do about this?
Adapt the CRM program to minimize the difference in service between customers.
A manufacturer decides to use a new fuse supplier for its production line but is concerned about the new supplier's reputation regarding quality defects. What action can the manufacturer take to minimize the risk to its manufacturing process?
Add penalty clauses to the contract.
anticipation inventories
Additional inventory above basic pipeline stock to cover projected trends of increasing sales, planned sales promotion programs, seasonal fluctuations, plant shutdowns, and vacations.
stakeholder relationship management
Addressing and managing the competing priorities, needs, and concerns of internal and external stakeholders in a proactive and sustained manner, resulting in decreased cost and enhanced stakeholder acceptance or buy-in.
Which of the following could best relieve some of the pressure from the bottlenecks that exist in different parts of each of an organization's multiple production facilities?
Advanced planning and scheduling (APS)
Which of the following factors has led to greater customer focus in business?
Advances in technology Greater global competition Higher general quality of goods and services
Which of the following will be most likely to promote success in a company opening an online store in addition to its retail locations?
Advertise that online products can be returned at the stores.
A supply chain team is going to brainstorm a list of causes of product returns. Which tool would be most appropriate for this purpose?
Affinity diagram
A study indicates that a company's e-business area that needs the most development is portals to provide manual and automated search features by user role as well as broker intermediaries to form a larger community of users. In which of the following layers of e-business are these changes located?
Aggregation
The supply chain manager needs to better understand what is important to customers. Which of the following should be used to measure this?
Agility, reliability, and responsiveness
Which of the following documents is a standardized form listing items being shipped directly to the titleholder?
Air waybill
When considering options for developing or buying enterprise resources planning (ERP) software, a firm should be most concerned to select software that provides which of the following benefits?
Alignment between the firm's strategy and operations
A midsize manufacturing firm works with a large retailer as its primary customer; the retailer is a dominant firm in the chain. The manufacturer has several sources of supply for each of its key materials and is trying to align its supply chain strategy with the retailer's corporate strategy. Which of the following must be the primary consideration when the manufacturer is setting corporate strategy?
Alignment with the retailer's corporate strategy to holistically maintain a profitable relationship
An organization is conducting warehouse capacity forecasting. Average inventory for various types of 1 cubic meter generators (which use 1 square meter of floor space each) is expected to be 600,000 units. The factor for non-storage space requirements is 3. There are 5 levels of vertical storage available for these units. If the warehouse holds only these types of inventory, what is the square meter requirement estimate for this warehouse?
All generators take up 1 square meter of floor space. 1 square meter each multiplied by 600,000 units is 600,000 square meters. Dividing this by 5 (for the vertical levels) equals 120,000 square meters. Multiplying 120,000 by 3 (for the additional space requirements) equals 360,000 square meters.
The principle of economies of distance refers to which of the following?
All miles are not equally costly, and longer trips usually include a greater percentage of less expensive miles.
The sales department's involvement with product management includes which of the following phases of the product's life cycle?
All phases, from conception through withdrawal
What does SCOR Version 12.0 apply to?
All product transactions
For which of the following items should demand be calculated rather than forecast?
All steering wheels for new Chevrolet Cruzes
Who promotes relationships between alliance partners, identifies opportunities for collaboration and improvement, and builds joint initiatives to capitalize on those opportunities?
Alliance manager
risk appetite
Amount and type of risk that an organization is willing to pursue or retain.
Globally Harmonized System of Classification and Labeling of Chemicals (GHS)
An International standard, created by the United Nations Economic Commission for Europe (UNECE), for classifying chemicals according to their health, physical and environmental hazards.
semipassive tag
An RFID tag that sends out data, is self-powered, and widens its range by harnessing power from the reader.
cost of goods sold (COGS)
An accounting classification useful for determining the amount of direct materials, direct labor, and allocated overhead associated with the products sold during a given period of time. See: cost of sales.
joint venture
An agreement between two or more firms to risk equity capital to attempt a specific business objective.
triple bottom line (TBL)
An approach that measures the economic, social, and environmental impact of an organization's activities with the intent of creating value for both its shareholders and society.
design for six sigma
An approach to designing products and processes that attempts to ensure the firm can provide products or services that meet six sigma quality levels. These quality levels correspond to approximately 3.4 defects per million opportunities.
ISO 26000
An international standard adopted by the International Organization for Standardization to assist organizations in contributing to sustainable development beyond legal compliance through a common understanding of social responsibility.
ISO 22301
An international standard that specifies requirements for setting up and managing an effective business continuity management system.
ISO 28000
An international standard that specifies the requirements for a security management system, including those aspects critical to security assurance of the supply chain.
reverse auction
An internet auction in which suppliers attempt to underbid their competitors. Company identities are known only by the buyer.
stock keeping unit (SKU)
An inventory item. For example, a shirt in six colors and five sizes represents 30 [of these]
tariff
An official schedule of taxes and fees imposed by a country on imports or exports
horizontal marketplace
An online marketplace used by buyers and sellers from multiple industries. This marketplace lowers prices by lowering transaction costs.
risk tolerance
An organization's or stakeholder's readiness to accept a threat or potential negative outcome in order to achieve its objectives.
supply chain continuity
An organization's strategic and tactical capability to plan for and respond to conditions, situations, and events as necessary in order to continue supply chain operations at an acceptable predefined level.
For product development, which is considered to be value-added?
An unnecessary handle that most customers say boosts confidence
Which is the best definition of data mining?
Analyzing collected data to search for previously unknown relationships
What does the economic order quantity (EOQ) model take into account in its calculation?
Annual carrying cost
An organization needs to order a type of teddy bear nine months in advance of the holiday season and bases the quantity partly on the consumer confidence index. What sort of inventory is this?
Anticipation inventory
waste
Any activity that does not add value to the good or service in the eyes of the consumer.
As part of a continuous improvement program, you've been asked to run some tests to determine if a new component conforms to quality specifications. Which cost type does this task fall under?
Appraisal costs-those incurred to determine the degree of conformance to quality requirements
When an enterprise buys new technology, which of the following selection criteria should be primary?
Appropriateness to supply chain strategy
Which of the following should be the primary selection criterion when an enterprise buys new technology?
Appropriateness to supply chain strategy
order losers
Areas or aspects of an organization in which poor performance can cause loss of business.
waste exchange
Arrangement in which companies exchange their wastes for the benefit of both parties
How can contract sourcing be categorized?
As a process change cost
What is a good way to brand the supply chain management function within an organization's overall revenue model?
As a value-added service
Which of the following is not a true statement about the logistics value proposition?
As long as the customer is satisfied with the service, the cost is not critical.
During the initial design phase of a product, a manufacturer recognizes that a supplier may have specialized expertise regarding the design and construction of a unique part. How can the manufacturer best formally collaborate with the supplier to take advantage of that expertise?
Ask the supplier to design the subcomponent for the item.
Which of the following production strategies sometimes meets resistance from distribution centers because of the increased demands for skills training and capacity expansion?
Assemble-to-order
What risk management action would produce the best results in mitigation of the possibility that risk response plans will not be implemented?
Assign individual responsibilities.
Basing a demand forecast for major kitchen appliances on housing start data is an example of which of the following?
Associative forecasting
Which of the following warehousing functions is most like spot stocking?
Assortment
Which of the following was a drawback in the early versions of material requirements planning (MRP) software?
Assumed infinite capacity
If each step of a supply chain adds value, what else can the customer expect to see aside from utility?
Attractiveness, price, and availability
What is one example of a preventive action plan for supplier availability risk?
Audit suppliers on capacity resilience.
Which of the following is a true prerequisite for developing collaborative relationships central to supply chain strategy?
Auditable information exchange to share knowledge, not just data
An organization that is building a new warehouse wants to maximize the use of space and reduce labor as much as possible. Which materials-handling system would be the best for the organization?
Automated guided vehicle system
Which of the following is a riderless materials-handling device that moves along optical tape or magnetic wire in the floor?
Automated guided vehicle system (AGVS)
A warehouse for high-end luxury goods wants a storage handling system that will reduce the risk of loss to pilferage to the maximum extent possible. Which system would work best to achieve that goal?
Automated storage and retrieval system
Which of the following materials-handling devices would you purchase to get the maximum storage density per square foot of warehouse space?
Automated storage and retrieval system (AS/RS)
Which of the following will add to the cost of a warehouse management system initially but almost always costs less in the long run due to reduced error rates and more efficient processing?
Automatic identification technologies and paperless processing
A company wants to improve its customer service. Which of the following should it focus on to achieve that goal?
Availability
A manager decides to source the key Just-in-Time (JIT) manufacturing goods from a local producer even though an overseas producer sells identical goods for less, even with the added cost of shipping. Which of the following is this manager most likely emphasizing?
Availability
In general, which is the most important consideration in locating a warehouse?
Availability of services
Which is the most significant factor when considering the location of warehouses?
Availability of services needed
What are the attributes of basic customer service?
Availability, operational performance, and customer satisfaction
What would a retail organization most likely use as its measure of inventory when calculating inventory turnover?
Average inventory at selling price
An organization relies on average inventory from its balance sheets rather than cash-to-cash cycle time to measure how well it is managing its saleable assets. What error might this result in?
Average inventory might obscure a large seasonal inventory buildup.
Which of the following best describes what an organization's risk response plan should do?
Balance risks in terms of probability, cost of occurrence, and cost of mitigation.
Which of the following is true of bar codes?
Bar codes are often integrated with RFID tags printed as a single label.
Which of the following descriptions applies most accurately to a quick response program (QRP)?
Basic type of collaboration that involves the sharing of point-of-sale (POS) information
Which of the following would be used in the process assessment stage of the continuous improvement model?
Benchmarks
The best case for a risk scenario is that a supply disruption will not occur and the subsidiary will spend US$100,000 in prevention costs for the period. The worst case is that a supply disruption will occur and will cost US$2 million in lost revenues and remediation costs. The worst case has a 20% probability. If these are the only two options being considered, what is the net expected monetary value (EMV) for this scenario?
Best case EMV = 0.8 x -US$100,000 = -US$80,000. Worst case EMV = 0.2 x -US$2,000,000 = -US$400,000. Net EMV = -US$80,000 + -$US400,000 = -US$480,000.
A supply chain project could come in on budget, or it could be over budget by US$200,000. There is a 90% chance that it will come in on budget. What is the net expected monetary value (EMV) of this scenario's two options?
Best case EMV = 0.9 x $US0 = $US0. Worst case EMV = 0.1 x -US$200,000 = -US$20,000. Net EMV = US$0 + -US$20,000 = -US$20,000.
Which of the following is the type of contract that initiates all foreign shipments?
Bill of lading
Where would you find the types of components in a clock radio?
Bill of material
A manufacturer that uses material requirements planning wants to schedule all necessary orders for the materials needed to manufacture the products. Where can the list of components and quantities required for the product being manufactured be found?
Bill of material (BOM)
What can help an organization ensure that each component or rare material in a returned product is properly recycled and tracked for compliance purposes?
Bill of material for disassembly
A hard drive manufacturer produces hard drives for dependent and independent demand sales. How should the organization categorize these hard drives once they pass final inspection?
Both dependent and independent demand hard drives are finished goods inventory.
What is the term for a situation in which a warehouse takes in a shipment from one manufacturer and sends it immediately to a number of consignees?
Break-bulk
What materials-handling system should be employed by a warehouse that deals with extremely heavy objects and wishes to use automation for labor reduction and safety reasons?
Bridge and wagon cranes
Which of the following methods is most appropriate for lifting very heavy items while causing minimal disruption to floor activities in the area?
Bridge crane
What is an ongoing cost associated with an IT project?
Bug fixes
Of the following methods of treating obsolete goods, which is considered to be the least responsible?
Burial in a clean, responsible landfill
business-to-business commerce (B2B)
Business conducted over the internet between businesses.
Which of the following activities should an organization perform for the extended supply chain prior to integration of external supply chain partner policies, work processes, and tasks and roles?
Business modeling, such as profit allocations
Which of the following internet-enabled business models is most likely to get market investment?
Business models intending to use the internet as one of many sales channels and owning some of their own physical distribution means
Which input to capacity planning may specify long-term capacity goals that require capital investments?
Business plan
Which area of the balanced scorecard™ may include data on number of prospecting calls conducted or productivity measures?
Business process perspective
Collecting information through surveys, games, or prizes is an example of which of the following?
Business-to-consumer (B2C)
An organization buys in response to an immediate need, sharing technical purchasing requirements rather than strategies or plans. This exemplifies which of the following types of business relationships?
Buy on the market
When buying materials from various suppliers, whose responsibility is it to ensure that none of the suppliers is banned by national restrictions from such trade?
Buyer
How can an additional echelon of distribution centers in the supply chain help lower transportation costs?
By acting as break-bulk warehouses
An organization finds itself overextended, attempting to create, market, and sell products well outside its areas of expertise, and is beginning to suffer financially as a result. How can subcontracting certain processes benefit the organization as it attempts to tackle the source of the problem?
By allowing it to focus on core competencies
How can a supply chain best demonstrate social value?
By avoiding or reducing negative environmental effects
How can dashboards empower individual contributors without prior involvement of managers?
By enabling them to plan changes based on information tailored to their roles and responsibilities
How can a manufacturer reduce capital plant requirements, inventories, and lead times using supplier relationship management?
By engaging in supplier co-location
What is a common method of aggregating products for demand planning purposes?
By life cycle stage
How can an organization avoid paying inverted duties?
By manufacturing and assembling items in a free trade zone
How can an organization generate revenue from the by-products of its manufacturing process?
By selling the by-products to other organizations that require them for manufacturing processes
How can a manufacturer in the plastics industry achieve lower prices via lower transaction costs when buying and selling with other companies in the plastics industry?
By using a vertical marketplace
Which of the following statements about outsourcing customer relationship management (CRM) is true?
CRM vendors may provide seamless customer service.
Which of the following would best help marketing professionals plan marketing programs, including program launch, scheduling of activities, continuous performance measurement, and response management?
Campaign management
Which of the following types of customer relationship management (CRM) campaigns are different enough that they typically require separate planning and cross-training of marketing and sales professionals?
Campaigns for customer types such as prospects or loyal customers
Which of the following is part of a good policy on data capture?
Capturing partial data is better than capturing no data.
A warehouse is selecting a system for moving products. It wants to reduce the labor associated with picking but without incurring high acquisition costs. The warehouse stores and moves only small, lightweight electronics products. What option is the best choice?
Carousels
Which inventory costs are variable costs that increase as the level of inventory increases?
Carrying costs
Raw materials invoices are missing crucial information. Which of these quality tools would be of the most use in approaching this issue?
Cause-and-effect diagram-help nominate possible causes and track them back to their roots
Which of the following documents is used to bolster an importer's claims for favorable import duty rates granted by treaty to the exporter's country?
Certificate of origin
A supplier is resistant to certification. Which of the following would be thebest argument to help convince the supplier to make the effort?
Certification can improve throughput and reduce costs.
supplier certification
Certification procedures verifying that a supplier operates, maintains, improves, and documents effective procedures that relate to the customer's requirements.
What is needed to prove that hazardous waste was transported properly to an incinerator and incinerated?
Chain of custody-provides documentary evidence of each point of transfer or contact with a material
Which of the following phrases best characterizes the approach to change in total quality management initiatives?
Changing processes so they naturally result in more satisfied customers
The continuous improvement (CI) team you're working with has decided to track when specific manufactured components are too wide, too thin, or too bendable during the first week of production next month. Which of the following CI tools would be best for this purpose?
Check sheet-tally count of the occurrences of certain defects in a product in a specified period of time.
Once a process has been analyzed, the improvement has been identified, and a benchmark has been selected, it is time to implement the solution. Put the following steps in the correct order so that the process improvement initiative will be put into action.
Choose key performance indicators (KPIs) and establish baselines; develop a master plan and a set of project plans; communicate plans and measures to all participants in the process; conduct a pilot of the change with a limited number of firms.
What is the most important thing for an organization to establish before it attempts to break into a market with many competitors or when the market conditions are considered challenging due to the economy?
Clear competitive advantage
A team manager leads his team on a project to identify and implement several process improvements. The project suffers as the manager personally oversees the efforts of each team member, slowing progress to a crawl. What should the manager have done to ensure a more successful project?
