SCM CH 17
T/F: Air carriers haul the most amount of commercial freight because of their inherent speed advantages
false
All of the following are criteria used to measure transportation performance except _____. a. speed b. reliability c. capability d. accessibility e. operator hours of service
A
Which of the following is not an advantage of centralizing professional service procurement? a. Increase the accountability of outside consultants to the buyer by increasing the monitoring and auditing of services provided. b. Lead to the ability to reduce the number of professional service providers. c. Reduce service provider redundancy. d. Reduce the likelihood of unnecessary charges. e. Improve the working relationship between internal user and professional service provider.
A
A/An _____ involves picking smaller amounts of materials from a series of nearby suppliers to be used in a just-in-time or lean manufacturing environment. a. common carrier b. exempt carrier c. milk run d. private carrier e. contract carrier
C
Which of the following is not a key part of a project's scope? a. Project deliverables. b. Milestones and guidelines. c. Service provider's background and experience. d. Budget. e. Rewards and penalties.
C
Which of the following is not one of the disadvantages of air carrier over other modes of transportation? a. Very high cost. b. Location of large airports limits shipping points. c. Seasonal availability. d. Cannot be used for large, bulky, or hazardous shipments. e. None of the above.
C
Which of the following is not one of the disadvantages of motor carrier over other modes of transportation? a. High cost. b. Limited to domestic or regional transportation. c. Very long lead times. d. Cannot be used for large volumes. e. None of the above.
C
A _____ is a key individual or unit that controls substantial indirect spending and typically has a position of great responsibility within the organization. a. purchasing consortium b. maverick spender c. 3PL d. power spender e. kanban
D
_____ refers to a mode's or carrier's ability to provide service over a geographic area. a. Speed b. Capability c. Total cost d. Accessibility e. Reliability
D
A/An _____ serves the transportation requirements of the party with which it has a legal agreement and provides only those services that have been negotiated with the shipper at a mutually agreed upon price. a. intermodal carrier b. private carrier c. common carrier d. exempt carrier e. contract carrier
A
A/An _____ system provides status alerts, via e-mail, fax, pager, and so on, to a buyer or salesperson that a particular shipment has been delayed and that this may affect other entities in the supply chain. a. event-based b. MRP c. ERP d. DRP e. None of the above.
A
All of the following are types of information a 3PL should provide to the buyer except _____. a. choice of mode b. number of carriers providing inbound, intraorganizational, and outbound transportation services c. total transportation expenditures by specific carrier and mode of transportation d. breakdowns of volumes by commodity or type of material e. percentage of shipments arranged by suppliers versus by buyers
A
Motor carriers are characterized by _____ variable costs, while rail carriers have comparatively _____ fixed costs. a. higher....high b. lower....high c. higher....low d. lower....low e. There is no difference in variable and fixed costing between motor and rail carriers.
A
The presence of _____ ensures a supply of available transportation in markets where only one-way traffic exists. a. exempt carriers b. one-way carriers c. common carriers d. motor carriers e. All of the above
A
Which of the following is not one of the disadvantages of water carrier over other modes of transportation? a. Limited flexibility. b. Seasonal availability. c. Very long lead times. d. Poor reliability. e. Cannot be used for large volumes.
A
_____ can be defined as how easy the professional service provider is to do business with. a. Wavelength b. Collaboration c. Cooperation d. Preference e. None of the above.
A
_____ can be defined as that amount of an organization's total procurement budget that is purchased from unauthorized sources. a. Indirect spend b. Direct spend c. PBL d. E-commerce e. Maverick spend
A
By law, a/an _____ must serve the general public without discrimination based on published rates for specific goods. a. contract carrier b. private carrier c. common carrier d. motor carrier e. intermodal carrier
C
T/F: A PBL agreement and a SLA are similar concepts.
true
T/F: A major advantage of a rail carrier is the wide range of items it is capable of carrying.
true
T/F: The greatest competition between domestic transportation modes involves rail and motor carriers
true
T/F: The use of 3PLs is increasingly becoming a viable option for smaller shippers and infrequent shipments
true
T/F: A clear trend is that many carriers now market themselves simply as providers of physical transportation services.
false
T/F: A project's scope does not need to include any nondisclosure statements to protect the buying company's interests
false
T/F: A shipper should necessarily negotiate a contract with every carrier it uses, even if it is considered a small or infrequent shipper.
false
T/F: Although it is important to develop a rationalized supply base such that buying power can be appropriately leveraged, a single-source strategy frequently maximizes the value of professional services
false
T/F: Assigning and maintaining accurate and representative commodity codes for indirect goods and services across an enterprise is relatively easy
false
T/F: Carriers will generally not consider the availability of backhauls when quoting one-way freight rates on a particular traffic lane.
false
T/F: Exempt carriers are highly regulated economically by the Surface Transportation Board.
false
T/F: For some purchased items, such as bulk raw materials, speed of transportation is the most important factor
false
T/F: Historically, expenditures for indirect materials and services have received the same level of management attention as have direct materials
false
T/F: In general, supply management should provide and manage suppliers' e-catalogs.
