Ch. 1 Basic Concepts

Question 1

supply chain management definition

Answer 1

Supply chain management (SCM) is the oversight of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer.

Question 2

supply chain definition

Answer 2

a supply chain consists of all stages involved, directly or indirectly, in fulfilling a customer request

• refers to networks of companies that work together and coordinate their actions to deliver a product to market

Question 3

logistics

Answer 3

refers to activities that occur within the boundaries of a single organization

Question 4

supply chain activities include (4)

Answer 4

1. marketing
2. new product development
3. finance
4. customer service

Question 5

5 areas that decisions need to be made

Answer 5

1. Production
2. Inventory
3. Location
4. Transportation
5. Information

Question 6

Production

Answer 6

• refers to capacity to store

- decisions regarding factories and warehousing

Question 7

trade off between

Answer 7

responsiveness and efficiency

Question 8

Factories can be (2)

Answer 8

1. product focus (focuses on making the entire product)

2. functional focus (focuses on performing just a few operations)

Question 9

Warehouses can be (3)

Answer 9

1. Stock keeping unit storage
2. Job lot storage
3. Crossdocking

Question 10

Stock keeping unit storage

Answer 10

all of a given type of product is stored together

Question 11

Job lot storage

Answer 11

all the different products related to the needs of a certain type of customer or related to the needs of a particular job are stored together

Question 12

crossdocking

Answer 12

smaller lots are used according to the needs of the day and quickly loaded onto outbound trucks

Question 13

Decisions Inventory (3)

Answer 13

1. Cycle Inventory
2. Safety Inventory
3. Seasonal Inventory

Question 14

Cycle inventory

Answer 14

amount of inventory needed to satisfy demand (large lots)

Question 15

Safety inventory

Answer 15

held as a buffer against uncertainty

Question 16

seasonal inventory

Answer 16

inventory that is built up in anticipation of predictable increases in demand that occur at certain times of the year

Question 17

location

Answer 17

• what activities to performed where

- centralize or decentralize

Question 18

transportation modes (6)

Answer 18

1. ship
2. rail
3. pipelines
4. trucks
5. airplanes
6. electronic transport

Question 19

Information used for (2)

Answer 19

1. coordinating daily activities

2. forecasting and planning

Question 20

trade off information

Answer 20

weighing the benefits that good information can provide against the cost of acquiring that information

Question 21

Participants in the supply chain (5)

Answer 21

1. producers
2. distributors
3. retailers
4. customers
5. Service Providers

Question 22

Aligning your supply chain with your business strategy (3)

Answer 22

1. understand the market you serve
2. define strengths
3. develop the needed supply chain capabilities

Question 23

factors that help to clarify requirements for the customers you serve (6)

Answer 23

1. the quantity of the product needed in each lot
2. the response time that customers are willing to tolerate
3. the variety of products needed
4. service level required
5. the price of the product
6. desired rate of innovation

Question 24

EOQ

Answer 24

economic order quantity: the most cost effective amount to purchase at a time

Question 25

virtual integration

Answer 25

finding other companies to carry some of the work (new way)