Clearly delegate responsibility.
What can help define a project's scope more clearly and thus prevent stakeholders from adding unapproved work (scope creep)?
Clearly state what will not be done.
An organization wants to reduce physical inventory via the use of information technology, keeping inventory in transit instead of remaining in warehouses. What should the organization do when handling inventory in this manner?
Closely track the inventory with GPS.
An organization has a diverse sales force, and salespeople frequently work from home or on the road. The organization wants to add customer relationship management (CRM) technology solutions very quickly. Which of the following would best help this organization meet these goals?
Cloud-based CRM system available as a software as a service (SaaS) subscription from a vendor
Which of the following is a solution for a manufacturer who wants to outsource some non-core manufacturing competencies but doesn't want to increase the risk of miscommunications, integration failures, or process delays in a currently highly efficient production process?
Co-location
electronic product codes (EPCs)
Codes that are used with RFID tags to carry information on the product that will support warranty programs.
The purpose of supply chains is to be globally competitive. What are the basic elements in a supply chain that can impact its ability to respond competitively to changes in the global marketplace?
Collaboration, time, distance
A manufacturer has worked extensively with a single supplier over the past 15 years, building high levels of trust. They fully share goals, strategies, and tactics with each other and attempt to reflect the partner's plans in their own. Which type of relationship does this represent?
Collaboration/strategic alliance
Which of the following exemplifies a long-term arrangement in which suppliers are fully aware of the purchaser's goals and strategies and work with the purchaser to develop and implement tactics?
Collaboration/strategic alliance
A retailer decides to commission the creation of a line of shoes to sell as an accessory to designer evening gowns. Which of the following would be the most appropriate business strategy?
Collaborative design for a unique look
If an organization wants to gather and address concerns from customers who had negative interactions with it, what is the best option?
Collecting and responding to negative comments on the internet and social media
How can an organization more effectively manage the tradeoff between inventory and transportation costs?
Combine forecasting and delivery information using IT to allow consolidation of shipments.
A soft drink manufacturer makes contact with workers at another company, offering to pay for information on their manufacturing process in order to improve its own product and streamline manufacturing. What is this an example of?
Commercial bribery
Which of the following documents is used for the valuation of goods for assessment of duties?
Commercial invoice
Which of the following documents would a banker consult for information about the value of export-import cargo in connection with a letter of credit?
Commercial invoice
You are working in an organization that is in the second developmental stage of organizational design. What should you be prepared to do?
Communicate upward or laterally in functional teams.
An organization has many part-time employees who can be sent home if orders are sluggish. It also has standing contracts for busy periods with external producers. Which of the following elements of demand management does this organization's strategy focus on?
Communicating demand
In order to provide the desired level of customer service but remain profitable, a retailer needs to avoid carrying unnecessarily high levels of inventory but must be able to respond rapidly to changes in demand and avoid stockouts. What organizational strategy linking to demand managment would be the best for this retailer?
Communicating demand
Which is an element of contract deployment?
Communicating with the winning supplier
An organization makes several adjustments to the supply chain to be more sustainable and use fewer natural resources from the area. The financial impacts of these changes are negligible. From a values perspective, which supply chain stakeholders would these changes best align with?
Communities
Which of the following is true of collaborative relationships in the supply chain?
Companies will always have a good reason to treat competitors in a different class from other types of supply chain members.
Which of the following companies is most likely to be interested in customer relationship management (CRM)?
Company that manufactures power tools for professional contractors
For which of the following companies would customer relationship management (CRM) probably be a priority?
Company with a customer base with diverse needs and interests
Proactively managing risk rather than being reactive provides which of these benefits to the organization?
Competitive advantage
An organization sets a goal of reducing its lead time from four days to two because another firm in its industry can offer two-day lead time. This is an example of which of the following?
Competitive benchmarking
Which of the following are benefits of a vertical supply chain?
Complete control and visibility of operations
A project manager is working sequentially on the plans for each project management Knowledge Area. What should he do after the scope, time, cost, quality, human resources, and other Knowledge Area plans have each received a once-through?
Complete the schedule and budget to reflect the impact of the later Knowledge Area plans.
A design team modifies an existing clothing line by making the buttons used on one item work for all the other items. This exemplifies which of the following?
Component commonality
Which of the following design strategies offers streamlined production and lower purchasing costs with a possible tradeoff against reduced design flexibility and lower quality?
Component commonality
Which of the following design strategies would most likely be responsible for the fact that only one screwdriver is needed to remove all the screws securing a computer case and to unfasten all components from the motherboard inside?
Component commonality
Which of the following would be included in a list of dependent demand items?
Computer hard drives delivered to the computer manufacturer for installation depending on customer request
payment terms
Conditions surrounding payment for a sale, providing a time frame in which a customer can pay without late penalties or additional fees. See: terms and conditions.
A U.S.-based organization uses gold in its electrical leads to provide a superior sound system product. In regards to conflict minerals, what does it need to do if this gold comes from South Africa?
Conduct a reasonable country-of-origin inquiry, including supplier audits.
A 3PL suspects that the company they purchased new software from made false promises about the software's abilities. What should the 3PL do first?
Conduct a technology audit
A manufacturer decides to use an overseas steel supplier for its production line but is wary of potential quality issues associated with the new steel supply. What preventive action can the manufacturer take to minimize the risk that the supplier is not capable of producing acceptable quality prior to ordering?
Conduct sampling and inspection at the supplier location.
An organization needs to maintain slow-moving stock on site, but it does not want to incur inventory carrying costs and wants to retain control of display of the inventory. What would be appropriate in this situation?
Consignment without VMI
According to the law of demand, what is likely to happen if the price of a good or service increases?
Consumption of substitute goods may increase.
A supplier uses an escape clause in a new contract, citing unexpected expenses. The project needs a new supplier quickly. Which is the best corrective action?
Contact request for proposal (RFP) finalists.
Which of the following creates online catalogs with metadata to automate how content is presented so parties see only items specific to their strategic needs, restrictions, and perspective?
Content management e-commerce
The Japanese term "kaizen" refers to which of the following business processes?
Continuous process improvement
What should an organization do as a preventive measure if it suspects that a supplier may go bankrupt?
Contract with alternate suppliers.
An organization is purchasing new software and is concerned about the potential for the total cost of ownership to increase dramatically as difficult-to-implement software upgrades and expensive training are required over time. What can the organization do to mitigate that risk?
Control excessive customization
joint replenishment
Coordinating the lot sizing and order release decision for related items and treating them as a family of items.
Effective logistics strategy depends upon which of the following?
Coordination of transportation, warehousing, and packaging to create maximum value
Which input into an organization's business model breaks down the organization's necessary functions and activities into decision-making activities and execution activities?
Core capabilities
The U.S. Department of Transportation identifies which four characteristics of concern due to health and U.S. EPA requirements?
Corrosivity, ignitability, toxicity, reactivity
Before a firm starts outsourcing logistics to third- or fourth-party providers, it must determine its current costs. Costs can be determined by which of the following?
Cost of current logistics functions Potential savings in time Improved quality of customer service
What is an often-overlooked cost of a warranty offering?
Cost of uncertainty of the number of returns during the warranty period
A manufacturer is developing a new product. It will use a new manufacturing process, and this makes it difficult for both the manufacturer and the supplier to accurately estimate costs. The manufacturer and the supplier have a strong, long-standing relationship. What type of contract would be most appropriate for this situation?
Cost-based contract
Which of the following is true regarding unauthorized persons creating counterfeit EPC Gen 2 RFID tags with a manufacturer's code and product SKUs (stock keeping units)?
Counterfeit tags can be made, but the EPCglobal Network's online registry will identify a mismatch and detect the fraud.
The tasks of a cross-organizational team involved in supply chain integration include which of the following?
Creating a plan for combining best practices across the network
Which of the following is typically a function of a warehouse management system (WMS)?
Creating put-away algorithms
Which of the following could have the unintended consequence of increasing demand variability for an organization's product or service?
Culture of optimism in demand forecasting
What is the term for a financial transaction in which one party agrees to buy/sell a fixed amount of a given currency at a fixed exchange rate on a fixed date in the future?
Currency hedging/futures
Which of the following forms of interface devices would be best for a small firm that wants to make a connection to a second small firm where both have highly customized software?
Custom linkage
Which of the following is an example of the "voice of the customer" (VOC) technique?
Customer design groups
What is the business strategy of an organization that develops a deep understanding of customer needs and then provides fewer options to select from than the competition?
Customer experience differentiation
Which supply chain flow travels through the organization via orders, sales activity, and forecasts?
Customer information
Which of the following describes a vulnerable customer?
Customer who is about to discontinue service or stop purchasing the product
Which of the following should be avoided in an enterprise resources planning (ERP) initiative even if the company has the capital to perform them all?
Customizing the ERP system to match the company's best practices
An organization sees demand for a luxury item grow over a three-year period that occurs during a period of national economic recovery following a recession. What is this an example of?
Cycles
A customer relationship management (CRM) program is which of the following?
Cyclical
Which tool provides organizations with the advantages of timely information and self-management?
Dashboards
Which of the following is true of data aggregation?
Data aggregation for customers can be by relatively equal demand, meaning that some zones will be larger than others.
Which of the following analytical tools would be able to find hidden patterns in the data that are collected from each of a company's retail locations?
Data mining
In the supplier certification process, before evaluating alternative suppliers and selecting suppliers, which of the following should already have been done?
Decide who should be carrying out testing or auditing.
What tool can be used to augment an expected monetary value (EMV) analysis and help organizations decide between two alternatives, each with possible best- and worst-case results?
Decision tree analysis
A firm uses an exchange to force price and other concessions from suppliers. Which of the following can occur when these methods are used for strategic supplies?
Decreased trust due to adversarial relationships
Which of the following is not a component of quality as defined by APICS?
Degree of customer satisfaction with product price
Which of the following activities would hinder implementation of a supplier relationship management (SRM) strategy?
Delaying training and corporate communication of the strategy until after pilot program results are identified
Which is true of contract elements?
Delivery requirements can specify exactly how to protect a product during shipment
Which of the following forecast techniques relies upon an expert panel that responds to questionnaires and never meets face to face?
Delphi method
From an IT perspective, which part of the supply chain exists to collect, analyze, and disseminate market intelligence?
Demand channel
Pegging refers to the ability to make a connection between the required numbers of a specific component and which of the following?
Demand for the parent according to the material requirements plan
What is true of demand elasticity over time?
Demand is more inelastic over the short term and more elastic over the long term
Which role is responsible for performing analytical work on data and the demand plan?
Demand manager
Which of the following variables differentiates supply chains in terms of efficiency and responsiveness?
Demand uncertainty and volume
A retailer wants to strategically position inventory throughout its supply chain to reduce inventory, lead times to the customer, and the bullwhip effect. Which ordering system would help the retailer achieve this goal?
Demand-driven material requirements planning system
Which of the following statements about customer segmentation is true?
Demographic segmentation is not based on data about actual customer buying behaviors.
An organization's senior leadership has asked each department head to formally sign off on an official date for several retail store openings. All department heads have signed off, even though some know that everything would need to work perfectly to make that date and that there are some major cultural issues in the way at some locations. What does this organization need to do to get this critical information to decision makers?
Design a way for people to provide anonymous information on strategic gaps.
Which product design method can help turn a product from an order qualifier to an order winner?
Design for quality
A company manufacturing a product containing hazardous materials redesigns the packaging so that the box containing the product can be used to return the product to the manufacturer. This is an example of which of the following?
Design for reverse logistics
Which of the following approaches to product design is compatible with the requirement that German brewers use refillable bottles?
Design for reverse logistics
An organization designs product documentation with large pictographs showing how to avoid common user errors that have previously resulted in customers believing that an otherwise good product is defective. This is an example of which of the following?
Design for service
Inventory turnover is a metric for which of the following approaches to product design?
Design for supply chain
How can an organization best design for logistics?
Design to maximize standardization.
foreign/free trade zone (FTZ)
Designated areas within a country that are considered to be outside the country. Material in the zone is not subject to duties and taxes until the material is moved outside the zone for consumption.
Which of the following is not a goal of design for manufacture and assembly (DFMA)?
Designing components with very tight tolerances
environmentally sensitive engineering
Designing with consideration of how a product or its packaging will ultimately be disposed.
What is an organization's next step in a make-versus-buy analysis after they have determined that they do not have texting-based customer service as a core competency?
Determine if there is a need for texting in customer service.
What challenge must an organization with many customer interactions overcome when utilizing six sigma?
Determining what constitutes a defect
What can an organization do if a need exists for a service for customers, the organization does not have it as a core competency, and it does not want to outsource the activity?
Develop it as a competency.
An organization wanting to create supply chain resilence is make-to-order and lean. How can it follow these principles while becoming more resilient?
Develop response plans and methods of detecting red flags that trigger those actions
A new customer segment will buy an organization's product only if it has additional features that require a new product variant. This variant would increase sales volume and only slightly increase marginal profits. Based on a customer-driven marketing philosophy, what should this organization do?
Develop the proposed new variant at the proposed price to gain lifetime customers.
Which of the following actions would best aid a supply chain in becoming demand-driven?
Developing agility for more frequent changeovers or staffing or process switching
When developing a partnership with a customer service supplier, an effective customer service management strategy would include which of the following?
Developing an annualized contract or trading partner agreement
Which of the following best describes profit margin?
Difference between sales and cost of goods sold
Which formula determines how long it will take to recoup an initial investment or break even?
Discounted payback period
Which is a key reason to take a hard look at organizational and supply chain strategy even if it is currently very profitable?
Disruptive technology
A company with multiple versions of the same enterprise resources planning (ERP) system and also a second ERP system due to a merger has experienced data quality and formatting problems, cannot leverage purchasing contracts effectively, and has no common metrics for management control purposes. Which of the following would be the best solution for this company's problems?
Don't replace any versions or vendors but use internet-based interface devices.
What option for handling excess production of dog food would generate tax savings?
Donate to dog rescue programs.
When are determinations about the delivery of components for operations made?
During the material requirements planning (MRP) process
A risk response will cost $30,000 for a risk of loss with a probability of 60% and an impact of $500,000. What is the expected monetary value of this risk after the response is factored in?
EMV = Probability x (Impact + Cost) = 0.6 x (-$500,000 + -$30,000) = -$318,000
Which of the following software systems has the power to tie together supply chain partners?
ERP
What is an essential component of any risk management system?
Economical application of resources
Which of the following is the primary demand generation task for a surgical device manufacturer developing a new product to compete against an existing product?
Educating doctors
The manufacturer of a formerly popular kitchen appliance has decided to redesign and rebrand the product in an effort to reach new, younger consumers. Which of the following functions would the marketing department be primarily responsible for in this effort?
Educating retailers on the product rebranding
At a time when manufacturers' orders for durable goods are declining and there is an inverted yield curve, what would be the best sustainability initiative?
Effectively reducing product packaging
According to the waste hierarchy, which is the best disposal method listed?
Electric company trash burner
Which of the following could be an example of ineffective cost cutting?
Eliminating one or more storage facilities to save warehousing costs without reviewing the impact on transportation costs
When supplier relationship management (SRM) increases the visibility of the entire supply chain, it benefits SRM participants in which of the following ways?
Enables faster response and better contingency planning
design for the supply chain
Enhancement of a firm's product design in consideration of the issues that will arise in the supply chain, from raw materials to the final stage of the product's life cycle.
Which of the following is the best technique to mitigate the risk of a supplier failing to implement a risk response plan?
Ensure that one individual is accountable for each response.
When attempting to secure competitive advantage in a market with thriving customer demand, what is an important factor to consider when analyzing potential competitors?
Ensuring that you have at least as many desired customer options as your competitor and use CRM to discover more desired options
What refers to conditions outside the control of a project team that influence or constrain the project?
Enterprise environmental factors
An organization is performing inventory planning and network design. Why would the organization find considering echelons helpful in the process?
Entire echelons could be omitted from the supply chain.
The APICS Dictionary, 15th edition, refers to a supply chain as a "global network." Which of the following correctly indicates what could comprise this network?
Entities and processes (the engineered flow) of any size or configuration
Which risk type requires organizations to monitor rapidly changing regulatory standards in order to maintain regulatory compliance?