false
T/F: In purchasing professional services, it is not important for a standard contract template or format to be developed by the organization's legal department because there are so many types of professional services and providers.
false
T/F: Inbound logistics may also include the shipment of repairable items back to maintenance facilities for refurbishment and return to usable or salable condition.
false
T/F: Inland water carriers are usually accessible for most domestic shippers, as lakes, rivers, and canals are widely dispersed throughout the country
false
T/F: Inland water carriers typically transport finished or semifinished products because of the lengthy in-transit time.
false
T/F: More effective control of inbound shipment costs usually requires purchasing goods under a shipping designation of FOB destination.
false
T/F: Moving to a centralized process for procuring professional services does not allow the buying company to leverage its corporate buying power.
false
T/F: Performance-based logistics has been widely adopted by the private sector
false
T/F: Private carriers are never utilized to make daily "milk runs," picking up smaller amounts of materials from a series of nearby suppliers to be used in a just-in-time or lean manufacturing environment
false
T/F: Project scopes should be very detailed for all service providers, including those who have previously performed work for the organization
false
T/F: Shipping a high-priced component via air is never a cost-effective option
false
T/F: The U.S. Bureau of Customs and Border Protection established the so-called "10+2" rule that affects all modes of transportation except ocean container freight.
false
T/F: The importance of effectively managing an organization's indirect spend is decreasing
false
In order for _____ to work, both the buyer and the logistics service provider must explicitly agree as to what the buyer's desired outcomes, goals, and objectives are and how the logistics service provider can help meet them. a. PBL b. MRO c. TQM d. TCO e. KPIs
A
Which of the following is not one of the advantages of motor carrier over other modes of transportation? a. High flexibility. b. Good reliability. c. Good for JIT delivery. d. Good speed. e. Low cost.
A
Which of the following is not one of the disadvantages of rail carrier over other modes of transportation? a. Seasonal availability. b. Limited access to rail line. c. Longer in-transit lead times. d. Less flexible - may not have rails to all locations. e. Limited access to rail spur.
A
Which of the following is not one of the major transportation service linkages throughout a typical supply chain? a. Production planning. b. Inbound logistics c. Intraorganizational movements. d. Outbound logistics. e. Recovery and recycling.
A
_____ refers to the accuracy and on-time consistency of the transportation service, arriving neither late nor early. a. Reliability b. Capability c. Accessibility d. Total cost e. Speed
A
Which of the following is not one of the advantages of water carrier over other modes of transportation? a. Good for bulk commodities (inland). b. High flexibility. c. Good for heavy, large items (international). d. Can handle most types of freight. e. Low cost.
B
A/An _____ is a manufacturer or distributor that controls and manages its own transportation equipment, whether owned or leased. a. common carrier b. private carrier c. contract carrier d. intermodal carrier e. exempt carrier
B
When freight is shipped _____, the buyer, or consignee, is responsible for choosing the carrier, arranging for the physical movement of the goods, paying the freight bill, and filing loss and damage claims. a. FOB destination b. FOB origin c. FOB delivered d. FOB supplier e. None of the above.
B
Which of the following is not one of the advantages of rail carrier over other modes of transportation? a. Lower cost. b. Good for expediting/emergency situations. c. Can handle a wide range of items. d. Piggyback service can increase flexibility. e. Direct between major cities.
B
_____ is defined by CSCMP as that part of supply chain management that plans, implements, and controls the efficient, effective forward and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption to meet customers' requirements. a. Supply management b. Logistics management c. Purchasing d. Transportation management e. None of the above.
B
[A/An] _____ is created by buyers from various businesses to pool their buying power together in order to reduce prices. a. kanban b. purchasing consortium c. collaborative buyer-supplier relationship d. reverse auction e. zero-based budgeting
B
_____ refers to a mode's or carrier's ability to provide the proper equipment and provide the appropriate services for a given product movement. a. Accessibility b. Capability c. Speed d. Total cost e. Reliability
B
Freight shipped _____ means the supplier retains title to the goods and controls the shipment until it is physically received and off-loaded at the consignee's dock. a. FOB carrier b. FOB origin c. FOB destination d. FOB in transit e. None of the above
C
Which of the following is not an advantage of using a 3PL? a. Economies of scale and increased flexibility. b. Improve service performance levels. c. Loss of dedicated in-house managed staff. d. Release capital from sale of assets. e. Concentrate on core business activities.
C
_____ can be defined as the sum of all purchased goods and services that are not a direct part of products or services delivered to the customer. a. Direct spend b. MRO c. Indirect spend d. Consignment inventory e. Kanban
C
The total cost structure of _____ is similar to _____ as the equipment, rights-of-way, and physical structure have a high fixed cost and a low variable operating cost. a. motor carriers....air carriers b. motor carriers....pipelines c. water carriers....rail carriers d. pipelines....rail carriers e. Cannot determine from the above information.
D
Which of the following is not a disadvantage of using a 3PL? a. Relinquish control, ownership, and expertise. b. Loss of integration between sales and supply. c. Loss of dedicated in-house managed staff d. Concentrate on core business activities. e. Sacrifice key business service differentiation.
