SCM 301 Exam #6
Assortment warehousing is
A form of warehousing in which a wide array of goods is held close to the source of demand in order to assure short customer lead times
_____ is a form of warehousing in which strategically placed hubs are used as sorting or transfer facilities
A hub-and-spoke system
A roadrailer is
A specialized rail car the size of a standard truck trailer that can be quickly switched from rail to ground transportation by changing the wheels
A multimodal solution is
A transportation solution that seeks to exploit the strengths of multiple transportation modes through physical, information, and monetary flows that are as seamless as possible
_____ is when incoming shipments are from a single source or manufacturer
Break-bulk warehousing
_____ is a sourcing strategy in which a company uses a single supplier for one particular part of service and another supplier with the same capabilities for a different part or service, with the understanding that each supplier can act as a backup for the other supplier
Cross sourcing
_____ profiles the major forces and trends that are impacting an industry, including pricing, competition, regulatory forces, substitution, technology changes, and supply/demand trends
Industry analysis
_____ is a term used to refer to the observation that any change, even a small one, in the requirement for items at the top of the bill of material can have drastic effects on items further down the bill of material.
MRP nervousness
_____ is the use of supply chain partners to provide products or services
Outsourcing
_____ is a structured approach used by decision makers to develop a sourcing strategy for a product or service, based on the value potential and the relative complexity or risk represented by a sourcing opportunity
Portfolio analysis
_____ is a term used to describe the effect of $1 in a cost savings increasing pretax profits by $1 and a $1 increase in sales increasing pretax profits only by $1 multiplied by the pretax profit margin
Profit leverage effect
_____ is the ratio of earnings to sales for a given time period
Profit margin
_____ is a field in the master schedule record that indicates estimated inventory level at the end of each time period.
Projected ending inventory
_____ is a sourcing strategy in which the buying firm depends on a single company for all or nearly all of a particular item or service.
Single sourcing
_____ is the application of quantitative techniques to purchasing data in an effort to better understand spending patterns and identify opportunities for improvement
Spend analysis
_____ is any operation that stores, repackages, stages, sorts, or centralizes goods or materials
Warehousing
_____, in the context of master scheduling, is confirmed demand for products
a booked order
Forecasted demand, in the context of master scheduling, is
a company's best estimate of the demand in any period
Master scheduling is
a detailed planning process that tracks production output and matches this output to actual customer orders
A purchase order (PO) is
a document that authorizes a supplier to deliver a product or service and often includes key terms and conditions, such as price, delivery, and quality requirements
Cross-docking is
a form of warehousing in which large incoming shipments are received and then broken down into smaller outgoing shipments to demand points in a geographic area
Postponement warehousing is
a form of warehousing that combines classic warehouse operations with light manufacturing and packaging duties to allow firms to put off final assembly or packaging of goods until the last possible moment
Consolidation warehousing is
a form of warehousing that pulls together shipments from a number of sources (often plants) in the same geographic area and combines them into larger - and hence more economical - shipping loads
An objective function is
a quantitative function that an optimization model seeks to optimize (i.e. maximize or minimize)
Planning and control is
a set of tactical and execution-level business activities that includes master scheduling, material requirements planning, and some form of production activity control and vendor order management.
A direct truck shipment is
a shipment made directly, with no additional stops, changing of trucks, or loading of additional cargo
A less than truckload (LTL) shipment is
a smaller shipment, often combined with other loads to reduce costs and improve truck efficiencies
Multiple sourcing is
a sourcing strategy in which the buying firm shares its business across multiple suppliers
A common carrier is
a transportation service provider that handles shipments on a case-by-case basis, without the need for long-term agreements or contracts
An optimization model
a type of mathematical model used when the user seeks to optimize some objective function subject to some constraints
A cost-based contract is
a type of purchasing contract in which the price of a good or service is tied to the cost of some key input(s) or other economic factors, such as interest rates
Warehousing
an operation that stores, repackages, stages, sorts, or centralizes goods or materials
The term _____ refers to a specialized form of an optimization model that attempts to assign limited capacity to various demand points in a way that minimizes costs
assignment problem
The term ______ refers to a field in the master schedule record that indicates the number of units that are available for sale each week, given those that have already been promised to customers.