Environmental
In general, which area of supply chain risk is the least developed at most organizations because it is a new area with many rapidly changing regulations?
Environmental risk
For an innovative product introduction at a new organization, which of the following would provide the best guidance for how many items to produce initially?
Expert opinion guided by purchased customer data
A channel master or nucleus firm is finding that many of its current partners have begun to look for ways of bypassing the firm, while others are performing redundant functions that cause unnecessary competition among supply chain members. Which of the following is a likely cause of this behavior?
Exploitation of power-based relationships
Which intermediary would be best to help a company prepare their goods to survive rough handling but with the least bulk and weight?
Export packing company
Which of the following types of firms, known in Japan as sogo shosha, may be a large conglomerate that actually buys goods in one country for sale in a foreign market?
Export trading company
A company benchmarks its competitor as having unattended internet trading and capable-to-promise (CTP). What stage of supply chain development has this competitor reached?
Extended enterprise
Why is it important to study enterprise environmental factors at the start of a project?
External events may make the project infeasible at this time.
Which of the following is true of portals?
External portals can provide company- and role-based access and authentication.
An organization outsources a key activity and stays involved with the supplier, monitoring and controlling on a daily basis. The resulting quality is not what was desired, but the supplier insists that its quality is superior to that of its competitors. Which of the following is the most likely reason for this problem?
Failure to establish clear performance expectations
A phone manufacturer decides to set up a total quality management (TQM) approach to achieve long-term success through customer satisfaction. The organizational management team is heavily involved at every step of the way, and they identify and focus on their customers: internal partners, distributors, retailers, and end-use customers. They make an explicit effort to not assign blame but focus to improve processes. Still, the organization does not realize the level of improvement that it anticipated prior to beginning the TQM approach. What may be the reasoning for the lackluster performance?
Failure to identify suppliers as important partners
An organization is looking to use quality function deployment (QFD) when designing products. It starts by using group decision making to ensure that design conflicts are resolved with the customer in mind, and it embraces the methodology wholeheartedly. However, the resulting designs are not meeting customer requirements. What is the likely cause of this shortcoming?
Failure to translate customer segment demand data and voice of the customer information into design requirements
An organization conducts due diligence with all of its tier 1 suppliers to minimize risks of supply chain disruptions. What is a significant residual risk?
Failures originating at the tier 2 level or below
What can get in the way of a message being received or properly understood by the intended recipient?
Filters or noise
An organization is using a consensus demand plan that has been integrated with the supply plans. Which other set of plans does the demand plan need to be integrated with?
Finance plans
Which area of the balanced scorecard™ may include data on the cash-to-cash cycle time?
Financial perspective
A European organization's fully owned subsidiary operates in South Korea, producing a large amount of inventory valued in South Korean wons (KRW) in a make-to-stock strategy for the holiday season. Which is a risk that the European headquarters faces?
Financial ratios measuring current assets could be affected by currency fluctuations.
Revenues, profit margin, market share, expenses, image, and reputation are values for which stakeholder group?
Firms in the supply chain
What Green SCOR definition refers to the degree to which a company can meet the environmental demands of its customers?
Flexibility
What is an essential trait for organizations with global supply chains?
Flexibility to withstand disruptions
A new organization is looking to enter into an established market. They intend to compete by serving customers with unique requirements through innovation and focused marketing strategies. What is this an example of?
Focused differentiation
What is the longest period during which an organization might have continuing expenses for a product line after it has been discontinued due to obsolescence?
For the estimated life of the last products sold or longer
mix forecast
Forecast of the proportion of products that will be sold within a given product family, or the proportion of options offered within a product line
demand forecasting
Forecasting the demand for a particular good, component, or service.
Which of the following pieces of warehouse equipment provides maximum flexibility in the movement, placement, and retrieval of pallets?
Forklift truck
A company executive tells an amusing story to the audience that helps make the organization's new mission and vision memorable. What sort of communication is this?
Formal
An organization designing a new product is looking for a method that will result in fewer cost overruns and higher product quality for the price while increasing customer satisfaction with the product. What collaboration method should they use during the design process?
Formal collaboration
configuration management system
Formal procedures to identify and document the physical characteristics of a product or project, control changes, and support an audit to verify conformance.
A major organization decides to greatly increase buying and selling activities over the internet, which should generate a high level of sales and traffic. Which internet structure layer must be invested in to support this effort?
Foundation level
In which stage of organizational design development might an organization start having at least one business process that requires collaboration from another corporation even if this is just for one product line or component? First: multiple dysfunction
Fourth: extended enterprise
What specific help do the ISO 14000 Series Standards provide to organizations?
Framework for an environmental management system with audits
Which of the following is an example of a loyalty program?
Free shipping for high-volume customers
Which of the following types of third-party logistics firms schedules cargo transport but operates no carriers?
Freight forwarder
A retailer is growing tired of one of its supplier's frequent promotions because they invariably lead to overstocks after the sale and produce no net gain in profits. The supplier also dislikes the promotions for similar reasons, but each season a new promotion is rolled out. Which of the following would best help these firms resolve their problems?
Frequent personal communications and relationship building between the firms
Which of the following describes a manager's movements as he or she adopts the SCOR model?
From a functional area orientation to a process orientation
Which of the following is true about the supply chain adding value for customers and stakeholders?
From their perspective, it must increase the product's or service's utility.
Other than competitive priorities, what does the organizational strategy feed to the supply chain strategy to ensure alignment?
Future direction, such as new products
A stock keeping unit (SKU) in a distribution system can identify which of the following?
Geographic location
Which of the following constitutes a potentially appropriate way to segment a market?
Geography Market potential age
Which of the following is a primary goal of companies at higher stages of development regarding the acquisition and use of data?
Getting access to data outside the company
How can gathering stakeholder communication requirements promote achieving project objectives?
Gives a better understanding of stakeholders' perspectives
A multinational organization decides to incorporate the ten key principles of the United Nations Global Compact (UNGC) into its business and is looking to generate reports to monitor its progress toward each of the ten goals. Which reporting framework should it use?
Global Reporting Initiative (GRI)
Which of the following scenarios presents the most risk related to product documentation or labeling?
Goods passing through France do not have trade documentation in French.
Which of the following happens most often when an organization uses available-to-promise (ATP)?
Goods that are still in the process of being assembled could be promised to a customer.
What global force that impacts virtually every supply chain is caused by the increasing power of speed and information available to both consumers and competitors?
Greater market volatility
Corporate participants in the U.S. C-TPAT (Customs-Trade Partnership Against Terrorism) receive which of the following benefits?
Greater reliance on self-policing
Which of the following is a primary benefit of entering into a vendor-managed inventory (VMI) agreement?
Greater visibility of inventory management
If you are creating a production schedule using the lot-for-lot replenishment method, which of the following would you use to determine the planned order receipt (assuming you know the gross amount required and the amount of inventory on hand)?
Gross requirement minus projected amounts on hand and scheduled receipts
What type of supplier segmentation would help develop an apples-to-apples benchmarking system for delivery consistency?
Grouping suppliers by similar lead time
A demand forecast determined by a panel of all the salespeople in an organization may reach an exaggerated, false conclusion due to which of the following situations?
Groupthink effect
What is prompting many countries to adopt the International Financial Reporting Standards (IFRS)?
Growth in international shareholders and trade
ISO 26000 is about which of the following topics?
Guidance for social responsibility
An organization has had a number of its trucks hijacked while traveling through a country. Which of the following is a mitigation strategy for this situation?
Have the trucks piggyback on a railway flatcar while going through that country.
Which benefit of supplier certification is more advantageous for the suppliers than for the customers?
Helps market existing capabilities
A manufacturer has a particularly productive work center that has started to generate outputs at a higher level than the packaging work center that follows it is able to handle. What risk does the manufacturer face as a result?
High inventories on hand or the waste of labor hours
Which of the following is likely when a retailer of children's toys uses conventional forecasting to anticipate demand (as does their wholesaler) and adds some safety stock to orders both to smooth out the inevitable variations from the forecast and to replenish supplies after a promotion (not communicated to their suppliers) that the retailer plans to have to liquidate excess inventory?
High inventory holding costs for the retailer and high variability of demand for the wholesaler
Which of the following conditions is a potential drawback of lot-for-lot replenishment when items must be ordered frequently?
High setup costs
Allowing suppliers to participate in improving the supply chain system helps supplier relationship management (SRM) participants in which of the following ways?
Higher customer satisfaction
Which of the following professionals should chair the demand planning phase meeting that is part of the sales and operations planning (S&OP) process
Highest-ranking demand-side professional
If the overall economy of a country is in a trough but economic leading indicators show a healthy increase in demand for the next quarter, which would be a good strategic choice for a risk-seeking organization to make?
Hire high-quality new employees at reasonable salaries
A manufacturer has a load that is exceeding current capacity due to an abnormally large one-time order. The manufacturer does not anticipate this imbalance to last more than the few weeks it will take to complete the order. Which option is the least efficient way to change capacity to match the load requirements?
Hire more workers
Which of the following would be best for showing frequency distribution?
Histogram
What are the four major areas addressed by the United Nations Global Compact?
Human rights, labour, environment, anti-corruption
Which of the following is true of ISO standards for the EPC Gen 2 standard for radio frequency identification tags?
ISO 18000-6 covers the Gen 2 standard.
The executive team of a 3PL has identified an organizational opportunity to create a better, consistent approach toward risk management. What tool should the 3PL start with to begin the process of creating and using a consistent approach?
ISO 31000
Which ISO supporting standard places emphasis on controls assessment, consequence analysis, likelihood analysis and probability estimation, preliminary analysis, and uncertainties and sensitivities?
ISO 31010
An organization is having issues discussing risk management priorities and responsibilities with external supply chain partners. What tool should the organization use to ensure that communication regarding risk management is clear between all parties?
ISO Guide 73
Which of the following is true of ISO standards in relation to supplier certification?
ISO certification must be renewed every three years.
How can an organization leverage social media for customer relationship management purposes during the development stage of a new product?
Identify ideas or concepts that have the potential to meet customer needs.
What is a chief customer officer (CCO) in charge of?
Identifying and responding to customer care opportunities
In a customer-focused organization, what is the starting point for new product development?
Identifying customer need
Which of the following is not a true statement about levels of collaborative intensity?
If there is little room for error in sourcing and the company has the internal capability, it should still form an alliance with one or more suppliers.
A manufacturer becomes concerned over political instability that threatens to result in higher tariffs on imported raw materials required for use in the manufacturing process. It decides to take preventive action. What action is the best for the manufacturer to take?
Immediately increase its inventory holdings of the materials in question.
Item A is constructed over one week using parts B and C. Part B has a lead time of two weeks, and part C has a lead time of four weeks. A week after part C was ordered, the scheduler discovers that part B will have an additional week of lead time. Which of the following should the scheduler do?
Immediately order part B and issue a net change so no other rescheduling is needed.
After the implementation of an improvement, change management issues need to be managed proactively and skillfully. Which of the following would not be appropriate?
Implement new roles and explain expectations to employees with minimal notice.
An organization is approached by a partner organization that suggests that the two organizations work to integrate software. The first organization is concerned about data protection and is hesitant to agree. Which solution would help allieviate this organization's concerns?
Implement process-oriented middleware
Which of the following actions contributes to the triple bottom line?
Improve fuel efficiencies of supply chain processes.
How can a manufacturer in a supply chain best reduce its costs of product transport?
Improve product stowability.
Which might be a positive effect of adding more warehouses to a system?
Improved customer service
What is an example of a tangible benefit to IT investment?
Improved scheduling
value added
In accounting, the addition of direct labor, direct material, and allocated overhead assigned at an operation. It is the cost roll-up as a part goes through a manufacturing process to finished inventory
economic value added
In managerial accounting, the net operating profit earned above the cost of capital for a profit center.
market demand
In marketing, the total demand that would exist within a defined customer group in a given geographical area during a particular time period given a known marketing program.
available-to-promise (ATP)
In operations, the uncommitted portion of a company's inventory and planned production maintained in the master schedule to support customer-order promising.
push system
In production, the production of items at times required by a given schedule planned in advance.
Some organizations use safety lead time to address lead time variations in which of the following?
In-transit inventory
Which of the following conditions contributes to the supply chain phenomenon known as the bullwhip effect?
Inaccurate demand forecasting
What is a method for disposal of hazardous waste that may require no transportation but does require special equipment and proof of compliance?
Incineration-the destruction of something, especially waste material, by burning.
Which of the following represents a sound approach to tracking data to use in demand forecasting?
Include all products in a family.
How can an organization generate buy-in by those affected by change?
Include those individuals in brainstorming sessions and ask for their reactions to ideas.
What is used in foreign trade contracts to identify which parties incur the costs and at what specific points the costs are incurred?
Incoterms® trade terms
What preventive action can a manufacturer take to be prepared for a potential labor disruption at a major port?
Increase safety stock.
A firm that has always claimed that it has the best processes and highest quality has recently suffered losses. They dictate these processes to their long-term Asian suppliers, but several of the suppliers have, without any explanation, recently had a string of cost and quality problems. Which of the following would best help this firm resolve its problems?
Increase visibility with the suppliers and allow the suppliers to suggest processes that work for them.
An organization's supply chain uses decentralized forecasting. If the organization executes a promotion that generates much higher sales than initially communicated, which of the following is the most likely result?
Increased distortion of future upstream supplier forecasts
In a Just-in-Time (JIT) system, which of the following may occur?
Increased frequency of order entry-Lots sizes are kept small, and orders are entered more frequently.
Which of the following is a risk of ordering more inventory than required to fill forecasted demand?
Increased obsolescence
A company has reached Stage 4 of supply chain development, extended enterprise, by engaging in extended supply chain global e-business. Which of the following is likely true of this company from this point forward compared to where they were a few years ago?
Increased outbound transportation costs
An organization is preparing to transition from a wholesale distribution model to an e-commerce-focused model with direct sales to customers in smaller quantities. What likely outcome should the organization prepare for?
Increased outbound transportation costs
When a logistics manager removes a complete tier from the distribution chain to reduce overall expenses, there may be a tradeoff for expenses in which of the following areas?
Increased transportation costs for extra miles of carriage
You're the supply chain manager responsible for the overall performance of the chain. Which of the following is the most desirable?
Increased velocity, reduced variability, increased visibility
Which of the following would be the least likely reason to implement radio frequency identification (RFID) at a company?
Increasing internal inventory accuracy in a make-to-order, low stock environment
Assuming a set of normal business constraints such as a need to constrain costs and provide a positive return on investments, which data capture policy would best allow an organization to more quickly translate data into increased opportunities for profit?
Incrementally improving data capture rather than pursuing system reengineering
What is an example of an environmental risk?
Industry regulations
Offering the choice of either waiting in line at a grocery store or using a self-checkout kiosk is designed to do which of the following?
Influence demand. Manage and prioritize demand
business intelligence
Information collected by an organization on customers, competitors, products or services, and processes. [It] provides organizational data in such a way that the organizational knowledge filters can easily associate with this data and turn it into information for the organization.
An organization is seeking to mitigate demand risks that occur in the form of inter-organizational communications. What is a potential root cause that it could address to mitigate risk in that area?
Internal attitudes that forecasts are trade secrets
An electronics manufacturer works with several small suppliers to obtain the necessary quantity of rare metals for its production goals. They notice that they are starting to regularly face supply issues for these rare metals, disrupting the manufacturing process. Which area of their web-enabled supply relationship management (SRM) system should they use to determine which supplier(s) are at fault for the supply issues?
Internal interfaces-internal interfaces area of the SRM system contains both the open order file and the procurement history, which should allow the organization to determine which supplier(s) have missed shipments and if any of them have been consistently at fault
An organization's information system infrastructure features various systems feeding into each other, allowing for some levels of data integration. Which is the next level of integration that the organization should plan to move into as it looks to improve upon the current system in a sustainable manner?
Internally integrated technology
Two bulk chemicals are each stable and safe by themselves, but interaction between the two could create a toxic gas cloud. What regulation would prohibit these chemicals from being stored next to each other on a container ship?
International Maritime Dangerous Goods (IMDG) Code
What sort of technology will enable even a smaller firm with great brand equity to become the channel master?
