Chapter 13: Supply Chain Logistics Networks

Question 1

Geographical information system

Answer 1

GIS

A system of computer software, hardware, and data that the firm’s personnel can use to manipulate, analyze, and present information relevant to a location decision

Question 2

Centralized placement

Answer 2

An inventory placement strategy of keeping all the inventory of a product in a single location, such as at a firm’s manufacturing plant or a warehouse, and shipping directly to each of it’s customers

Question 3

Inventory pooling

Answer 3

A reduction in inventory and safety stock because of merging of variable demands from customers

An advantage resulting from centralized placement strategy. Varying demands from different customers evens out overall use of stock

Question 4

Disadvantage of centralized placement inventory strategy

Answer 4

Potential for uneconomical shipping/ logistics costs due to small loads

Question 5

Forward placement

Answer 5

An inventory placement strategy where the stock is located closer to customers, at a warehouse, distribution center, wholesaler, or retailer

Question 6

Advantages of forward placement inventory strategy

Answer 6

Improves delivery times
Reduces transportation costs

(Both can stimulate sales)

Question 7

Disadvantaged of forward placement inventory strategy

Answer 7

Reduced pooling effect advantages, more need for safety stocks to cover uncertain demand for individual locations

Question 8

Categories of AI application in supply chains

Answer 8

• augmentation (assisting humans in tasks)
• automation (performing tasks without human intervention)