Module 4B

As the prediction error increases, safety stock costs _____. a. do not change b. decrease c. increase

c. increase

Friendships allow manager to cultivate loyalty and reciprocity which can lead to which of the following categories of actions?

a. Enhanced business volume

If a manger grows his or her business with a specific supplier that increases dependence on that supplier and increases risk if something happens, this may be the dark side of which category of actions of supply chain friendships?

a. Enhanced business volume

Friendships allow manager to increase the ease of communication and the sensitivity of business information exchanged which results in which of the following categories of actions?

a. Enhanced communcation

If a manager discloses sensitive, confidential information that ends up being financially negative for his or her organization, this may be the dark side of which category of actions of supply chain friendships?

a. Enhanced communication

If a manger lets a supplier get away with providing inferior services and products, this may be the dark side of which category of actions of supply chain friendships?

a. Enhanced trust

Based on the table below, which product's forecast indicates the lowest magnitude of forecast error? Product Mean Absolute Percent Error (MAPE) Mean Forecast Error (MFE) A 10% 650 B 8% 640 C 24% 785 D 12% 630 a. Product B b. Product D c. Product C d. Product A

a. Product B

Based on the table below, which product's forecast is the least biased? Product Mean Absolute Percent Error (MAPE) Mean Forecast Error (MFE) Standard Deviation of Forecast Error A 9% 300 30,053 B 24% 360 39,987 C 22% 290 32,387 D 18% 295 32,306 a. Product C b. Product B c. Product D d. Product A

a. Product C

Forecast ______ describes whether we are on average forecasting too high or low while forecast _______ measures the size of the forecast error, irrespective of the ___________ of the error. a. bias, magnitude, direction b. direction, bias, magnitude c. magnitude, bias, direction d. magnitude, direction, bias

a. bias, magnitude, direction

Lowe's and Home Depot working together to get products to areas ravaged by natural disasters like hurricanes is an example of:

a. competitive collaboration

A key output of a S&OP process is a _____ forecast.

a. consensus

If forecast error is negative, then the forecast was too _____. a. high b. low

a. high

If the RSFE or MFE is negative, then on average the forecasts are too _____. a. high b. low

a. high

What is the final step in developing a successful supply chain relationship?

a. implementation and continuous improvement

If forecast error is positive, then the forecast was too _____.

a. low

If the RSFE or MFE is positive, then on average the forecasts are too _____. a. low b. high

a. low

If the forecast error is positive, then the forecast was too _____. a. low b. high

a. low

Calculating the ____ means taking the running sum of the forecast errors and dividing it by the number of observations or the number of forecasts. a. mean forecast error b. mean square error c. mean absolute deviation d. standard deviation of forecast error

a. mean forecast error

Assume the two SKUs have the same MAPE. However, SKU A has a higher standard deviation of forecast error than SKU B. All other things being equal, we would carry ______ safety stock for SKU A. a. more b. less c. about the same d. cannot tell from the information given

a. more

Some measures of forecast accuracy include the running sum of forecast errors, the mean absolute percentage error, and mean forecast error. The formula for each is dependent on the forecast error, which is calculated by using the equation: a. The average of actual demand for period t and forecasted demand for period t b. Actual demand for period t minus the forecasted demand for period t c. Actual demand for period t plus the forecasted demand for period t d. Actual demand for period t divided by the forecasted demand for period t

b. Actual demand for period t minus the forecasted demand for period t

_____ is a concept that encourages and facilitates collaborative processes between members of a supply chain. a. S&OP b. CPFR c. both a & b d. neither a nor b

b. CPFR

This question is part of what S&OP process: "If there were no constraints from the supply side, what could we actually sell?" a. Executive review b. Demand review c. Supply review d. Consensus e. Preparation

b. Demand review

MAPE is used to measure forecast error _____. a. Bias b. Magnitude c. Safety stock d. both a and b