Internet-enabled supply chain with an efficient technology model
An organization wants to identify and understand the risk associated with a highly technical process that they have pioneered and use exclusively. Several process experts that designed the process still work for the company. What is the best method for the organization to use to identify the risk in question?
Interviews
pipeline stock
Inventory in the transportation network and the distribution system, including the flow through intermediate stocking points.
Which of the following changes tend to occur as a result of adding warehouses to a logistics network (assuming no other changes)?
Inventory increases, while the ratio of storage space to total warehouse square feet decreases.
end-of-life-inventory
Inventory kept on hand to satisfy demand for products that are no longer being manufactured.
If inventory turnover decreases, which of the following must also decrease?
Inventory velocity
distribution inventory
Inventory, usually spare parts and finished goods, located in the distribution system (e.g., in warehouses or in transit between warehouses and the consumer).
days of supply
Inventory-on-hand metric converted from units to how long the units will last.
An organization is having issues with the bullwhip effect. How can it best reduce instances of the bullwhip effect on an ongoing basis without increasing stockouts?
Invest in technology to increase vertical collaboration and visibility in the supply chain.
What is the key question to ask when setting a customer service strategy?
Is the cost to achieve the level of service justified?
What can be the effect of placing an order for replenishment inventory early?
It can create the potential for a very large overstock.
How can a company best introduce a brand-new product type that has no sales history and ensure its availability?
It can send product directly from production to central distribution centers that ship only per actual customer orders.
What is a risk of using incentives to reward performance with regard to certain performance metrics?
It creates an incentive to ignore things that are not measured.
Which of the following statements about total productive maintenance is false?
It increases materials handling.
The fifth step in the process for creating and maintaining a customer-centric business (monitor, measure, and report) displays what characteristics?
It involves continuous research. It is iterative. is based on measures arising from ongoing customer contact.
Is it a good idea or a bad idea for a manufacturer to shift costs to its distributors to improve its profits?
It is a bad idea if the ultimate price to the consumer is higher.
What is true of strategic sourcing?
It is collaborative.
Which of the following describes a successful continuous improvement project that has the best impact?
It is directed from the top down and implemented from the bottom up in the supply chain.
How can a customer-focused business benefit from segmentation?
It will learn more about individual customers.
Which of the following is true of a global supply chain alliance that is forged strongly from the beginning?
It will still need constant maintenance.
Your organization has been working diligently on improving the customer service scores of its logistics services in order to reach a 100% service level. Is that a good strategy?
It's not a good strategy, because the company could incur additional expenses that are counterproductive.
Which of the following does not describe suboptimization?
It's the amount of unusable warehouse space shared by supply chain partners.
What is the definition of inventory?
Items to support production, supporting activities, and customer service
As a general rule, instituting Just-in-Time (JIT) in a manufacturing facility affects employees' jobs in which of the following ways?
Job responsibilities expand.- training and cross training employees
Which has the potential to reduce customs clearance delays?
Joining national trade partnerships
Which of the following is the best basis for moving to formal remedies after a supplier has been warned that it is in violation of its contract and has been given a deadline for further review?
Judgment call on supplier's intent to make changes
Which of the following conditions is generally associated with lot-for-lot replenishment?
Just-in-Time (JIT) manufacturing
The two outer pillars of the House of Toyota represent which of the following?
Just-in-Time and jidoka
Which of the following is a supply chain strategy based on the business strategy of product differentiation?
Keeping minimal inventory of the base model and expanding inventory of options
A demand plan dashboard for use in the demand review meeting of the sales and operations planning (S&OP) process should include which of the following information?
Key events, risks, and notes on where demand-side departments disagree
If a restaurant chain performs hourly forecasting, which of the following will likely be reduced, assuming that there is acceptable forecast error?
Labor costs
Which would be considered an external risk to the supply chain?
Labor shortages
What is a potential cause of issues in succeeding with triple bottom line goals in the economic area?
Lack of alignment between the financial-related goals of different functions in the supply chain
A supply chain channel master develops a balanced scorecard approach to SCM, only to have it fail to improve the performance of SC partners. Which of the following would be the most likely cause of failure?
Lack of executive-level leadership of the initiative across the chain
A manufacturer decides to employ (TQM) to improve the manufacturing process.management team directs floor managers to assemble teams of machine operators to decide how to best improve and to report back to them. They direct managers to look for solutions and better processes, not to identify poor performers, and to focus on ways to best serve their customers. They expect that the teams will generate standard performance measures to track improvement. Despite this effort, the TQM process fails. What is the most likely reason for the failure?
Lack of upper-level management participation in the process
When deciding whether to acquire a component from a domestic or foreign source, which of the following comparisons provides the most accurate assessment of their relative value?
Landed cost of each source
Dropping the price of a popular new technological gadget to match the price of a substitute product just coming out will likely have what effect?
Large increase in demand
By asking bank customers to mail their deposits to a local address, bank management thought they were fulfilling a customer need. Instead, they were actually creating waste in terms of an extra step in a deposit process for their customers. Which of the following approaches does this situation exemplify?
Lean thinking
Heijunka is the Japanese term relating to which type of continuous improvement activity?
Lean/JIT
Which of the following capability improvement goals is a proactive reason for forming a strategic alliance?
Learning new skills from the alliance partner
A French organization that is working with an Italian organization should be mindful of the differences between which of the following when performing supplier relationship management (SRM)?
Legal systems
Suppliers involved in online marketplaces/exchanges may experience which of the following risks?
Less chance of process improvements-When suppliers face tighter margins due to global competition on exchanges, they frequently have less capital to invest in long-term process improvements
A company's product is basically a cheap but branded plastic toy that doesn't require much quality. Which would be a type of material that is tightly linked to the company's brand equity?
Leveragable materials
Which group of financial ratios helps determine whether a supplier is likely to be able to meet its debt obligations based on relative levels of debt versus equity?
Leverage ratios-measure how much debt is being used to finance the business and thus help show whether it is likely to meet those debt payments
Which of the following is an advantage of using enterprise resources planning (ERP) vendor offerings versus best-of-breed vendor offerings?
Leveraged ownership of enterprise data
How should organizations balance sustainability customer requirements against product cost?
Limit sustainability costs to allow still meeting a price customers will pay.
What is a drawback of water transport as compared to other modes?
Limited accessibility to waterways
Which of the following should be done regarding inventory policy if a snack chip manufacturer adds a new type of snack chip to its line of offerings?
Link the item's policy to the production line product family. Link the policy to the organization's other product families stocked on the same shelves.
A manufacturer is examining the financial health of a potential supply partner. If it wishes to get an idea of how easily the organization can meet short-term financial obligations, which group of ratios should the manufacturer examine?
Liquidity ratios
A business plan would typically include which of the following?
Long-term guidance for developing tactical production plans
What is a risk of a conservative returns authorization policy?
Long-term reduction in revenues
Developing a Just-in-Time (JIT) supply chain generally implies adopting which of the following strategies with suppliers?
Long-term relationships with a limited number of suppliers
Which would be the fastest way for a fashion clothing company to get to market while also minimizing demand mismatch risks?
Look at street trends and buy appropriate fabrics before the runway season.
Which of the following would best reveal a situation in which salespersons changed demand plan numbers to deliberately understate demand just to make their next quarter's sales goals easier to meet?
Look at the assumptions to see if they support changes in the demand plan
An organization is looking to save money by outsourcing transportation to 3PLs. The organization currently has a highly effective system but wants to turn attention to other areas of the business. What is the potential negative outcome of this decision?
Loss of efficiency in the transportation system
What risk is run when an organization outsources the entire manufacturing and assembly process of its product to overseas factories?
Loss of intellectual property
Which of the following types of inventory costs could be overlooked when setting safety stock levels because they are difficult to quantify even though they are significant costs?
Lost sale costs
A retailer opens a new store, focusing on maximizing available square footage for sales. As such, the retail location does not have a large back room and cannot hold a large amount of backstock inventory. What is the most appropriate ordering system for this retail location?
Lot-for-lot
Which of the following fixed versus variable cost scenarios correctly identifies the cost structure of trucking?
Low fixed costs, high variable costs
An efficiency-focused supply chain strives for which of the following?
Low forecasting errors, limited product variety, and a long product life cycle
Which level of employees is likely to produce "defects" that are highly visible and annoying to the customer from a six sigma perspective?
Low-level
What was Gap Inc. able to achieve with its supply chain strategy for its stores?
Lower-scale economies for purchasing and production
Which is the primary benefit of a horizontal marketplace or trading exchange?
Lowers transaction costs
Which of the following illustrates an emphasis on the affordability aspect of customer value?
Luxury boat priced lower than other luxury boats of similar size and features
Once a collaborative partnership has been formed, which of the following should be avoided?
Maintaining existing incentives from each of the respective firms
Which of the following is the Level 1 SCOR management process that entails converting materials or creating content for services?
Make
Organizations that have low sales volume and serve markets with more volatile demand and uncertain forecasting tend to focus on what type of manufacturing strategy?
Make-to-order
Which of the product categories designated by Marshall L. Fisher would be the most likely classification for a custom product that has a six-month lead time?
Make-to-order functional product
What should an organization work toward when using the Governance, Risk, and Compliance (GRC) framework?
Making GRC activities part of the organizational culture
An organization wants to pursue the lowest total cost of ownership (TCO) with its offshore supply chain partners. Which of the following problems cannot be overcome by hiring local experts in the foreign country?
Management incentives rewarding organizational cost reductions
An organization wants to set up a new location in a low power distance, low uncertainty avoidance location. What should the organization expect will be true of the new location's culture?
Managers will consult with employees about what should be done, and the workplace will be characterized by self-control with fewer rules.
What is an example of a tactical task that may be required when using supplier relationship management (SRM)?
Managing supply
A peach orchard in Colorado decides to engage in business-to-business sales for the first time, looking to stock fresh peaches in a small set of independent grocers around the state. Which fulfillment channel is most appropriate for the orchard to use?
Manufacturer storage with direct delivery
A small dairy company is selecting an order fulfillment channel to handle milk deliveries to local retailers. Which method is most applicable?
Manufacturer storage with direct delivery
An electric car company is operated on a make-to-order system, giving customers the ability to customize even minor details when purchasing from an independent dealer. The vehicle is then delivered to the customer from the manufacturer. Which fulfillment channel is most appropriate for the car company?
Manufacturer storage with drop ship
Which order fulfillment pattern can be described as one where customers can order either from a retailer or a distributor and orders are fulfilled directly from the manufacturer to the customer?
Manufacturer storage with drop ship
What fulfillment channel would be most appropriate for a manufacturer of inexpensive watches that does not allow for customer customization and that wants to retain control of the inventory until delivery to the retailer or customer?
Manufacturer to distribution center to retailer
Redundancies between members of an extended supply chain could be discovered through which of the following processes?
Mapping the end-to-end supply chain processes
What information needs to be tracked at each point along the reverse supply chain?
Marginal costs/revenues and the status of each product or subcomponent
What is the plan that provides, in effect, a contractual agreement ensuring salespeople that they can make delivery promises?
Master production schedule (MPS)
A salesperson needs to expedite an order, but doing so will require alteration of the production of items inside a planning time fence. With whom would the salesperson negotiate this change?
Master scheduler
Which of the following processes develops the master production schedule based on demand and inventory levels?
Master scheduling
Where in the planning process does the capacity requirements planning process occur?
Material requirements planning
Which of the following processes results in production numbers driven by dependent demand?
Material requirements planning
Which areas does operations research rely upon to help with network modeling?
Mathematics, statistics, and computing
When preparing different marketing messages for similar products, which tool is particularly useful in distinguishing between features?
Matrix diagram
functional product
Mature products that tend to have a low profit margin and a predictable demand.
What is one of the tradeoffs of focusing on transportation and storage when designing for logistics?
Maximizing items on a pallet may cause issues with slow-moving goods for retailers.
What should supply plans do?
Measure costs and benefits over a base period plus costs to grow capacity over a long horizon.
A vertically integrated enterprise can grow by doing which of the following?
Merging with or acquiring other companies
An organization is undertaking a total cost of ownership study of the supply chain, looking to reduce costs. When looking at landed costs, which cost may represent an area to generate cost savings?
Monitoring and control costs
A total cost of ownership (TCO) study can show that when pursuing offshore outsourcing to a country with low labor costs, the reduction in the total cost is usually partly offset by increases in which of the following?
Monitoring and control costs,Transportation costs
An organization wants to gain detailed information regarding customer satisfaction level on a regular basis. The executive team considers this crucial to its continuous improvement efforts and is willing to allocate significant resources to gain the information. What is the best approach for measuring customer satisfaction level?
Monthly/quarterly customer feedback questionnaires
What method for collecting customer satisfaction information should an organization use if it wants detailed information supplied at regular intervals?
Monthly/quarterly customer feedback questionnaires
Voluntary sustainability program compliance can reduce which of the following risks?
More expensive compliance if program elements become mandatory
Buyers involved in online marketplaces/exchanges may experience which of the following risks?
More product rework and returns-they aren't working with trusted suppliers
A renewable energy company based in the United States is planning to open a factory in the European Union to reduce the risk of damage during transportation for fragile components. What labor considerations should the company be aware of before staffing the factory?
More stringent protections for worker privacy, collective bargaining, and employee benefits
An organization normally receives a basic component for a product in a fully assembled state. Due to a natural disaster, it must assemble some of these components itself. Where would it check to see the raw materials needed to perform this assembly work?
Multilevel bill of material
After selecting the proper partner, what is the next step in creating a successful alliance?
Negotiate a win/win deal.
An organization's two distribution centers have planned order releases of 100 and 200 units respectively. Its central factory has a projected available balance of 100 units and scheduled receipts of 200 units and keeps 100 units of safety stock. In distribution requirements planning, what is the net requirement for the central factory for a given week?
Net Requirement = (Gross Requirements + Safety Stock) - (Projected Available Balance + Scheduled Receipts) = [(100 units + 200 units) + (100 units)] - (100 units + 200 units) = 400 units - 300 units = 100 units
return on assets (ROA)
Net income for the previous 12 months divided by total assets. See: return on owner's equity (ROE).
Which element of an income statement does the return supply chain process impact?
Net sales
A local area network (LAN) exists at which of the following IT infrastructure levels?
Network level
An organization sets out new business goals, including new business vision and mission statements. They undergo a reorganization to align the organization's structure with the new goals. What other adjustment is likely to be necessary?
New job definitions and organizational structures
Which of the following statements about successful strategic supplier relationships is true?
No single restructuring of processes will be adequate.
Can a highly efficient cross-docking system achieve the goal of no inventory ever at rest?
No, due to inherent variability in demand.
An organization has commercial property insurance with a business interruption insurance rider. If there is a partial plant shutdown due to a hurricane but 60% of workers can still get to the plant and do their jobs, can the organization expect a claim payout?
No.A condition for the business interruption insurance is that damage is sufficient to shut down all operations
A logistics manager might approach which of the following intermediaries to purchase cargo space that the intermediary purchased elsewhere and marked up for resale?
Non-vessel operating common carrier (NVOCC)
An organization is using the Global Reporting Initiative comprehensive reporting option. What does it need to report about the "effluents and waste" aspect of the environmental category?
Nothing, if omitting it would have no effect on stakeholders' decisions.
Which of the following must champion the relationships to be formed across an extended supply chain?
Nucleus firm
Which of the following component purchasing goals are reactive or defensive reasons for forming a strategic alliance?
Number of suppliers able to provide the component
cross-selling.
Occurs when customers buy additional products or services after the initial purchase
An organization is contracting to sell products to a company in another state. The buying organization is negotiating to execute payment in two months. The selling organization hopes to be paid in one month instead of two but believes the buyer will walk away if they push to receive payment earlier than the buyer is requesting. What is the best method to encourage the buying company to pay early?
Offer terms like 1/30 net 60.
What would be a good way to move from a transactional relationship to a collaborative relationship with a trustworthy customer, helping to improve the organization's order-to-cash cycle time (the speed of converting orders to payments and then to cash)?
Offer trade credit.
What should a project manager do if a project near completion is indefinitely postponed?
Officially close the project and release the team.
What is a drawback to using U.S. GAAP, which is country-specific, as opposed to using the International Financial Reporting Standards?
