CSCP Exam Mod 1

Question 1

active tag

Answer 1

A radio frequency identification tag that broadcasts

information and contains its own power source.

Question 2

advanced planning and scheduling (APS)

Answer 2

Techniques that deal with analysis and planning of logistics and manufacturing during short, intermediate, and long-term time periods. [This] describes any computer program that uses advanced mathematical algorithms or logic to perform optimization or simulation on finite capacity scheduling, sourcing, capital planning, resource planning, forecasting, demand management, and others. These techniques simultaneously consider a range of constraints and business rules to provide real-time planning and scheduling, decision support, available-to-promise, and capable-to-promise capabilities. [This] often generates and evaluates multiple scenarios. Management then selects one scenario to use as the “official plan.” The five main components of [these] systems are (1) demand planning, (2) production planning, (3) production scheduling, (4) distribution planning, and (5) transportation planning.

Question 3

automatic identification and data capture (AIDC)

Answer 3

Technologies that collect data about objects and then sends the data to a computer without human intervention. Examples include radio frequency wireless devices and terminals, bar code scanners, and smart cards.

Question 4

automatic identification system (AIS)

Answer 4

A system that can use various means, including bar code scanning and radio frequencies, to sense and load data in a computer.

Question 5

available-to-promise (ATP)

Answer 5

1) In operations, the uncommitted portion of a company’s inventory and planned production maintained in the master schedule to support customer-order promising. [This] quantity is the uncommitted inventory balance in the first period and is normally calculated for each period in which an MPS receipt is scheduled. In the first period, [this] includes on-hand inventory less customer orders that are due and overdue. Three methods of calculation are used: discrete […], cumulative […] with look-ahead, and cumulative […] without look-ahead. (2) In logistics, the quantity of a finished good that is or will be available to commit to a customer order based on the customer’s required ship date. To accommodate deliveries on future dates, [this] is usually time-phased to include anticipated purchases or production receipts.

Question 6

business process management (BPM)

Answer 6

A business discipline or function that uses business practices, techniques, and methods to create and improve business processes. [A] holistic approach to the use of appropriate process-related business disciplines to gain business performance improvements across the enterprise or supply chain. It promotes business effectiveness and efficiency while striving for innovation, flexibility, and integration with technology. Most process improvement disciplines or activities can be considered [this].

Question 7

business-to-business commerce (B2B)

Answer 7

Business conducted over the internet between businesses. The implication is that this connectivity will cause businesses to transform themselves via supply chain management to become virtual organizations—reducing costs, improving quality, reducing delivery lead time, and improving due-date performance.

Question 8

business-to-consumer sales (B2C)

Answer 8

Business being conducted between businesses and final consumers, largely over the internet. It includes traditional brick and mortar businesses that also offer products online and businesses that trade exclusively on the internet.

Question 9

capable-to-promise (CTP)

Answer 9

The process of committing orders against available capacity as well as inventory. This process may involve multiple manufacturing or distribution sites. Used to determine when a new or unscheduled customer order can be delivered. Employs a finite-scheduling model of the manufacturing system to determine when an item can be delivered. Includes any constraints that might restrict the production, such as availability of resources, lead times for raw materials or purchased parts, and requirements for lower-level components or subassemblies. The resulting delivery date takes into consideration production capacity, the current manufacturing environment, and future order commitments. The objective is to reduce the time spent by production planners in expediting orders and adjusting plans because of inaccurate delivery-date promises.

Question 10

content management applications

Answer 10

Supports the evolutionary life cycle of digital-based information and makes information dynamically updatable online; includes the ability to publish content to a repository and support access to digital-based content.

Question 11

cost of goods sold (COGS)

Answer 11

Term: cost of goods sold (COGS)

Question 12

database management system (DBMS)

Answer 12

The software designed for organizing data and providing the mechanism for storing, maintaining, and retrieving that data on a physical medium (i.e., a database). [This] separates data from the application programs and people who use the data and permits many different views of the data.

Question 13

demand shaping

Answer 13

Simplification of parts, products, and processes to improve quality and reduce manufacturing costs.

Question 14

design for manufacture and assembly (DFMA)

Answer 14

A product development approach that involves the manufacturing function in the initial stages of product design to ensure ease of manufacturing and assembly.

Question 15

design for quality

Answer 15

A product design approach that uses quality measures to capture the extent to which the design meets the needs of the target market (customer attributes), as well as its actual performance, aesthetics, and cost.

