Chapter 11 exam 3

Question 1

The objective of supply chain management is to structure the supply chain to _____ its competitive advantage and benefits to the ultimate consumer.

Answer 1

maximize

Question 2

coordination of all supply chain activities involved in enhancing customer value.

Answer 2

supply chain management

Question 3

choosing between obtaining products and services externally as opposed to producing them internally.

Answer 3

make-or-buy decisions

Question 4

transfer traditional internal activities and resources to outside vendors.

Answer 4

outsourcing.

Question 5

Six sourcing strategies:

1. many suppliers
2. few suppliers
3. vertical integration
4. ___ _____
5. Keiretsu networks
6. ____ ______

Answer 5

joint ventures, virtual companies

Question 6

sourcing strategy that is commonly used for commodity products; purchasing is typically based on price, suppliers compete with one another

Answer 6

many suppliers

Question 7

sourcing strategy, buyers form longer term relationships with fewer suppliers. create value through economies of scale and learning curve improvements,

Answer 7

few suppliers

Question 8

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

Answer 8

vertical integration

Question 9

formal collaboration that enhances skills, secure supplies, and reduce costs. challenge is to cooperate without diluting brand or conceding competitive advantage.

Answer 9

joint ventures.

Question 10

middle ground between few suppliers and vertical integration. supplier becomes part of company coalition.

Answer 10

Keiretsu networks

Question 11

rely on a variety of supplier relationships to provide services on demand.

Answer 11

virtual companies

Question 12

shipments get misrouted, stolen, damaged, or excessively delayed.

Answer 12

security and JIT

Question 13

three issues complicate development of an efficient, integrated supply chain:

Answer 13

local optimization, incentives and large lots.

Question 14

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

Answer 14

bullwhip effect

Question 15

opportunities for effective management in the supply chain include the following 10 items:

1. accurate “pull” data
2. lot size reduction
3. single-stage control of replenishment
4. vendor-managed inventory
5. collaborative planning, forecasting, and replenishment (CPFR)
6. blanket order
7. standardization
8. postponement
9. electronic ordering and funds transfer
10. drop shipping and ___

Answer 15

special packaging.

Question 16

accurate sales data that initiate transactions to “pull” product through the supply chain.

Answer 16

pull data

Question 17

fixing responsibility for monitoring and managing inventory for the retailer.

Answer 17

single stage control of replenishment

Question 18

system in which suppliers maintains material for the buyer, often delivering directly to the buyers using department.

Answer 18

vendor managed inventory (VMI)

Question 19

systems which members of supplier chain share information in joint effort to reduce supply chain costs.

Answer 19

CPFR

Question 20

long term purchase commitment to a supplier for items that are to be delivered against short term release to ship.

Answer 20

blanket orders

Question 21

delaying any modifications or customizations to a product as long as possible in the production process.

Answer 21

postponement

Question 22

speeds transactions and reduces paperwork.

Answer 22

electronic ordering and funds transfer

Question 23

shipping directly from supplier to end consumer rather than from the seller, saving time and reshipping costs.

Answer 23

drop shipping

Question 24

building the supply base has 4 steps:

1. supplier evaluation
2. supplier _____
3. negotiations
4. contracting

Answer 24

development

Question 25

step of building the supply base that is finding potential suppliers

Answer 25

supplier evaluation

Question 26

step of building the supply base that integrates the supplier into the system.

Answer 26

supplier development

Question 27

Shares risks, benefits, creates incentives.

Answer 27

Contracting.

Question 28

Purchasing facilitated through the internet, reduces costs, integrates supply chain.

Answer 28

E-procurement.

Question 29

Objective of _____management is to obtain efficient operations through the integration of all material acquisition, movement and storage activities.

Answer 29

Logistics

Question 30

Shipping systems:
Trucking
Railroads 
\_\_\_\_
Waterways
Pipelines
Multimodal.

Answer 30

Airfreight

Question 31

Moves the vast majority of manufactured goods.

Answer 31

Trucking

Question 32

Capable of carrying large loads, little flexibility through containers and piggybacking have helped with this.

Answer 32

Railroads.

Question 33

Fast and flexible for light loads, may be expensive.

Answer 33

Airfreight

Question 34

Typically used for bulky, low value cargo.

Answer 34

Waterways

Question 35

Used for transporting oil, gas, and other chemical products.

Answer 35

Pipelines.

Question 36

Combines shipping methods, common in international shipments.

Answer 36

Multimodal

Question 37

Fundamental purpose is to store gods, may be expensive.

Answer 37

Warehousing

Question 38

Postponed final assembly of a product so the distribution channel can assemble it.

Answer 38

Channel assembly.

Question 39

The outbound flow of products. Increasing the number of facilities generally improves response time and customer satisfaction.

Answer 39

Distribution management.

Question 40

Three types of ethics involved in sustainable supply chain management:
Personal ethics
Ethics __________
Ethical behavior regarding the environment

Answer 40

Within the supply chain

Question 41

Institute for supply management (ISM) principles and standards:
Promote and uphold responsibilities to ones employer; avoid perceived impropriety or conflicts of ____

Answer 41

Interest

Question 42

ISM ethical standards:
Perceived impropriety
Conflicts of interest
\_\_\_\_\_\_\_\_\_\_\_\_\_
Responsibilities to your employer 
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Sustainability and social responsibility. 
Confidential and proprietary information
\_\_\_\_\_\_\_
Applicable laws, regulations and trade agreements. 
Professional competence.

Answer 42

Issues and influence, supplier and customer relationships. Reciprocity.

Question 43

Process of sending returned products back up the supply chain for value recovery or disposal.

Answer 43

Reverse logistics.

Question 44

Supply chain designed to optimize both forward and reverse flows.

Answer 44

Closed loop supply chain.

Question 45

Percentage invested in inventory = (average inventory investment/total assets) x 100

Answer 45

Assets committed to inventory.

Question 46

____ _____ = (cost of goods sold/average inventory investment)

Answer 46

Inventory turnover

Question 47

__________ = average inventory investment/(average cost of goods sold/52 weeks)

Answer 47

Weeks of supply

Question 48

Set of processes, metrics and best practices developed by the supply chain council.

Answer 48

The SCOR model.