Organizations may find legal ways to be less transparent.
Which of the following is a best practice for managing and prioritizing demand?
Organizations should retain demand management and prioritization power solely within the demand side of the organization.
A process expert says that most likely, the cost per unit of a new product should be $12, but, in the worst case, it could be as much as $16. He says that if commodity prices stay low, unit costs could be as low as $9. If a PERT weighted average is used, what should the risk analysis use as the cost per unit?
PERT Weighted Average = (Optimistic + [4 x Most Likely] + Pessimistic)/6 = ($9 + [4 x $12] + $16)/6 = $12.17
What is true of packaging for seaborne delivery to a foreign buyer?
Packaging should be as light as possible.
Maria sells her paintings in the street market on weekends. Which of the following are Tier 2 suppliers in this supply chain model?
Paint wholesaler
The schedule will not allow exhaustive analysis of all the scenarios that the team knows are causing a system to crash, but they need to correct the majority of the issues. What quality tool would best help them focus their resources?
Pareto diagram
business continuity management system (BCMS)
Part of the overall management system that establishes, implements, operates, monitors, reviews, maintains, and improves an organization's capability of delivering products or services at acceptable predefined levels following a disruptive incident
One of a tire producer's suppliers is a natural rubber producer whose products are becoming subject to more demand even as the product becomes more rare. Another of their suppliers is a tire recycler, who provides the tire producer with old tires. Which of the following collaborative intensities would be appropriate for these partners?
Partnership or higher for the natural rubber producer; buy on the market for the tire recycler
Which of the following is true of radio frequency identification (RFID)?
Passive RFID tags do not contain their own power source.
The developers of the balanced scorecard approach to performance were concerned that traditional metrics placed too much emphasis on which of the following considerations?
Past financial performance
Which type of organization has made filing a patent after a reasonable patent search a much riskier endeavor?
Patent assertion entities
What is the most important focus area when developing plans for each area during the change management process?
People and relationships
When planning for change, what are the most important aspects to plan from a change management perspective?
People and relationships
Which metric would be useful for the innovation and learning perspective in the balanced scorecard™?
Percentage of floor workers with completed safety certifications
Which SCOR metric for the source process is used for make-to-order or engineer-to-order but is not needed for make-to-stock environments?
Perfect order fulfillment
Which is a good way to optimize the organization of storage locations?
Perform a velocity analysis of warehouse space and relocate items as needed.
A company that sells spare parts for cash registers has multiple inventory inaccuracies, multiple names for parts in their systems, and redundant products. Which of the following are the best first steps to help the company improve these issues?
Perform data cleansing and institute role-based access policies, procedures, and software limits for adding, deleting, and modifying information
Which is the most cost-effective example of Monitoring and Controlling in project management?
Performing process audits at the start of Executing
Which of the following correctly describes the benefit of conducting periodic inventory counts?
Periodic counting provides a financial value for all inventory at one point in time.
What is true regarding the competitive advantage of an electronic business supply chain?
Physical assets become barriers to change and are tied-up costs
When determining risk responses, how can an organization best prepare for unknown risks?
Place money in a reserve fund.
The design and implementation of two-way communication between a business and its customers describes which of the following components of a customer-driven marketing strategy?
Placement
During which part of the change management process do you get approval and funding for a potential change?
Plan for change.
During what step in the change management process should SMART criteria be set?
Planning-Planning is when baselines are set to help determine if an initiative is succeeding.
An organization designs products to be built to order, featuring modular parts that are easy to combine to meet customized orders from customers. Product assembly and customization occurs just prior to shipping. What is this an example of?
Postponement
Which of the following warehouse operations assumes that there will be costs for training or hiring staff with final production skills?
Postponement-there will be costs for training or hiring staff with final production skills
Which of the following can be a result of a carefully designed reverse logistics chain?
Potential for very lucrative customer service contracts and extended warranties
Which of the following best defines a virtual organization?
Potentially long-term relationship between separate business entities to design products and immediately share all customer data
Which of the following meetings is typically used to arrive at a consensus between plant managers, logistics managers, schedulers, customer service managers, and other supply chain managers prior to involving executives in sales and operations planning (S&OP)?
Pre-S&OP meeting
What is the term for a customer relationship management (CRM) tactic described as "an analytical model to identify vulnerable customers"?
Predictive churn
Rough-cut capacity planning at the end-item level is part of which process?
Preparation of the master production schedule
A large organization is changing its structure to meet customers' changing demands. It works to determine success criteria and create plans for each area. It then conducts projects, training, and events related to the changes and follows that up by monitoring and controlling against new metrics that align incentives to strategic goals. However, resistance to the change ends up being high, and the change process misses performance expectations. What element of the change process did the organization fail to perform, causing the failure of the project?
Prepare for change.
During which part of the change management process do you explore the costs and benefits of a potential change?
Prepare for change.
A team is trying to choose a solution to a faulty process from several options. Which of these tools would be appropriate in this situation?
Prioritization matrix
Which of the following documents constitutes a price quote in export-import trade?
Pro forma commercial invoice
Which of the following are usually components of the market plan?
Pro forma profit and loss (P&L) statement, management controls, and opportunity and issue analysis
What type of risk is posed by IT processes?
Process
Which continuous improvement tool can be used in two different manners: to identify measures that can be taken to avoid undesirable, intermediate consequences and to lay out a plan to predict future foreseeable problems that can then be resolved successfully?
Process decision program chart
Which quality tool could help a supply chain manager provide the logical inputs that a software engineer would need in order to build an automated decision support system to route shipment orders to the proper carrier given a series of decision points?
Process map-simple tool showing the logical flow and branching decisions of a process, so it could help get the process automated correctly.
Which of the following forms of interface devices would be best for a firm implementing an internal solution that can be directly extended to integrate external partners who resist standardizing?
Process-oriented middleware
Which of the following is available from an internal interface to a supplier relationship management (SRM) system?
Procurement history
multisourcing
Procurement of a good or service from more than one independent supplier.
According to the 40/30/30 rule, what plays the largest role in the generation of scrap, rework, and waste?
Product design
What is the proper order for the meetings in the sales and operations planning (S&OP) process?
Product review, demand planning, supply planning, financial review, pre-meeting
What would greatly help to prove information about an organization's product labeling claim of "Made in the U.K."?
Product traceability and configuration management
Which is a fundamental marketing concept upon which customer-focused marketing is based?
Products and services have more than one market segment
design for remanufacture
Products developed in a manner that allows components to be used in other products. This process is associated with green manufacturing.
innovative products
Products that tend to have a high profit margin, be unique, have less competition, and have dynamic demand.
What tool associated with advanced planning and scheduling (APS) would allow an organization that manufactures custom products to see what parts combinations it can produce and the profit margin for a particular order?
Profitable-to-promise
What PMBOK® Knowledge Area is concerned with planning, acquiring, developing, managing, and releasing the team?
Project Human Resource Management
In what process group included in the project management cycle is the project manager selected?
Project initiation
Which is a best practice for a person fulfilling a project manager role?
Project managers admit to mistakes and see them as learning opportunities.
In what process group included in the project management cycle are decisions made on how to identify, prioritize, and manage risks?
Project planning and design
An organization is preparing to undergo structural changes. It has set out a high-level plan containing all the proposed improvements in sequence. What other plan or plans are required before the organization can begin implementing change?
Project plans
Which of the following components of a customer-driven marketing strategy could be described as a variety of activities designed to position what the business is selling to the right people, at the right time, and in the right manner?
Promotion
Which of the following could help limit the size of product recalls to goods produced just at a specific factory between specific dates?
Proprietary bar codes
Which of the following is valid advice for contingency planners preparing for a potential business disruption?
Protection against production disruptions should not rely solely on having extra stores of inventory.
Which of the following statements best describes the relative care that should be taken in securing A, B, and C inventory items?
Provide the best protection for A items.
What are typically the main external ties for a company at Stage 2 of supply chain network technology optimization, the semifunctional enterprise?
Providers of functions that are not core capabilities for the organization
ISO 73
Provides the definitions of generic terms related to risk management.
In postponement of product design, which is the supply chain strategy being used?
Push-pull strategy
Which warehouse activity entails removing material from the dock (or location of receipt), placing that material in a staging area and then moving it to a specific location, and recording the movement and identification of the location where the material has been placed?
Put-away
Which is an example of reuse from the waste hierarchy?
Putting returned items in new boxes and back on the sales floor after inspection
Which of the following is generally considered an important combination method in forecasting because it can reduce bias, even though an effect such as groupthink could increase bias?
Qualitative forecasts
What are time-series models used in?
Quantitative forecasting
What quality attribute of communications relates most to the need for efficiency?
Quantity of data provided
A ski resort wants to automatically detect when skiers have a lift ticket and when to offer a returning skier a loyalty discount. Which technology would meet these objectives with the least trouble for skiers?
RFID
A public organization is struggling to be profitable. It believes that with certain capital improvements it will see a large growth in profitability. However, it still wants to control long-term costs, even while making these investments. Which method of financing these capital improvements would be best for the organization?
Raise money via stock release.
An organization is looking to use demand management to tailor demand to meet available capacity at product launch, due to limited initial capacity. How can the organization best achieve its goals?
Raise the price on a semi-permanent basis.
An organization needs a warehouse for many stock keeping units (SKUs), space is at a premium, and they plan to install a directed pick and put-away system. Which of the following would be the best stock location method?
Random location storage
An organization has attempted to forecast demand for a popular product over the last decade. They have sufficiently accounted for changes due to holidays and climate specifics as well as those due to advertised sales. They have been accurate when forecasting long-term changes, but over short-term periods, they have been inaccurate, at times leading to stockouts and excess inventory. What is the likely cause of their forecast inaccuracy?
Random variation
Which stock location method will tend to maximize cube utilization?
Random-location storage
Which will help an organization and its trading partner better manage currency exchange risks between each other?
Rate sampling clauses as part of contractual payment terms
In a low-price supermarket chain, the stores, the distribution centers, the third-party logistics provider, and the manufacturers work together to replace what is sold in the stores within less than 24 hours. What type of supply chain structure does that illustrate?
Reactive efficient
According to macroeconomic theory, as aggregate prices decrease, what happens to the real gross domestic product (GDP), and why?
Real GDP increases, because there is more real wealth
Which of the following can be used to immediately improve an organization's inventory accuracy even if it doesn't reduce lead times?
Real-time point-of-sale data updates in the enterprise resources planning (ERP) system
An organization using mass customization has had complaints of defective products. The cause is a valve installed backward in final assembly at the distribution centers (DCs). Which of the following would address the root cause of the problem?
Redesign the product so the valve can be installed only one way.
Which is not a lean principle?
Reduce the number of defects to a target level.
What is the correct order of activities in the waste hierarchy, starting from the top of the pyramid?
Reduce, reuse, recycle, recover energy, responsible disposal in landfill
Powder coating is a type of painting that uses electrical charges to attract the sprayed material to the object being coated. It is an example of which of the following when compared to standard spray painting?
Reduce-Powder coating reduces the amount of sprayed material that becomes waste in comparison to standard spray painting.
Benefits of a fourth-party logistics provider (4PL) arrangement include which of the following?
Reduced costs and/or higher-quality logistics operations
The sales and operations planning (S&OP) team might decide to adopt a chase production strategy because it offers which of the following benefits?
Reduced inventory holding costs
Which is a primary goal for reverse logistics for most organizations?
Reducing the volume of reverse logistics transactions
A supply chain manager plans to increase the number and geographic locations of warehouses. Which of the following changes would be the most likely overall benefit to the supply chain?
Reduction of delivery time to retail outlets
A new transportation company in Poland is entering the road transportation sector, operating internationally in the European Union (EU). Which environmental regulation must they consider as they begin operations?
Regulations regarding low emission zones
A small auto parts store is upgrading to digital tracking of parts numbers, order numbers, and customer data. What option should it use for digital storage of these data?
Relational database
Which term describes the development of lifetime customers by training staff to optimize each customer's experience?
Relationship building
An organization wants to set up a new location in a culture that is collectivist and has a long-term orientation. What should the organization expect will be true of the new location's culture?
Relationships will be more important than one's job, with traditions that may change and adjust to the times.
Which of the following is an integral part of the sales and operations planning (S&OP) process because it promotes meeting brevity and consensus building?
Replanning
Which of the following would promote accuracy and efficiency in the demand management process?
Require headquarters sales staff to provide assumptions used in demand plan numbers.
Demand and which of the following types of information typically flow from the end customer upward in a service supply chain?
Requirements
Which of the following tasks is most likely to be performed by a purchasing agent/planner rather than a purchasing manager?
Resolving discrepancies in orders or accounts
What level of capacity planning and control focuses on long-range activities?
Resource planning
A metal stamping company produces multiple items in their thin steel processing area. At a recent sales and operations planning meeting, a need for an additional stamping press was identified though resource planning. Which of the following was an input to verify the need?
Resource profile
Which customer-focused metric is a measure of whether the response is on target and correct so that the customer does not require additional follow-up?
Response accuracy
Which of the following processes is part of the Supply Chain Operations Reference (SCOR) process model?
Return
Which is an example of a return that could be part of the reverse supply chain?
Return initiated by a component supplier and directed to a raw material supplier
Where in the waste hierarchy would remanufacturing be located?
Reuse
A toy manufacturer wants to use an auction to procure a large shipment of common screws at the lowest possible cost. Which type of auction should the manufacturer use?
Reverse auction
In what type of auction does the buyer post the equivalent of an online request for quotation, many sellers bid on the contract, and the lowest bidder has a binding contract to fulfill the buyer's needs?
Reverse auction
Which of the following is sometimes overlooked when designing a supply chain?
Reverse supply chain flow
What tool can assist in identifying risk at an organization that has previously conducted risk analyses and retains the results of those analyses?
Risk checklist
What can a risk manager use to shorten the risk identification process?
Risk checklists and documentation and assumption reviews
Who is responsible for identifying potential failure points along the supply chain?
Risk manager
When an organization cross-references the impact of potential risk situations to the possibility of their occurring, what have they created?
Risk rating
Which of the following components of a risk assessment process might result in shareholders requiring a greater minimum return on their investment?
Risk tolerance
Which of the following would contain information such as machine setup and run time?
Route sheet
Which of the following parts of a transportation management system (TMS) would a manager use to optimize and select carriers for the movement of a container from a container ship to a railcar and finally to a truck?
Routing
Supplier A's plexiglass costs US$10 per square meter and has a nonconformance cost of US$3 per square meter. Supplier B's plexiglass costs US$12 per square meter and has no nonconformance costs. What is the supplier performance index for each supplier?
SPI = (Material Cost + Nonconformance Cost)/Material Cost. Supplier A SPI = (US$10 + US$3)/US$10 = 1.3. Supplier B SPI = US$12/US$12 = 1.0.
Which of the following describes human-friendly code that allows users without extensive training to perform custom database searches?
SQL
Which of the following statements about supplier relationship management (SRM) technology is true?
SRM technology can increase the visibility of the entire supply chain.
Where would a wholesaler find information on an organization's hazardous waste if they are using the Globally Harmonized System of Classification and Labeling of Chemicals?
Safety data sheets
A supply chain that produces and sells bar soap using traditional forecasting at each stage has been experiencing the bullwhip effect. Which of the following has the strongest influence on this effect?
Safety stock
Expenses involved in the reverse logistics chain may be offset by which of the following?
Sale of service contracts
What customer relationship management tool should a company turn to if it is trying to enable sales staff to access information when at client sites with phones, tablets, and other handheld devices?
Sales force automation
Which of the following aspects of a customer relationship management technology system would be used for channel partner management and pipeline management?
Sales force automation
A small salsa company is working to create a footprint in its local market by offering product demonstrations at multiple area grocery stores multiple times per week. What customer relationship management technology tool can they use to ensure that they don't miss demonstration appointments, given the large number and locations of demonstrations?
Sales force automation-event management tools, which provide active notifications of sales event priorities such as proposal deadlines, campaign openings, closing dates, or product demonstration appointments.
After performing an extensive customer survey, what else does an organization need to do to discover whether there are any customer requirements being missed in the market?
Scan what the competitors are offering.