Question 16

design for remanufacture

Answer 16

Products developed in a manner that allows components to be used in other products. This process is associated with green manufacturing.

Question 17

design for service

Answer 17

Simplification of parts and processes to improve the after-sale service of a product.

Question 18

design for six sigma

Answer 18

An approach to designing products and processes that attempts to ensure the firm can provide products or services that meet six sigma quality levels. These quality levels correspond to approximately 3.4 defects per million opportunities.

Question 19

design for the environment (DFE)

Answer 19

Considering health, safety, and environmental aspects of a product during the design and development phase of product development.

Question 20

design for the supply chain

Answer 20

Enhancement of a firm’s product design in consideration of the issues that will arise in the supply chain, from raw materials to the final stage of the product’s life cycle.

Question 21

economic value added

Answer 21

In managerial accounting, the net operating profit earned above the cost of capital for a profit center.

Question 22

electronic commerce

e-commerce

Answer 22

The use of computer and telecommunication technologies to conduct business via electronic transfer of data and documents.

Question 23

electronic data interchange (EDI)

Answer 23

The paperless (electronic) exchange of trading documents, such as purchase orders, shipment authorizations, advanced shipment notices, and invoices, using standardized document formats.

Question 24

electronic document

Answer 24

The electronic representation of a document that can be printed.

Question 25

electronic product codes (EPCs)

Answer 25

Codes that are used with RFID tags to carry information on the product that will support warranty programs.

Question 26

enterprise resources planning (ERP)

Answer 26

Framework for organizing, defining, and standardizing the business processes necessary to effectively plan and control an organization so the organization can use its internal knowledge to seek external advantage. [This type of] system provides extensive databanks of information including master file records, repositories of cost and sales, financial detail, analysis of product and customer hierarchies, and historic and current transactional data.

Question 27

global strategy

Answer 27

A strategy that focuses on improving worldwide performance through the sales and marketing of common goods and services with minimum product variation by country. Its competitive advantage grows through selecting the best locations for operations in other countries.

Question 28

glocalization

Answer 28

A combination of “globalization” and “localization.” In a supply chain context, [this] is a form of postponement where a product or service is developed for distribution globally but is modified to meet the needs of a local market. The modifications are made to conform with local laws, customs, cultures, and preferences.

Question 29

information system architecture

Answer 29

A model of how the organization operates regarding information. The model considers four factors: (1) organizational functions; (2) communication of coordination requirements; (3) data modeling needs; and (4) management and control structures. [This] should be aligned with and match the architecture of the organization.

Question 30

innovative products

Answer 30

Products that tend to have a high profit margin, be unique, have less competition, and have dynamic demand.

Question 31

inventory optimization software

Answer 31

A computer application that can find optimal inventory strategies and policies related to customer service and return on investment over several echelons of a supply chain.

Question 32

inventory valuation

Answer 32

The value of the inventory at either its cost or its market value. Because inventory value can change with time, some recognition is taken of the age distribution of inventory. Therefore, the cost value of inventory is usually computed on a FIFO, LIFO, or standard cost basis to establish the cost of goods sold.

Question 33

keiretsu

Answer 33

A form of cooperative relationship among companies in Japan where the companies largely remain legally and economically independent, even though they work closely in various ways such as financial backing. A member of [this] generally owns a limited amount of stock in other member companies. [It] generally forms around a bank and a trading company, but “distribution” (supply chain) alliances [of this type] have been formed of companies ranging from raw material suppliers to retailers.

Question 34

legacy systems

Answer 34

A computer application program that is old and interfaces poorly with other applications but is too expensive to replace. It often runs on antiquated hardware.

Question 35

level of service

Answer 35

A measure (usually expressed as a percentage) of satisfying demand through inventory or by the current production schedule in time to satisfy the customers’ requested delivery dates and quantities. In a make-to-stock environment, [this] is sometimes calculated as the percentage of orders picked complete from stock upon receipt of the customer order, the percentage of line items picked complete, or the percentage of total dollar demand picked complete. In make-to-order and design-to-order environments, [it] is the percentage of times the customer-requested or acknowledged date was met by shipping complete product quantities.

Question 36

life cycle analysis

Answer 36

A quantitative forecasting technique based on applying past patterns of demand data covering introduction, growth, maturity, saturation, and decline of similar products to a new product family.