b. Magnitude

Based on the table below, which product's forecast indicates the lowest magnitude of forecast error? Product Mean Absolute Percent Error (MAPE) Mean Forecast Error (MFE) A 8% 650 B 20% 675 C 19% 405 D 17% 500 a. Product C b. Product A c. Product B d. Product D

b. Product A

Based on the table below, which product's forecast is the least biased? Product Mean Absolute Percent Error (MAPE) Mean Forecast Error (MFE) Standard Deviation of Forecast Error A 11% 220 19,675 B 13% 210 23,130 C 23% 405 43,739 D 24% 500 52,836 a. Product C b. Product B c. Product D d. Product A

b. Product B

The RSFE and MFE are used to measure _____ in forecast error. a. error b. bias c. magnitude d. standard deviation

b. bias

A CPFR program allows a producer to determine replenishment quantities in concert with a retailer and thereby remove redundant inventory and improve customer service. This activity likely _____. a. worsens the bullwhip effect b. mitigates the bullwhip effect c. has no effect on the bullwhip d. none of the above

b. mitigates the bullwhip effect

If the forecasts on average are too high, RSFE and MFE will be _____. a. positive b. negative

b. negative

Full collaboration is the dynamic combination of:

buyers, sellers, retailers, 3PLs, and appropriate government agencies

Based on the table below, which product's forecast is the least biased? Product Mean Absolute Percent Error (MAPE) Mean Forecast Error (MFE) Standard Deviation of Forecast Error A 14% 300 33,199 B 10% 210 21,208 C 6% 525 58,727 D 14% 500 53,192 a. Product D b. Product A c. Product B d. Product C

c. Product B

A purpose of the consensus meeting is to _______________________. a. Align the sales and demand planning forecast b. Make a decision about how to proceed c. Quantify the gap between supply and demand d. Gather demand assumptions

c. Quantify the gap between supply and demand

Which forecast error metric is used in the traditional calculation of safety stock in automated systems? a. Running sum of forecast error (RSFE) b. Mean forecast error (MFE) c. Standard deviation of forecast error d. Mean absolute percent error (MAPE)

c. Standard deviation of forecast error

An organization has developed three alternate sales and operations plans for the coming six months and now must choose between them. They should consider: a. what the cash flows are like. b. how flexible the plan is. c. how their plan will impact supply chain partners. d. All of these are good criteria for a sales and operation plan.

d. All of these are good criteria for a sales and operation plan.

In order to manage forecast accuracy, companies must: I. Measure forecast error II. Monitor forecast error III. Make forecast adjustments based forecast error a. I & III b. I & II c. II & III d. I, II & III

d. I, II & III

Based on the table below, which product's forecast indicates the lowest magnitude of forecast error? Product Mean Absolute Percent Error (MAPE) Mean Forecast Error (MFE) A 16% 600 B 18% 525 C 20% 395 D 5% 400 a. Product C b. Product A c. Product B d. Product D

d. Product D

Firms that practice S&OP with discipline are likely to experience higher levels of _____________ relative to firms with weak undisciplined implementation. a. order fill rate b. gross margin c. customer retention d. all of the above e. none of the above

d. all of the above

A forecast is known to be unbiased. The magnitude must then _____. a. have zero magnitude of error b. have a low magnitude of error c. have a large magnitude of error d. cannot tell what magnitude would be from the bias

d. cannot tell what magnitude would be from the bias

The fundamental purpose of an S&OP process is to _____. a. eliminate lost sales b. refine the sales forecast c. reduce inventory d. match supply and demand

d. match supply and demand

Which forecast error metric is used to measure forecast error bias? a. Mean forecast error (MFE) b. Mean absolute percent error (MAPE) c. Standard deviation of forecast error d. Running sum for forecast error (RSFE) e. both a and d

e. both a and d

Which forecast error metric is used to measure forecast error magnitude? a. Mean forecast error (MFE) b. Mean absolute percent error (MAPE) c. Standard deviation of forecast error d. Running sum for forecast error (RSFE) e. both b and c

e. both b and c