When considering methods of sharing their performance ratings with suppliers, which of the following provides quantitative feedback?
Scorecards
A retailer observes that over the past three years, mulch sales have dramatically increased in the spring and early summer before subsiding through midsummer, fall, and winter. What is this an example of?
Seasonality
A manager declines a partnership because the information requested for greater visibility between the extended supply chain is closely connected to data that produce a competitive advantage for the firm. This is an example of the failure of which of the following to be established?
Security
Lean organizations avoid which of the following?
Seeking out the lowest project bid from suppliers
What is segmentation by customers' actual buying habits an example of?
Segmentation by customer needs
Which method of segmentation is being used when a customer who frequently buys upgrades bypasses a telephone queue and gets immediate customer service?
Segmentation by customer value
Which of the following is the best example of a promotion activity in a customer-driven marketing strategy?
Segmenting customers according to their value to the business
Which practice would help organizations craft targeted messages that would be appropriate for groups of individuals needing a higher degree of care and attention than others?
Segmenting other supply chain partners
An organization wants to embrace the triple bottom line and enhance sustainability efforts. How can it do this through decision making around procurement?
Select vendors who use ISO 14000.
What skill area relates to the need for project managers to determine whether they or the candidates they are considering have enough learning and field experience for a given project?
Self-assessment and experience
An organization overestimates demand and produces inventory that ends up stored in warehouses for several years, until it is no longer considered a marketable product. What action must the company take for the purposes of the balance sheet?
Sell off the inventory at a discount or write it off and remove it from the financial statement.
A website that can interface with an enterprise resources planning (ERP) system to provide available-to-promise (ATP) data to end customers is what type of e-commerce?
Sell-side
Which of the following is the most critical aspect of influencing demand with extended supply chain partners?
Selling the benefits of changes using soft skills such as leadership
A firm's highest stage of production is manufacturing resource planning (MRP II), it uses informal demand planning with disconnected spreadsheets for the supply chain, and it has online catalogs on the internet. What stage of supply chain development has the firm reached?
Semifunctional enterprise
Which of the following is the supply chain evolution stage in which a nucleus company begins initiatives to improve efficiency, effectiveness, and quality within functional areas?
Semifunctional enterprise
An organization that networks its enterprise resources planning (ERP) systems across corporate boundaries might do which of the following to reduce the bullwhip effect?
Send point-of-sale data directly to suppliers.
What should the course of action be if rough-cut capacity planning determines that production targets are not realistic under the tolerances set out by the sales and operations planning (S&OP) policy?
Send the plan back to the master scheduler for revision.
What should happen with a project management plan after it is completed and approved?
Send updates to team members regularly using configuration management
subcontracting
Sending production work outside to another manufacturer. See: outsourcing.
Which of the following techniques is a street food vendor using to mitigate the risk of insufficient demand by moving the cart to near an event such as a fireworks show?
Sense and respond
In the development stage of customer relationship management (CRM), customer ownership has which of the following characteristics?
Sense of partnership and mutual investment,Involvement of key customers in crafting the product or service Increased likelihood of early sales
What are the top three factors, in order of importance, that influence most retail customers' decisions to purchase products?
Service, quality, price
A manufacturer used demand forecasting to determine how many products it would need to manufacture for the next quarter. Unfortunately, the demand forecast was inaccurate, and the manufacturer could not meet actual demand, due to lack of inventory. What is an action the manufacturer can take to mitigate this risk in the future?
Set safety stock using statistical forecasting.
If a major consumer electronics company wants to optimize its knowledge of its marketplace, it should do which of the following?
Share distribution point information with its partners.
How can an organization use supply chain information networks to manage risk?
Share information with partners and internal locations to help minimize disruption caused by risk.
When embracing continuous improvement in implementing a supplier relationship management (SRM) program, which of the following actions should partner companies take?
Share innovative ideas with each other without asking for compensation.
An organization has the opportunity to win a large corporate client, but it needs a fleet of refrigerated trucks. What can the organization do to add this capability quickly without worsening their activity ratios or risking that ad hoc contractors will have insufficient capacity?
Share the opportunity with a refrigerated delivery partner.
The supply chain manager has recently been told that he must increase the supply chain value to the external stakeholders. Which stakeholders should he focus on, and what should be done?
Shareholders; increase dividend income.
supply chain visibility
Sharing information throughout the supply chain to create transparency among supply chain partners; for example, the ability of supply chain partners to access demand and production information from trading partners.
In an advanced supply chain, which of the following would be the best data for a buyer to send to a sheet metal producer?
Sheets of steel required for metal door construction company for the month
Which of the following actions would be the best choice if the load scheduled for a work site exceeds its rated capacity?
Shift work to another work center with available capacity.
If there are no sales data for a new type of car with an innovative technology to use to anticipate regional sales, which is the best method of satisfying demand?
Ship most units to distribution centers instead of retail locations.
You are shipping copy machines and high-end cameras from Asia. What is the best choice for the transportation to use in this case?
Ship the items using two different modes: the copy machines via water and the high-end cameras via air.
Which of the following is a current global force shaping supply chain management strategies?
Shortening product life cycles
What does the term "flattening of the globe" refer to?
Shrinking of the world into one global economy
Which of the following provides a sound method for grouping products into product families for the operations plan?
Similarity of manufacturing processes
design for service(maintainability)
Simplification of parts and processes to improve the after-sale service of a product. Syn: design for maintainability.
design for manufacturability
Simplification of parts, products, and processes to improve quality and reduce manufacturing costs.
Which of the following continuous improvement methodologies focuses on reduction of defects to statistical insignificance?
Six sigma
Which of the following items are the three key components to successful change?
Skill Desire Knowledge
Which SCOR management process includes issuing purchase orders, scheduling deliveries, receiving, shipment validation and storage, and accepting supplier invoices?
Source
What value can a customer service group add when a product is no longer available in the assigned facility?
Sourcing a product from an alternate facility if a stockout occurs
How can a brick-and-mortar retailer that relies exclusively on 3PL and 4PL support for supply chain activities best implement sustainability efforts in its supply chain?
Specify sustainability as a selection criterion in requests for proposals and specify sustainability performance in contracts.
An organization wants to consolidate its purchasing efforts. What supplier relationship management (SRM) analytics function would be of most help to the organization?
Spend analysis
Which of the following supplier relationship management (SRM) analytical applications would quantify how much it is costing the organization when buyers resist using national agreements for some categories of purchases?
Spend analysis
A company can demonstrate cross-functional integration of planning and capacity for operations. It appoints a leader with experience in external integration, who starts by aggregating purchasing to find volume discounts. This organization is currently trying to grow out of which of the following stages of supply network technology optimization?
Stage 2, semifunctional enterprise
At which of the following stages would a company be if it has multiple uncoordinated improvement efforts, such as inventory reduction, better forecasting techniques, and lower cost procurement, occurring sequentially instead of in concurrence?
Stage 2: Semifunctional enterprise
You know the actual hours worked at a work center. What else do you need to know to calculate the work center's efficiency?
Standard hours of output
A superior assigns you as a project manager. She tells you to staff a team and start planning right away even though the project charter has not yet been signed. What should you do?
State that the charter needs to be signed before you can start.
Some companies that operate a particular kind of transportation are trying to minimize their costs by running their vehicles more slowly to minimize fuel consumption, even though it increases delivery time. Which mode is most likely using this strategy?
Steamship lines
An organization decides to stage capacity investments so that capacity stays ahead of demand but to do so in a manner that does not require a single major investment up front. What is the best method for the organization to stage the growth in capacity?
Stepwise lead strategy
An organization orders a large quantity of valuable, rare materials required for its manufacturing process in order to achieve economies of scale for ordering and transportation. It does not need all of the quantity ordered immediately and is looking for a way to defer costs associated with the inventory while ensuring that the inventory is secure. What is the best option available to the organization?
Store the items in a free/foreign trade zone (FTZ).
Which of the following is a good example of a virtual organization?
Strategic alliance of four companies to develop a new drug under one company's name-short-term alliance between independent organizations in a potentially long-term relationship to design, produce, and distribute a product
Which of the following is the most appropriate subject for discussion at the demand planning phase meeting that is part of the sales and operations planning (S&OP) process?
Strategies to close any gaps between the demand plan and business plan revenue goals
What is the best definition of the phrase "contact channel strategy"?
Strategy to ensure the most cost-effective and customer preferred channel is used to distribute products; and securing lifetime customers through exceptional customer care
alliance development
Strengthening the capabilities of a key supplier
An organization's marketing department conducts market research by studying the size, location, nature, and characteristics of markets along with sales (or consumption) data. What else does it need to do?
Study market share and do consumer research.
Each company in an extended supply chain has its own decision support system, each run separately using the same data. Often some firms end up with a surplus while others have shortages. Which of the following describes this supply chain's problem?
Suboptimization
An organization wants to understand what supply risks pose a threat to its manufacturing process. It performs an audit of its suppliers and discovers that one of them is running low on raw materials. What type of risk would this cause to the organization's manufacturing process?
Supplier lead time
Which of the following strategies represents the traditional "over the wall" approach to product design?
Supplier plays no role in design.
Which of the following is the primary measurement of whether a supplier certification process is valid?
Supplier procedures should be related to the customer's requirements.
An organization has completed certifying its key suppliers. Which of the following can be used to confirm if the organization is obtaining the returns it was expecting from its investment?
Supplier quality rating
What is a key difference between certification and supplier rating systems?
Supplier rating systems are used more frequently to capture ongoing performance levels.
An organization is expanding its purchasing efforts into a new region with different cultural dimensions and expectations that are difficult for outsiders to navigate. Which business practice would it benefit most from subcontracting?
Supplier relationship management (SRM)
When segmenting suppliers, which is the best criterion to use in identifying the most important supplier segment?
Supplier's ability to advance strategic goals
A supplier claims to be ISO 14001 compliant. Which is the customer's least costly but still acceptable method of verifying certification to this standard?
Supplier's declaration of conformity to ISO 14001 attested by internal audit
Which of the following should be included in the performance measurement of suppliers if the organization wants to ensure long-term growth and continual improvement of supply chain visibility?
Supplier's financial stability and capital expenditures
Which of the following statements about the supplier certification process is correct?
Suppliers should be clearly informed of certification process criteria.
Which of the following systems can provide proactive tools such as automatic notification by portable device when a party needs to act as well as a simple means of reversing prior operations decisions?
Supply chain event management (SCEM)
Which of the following systems will automatically come up with an alternate plan based on defined business workflow rules whenever the specific situation triggers alert resolution logic?
Supply chain event management (SCEM)
Which is true of supplier selection?
Supply chain sourcing considers how a supplier's products could affect the organization's reputation.
content management applications
Supports the evolutionary life cycle of digital-based information and makes information dynamically updatable online; includes the ability to publish content to a repository and support access to digital-based content.
An organization tells buyers that cost and environmental sustainability are key goals for materials ordered. Buyers are given bonuses only if they meet cost-of-goods-sold targets. What is the likely effect of this?
Sustainability goals will be partially met as buyers balance competing goals.
What tool should be used by an organization that wants to share information about organizational performance in areas such as energy use and pollution generation?
Sustainability scorecard
Which of the following statements about implementing customer relationship management (CRM) technology is correct?
Systems should be measured against whether they increase efficiency and meet customer expectations.
Which of the following is a quality that supply chain risk management must have?
Systemwide focus
Which of the following is true of the total cost of ownership (TCO)?
TCO compares the differences between the incremental costs of alternatives.
Which tax incentive waives taxes on specific inventory, property, plant, or equipment for a temporary or indefinite period?
Tax holiday
advanced planning and scheduling (APS)
Techniques that deal with analysis and planning of logistics and manufacturing during short, intermediate, and long-term time periods. [This] describes any computer program that uses advanced mathematical algorithms or logic to perform optimization or simulation on finite capacity scheduling, sourcing, capital planning, resource planning, forecasting, demand management, and others
Which of the following statements regarding technology audits is true?
Technology audits are critical for determining the adequacy of financial reporting controls.
which of the following statements about technology and customer relationship management (CRM)/supplier relationship management (SRM) is true?
Technology plays a supporting role in CRM and SRM.
Which of the following cross-enterprise functional teams must be one of the first to be set up and must generate specific results before the other teams can proceed?
Technology team
An organization has a reliable supplier who has never had order or lead time issues. Which of the following choices would be best when the price of the materials fluctuates strongly with the market and is currently low?
Temporarily increase cycle stock.
Which of the following situations is the most critical to address in a transportation management system because it could result in workers and managers ceasing to trust in the integrity of the system?
Ten percent of shipped items have missing cube or weight data.
Which of the following statements about the International Organization for Standardization (ISO) is false?
The ISO can legally enforce implementation of its standards.
Harmonized Tariff Schedule (HTS)
The US International Trade Commission's mechanism by which international tariffs are standardized.
Which of the following statements about the World Trade Organization (WTO) are true?
The WTO helps less-developed nations with better access to world markets for their exportable products. The WTO can arbitrate disputes and complaints between member nations. Businesses located in a member nation can open a branch in another member nation to gain access to that country's markets.
supply chain resilience
The ability of a supply chain to anticipate, create plans to avoid or mitigate, and/or to recover from disruptions to supply chain functionality.
market share
The actual portion of current market demand that a company or product achieves.
planning horizon
The amount of time a plan extends into the future.(12-18 months)
An organization that has a famous brand of cookies is considering approaching a famous ice cream company to co-produce a cookies and cream flavor. How best should this be positioned?
The brands add value to each other.
What group is the primary stakeholder in any business activity?
The business itself
A seller of industrial equipment uses a letter of credit with a buyer in a foreign country. What is a risk that still exists after the goods have passed customs in the buyer's country but before the transaction is complete?
The buyer could refuse to accept the goods.
Which of these companies is practicing good risk management in terms of its suppliers?
The company develops detailed plans to shift work orders among several certified global suppliers in the event of labor disruptions in their countries.
cross-docking
The concept of packing products on incoming shipments so they can be easily sorted at intermediate warehouses or for outgoing shipments based on final destination.
obsolescence
The condition of being out of date. A loss of value occasioned by new developments that place the older property at a competitive disadvantage
ordering cost
The costs that increase as the number of orders placed increases
What can be said of a week when $90,000 worth of garage doors were custom-built and shipped but there were $100,000 worth of customer garage door orders?
The customer service ratio was 90%.
Which of the following statements about purchased customer data is true?
The data may be more useful for new customer acquisition.
independent demand
The demand for an item that is unrelated to the demand for other items. Demand for finished goods, parts required for destructive testing, and service parts requirements are examples of independent demand.
inventory visibility
The extent to which inventory information is shared within a firm and with supply chain partners.
A firm that has recently completed an enterprise resources planning (ERP) implementation is feeling exhausted and generally believes that their current technology will provide enough of an advantage. What advice should the members of the organization be given?
The firm should embrace change as a continuous process and immediately begin analyzing where it needs its next investment.
Which is the most important criterion for making the decision to contract out a business function to a third party?
The function is a core competency for the third party.
distribution requirements planning (DRP)
The function of determining the need to replenish inventory at branch warehouses.
demand management
The function of recognizing all demands for goods and services to support the marketplace. It involves prioritizing demand when supply is lacking.
value chain
The functions within a company that add value to the goods or services that the organization sells to customers and for which it receives payment.
risk management
The identification, assessment, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability and/or impact of unfortunate events or to maximize the realization of opportunities.
Which of the following statements identifies a beneficial result of including more periods in a moving average?
The impact of random variations is reduced.
What is the biggest risk of signing a long-term supply contract to buy regular amounts of a subcomponent to get a significant price reduction?
The inventory of obsolete items could increase.
An organization's inventory on its balance sheet in year 1 is $6 million and in year 2 it is $4 million. If its cost of goods sold (COGS) in year 2 is $80 million, what is its inventory turnover ratio?
The inventory turnover ratio requires calculating average inventory, which in this case uses the balance sheet values for years 1 and 2, which are ($6 million + $4 million)/2 = $5 million. The inventory turnover ratio is COGS divided by average inventory: $80 million/$5 million = 16 times.