D
Which of the following is not an advantage of using a 3PL? a. Economies of scale and increased flexibility. b. Improve service performance levels. c. Loss of dedicated in-house managed staff. d. Release capital from sale of assets. e. Concentrate on core business activities.
D
Which of the following is not one of the advantages of air carrier over other modes of transportation? a. Quick and reliable. b. Good for light/small, high-value shipments. c. Good for expediting/emergency situations. d. Low cost. e. None of the above.
D
_____ includes movement and handling of materials between production facilities within the same organization as well as movement into and out of intermediary storage facilities. a. Inbound logistics b. Recovery c. Outbound logistics d. Intraorganizational movement e. Recycling
D
_____ represents the link between a company and its customers. a. Inbound logistics b. Intraorganizational movement c. Reverse logistics d. Outbound logistics e. Recovery and recycling
D
Which of the following is not one of the common examples of indirect spend? a. Professional and consulting services. b. Employee benefits. c. Travel. d. Maintenance, repair, and operating supplies. e. Production components.
E
T/F: The most significant advantage of a motor carrier is its relatively lower variable cost
false
T/F: The primary objective of deregulation in the United States was to make its domestic transportation systems more efficient by dramatically increasing marketplace competition within the transportation and logistics industry and increasing economic regulation.
false
T/F: The use of a pipeline is usually part of the decision tradeoff between transportation modes.
false
T/F: Traditional cost accounting systems are designed to systematically track and consolidate indirect spend across an organization.
false
T/F: Virtually all of indirect spend is normally purchased throughthe organization's formal sourcing function or using well-established supply management processes
false
T/F: A major disadvantage of a rail carrier is its relatively higher cost.
true
T/F: A major outcome from transportation economic deregulation has been the shift of pricing information garnered from public tariffs and rate bureaus to the negotiating table
true
T/F: A performance-based logistics system seeks to drive the logistics service provider's performance by clearly delineating the buyer's preferred outcomes, not by transaction, but in terms of provider value-added and overall systems costs.
true
T/F: A preferred supplier list database should be set up to generate a list of preferred suppliers based on previous project performance criteria
true
T/F: A savvy buyer will want to control transportation costs internally instead of simply allowing the shipper to pass them along in the form of a delivered price.
true
T/F: A two-day shipment by truck can often take a week or more by railbecause of the extra handling involved.
true
T/F: Additional railcars can be added to a freight train with only a minimal increase in its total variable cost, absent any limitations on train length
true
T/F: Air freight has a high variable-cost-to-fixed-cost ratio because of the high costs of operating a flight.
true
T/F: Although mode selection is usually not an issue for international ocean shipments, as in all strategic supplier selection decisions, carrier selection is still paramount
true
T/F: An apparently low-cost carrier may actually end up costing far more than a seemingly higher-cost carrier when the total associated costs are calculated.
true
T/F: As organizations continue to focus more and more on their internal core competencies and outsource non-core activities, they have come to recognize that many of their necessary transportation and logistics services can, and should be, outsourced to expert companies specializing in transportation and logistics services.
true
T/F: Because of the huge quantities involved, deciding on the use of pipeline is rarely something a buyer needs to consider
true
T/F: Because of widespread industry differences, one company's indirect spend may be considered direct spend for another
true
T/F: By limiting internal requisitioners to previously approved catalogs of already contracted goods and services from preselected and approved suppliers, volume commitments to approved suppliers can be achieved and maverick spending reduced.
true
T/F: Centralization of professional service procurement can increase the accountability of outside consultants to the buyer by increasing the monitoring and auditing of services provided
true
T/F: Every project must have a scope that succinctly defines the project to help avoid misunderstandings between the buyer and the service provider
true
T/F: Full-service carriers, in addition to picking up and delivering goods, may consolidate shipments, provide simplified billing, ship just-in-time from local storage points, handle complex overseas shipments, coordinate shipments with other carriers or modes, or configure final products for direct shipment to end customers
true
T/F: Growth in international trade has increased the amount of freight moving on oceangoing vessels.
true
T/F: If indirect spend is to be leveraged, supply management must have a clear understanding of exactly what indirect goods and services are being purchased by individual SBUs.
true
T/F: Many buyers are beginning to question the sustainability of cost reductions achieved through reverse auctions over time once the initial reductions are made
true
T/F: Oftentimes, a single mode of transportation may prove inadequate for a specific shipment.
true
T/F: On average, transportation costs easily comprise ten percentor more of a product's total cost.
true
T/F: Reverse logistics flow requires companies to find innovative methods of recovering and recycling products to minimize potential negative impacts on the natural environment
true
T/F: Suppliers of multiple indirect items can often have multiple ship-to and bill-to addresses, resulting in numerous codes being assigned to the same supplier for each item.
true
T/F: The parameters on which a professional services supplier is evaluated should include, but not be limited to, quality, cost management, delivery, technical support, and wavelength.
true
T/F: Top management should consider internal buy-in from affected employees and other stakeholders before defining the final scope of the project.
true
T/F: Whenever a supplier ships FOB destination, the buyer often loses the ability to track or control its inbound transportation expenses which also artificially increases the value of the buyer's inventory
true