available to promise (ATP)
The first step of the strategic sourcing process, which is sometimes kicked off in response to an entirely new need within an organization, in the vast majority of cases, is
conducted to improve the performance of a firm's existing sourcing activities
Booked orders, in the context of master scheduling, are
confirmed demand for products
A _____ is a transportation service provider that handles shipments for other firms based on long-term agreements or contracts
contract carrier
_____ is a time-phased planning approach similar to MRP that uses planned orders at the point of demand (customer, warehouses, etc.) to determine forecasted demand at the source level (often a plant).
distribution requirement planning (DRP)
According to the top-down model of manufacturing planning and control systems, production activity control
ensures that in-house manufacturing takes place according to plan; it also helps manufacturing managers identify potential problems and take corrective actions.
According to the top-down model of manufacturing planning and control systems, vendor order management
ensures that materials ordered from supply chain partners are received when needed; it also helps purchasing managers identify potential problems and take corrective actions
According to the top-down model of manufacturing planning and control systems, sales and operations planning
establishes overall production, workforce, and inventory levels
_____ is the process of working backward from the master production schedule for a level 0 item to determine the quantity and timing of orders for the various subassemblies and components
exploding the BOM
The _____ of the procure-to-pay cycle is ordering; the most common way the ordering step begins is through the release of a purchase order. A purchase order (PO) is simply a document that authorizes a supplier to deliver a product or service and often includes terms and conditions, such as price, delivery, and quality requirements
first step
A _____ is a type of purchasing contract in which the stated price does not change, regardless of fluctuations in general overall economic conditions, industry competition, levels of supply, market prices, or other environmental changes
fixed-price contract
_____, in the context of master scheduling, is a company's best estimate of the demand in any period.
forecasted demand
A _____ is an agent who serves as an intermediary between an organization shipping a product and the actual carrier, typically on international shipments
freight forwarder
Total cost analysis
is a process by which a firm seeks to identify and quantify all of the major costs associated with various sourcing options
Portfolio analysis
is a structured approach used by decision makers to develop a sourcing strategy for a product or service, based on the value potential and the relative complexity or risk represented by a sourcing opportunity
The term _____ refers to the amount of product that will be finished and available for sale at the beginning of each week.
master production schedule (MPS)
According to the top-down model of manufacturing planning and control systems, _____ determines when specific products will be made, when specific customer orders will be filled, and what products/capacities are still available to meet new demands.
master scheduling
The term _____ refers to a detailed planning process that tracks production output and matches this output to actual customer orders.
master scheduling
_____ is a planning process that translates the master production schedule into planned orders for the actual parts and components needed to produce the master schedule items
material requirements planning (MRP)
Return on assets is
net income/average total assets
In the second step of the strategic sourcing process, decision makers
often need to develop a more detailed picture, or profile, of the internal needs of the organization, as well as the characteristics of the external supply base
Sustainability is
performing activities in a manner that meets the needs of the present without compromising the ability of future generations to meet their needs
The term _____ refers to the amount of time the master schedule record or MRP record extends into the future.
planning horizon
_____ ensures that in-house manufacturing takes place according to plan; it also helps manufacturing managers identify potential problems and take corrective actions.
production activity control
_____ uses the master production schedule to monitor key resource requirement
rough-cut capacity planning
_____ is a form of warehousing that attempts to position seasonal goods close to the marketplace. At the end of each season, the goods are either liquidated or moved back to a more centralized location
spot stock warehousing
A statement of work refers to
terms and conditions for a purchased service that indicate, among other things, what services will be performed and how the service provider will be evaluated
The master production schedule (MPS) is
the amount of product that will be finished and available for sale at the beginning of each week
Exploding the BOM is
the process of working backward from the master production schedule for a level 0 item to determine the quantity and timing of orders for the various subassemblies and components
Cost of goods sold is
the purchased cost of goods from outside suppliers
Planning lead time is
the time from when a component is ordered until it arrives and is ready to use
Insourcing is
the use of resources within the firm to provide products or services
A _____ is a service firm that handles all of the logistics requirements for other companies
third-party logistics provider (3PL)
Material requirements planning (MRP)
translates the master schedule for final products into detailed material requirement
According to the top-down model of manufacturing planning and control systems, _____ ensures that materials ordered from supply chain partners are received when needed; it also helps purchasing managers identify potential problems and take corrective actions.
vendor order management