An organization is undertaking rough-cut capacity planning (RCCP) for a ceramic vase factory in order to examine a proposal for a small production target increase. The factory maintains a 30-day supply of raw materials to buffer against supply issues. It features three production lines for crafting the vases, which typically operate at 75% capacity, and has two large kilns for firing vases, which typically operate at 95% capacity. There are three inspection and packing lines, which also typically operate at 75% capacity. Which area is RCCP most likely to examine?
The kilns used to fire the vases
An organization is using an order point system, and its supplier reduces its delivery lead time. What will happen if the organization keeps the same order point?
The level of safety stock will automatically increase.
Which of the following statements about continuous improvement approaches is false?
The most valuable approach is lean.
A manufacturer uses an order point system to determine when to place an order. It requires an average of 240 units per week, and the order lead time is 3 weeks. It maintains 170 units of safety stock. What is the resulting order point?
The order point is calculated by adding the demand during the order lead time to the safety stock level. In this case, the demand during the order lead time is 240 x 3 = 720, which is then added to the safety stock level of 170 units, which results in an order point of 890 units.
A U.S. organization gets an accredited third party to certify it is compliant with ANSI Z.10. What does this mean?
The organization has safety standards that exceed U.S. OSHA requirements.
electronic data interchange (EDI)
The paperless (electronic) exchange of trading documents, such as purchase orders, shipment authorizations, advanced shipment notices, and invoices, using standardized document formats.
What would be a reason to assign percentage ratings to both probability and impact levels?
The percentages can help assessors agree on the value of the rating level.
reverse supply chain
The planning and controlling of the processes of moving goods from the point of consumption back to the point of origin for repair, reclamation, recycling, or disposal. See: reverse logistics.
In a master scheduling grid, the planning horizon relates to the cumulative lead time in which of the following ways?
The planning horizon is equal or greater than the cumulative lead time
enterprise resources management
The planning, execution, control, and measurement functions required to effectively operate an enterprise.
An organization wants to create automatic communication between its inventory management system and its main supplier's inventory management system, which are incompatible. They decide to use data-oriented middleware despite the labor-intensive setup process. What long-term risk is associated with this selection?
The process may need to be repeated when adding, changing, or upgrading software in the future.
capable-to-promise (CTP)
The process of committing orders against available capacity as well as inventory. This process may involve multiple manufacturing or distribution sites.
strategic planning
The process of developing a strategic plan. See: operational planning, strategic plan, tactical planning.
outsourcing
The process of having suppliers provide goods and services that were previously provided internally.
sourcing .
The process of identifying a company that provides a needed good or service
value stream
The processes of creating, producing, and delivering a good or service to the market.
tactical buying
The purchasing process focused on transactions and nonstrategic material buying
A manufacturer, a distributor, a wholesaler, and a retailer all agree to base their orders on actual consumer orders instead of performing detailed forecasts based on each party's Tier 1 customers' actual orders. Which of the following will result, and what are the likely risks of this method?
The push/pull line moves back to the manufacturer but at the risk of greater overtime or rush orders.
material requirements plan
The result from the process of material requirements planning.
business rules
The rules for an organization, such as policies or procedures, that define or constrain some aspect of the business and are meant to provide guidance.
What is a major drawback associated with using a custom scorecard to report organizational performance?
The scorecard may not be very well balanced.
database management system (DBMS)
The software designed for organizing data and providing the mechanism for storing, maintaining, and retrieving that data on a physical medium (i.e., a database).
inventory velocity
The speed with which inventory passes through an organization or supply chain at a given point in time as measured by inventory turnover.
product life cycle
The stages a new product goes through from beginning to end (i.e., the stages that a product passes through from introduction through growth, maturity, and decline
In a process map, an oval shape is used to signify which of the following?
The start and end of a process
universality
The strategy of designing a product initially intended for one market in such a way that it can also be sold in other markets. A form of standardization.
modular design strategy
The strategy of planning and designing products so that components or subassemblies can be used in current and future products or assembled to produce multiple configurations of a product
overall value at risk (VAR)
The sum of the probability of risk events times the monetary impact of the events; can impact any core supply chain functions (e.g. plan, source, make, deliver, and return) or key dependencies.
total cost to serve
The sum of the supply chain cost to deliver products and services to customers. Comprises both direct cost and indirect cost.
An organization that uses standard costing is calculating the efficiency of its main manufacturing facility over the last month. In any given week, the facility has 1,600 standard hours of work. The hours actually worked over the last four weeks are as follows: week 1—1,689, week 2—1,547, week 3—1,590, week 4—1,730. What is the total efficiency for the last four weeks?
The sum of total standard hours worked for the period in question is 6,400. The sum of the hours actually worked is 6,556. 6,400/6,556 = 97.6%.
Supplier capacity measurements show that supplier X consistently has had three times as many units available as its top competitors. Based on only this metric, what can the organization determine?
The supplier looks promising but should be carefully checked for signs of financial distress.
When the financial goals of sales, marketing, and the supply chain in a company are not properly aligned, what typically occurs?
The supply chain sacrifices best practices to make the short-term numbers look better.
supply chain risk
The variety of possible events and their outcomes that could have a negative effect on the flow of goods, services, funds, or information resulting in some level of quantitative or qualitative loss for the supply chain.
When conducting capacity forecasting for a warehouse that uses random location storage, what would happen if the maximum inventory of each type of unit is used to determine the overall warehouse footprint size?
The warehouse would have a large amount of excess capacity.
A local supplier is selected as a supply partner over an international supplier who had a lower total cost of ownership. An audit reveals that the supplier was given more weight for being local. Which of the following would make this weighting valid?
The weight is based on the organization's corporate social responsibility policy.
Which is one reason why suppliers will not increase supply past a given point even if the prices keep getting higher and there is more incentive to produce more supply?
There are diminishing returns
Which of the following characteristics belongs to the e-business supply chain rather than a traditional supply chain?
There is a focus on economies of scale and scope.
What is a risk of having too many communication channels open on a project with many stakeholders?
There is a higher risk of missed or erroneous communications.
Since reverse logistics affects the entire product life cycle, one can expect which of the following?
There will be increased use of customer service with products in early life cycle stages.
What is the biggest difference between railroads in Europe and those in many other parts of the world?
They are not standardized.
Which of the following statements about effective supplier performance measurement systems is true?
They automate key supplier performance measurement activities.
Which of the following statements about free trade zones (FTZs), also known as foreign trade zones or export processing zones, are true?
They can help manufacturers with potentially noncompliant shipments avoid customs fines by repacking or remarking imports. They are geographic areas where duties, tariffs, and quotas are delayed and/or avoided.
Why should positive variances from standards be tracked by an organization?
They could show where someone was taking a dangerous shortcut.
Which of the following describes customer-focused businesses?
They educate customers throughout the purchasing process.
Which of the following describes lifetime customers?
They have forged a win-win relationship with the business in question.
Which of the following describes commercial bribes?
They may be a payoff to cover up inferior products.
What is true of two organizations with electronic business supply chains operating in the same industry?
They may operate as a buyer, seller, rival, or trading partner depending on the product in question and the market conditions.
What is true of common carriers?
They must take all legitimate business within the scope of their license, even at a loss.
landed cost
This cost includes the product cost plus the costs of logistics, such as warehousing, transportation, and handling fees.
order qualifiers .
Those competitive characteristics that a firm must exhibit to be a viable competitor in the marketplace
order winners
Those competitive characteristics that cause a firm's customers to choose that firm's goods and services over those of its competitors.
A company competing on innovation should minimize which metric?
Time-to-volume
Which is an objective of aggregate inventory management?
To balance customer service, operations efficiency, and inventory investment cost objectives
Which of the following statements correctly identifies the purpose of the weights in a weighted moving average?
To be more sensitive to recent trends in demand
How can IT be employed to aid supply chain management?
To deepen trust in existing relationships
What is the purpose of the Harmonized Tariff Schedule (HTS)?
To have a standard set of numerical identifiers that provide descriptions of products for import and export
Which is the primary reason why organizations need to implement customer relationship management (CRM)?
To help ensure competitive survival
Which of the following goals is the most compelling reason for a manufacturer to own its own warehouses rather than using a contractor's warehouses?
To increase control over warehouse design decisions
Which of these proactive reasons to form strategic alliances focuses on shared technology that can add to the skills base of both organizations?
To increase organizational expertise
What might be one reason to decentralize returns processing as opposed to centralizing it?
To increase the speed of processing
Why might an organization choose to follow voluntary sustainability regulations?
To lessen the reputation risks associated with the environmental impact of the business
What is the purpose of the five Ss?
To make everything in the workplace orderly and clean and to maintain it that way
Business models intending to use the internet as one of many sales channels and owning some of their own physical distribution means
To minimize metadata
Which of the following is a major goal of service-oriented architecture (SOA)?
To separate applications from data so that applications have universal functionality
Which of the following is a primary purpose of the cash flow statement?
To show key stakeholders if the company has sufficient cash to pay debts, bills, and dividends to owners
Which of these proactive reasons to form strategic alliances focuses on lowering system costs and using resources more effectively?
To strengthen operations
Which of the following is taken into consideration when calculating inventory accuracy?
Tolerance level per stock keeping unit (SKU) Target value of SKU On-hand quantity and recorded balance Total number of SKUs
Which of the following is part of the correct definition of customer relationship management (CRM)?
Tool to support existing and potential customer needs
Selection of processes for improvement, according to quality methodology, should be done at which of the following levels?
Top management
Managers are enticed by the lower item cost of a product component when it is sourced overseas in a country with low labor costs. Which of the following can a supply chain manager use to show managers that item cost is only a minor part of the overall equation?
Total cost of ownership
Which would be considered a key performance indicator (KPI)?
Total supply chain inventory turns
Which of the following materials-handling options uses space efficiently, has the potential to improve inventory identification and accuracy, and is flexible?
Towline
Which is a best practice for expediting transportation?
Track the percentage of orders expedited and the marginal costs of expediting.
What is a best practice when sales or managerial overrides are used in combination with seasonally adjusted exponential smoothing?
Track the quantitative and qualitative forecasts separately
What type of insurance should a manufacturer fulfilling a government contract seek if it is concerned about the project being cancelled for political reasons?
Trade disruption insurance
What option to measure customer satisfaction would work best for a retail store that wants to gather large amounts of feedback from customers if the retailer doesn't mind having fairly brief responses?
Transaction customer feedback questionnaires
What level of communication would be expected in a successful small business still run with paper versions of the general ledger and with purchase orders once a month by telephone and is asked by its most important customer to accept EDI orders?
Transactional with information sharing
if a fleet of delivery trucks is experiencing relatively poor maintenance, this is a red flag for what type of supply risk?
Transportation lead time
Which of the following should be integrated in a transportation management system (TMS) to increase cost control, customer service, and automation?
Transportation planning and order fulfillment
If you were able to get a 20% discount on any of the following logistics expenses, which would you choose to receive the maximum cost savings?
Transportation(Transportation expenses make up the largest portion of the logistics budget)
A group of employees is discussing which features would be best for a new product they will be launching. Using a flipchart, they have written their overarching product goal and the four product features they want. They're now in the midst of adding further details about each of the product features. Which of the following tools are they using?
Tree diagram
According to John Maynard Keynes, which is a primary cause of recessions from a macroeconomic perspective?
Trend to forego capital investments and instead save cash
Fatima Alano is the new CEO of a company, and she's known for the sustainability initiatives she spearheaded at her last company. Which of the following would she be most likely to focus on first?
Triple bottom line
Which international agreement that documents dangerous goods controls is not legally binding?
United Nations Recommendations on the Transport of Dangerous Goods
A trend in extending the design of products originally made for emerging economies for sales in developed economies is an example of which of the following?
Universality
If unexpected customer orders are received and must be filled within 30 days, what metric would be used to measure the manufacturer's performance on the order?
Upside supply chain adaptability
An organization wants to sell products overseas for the first time but is wary of the customs process. What can it do as a preventive action in regard to the risk involved?
Use 3PLs with customs experience.
A small organization in the United States is purchasing goods from an organization in Japan. What should the organization do to protect against operating exposure caused by currency exchange?
Use a broker to assist with currency hedging.
An organization is concerned about the quality of the materials it is importing. It wants to inspect all incoming materials prior to paying import duties. What should the organization do?
Use a free/foreign trade zone (FTZ).
A new manufacturing process produces wastewater with higher levels of acidity than can be discharged. What can the organization do to solve this issue in a way that is also high on the waste hierarchy?
Use a waste exchange to advertise acidic water as a possible raw material
An organization wants to automatically record the movement of inventory through its supply chain using a warehouse automation system (WMS). It typically is looking for information on a limited number of high-value items as well as a large number of medium- and low-value items. What is the best way to track the inventory using the WMS?
Use active RFID tags on each high-value item and passive tags on boxes of low- and medium-value items
A manufacturer that uses assembly lines committed to the Just-in-Time (JIT) methodology is running into issues reconciling material requirements planning (MRP) with that methodology. What is the best option available to address the conflict?
Use balanced flow.
A large organization is looking to improve the performance of multiple customized applications and cut long-term costs while doing so. They currently have dedicated servers for each application. What is the best option available to the organization?
Use cloud computing to virtualize servers and create internal clouds for the applications to use.
How can an organization pursue cost savings when shipping multiple parts used in construction for a single item?
Use joint replenishment.
Pareto analysis
Use of [a specific] principle in prioritizing or ranking a range of items to separate the vital few from the trivial many. See: 80-20.
Product traceability and configuration management can help the organization with compliance in what area?
Use of a trading bloc-Product traceability and configuration management would help when determining whether goods qualify for preferred treatment under trade bloc provisions.
Which of the following is/are common currency-related trends?
Use of currency hedging when available Use of letters of credit
Which of the following can be used in a balanced scorecard to both measure compliance and provide goals for continual improvement?
Use of more than one target per measure
A start-up company wants to save time and money during the initial information technology setup process. What is the best choice for the company?
Use software as a service
manufacturer is looking for a supplier for materials needed for a new item. It draws bids from several companies that it has done business with before. These include one bid that is significantly lower in price than the others. Before making a final determination, what should the manufacturer do?
Use supplier relationship management (SRM) information to review the past performance of the vendors.
For smaller or less market-dominant organizations, which of the following would best ensure that suppliers are complying with ethical standards?
Use third-party auditors agreed to by both parties.
Which of the following is a main reason why portals in web-based warehouse management systems (WMS) enhance visibility and control?
Users can either push data and inventory to others or pull inventory and data to themselves.
Comparing the export-import business to domestic supply chains, which of the following is a more common practice with exporting and importing?
Using intermediary logistics specialists
What tool can help a supply chain director visually show the value provided by the supply chain, including all of the process steps as well as the value-added and non-value-added time for each step?
Value stream map
Which of the following identifies a type of collaboration in which a manufacturer of razor blades determines how its product is displayed on a retailer's shelves and performs cycle counting at the store?
Vendor-managed inventory (VMI)
When Henry Ford organized Ford Motor Company to include raw materials extraction and dealerships as well as his assembly lines, he created which of the following?
Vertical supply chain
A division-level supply chain professional working to streamline organizational operations sends an email to the manager of a company-owned warehouse, looking for a performance metrics report. What dimensions of communication are represented in this action?
Vertical, informal, internal
A manufacturer in a highly competitive industry wants to improve efficiency and lower overall costs for its products by increasing information sharing and collaboration with multiple suppliers and distribution partners. It is exploring a business-to-business exchange to facilitate this effort. Which ownership model would work best for the manufacturer?
Virtual trading exchange
Which of the following types of automated identification and data capture (AIDC) systems could be used to read text on the side of a box as it moves on a conveyor belt?
Vision systems
A key performance indicator for merchandizing products is:
Volume growth, market share, and total supply chain inventory returns
A retailer studies its customer retention rate and discovers that it loses an average of 25% of its customers from year to year. It decides to focus on retaining these customers in an effort to be less reliant on new customers for revenue. What marketing campaign management tool should the retailer use to increase customer retention rates
Vulnerable customer campaigns
What has the potential to create a beneficial use for waste rather than having to pay for its disposal?
Waste exchange
Which of the following is correctly associated with supplier relationship management (SRM)?
Way to ensure mutual profitability while meeting marketplace needs
Which of the following allows developers to wrap otherwise incompatible electronic messages in a shell for universal message receipt?
