Ch. 11

Question 1

The supply chain denotes the process by which components are moved and produced from raw material to the ultimate consumer.

Answer 1

Supply Chain

Question 2

is the streamlining of a business’ supply- side activities to maximize customer value and to gain a competitive advantage in the marketplace.

Answer 2

Supply Chain management

Question 3

What is a primary supplier selection criterion for a firm pursuing a differentiation strategy?

Answer 3

Willingness of supplier to work with JIT programs and contribute design and tech expertise

Question 4

For which corporate strategy(ies) should supply chain inventory be minimized?

Answer 4

Just-in-time

Question 5

What are alternative sourcing strategies? What are the six sourcing strategies?

Answer 5

Using many suppliers, using few suppliers, vertical integration, joint ventures, participating in Keiretsu networking, and creating virtual companies.

Question 6

What would it be called if a fast-food retailer acquired a spice manufacturer?

Answer 6

Vertical Integration

Question 7

What is a disadvantage of the “few suppliers” sourcing strategy?

Answer 7

It is costly to change suppliers

Question 8

Developing the ability to produce goods or services previously purchased or actually buying a supplier or a distributor.

Answer 8

vertical integration

Question 9

What are advantages of the “few suppliers” sourcing strategy?

Answer 9

Long-term relationship, suppliers willing to participate in just-in-time, and protecting each other’s trade secrets.

Question 10

What sourcing strategy is used by a fried chicken fast-food chain that has acquired feed mills and poultry farms?

Answer 10

Vertical integration

Question 11

Japanese manufacturers often pursue a strategy that is part collaboration, part purchasing from a few suppliers, and part vertical integration. What is this approach called?

Answer 11

Keiretsu

Question 12

What are advantages of a virtual company?

Answer 12

Lower overhead costs, Lower capital needed, Higher scalability

Question 13

When Daimler and BMW pooled resources to develop standardized auto components, what sourcing strategy best describes that action?

Answer 13

Joint Venture

Question 14

Risk of not meeting customer needs and losing money.

Answer 14

Supply Chain Risk

Question 15

How can firms mitigate supply chain risk?

Answer 15

Research and assess possible risks, innovative planning, reduce potential disruptions, have flexible secure supply chains.

Question 16

Using one supplier for a component and a second supplier for another component, where each supplier acts as a backup for the other.

Answer 16

Cross-sourcing

Question 17

Increasing fluctuation in orders that often occurs as orders move through the supply chain.

Answer 17

Bull-whip effect

Question 18

What is the impact of the bullwhip effect?

Answer 18

Creates unstable production schedules, expensive capacity change costs, and longer lead times.

Question 19

What is a remedy for shortage gaming?

Answer 19

allocate orders based on demand.

Question 20

Hewlett-Packard withholds customization of its laser printers as long as possible. This is an example of which opportunity with the integrated supply chain?

Answer 20

Postponement

Question 21

A furniture maker has delivered a dining set directly to the end consumer rather than to the furniture store. The furniture maker has adopted what opportunity with the integrated supply chain?

Answer 21

Drop shipper

Question 22

A system in which a supplier maintains material for the buyer, often delivering directly to the buyer’s using department.

Answer 22

Vendor Managed Inventory

Question 23

A system in which members of a supply chain share information in a joint effort to reduce supply chain costs.

Answer 23

Collaborative planning, forecasting, and replenishment (CPFR)

Question 24

What type of negotiating strategy requires the supplier to open its books to the purchasers?

Answer 24

Cost-based price model

Question 25

What are the three classic types of pricing negotiation strategies?

Answer 25

The three are: 1) cost based price model (open books about full or direct costs of making a good), 2) market-based price model (sets price based upon similar products being offered on the market) and 3) competitive bidding (bids are sought from competing contractors, suppliers).

Question 26

What are the four stages of supplier selection?

Answer 26

Supplier evaluation, supplier development, negotiation, and contracting.

Question 27

Of the four stages of supplier selection, at what stage could the factor weighting approach be used?

Answer 27

Supplier evaluation

Question 28

What is a synonym for suppliers?

Answer 28

Vendors

Question 29

What are three common features of contracts between buyers and suppliers?

Answer 29

Quantity discounts, buybacks, and revenue sharing.

Question 30

Purchasing facilitated through the internet

Answer 30

e-Procurement

Question 31

The process of managing materials for operations to meet certain objectives such as delivery speed, low inventories, and high accuracy.

Answer 31

Logistics Management

Question 32

What are alternative shipping systems?

Answer 32

Trucking, railroad, airfreight, waterways, pipelines, and multimodal

Question 33

Sends components and modules to be assembled by a distributor, treats these distributors as manufacturing partners.

Answer 33

Channel Assembly

Question 34

What are the three goals of supply chain managers when outsourcing logistics?

Answer 34

Reduce inventory, cost, and improve delivery.

Question 35

Accepting shipments from a variety of sources and recombining them for distribution to a variety of destinations, often without storing goods throughout the transition.

Answer 35

Cross-docking

Question 36

What three logistics-related costs are relevant when analyzing the choice of number of facilities in a distribution network?

Answer 36

Inventory strategy, location strategy, and transport strategy

Question 37

Refers to numerous activities and processes such as packaging, warehousing, supply chain, and logistics.

Answer 37

Distribution Management

Question 38

What is the objective of distribution management?

Answer 38

Response time, lowest cost, and maximum profit

Question 39

What is the process called of sending returned products back up the supply chain for value recovery or disposal?

Answer 39

Return of reverse logistics