Chapter 5 COPY Flashcards

1
Q

Hard Infrastructure Requirements

A

include the availability of suppliers, transportation services, communication, utilities, and warehousing facilities.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Soft Infrastructure requirements

A

include the availability of a skilled workforce, workforce turnover, and the community receptivity to business and industry.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

A managers goal when locating facilities and allocating capacity should be to

A

maximize the overall profitability of the resulting supply chain network while providing customers with the appropriate responsiveness.
-A manager must consider many trade-offs during network design

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Managers use network design models in two situations.

A
  1. decide on locations and capacities

2. assign current demand to facilities.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Duties that must be paid when products and/or equipment are moved across international, state, or city boundaries are referred to as

A

tariffs

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

If a country has very high tariffs,

A

companies either do not serve the local market or set up manufacturing plants within the country to save on duties.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Developing countries often create free trade zones where

A

duties and tariffs are relaxed as long as production is used primarily for export.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Building some over-capacity in the supply chain network and making the capacity flexible allows a firm to alter production flows within the supply chain to

A

produce more in facilities that have a lower cost based on current exchange rates.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Total logistics costs are a sum of the

A

inventory, transportation, and facility costs.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

The facilities in a supply chain network must

A

at least equal the number that minimizes total logistics cost.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

When faced with a network design decision, the goal of a manager is to design a network that

A

maximizes the firm’s profits while satisfying customer needs in terms of demand and responsiveness.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

The objective of the first phase of network design is to

A

specify what capabilities the supply chain network must have to support a firm’s competitive strategy.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

The objective of the second phase of network design is to

A

identify regions where facilities will be located, their potential roles, and their approximate capacity.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

The objective of the third phase of network design is to

A

C) select a set of desirable sites within each region where facilities are to be located.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

It is very important that long-term consequences be thought through when making facility decisions, because

A

facilities last a long time and have an enduring impact on a firm’s performance.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

The implications of culture should not be glossed over because

A

tariffs and tax incentives should be carefully considered.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

The quality of life at selected facility locations has a significant impact on performance because

A

it influences the work force available and their morale.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Capital, growth strategy, existing networks and global competition mostly affect which of the four Global Network Design Decisions?

A

Phase I - Supply Chain Strategy

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

The availability of suppliers, transportation services, communication, utilities, and warehousing infrastructure mostly affect which of the four Global Network Design Decisions?

A

Phase III - Desirable Sites

20
Q

Tariffs, economies of scale and aggregate factor costs mostly affect which of the four Global Network Design Decisions?

A

Phase II - Regional Facility Configuration

21
Q

Supply chain network design decisions include

A

both the location of manufacturing, storage, or transportation-related facilities and the allocation of capacity and roles to each facility.

22
Q

Supply chain network design decisions classified as facility role are concerned with

A

what processes are performed at each facility.

23
Q

Supply chain network design decisions classified as facility location are concerned with

A

where facilities should be located.

24
Q

Supply chain network design decisions classified as capacity allocation are concerned with

A

how much capacity should be allocated to each facility.

25
Q

Supply chain network design decisions classified as market and supply allocation are concerned with

A

what markets each facility should serve and which supply sources should feed each facility.

26
Q

Decisions concerning the role of each facility are significant because

A

they determine the amount of flexibility the supply chain has in changing the way it meets demand.

27
Q

Facility location decisions have a long-term impact on a supply chain’s performance because

A

it is very expensive to shut down a facility or move it to a different location.

28
Q

Capacity allocation decisions have a significant impact on supply chain performance because

A

capacity decisions tend to stay in place for several years.

29
Q

Allocating too much capacity to a location results in

A

poor utilization, and as a result, higher costs.

30
Q

Allocating too little capacity results in

A

poor responsiveness if demand is not satisfied or high cost if demand is filled from a distant facility.

31
Q

The allocation of supply sources and markets to facilities has a significant impact on performance because

A

it affects total production, inventory, and transportation costs incurred by the supply chain to satisfy customer demand.

32
Q

The allocation of supply sources and markets to facilities should be reconsidered on a regular basis so that

A

the allocation can be changed as market conditions or plant capacities change

33
Q

Network design decisions have a significant impact on performance because they

A

determine the supply chain configuration.
and
set constraints within which inventory, transportation, and information can be used to either decrease supply chain cost or increase responsiveness.

34
Q

Firms focusing on cost leadership tend to

A

find the lowest cost location for their manufacturing facilities.

35
Q

Firms focusing on responsiveness tend to

A

locate facilities close to the market they serve.

36
Q

A facility that serves the role of being a low-cost supply source for markets located outside the country where the facility is located is

A

an offshore facility.

37
Q

A facility that also has low cost as its primary objective, but its strategic role is broader than that of an offshore facility is

A

a source facility.

38
Q

A facility built because of tax incentives, local content requirement, tariff barriers, or high logistics cost to supply the region from elsewhere with the objective to supply the market where it is located is

A

a server facility.

39
Q

A facility located primarily to obtain access to knowledge or skills that may exist within a certain region is

A

an outpost facility

40
Q

A facility that serves the market where it is located but also assumes responsibility for product customization, process improvements, product modifications, or product development is

A

a contributor facility.

41
Q

A facility that creates new products, processes, and technologies for the entire network is

A

a lead facility.

42
Q

Production technology displays significant economies of scale,

A

few high-capacity locations are the most effective.

43
Q

If facilities have lower fixed costs,

A

many local facilities are preferred because this helps lower transportation costs.

44
Q

If the production technology is very inflexible and product requirements vary from one country to another, a firm has to set up

A

local facilities to serve the market in each country.

45
Q

If the technology is flexible,

A

it becomes easier to consolidate manufacturing in a few large facilities.