Web services
For transportation management systems (TMS), which of the following would be the best choice to plan for shipment costs, fuel costs, road maps and routes, road conditions, weather conditions, and carrier availability?
Web-based TMS services
Under International Commercial Terms (Incoterms), when is the risk of loss transferred from the seller to the buyer in a standard FOB Origin contract?
When the seller duly delivers the inventory to the carrier
When can sharing actual demand data and demand plans complicate a buyer-supplier relationship?
When the supplier disregards the information and does not develop sufficient capacity
What useful information may come from identifying the organization's weaknesses during the change managment process?
Where change will meet the most resistance
According to Michael Porter, in his influential work on business strategy Competitive Advantage, what else needs to be integrated into a business plan if it already specifies customer service, sales channels, a value system, and an asset footprint?
Whether to use make-to-stock or some other operating model
Which of the following best describes a customer data warehouse (CDW)?
Which of the following best describes a customer data warehouse (CDW)?
A bribe can be in the form of anything the recipient considers to be valuable.
Which of the following is true of a bribe in international trade?
Which of the following is true of the use of data for decision making?
Which of the following is true of the use of data for decision making?
Which of the following would appear in the routing file?
Work center ID
Performance metrics for an organization's suppliers indicate that the number of shipments that were not precleared was between 40 to 50 percent all year. If the target for this metric is five percent, which of the following are valid options?
Work with the supplier to reengineer the clearing process, if failed, Review the target to ensure that it is accurate and feasible and, if not, make changes. Find a different supplier
Does an organization need more than one order status reporting system?
Yes. Intermediate customers might need the information to automatically link with their systems.
Should the supply chain manager of a channel master monitor the communications process between it and its strategic trading partners?
Yes. It is important that communications stay complete, accurate, and respectful.
Which of the following is a leading economic indicator?
Yield curve
A strategic profit model calculates return on assets (ROA) using net profit margin times asset turnover. The model also shows what ratios and calculations are used to calculate the latter ratios. Which is a good supply chain management use for this model?
You can calculate how much of a loss in sales it would take to make an inventory reduction unprofitable.
Supply Chain Operations Reference (SCOR) model
[It] describes the business activities associated with satisfying a customer's demand, which include plan, source, make, deliver, return, and enable.
When inventory moves from being backordered to being in excess, it may be due to:
a change in demand downstream in the supply chain.
Cost-effective and efficient collaboration between supply chain partners requires:
a conflict resolution model specified within the buyer-supplier contract.
balanced scoresheet
a list of financial and operational measurements used to evaluate organizational or sc performance
If the only plan an organization can devise to respond to a risk proactively would cost the organization more than the expected monetary value of the risk without any response, what should the organization do?
accept
During which phase of the PDCA model does a demand manager lead efforts to respond to variances from the plan and address root causes of the variances?
action
Demand forecasts are likely to be most accurate for which of the following items?
all cars
The minimum total cost on an economic order quantity (EOQ) curve is:
always directly above the intersection of the carrying and ordering cost curves.
virtual trading exchange
an online trading exchange that enables both information integration and collaboration between multiple trading partners
In distribution requirements planning (DRP), the key difference between a push system and a pull system is whether:
area warehouses are authorized to order inventory replenishment.
A great majority of international shippers use freight forwarders because they:
arrange charters or book vessel space. handle payments. quote carrier rates.
The primary objective of transportation is to carry goods/materials between partners and customers:
at an optimal cost in time, money, and environmental degradation.
If an organization has a demand manager position, this person's direct supervisor should:
base performance measurements on the reliability of the overall demand plan.
E-business vision and strategy should:
be tightly integrated with and driven by a valid business strategy.
business-to-consumer sales (B2C)
business being conducted between businesses and final consumers, largely over the internet.
Which of the following provides a point of reference for formulating sales and operations planning?
business plan
An organization does research and then creates a schedule and budget for influencing demand for a new product, including promotions and advertisements. The activities are performed well, but, after nine months, the sales are far below what was expected and the product is abandoned. Which of the following aspects of the plan-do-check-action cycle did these demand-influencing activities omit?
check and action
If an organization outsources all of its production activities but continues to perform warehousing and distribution, then the inventory management role should:
collaborate with external inventory management at each level of production planning.
Which of the following types of carriers must be approved by the federal government and has heavily regulated rates and services?
common carriers
An organization is failing to achieve its envisioned savings from its new supplier contracts and web-based ordering system, and it discovers that some employees are still using old, personally preferred suppliers. This is a failure in:
compliance management
A manufacturer enlists a marketing company to survey current and prospective customers to determine their perceptions of the manufacturer's brand and gauge their reactions when shown a series of new product concepts. What type of marketing research is being conducted?
consumer research
Information technology enables supply chain management by:
creating global visibility, so that even companies with no global operations must compete globally.
A business is attempting to create more powerful bonds with its customers by delivering greater customer satisfaction and mutual dependence. This business is pursuing a strategy of:
creating lifetime customers.
In the supply chain model, customer relationship management (CRM) is instrumental in:
creating more profitable customer relationships.
A business finds that a dissatisfied customer has created a website on which the business and its products are harshly criticized. This situation most likely represents a failure in:
customer communication and care.
A business gathers information from its accounts information system to identify those customers who have bought a large volume of items in an innovative product group. This is an example of:
data mining
Supply chain management works to reduce:
demand and supply variability.
An organization is implementing ISO 31000 risk management in response to an executive-level mandate. This mandate should include a commitment to:
develop a transparent process inclusive of all stakeholders.
response focused sc
develop forecast based on system flexibility and capacity cushion
The steps for successfully implementing a strategic supplier alliance include:
developing employee negotiation and joint problem-solving skills.
what should a risk definition include?
each identified risk must also have a time dimension or a specific time horizon (e.g., day, month, year) and a specific perspective or view that defines the scope of the risk (e.g., boundaries, what's not included).
The United Nations Global Compact was designed to:
encourage companies to integrate its principles into their global business activities.
Complete the schedule and budget to reflect the impact of the later Knowledge Area plans.
executing
Which carrier type is commonly used for unprocessed agricultural products?
exempt
You work in the supply chain as a finance manager, and your supervisor has told you that he wants you to become more familiar with spend management. This means that you will likely be spending more time:
focused on outsourcing processes
When designing the customer relationship management strategy for computer algorithms for segmenting customers and prospects, which of the following is the best input data, according to best practices?
historical purchasing patterns,Demographics
A start-up manufacturer of cosmetics is selecting an inventory planning method. It wants to minimize inventory levels, minimize the bullwhip effect as much as possible, and remain responsive to local variations in demand. Which method would work best in this situation?
hybrid
An Ishikawa diagram is used to:
identify all possible causes of an effect and then research the most likely ones.
A benefit of an organization implementing customer segmentation is the ability to:
identify the best way to fulfill customer needs.
Continuous process improvement is supposed to:
improve worker satisfaction by eliminating unnecessarily strenuous or stressful work.
Which of the following is a benefit of lateral supply chains?
improved business focus and expertise
An example of a proactive benefit driving a strategic alliance would be a concern about:
improving time to market or increasing quality.
Microeconomics focuses on the decisions that businesses and people make:
in terms of resource allocation and the prices of products and services.
When market research reveals that some customer segments desire certain features but other segments desire different features, an organization's primary criteria for deciding on features to include are those that:
increase net profit margin
Older enterprise resources planning (ERP) systems typically can do all of the following without further upgrades except:
increasing flexibility by allowing changes to their conceptual models.
Reducing the time in which inventory is not moving by using Just-in-Time (JIT) delivery and lean manufacturing is an example of an effort aimed at:
increasing velocity.
A company fears that it will be overcome in the marketplace by a competitor who is developing a new technology. In response, the company forms an alliance with a supply chain partner. They invest equally in creating the alliance infrastructure, revise their corporate visions and organizational structure, and create processes to share information and merge workflows. This alliance may fail because it lacks:
individual excellence.
An organization is looking to help its supplier with continuous improvement. It would like to seek certification that reflects its narrow focus in a specialty field. Which of the following would be the best place to start searching for appropriate certification standards?
industry specific and non-profit
"A period marked by high costs and low sales." This phrase best describes what phase of the product life cycle?
introduction
Which of the following is the technique of using visual signals to "pull" components through the manufacturing process?
kanban
Increased customer visibility means:
knowing what each customer values. being aware of each point of contact between the customer and the business. seeing the transaction from the customer's viewpoint.
A value stream map is usually used in conjunction with which of the following improvement methods?
lean
If an organization and its major supply chain partners each implement ISO 31000 and ISO Guide 73:2009 related to risk management, they should be able to:
mitigate the risk of miscommunications with external partners due to risk terminology differences.
How often, under normal circumstances, does a pre-S&OP meeting take place?
monthly
All of the following are included in supply chain event management's active visibility except:
multiple application workflow capability.
A proven method of estimating the amount of a risk budget to devote to a particular risk response is:
multiplying the expected cost of the risk by its likelihood.
Which replenishment frequency would typically require the highest level of safety stock?
once per week
A statistical forecast should be:
one of many inputs to demand plans.
Through the use of Just-in-Time (JIT) and other lean techniques, velocity produces products and services:
only as fast as customers want them.
A warehouse ideally should:
optimize cube utilization and inventory velocity in part by providing 100% accessibility.
fourth-party logistics (4PL)
organization is often a separate entity formed by a joint venture or other long-term contract between a client and one or more partners
If you are working in a firm that is in Stage 1 of supply chain management evolution, you should be prepared for:
overly optimistic forecasting
Which of the following has the highest fixed costs of any means of transporting petroleum?
pipeline
Which of the following modes of transporting petroleum involves the lowest operating costs?
pipeline
Which of the following offers the greatest security against loss when transporting liquid cargo?
pipeline
A razor blade manufacturer installs RFID in their promotional displays so they can monitor when these displays leave the back rooms of retail locations and when they are discarded. This is an example of marketing control over which of the following?
placement
SC SCOR model
plan, source, make, deliver, return, enable
Maintaining a large safety stock of flu medicine in anticipation of a potential epidemic is an example of:
planning demand
"A strategic decision, based on competition, perceived value, and brand identity." This describes which component of a modern marketing strategy?
price
Which of the following is the most significant drawback of specialized package carriers such as FedEx and TNT?
price
According to the House of Toyota, Just-in-Time is facilitated by:
pull systems, one-piece flow, and takt time.
A logistics manager concerned with avoiding breakage of cargo would be least inclined to choose which of the following modes of transportation (ignoring tradeoffs)?
rail
Considering the types of cargo typically carried over long distances by inland water carriers and the rates per ton-mile, which of the following modes of transportation is the barge's closest competitor?
rail
What method of transportation should an organization use if it is looking for a fuel-efficient way to transport goods to multiple destinations around a continent?
rail
The key to synchronizing supply and demand is to:
reach consensus on a demand plan and a production plan and share relevant changes with supply chain partners.
Vendor-managed inventory is an example of a collaborative initiative that can benefit supply chain participants by:
reducing inventory costs.
By ordering extra safety stock, a purchasing manager might reasonably expect to benefit the supply chain in all of the following ways except:
reducing overall supply chain costs.
As part of a regular SWOT analysis, a manufacturer of luxury goods identifies a high likelihood of a national personal income tax increase in its primary market following sweeping electoral changes. What potential outcome should the manufacturer prepare for?
reduction in demand
An organization's core competency is in the service component of a product-service package, and customers have praised their ability to quickly resolve problems. If most of these problems are product quality issues, the best way to improve this supply chain would be to:
replace the process value supply chain partners who have poor quality.
Which of the following modules of an advanced planning and scheduling (APS) system would allow an organization to simulate in advance the effect on customer service of closing a plant?
requirements optimization
If an organization with limited staff has a customer relationship management (CRM) system that allows customers to customize a product-service package, the organization should:
reserve some fee-based service representative help for their more profitable segments.
The authors of a Harvard Business Review article think that an intense focus on glocalization will soon be coming to an end. Supporters of this perspective believe that multinational corporations (MNCs) should instead be focusing their efforts on:
reverse innovation
Successful implementation of customer relationship management (CRM) and supplier relationship management (SRM) philosophies usually requires:
revision of decision-making processes.
Where should an organization look to find the sequence of operations for the manufacture of a product when engaging in capacity requirements planning?
routing file
Stockpiling is a warehouse function used for:
seasonal inventories: clothing, lawn furniture, and agricultural products.
A key element of contingency planning for supply chain management that differs from contingency plans for other business functions is that it is necessary to
share risks among supply chain partners.
All things being equal, which example would improve organizational profit metrics the most?
sharing customer data with suppliers, which reduces raw materials inventory
The network configuration of a supply chain:
should be designed to reflect trading partners' capacities.
Ishikawa diagram
shows the causes of an event and is often used in manufacturing and product development to outline the different steps in a process, demonstrate where quality control issues might arise and determine which resources are required at specific times.
Reducing the number of steps in a service to just those specified by the most recent core customer segment survey and offering a few other steps as options exemplifies which of the following design strategies?
simplification and customization
A design engineer is creating a product that conforms to customer needs according to market research. Which of the following is the most important secondary design element that the engineer should include in the design?
sold for positive return
Which of the following statements is true about changing market conditions such as those in the fashion industry?
some companies manage this by starting their seasonal product design process early.
The widest demand variability in the bullwhip effect generally occurs at which of the following nodes?
supplier
A coal mine ships coal to a generating plant that supplies power to a manufacturer that produces a machine that is shipped to a distributor that sells mining equipment to the same mine that began the process. This is an example of a:
supply chain that doubles back on itself.
The most productive, cost-effective packaging needs to:
support efficiency, be protective, be labeled, and have low environmental impact.
What is a characteristic of a project that distinguishes it from an operation?
temporary in nature
Direct materials plus direct labor plus manufacturing overhead equals:
the cost of goods sold.
Maintaining a high level of customer care is critical to customer-driven brand image promotion because:
the internet has given dissatisfied customers the means to make their dissatisfaction quickly and widely known.
The House of Toyota is often used to explain the entire scope of lean. Toyota's sudden acceleration quality issues have underscored the importance of aligning:
the long-term quality strategy and the value proposition with the short-term growth strategy.
supplier/customer/product risk rating
the numerical risk rating for supplier, customer, or product. normalized and used for comparison purpose
Which is true of transitioning from a traditional buyer-supplier relationship to a strategic alliance?
the relationship will have multiple contact points aligned by the business process.
The activity network diagram, also known as the critical path method chart, can be used when a team needs to identify:
the required order of tasks and their respective time requirements in a process or project.
Which of the following is true of a manager's transportation execution decision support system (DSS)?
the transportation execution DSS uses simpler models than strategic or tactical DSS systems.
An organization has formed an alliance with a supplier. The supplier's personnel have complained that they have to learn new skills and technologies. Which can best help the supplier's employees appreciate the alliance?
the work being done is helping to build organizational skills and expertise.
Perfect order fulfillment is equal to:
total perfect orders divided by the total number of orders.
A control chart can be used to track which of the following?
track process variation for a variety of process outcomes like component size, wait time, percentages, thickness, etc.
Success in e-business is often difficult to achieve because both parties must have access to the same analysis of the same data but cannot get to this level of visibility without:
trust
A partnership in a supply chain is a relationship that must be based on:
trust, shared risks, and the rewards of achieving a competitive advantage.
Sales training to increase business-to-business (B2B) customer loyalty should focus on:
understanding the customers' business requirements.
You are ordering a camping tent through the call center for a recreational equipment manufacturer. The operator notes that for a little more money you could receive significantly more value in another tent model. This is an example of:
up-selling
To keep supply chains competitive, warehousing focuses on:
value-added activities.
All of the following are prerequisites for companies wanting to invest in radio frequency identification (RFID) except:
very high inventory accuracy.
Which is usually planned in manufacturing and can be somewhat controlled even though it isn't value-added?
waste
A mining company is looking to move iron ore from the mining location processing facilities economically. What is the best low-cost option?
water
A U.S. organization imports chemicals from Mexico. Since September 11, 2001, customs delays checking for contraband have become onerous, and lead time has become highly variable. Which of the following are ways to reduce this risk?
work with U.S. customs by enrolling in C-TPAT,Source the chemicals domestically.
