FINAL PT 2

Question 1

Prevention Costs

Answer 1

Costs incurred to prevent defects from happening

Question 2

Appraisal Costs

Answer 2

Costs incurred during the process to monitor quality

Question 3

Prevention Cost Examples

Answer 3

Training and Development, Product Design

Question 4

Appraisal Cost Examples

Answer 4

Testing and Inspection, Quality audit

Question 5

Cost of Quality =

Answer 5

Control Costs + Failure Costs

Question 6

Internal Failure Costs

Answer 6

Defects discovered BEFORE reaching customer

Question 7

External Failure Costs

Answer 7

Defects discovered AFTER reaching customer

Question 8

Internal Failure Cost Example

Answer 8

Lost capacity, inc cycle times

Question 9

External Failure Cost Example

Answer 9

Customer Service, warranties

Question 10

Cost increases as…

Answer 10

The product moves through it’s cycle

Question 11

Every Organization, Person, Product, and/or Service is Part of

Answer 11

The Supply Chain

Question 12

Basic Components of a Supply Chain

Answer 12

(CS RWDFR) Customer, Service Provider, Retailer, Wholesaler, Distributor, Factory, Raw Materials

Question 13

Customers define:

Answer 13

Product, Demand, Distribution

Question 14

Customers

Answer 14

Public, Business, Govt, or any Component Within the Supply Chain

Question 15

Service Provider

Answer 15

Typically provides people or a nonphysical product

Question 16

Retailer

Answer 16

Has a place of business to provide direct sale of goods in small quantities to the public for use or consumption rather than resale

Question 17

5

Answer 17

5

Question 18

Wholesaler

Answer 18

The sale of goods to anyone other than a standard consumer

Question 19

Distributer

Answer 19

distribute goods in large quantities and have exclusive rights within a given territory

Question 20

Factory

Answer 20

Business that produces materials/final product that is either used in other products or sold directly to consumers

Question 21

The More Complex a Supply Chain Becomes,

Answer 21

THE HIGHER THE RISK

Question 22

Procurement vs Purchasing

Answer 22

Procurement is purchased in BULK from wholesalers/distributers

Question 23

Job of Stocking/Distribution?

Answer 23

Delivery to the shelves, kits, and internal consumers of the product

Question 24

2 Ways to manage the Supply Chain:

Answer 24

By Inspection (less communication), by Certification (robust communication)

Question 25

Supply Chain Management is a very BIG field and is getting ___________ and ________________

Answer 25

bigger; more complex

Question 26

Bull Whip Effect

Answer 26

Product shortages or overstocks that increase in severity as one moves up
the supply chain and away from the customer

Question 27

Bull Whip Effect Causes:

Answer 27

Demand Forecast Uprising, Order Batching, Price Fluctuation, Rationing

Question 28

Bull Whip Effect Solutions:

Answer 28

Communication, Channel Alignment, Operational Efficiency

Question 29

5 Reasons to Keep Inventory:

Answer 29

(LSU EA) Lead Time, Seasonal Demand, Uncertainty, Economies of Scale, Appreciation in Value

Question 30

Stocks in Transit

Answer 30

Inventory in the Logistics Process

Question 31

Consignment Stocks

Answer 31

Inventory possessed but not owned

Question 32

Economic Ordering Quantity Formula

Answer 32

Square Root of (2 * Order Cost) * (Demand Rate / Holding Cost)

Question 33

Optimal Service Level Formula

Answer 33

Stock Out Cost/ (Stock Out Cost + Ordering Cost)

Question 34

Re-Order Point Formula

Answer 34

NORM.INV(OSL,Mean Demand,Std Dev)

Question 35

Downsides to Inventory

Answer 35

Obsolescence, Overhead Exp, Space Usage, Complicated Inventory Control

Question 36

4 Types of Inventory Ordering

Answer 36

Buffer Stock, Just-In-Time, Economic Ordering Quantities, Order Timing

Question 37

Safety Stock

Answer 37

Minimum amount of inventory held based on std dev/volatility

Question 38

Quality

Answer 38

The degree to which a product or service meets or exceeds a customer’s needs or expectations.

Question 39

5

Answer 39

5

Question 40

Quality Management

Answer 40

Set of activities to maintain quality of products and services

Question 41

Conformance Quality

Answer 41

The degree of match between specifications and the actual product or service

Question 42

Barilla’s advertising strategy is

Answer 42

MODERN

Question 43

Barilla’s promotional strategy is to

Answer 43

Offer discounts because it is expected by customers