Question 37

market share

Answer 37

The actual portion of current market demand that a company or product achieves.

Question 38

marketing research

Answer 38

The systematic gathering, recording, and analyzing of data about problems relating to the marketing of goods and services. Such research may be undertaken by impartial agencies or by business firms or their agents. Marketing research includes several types: (1) market analysis (product potential is a type) is the study of the size, location, nature, and characteristics of markets; (2) sales analysis (or research) is the systematic study and comparison of sales (or consumption) data; (3) consumer research (motivation research is a type) is concerned with the discovery and analysis of consumer attitudes, reactions, and preferences.

Question 39

modular design strategy

Answer 39

The strategy of planning and designing products so that components or subassemblies can be used in current and future products or assembled to produce multiple configurations of a product. […].

Question 40

modular system

Answer 40

A system architecture design in which related tasks are grouped in self-contained packages. Each package, or module, of tasks performs all of the tasks related to a specific function. Advances in functions can be implemented without affecting other packages or modules because of the loose coupling with other modules. One example is a multitiered architecture in which application business rules are separated from the data management rules. Another example is a client-server architecture in which user interface tasks are separated from the application software.

Question 41

multicountry strategy

Answer 41

A strategy in which each country market is self-contained. Customers have unique product expectations that are addressed by local production capabilities.

Question 42

obsolescence

Answer 42

1) The condition of being out of date. A loss of value occasioned by new developments that place the older property at a competitive disadvantage. A factor in depreciation. 2) A decrease in the value of an asset brought about by the development of new and more economical methods, processes, or machinery. 3) The loss of usefulness or worth of a product or facility as a result of the appearance of better or more economical products, methods, or facilities.

Question 43

order losers

Answer 43

Areas or aspects of an organization in which poor performance can cause loss of business. For example, failure to meet customer expectations with delivery of the product is [this].

Question 44

order qualifiers

Answer 44

Those competitive characteristics that a firm must exhibit to be a viable competitor in the marketplace. For example, a firm may seek to compete on characteristics other than price, but in order to “qualify” to compete, its costs and the related price must be within a certain range to be considered by its customers.

Question 45

order winners

Answer 45

Those competitive characteristics that cause a firm’s customers to choose that firm’s goods and services over those of its competitors. [These can be considered to be competitive advantages for the firm. [They also] usually focus on one (rarely more than two) of the following strategic initiatives: price/cost, quality, delivery speed, delivery reliability, product design, flexibility, after-market service, and image.

Question 46

partnership

Answer 46

1) A form of business ownership that is not organized as a separate legal entity (i.e., unincorporated business), but entailing ownership by two or more persons. 2) In a supply chain, a relationship based on trust, shared risk, and rewards aimed toward achieving a competitive advantage.

Question 47

passive tag

Answer 47

A RFID tag that does not send out data and is not self-powered.

Question 48

product differentiation

Answer 48

A strategy of making a product distinct from the competition on a nonprice basis such as availability, durability, quality, or reliability.

Question 49

product life cycle management (PLM)

Answer 49

The process of facilitating the development, use, and support of products that customers want and need. Helps professionals envision the creation and preservation of product information, both to the customer and along the reverse-logistics portion of the supply chain.

Question 50

project management

Answer 50

The use of skills and knowledge in coordinating the organizing, planning, scheduling, directing, controlling, monitoring, and evaluating of prescribed activities to ensure that the stated objectives of a project, manufactured good, or service are achieved.

Question 51

pull system

Answer 51

1) In production, the production of items only as demanded for use or to replace those taken for use. 2) In material control, the withdrawal of inventory as demanded by the using operations. Material is not issued until a signal comes from the user. 3) In distribution, a system for replenishing field warehouse inventories where replenishment decisions are made at the field warehouse itself, not at the central warehouse or plant.

Question 52

push system

Answer 52

1) In production, the production of items at times required by a given schedule planned in advance. 2) In material control, the issuing of material according to a given schedule or issuing material to a job order at its start time. 3) In distribution, a system for replenishing field warehouse inventories where replenishment decision making is centralized, usually at the manufacturing site or central supply facility.

Question 53

quality function deployment (QFD)

Answer 53

A methodology designed to ensure that all the major requirements of the customer are identified and subsequently met or exceeded through the resulting product design process and the design and operation of the supporting production management system. [It] can be viewed as a set of communication and translation tools. [It] tries to eliminate the gap between what the customer wants in a new product and what the product is capable of delivering. [This] often leads to a clear identification of the major requirements of the customers. These expectations are referred to as the voice of the customer (VOC).

Question 54

radio frequency identification (RFID)

Answer 54

A system using electronic tags to store data about items. Accessing or retrieving this data is accomplished through a specific radio frequency and does not require close proximity or line-of-sight access.

Question 55

return on assets (ROA)

Answer 55

Net income for the previous 12 months divided by total assets.

Question 56

return on investment (ROI)

Answer 56

A relative measure of financial performance that provides a means for comparing various investments by calculating the profits returned during a specified time period. In the theory of constraints, [this] is calculated as throughput minus operating expense divided by investment.

Question 57

semipassive tag

Answer 57

An RFID tag that sends out data, is self-powered, and widens its range by harnessing power from the reader.

Question 58

service industry

Answer 58

1) In its narrowest sense, an organization that provides an intangible product (e.g., medical or legal advice). 2) In its broadest sense, all organizations except farming, mining, and manufacturing. Includes retail trade; wholesale trade; transportation and utilities; finance, insurance, and real estate; construction; professional, personal, and social services; and local, state, and federal governments.

Question 59

sourcing

Answer 59

The process of identifying a company that provides a needed good or service.

Question 60

spend management

Answer 60

Managing the outflow of funds in order to buy goods and services. The term is intended to encompass such processes as outsourcing, procurement, e-procurement, and supply chain management.

Question 61

strategic planning

Answer 61

The process of developing a strategic plan.

Question 62

supply chain event management (SCEM)

Answer 62

A term associated with supply chain management software applications, where users have the ability to flag the occurrence of certain supply chain events to trigger some form of alert or action within another supply chain application. [It] can be deployed to monitor supply chain business processes such as planning, transportation, logistics, or procurement. Can also be applied to supply chain business intelligence applications to alert users to any unplanned or unexpected event.

Question 63

supply chain management

Answer 63

The design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand, and measuring performance globally.

Question 64

supply chain resilience

Answer 64

The ability of a supply chain to anticipate, create plans to avoid or mitigate, and/or to recover from disruptions to supply chain functionality.

Question 65

transportation management system (TMS)

Answer 65

A computer application system designed to manage transportation operations. Typically offer modules focused on specific functions, such as intermodal transportation, import/export management, fleet service management, and load planning and optimization.

Question 66

universality

Answer 66

The strategy of designing a product initially intended for one market in such a way that it can also be sold in other markets. A form of standardization.

Question 67

value added

Answer 67

1) In accounting, the addition of direct labor, direct material, and allocated overhead assigned at an operation. It is the cost roll-up as a part goes through a manufacturing process to finished inventory. 2) In current manufacturing terms, the actual increase of utility from the viewpoint of the customer as a part is transformed from raw material to finished inventory; the contribution made by an operation or a plant to the final usefulness and value of a product, as seen by the customer. The objective is to eliminate all non-value-added activities in producing and providing a good or service.

Question 68

value chain

Answer 68

The functions within a company that add value to the goods or services that the organization sells to customers and for which it receives payment.

Question 69

value stream

Answer 69

The processes of creating, producing, and delivering a good or service to the market. For a good, [this] encompasses the raw material supplier, the manufacture and assembly of the good, and the distribution network. For a service, [this] consists of suppliers, support personnel and technology, the service “producer,” and the distribution channel. May be controlled by a single business or a network of several businesses.

Question 70

value stream mapping

Answer 70

A lean production tool to visually understand the flow of materials from supplier to customer that includes the current process and flow as well as the value-added and non-value-added time of all the process steps. Used to lead to reduction of waste, decrease flow time, and make the process flow more efficient and effective.

Question 71

value-added network (VAN)

Answer 71

A network, often supporting EDI, providing services additional to those provided by common carriers.

Question 72

warehouse management system (WMS)

Answer 72

A computer application system designed to manage and optimize workflows and the storage of goods within a warehouse. Often interfaces with automated data capture and enterprise resources planning systems.

Question 73

web services

Answer 73

A common internet or intranet framework that enables the movement of data from one supply chain application to another, without the requirement for a direct connection between the two applications and without regard to the underlying operating system for those applications.