SCMT Exam 2 - FLASHCARDS - Chapter 15

Question 1

Which one of the following companies does not specialize in logistics?

United Parcel Service

FedEx

DHL

Ford Motors

Answer 1

Ford

Question 2

The problem of deciding how best to transport goods from plants to customers involves major trade-offs. Which of the following are some of those major trade-offs?

complexity of the information system

flexibility to react to changes

cost of transporting the product

speed of delivery

inventory levels

Answer 2

flexibility to react to changes

cost of transporting the product

speed of delivery

Question 3

The ______ offers great flexibility for moving goods to virtually any location not separated by water?

Answer 3

Highway

Question 4

In hub-and-spoke systems, the warehouse is referred to as a

Answer 4

Hub

Question 5

Today, a manufacturing company most often will contract with a _____ _____ logistics company to handle many of its logistics functions.

Answer 5

Third party

Question 6

The problem of deciding how best to transport goods from plants to customers is a _____ one that affects the _____ of a product.

Answer 6

difficult; cost

Question 7

A technique often used by communications companies to locate their transmission towers.

Answer 7

Centroid method

Question 8

Which of the following is the terms used for systems that combine the idea of consolidation and that of cross-docking?

Answer 8

Hub-and-spoke system

Question 9

These provide a mechanism to combine diverse factors in an easy-to-understand format.

Answer 9

factor-rating systems

Question 10

All functions concerned with the movement of materials and finished goods on a global scale, is termed?

Answer 10

international logistics

Question 11

A special linear programming method that is useful for solving problems involving moving products from several sources to several destinations is known as _____

Answer 11

Transportation method

Question 12

Production plant constraints are entered into Solver using what type of constraint?

Answer 12

≤

Question 13

For what percentage of GDP does logistics account?

Answer 13

8–9 percent

Question 14

Which of the following is a plant location technique that uses a coordinate grid system?

Transportation method

Factor rating

Location method

Centroid method

Answer 14

Centroid method

Question 15

This can include the presence of similar-sized businesses, the presence of companies in the same industry and, in the case of international locations, the presence of other foreign companies.

Answer 15

Business climate

Question 16

Services typically have _____ sites to maintain close contact with customers?

Answer 16

Multiple

Question 17

The two common objectives of the transportation method are what?

Answer 17

Maximize the profit of shipping n units to m destinations
Minimize the cost of shipping n units to m destinations

Question 18

All functions concerned with the movement of materials and finished goods on a global scale, is termed?

Answer 18

international logistics

Question 19

For a service, the location decision is closely tied to what?

Answer 19

the market selection decision

Question 20

What is The art and science of obtaining, producing, and distributing material and product in the proper place and in the proper quantities?

Answer 20

Logistics

Question 21

What does logistics include?

Answer 21

• Includes forward and reverse flows
• Includes flow of materials and information
• Load, offload, move, sort and select material
• International Logistics: functions on a global scal

Question 22

What are major logistics activities faced by a firm?

Answer 22

– Order‐taking and order processing
– Warehousing
– Transportation
– Returns
– After‐sales service
– Managing reliable supply of raw materials & components

Question 23

What are inbound flows?

Answer 23

Work with suppliers and procurement managers, includes
accounting and finance areas

Question 24

What are outbound flows?

Answer 24

– Work with marketing, sales, and customers
– Ensure customer requirements are satisfied

Question 25

What does logistics seek to minimize?

Answer 25

Seeks to minimize the total landed costs, not just one cost element

Question 26

What percent of sales revenue does logistics include?

Answer 26

As much as 25‐30% of each dollar of sales revenue

Question 27

What is the sum of all product and logistics related costs?

Answer 27

Total landed costs

Question 28

What types of costs are raw materials, storage, labor?

Answer 28

Costs within country of manufacture

Question 29

What is the most visible part of logistics?

Answer 29

Transportation

Question 30

What is the government's role in logistics?

Answer 30

Economic and safety regulation

Question 31

What is safety regulation?

Answer 31

(increasing): safe for carriers and public, including increased emphasis on security from terrorist activity and transparency on travel locations

Question 32

What is the fact that cost per unit of weight decreases as shipment size increases?

Answer 32

Economies of scale

Question 33

What is the fact that cost per unit traveled decreases as distance moved increases?

Answer 33

Economies of distance

Question 34

What is combining many smaller shipments into one large shipment?

Answer 34

Consolidation?

Question 35

What is a pooled delivery?

Answer 35

Combine small shipments from one area going to the same (destination) area

Question 36

What is a scheduled delivery?

Answer 36

Delivery at specific times

Question 37

What mode of transportation is : • Major transportation mode in U.S. • Can offer door‐to‐door service anywhere • Low fixed costs, high variable costs

Answer 37

Truck

Question 38

What is the oldest mode of transportation?

Answer 38

Water

Question 39

What mode of transportation never stops and is not affected by the weather?

Answer 39

Pipeline

Question 40

Which mode of transportation is the newest and the least utilized mode?

Answer 40

Air

Question 41

Which mode of transportation has low dependability and high variability?

Answer 41

Air

Question 42

Which mode of transportation has high variable costs and low fixed costs?

Answer 42

Air

Question 43

What is value density?

Answer 43

ratio of value to weight, often determines the mode of transportation and type of carrier used

Question 44

What mode of transportation is fast but expensive?

Answer 44

Air

Question 45

What mode of transportation has great flexibility?

Answer 45

Truck

Question 46

What mode of transportation has high capacity and low cost, but is slow?

Answer 46

Ship

Question 47

What mode of transportation is low cost but slow and variable?

Answer 47

Train

Question 48

What mode of transportation is highly specialized and limited to liquids, gases, and solids in slurry form?

Answer 48

Pipeline

Question 49

What mode of transportation is the last step in many consumer supply chain?

Answer 49

Hand delivery

Question 50

What is a warehouse?

Answer 50

Historically a place to store inventory

Question 51

What is a distribution center?

Answer 51

Strategically store inventory, package final product configurations and assortments

Question 52

What is handling and locating material increases costs and the risk of damage?

Answer 52

Material handling

Question 53

What are robots that retrieve, move, and put‐away material?

Answer 53

Automated Storage and Retrieval Systems

Question 54

What is an RFID?

Answer 54

Electronic tracking of material

Question 55

What are operations warehouses must perform on a daily basis?

Answer 55

- Receiving and unloading - In‐storage handling - Storage - Order picking - Staging - Shipping

Question 56

What is the ratio of value to weight, often determines the mode of transportation and type of carrier used?

Answer 56

Value density

Question 57

How many transportation modes will most items need to reach their final destination?

Answer 57

Two

Question 58

What type of packaging can decrease handling costs and risk of damage?

Answer 58

Proper packaging

Question 59

What cost industry is packaging?

Answer 59

975 billion

Question 60

What are the benefits of cross-docking?

Answer 60

Reduces: • Inventory carrying costs by avoiding storage • Costs of order fulfillment and material handling • Number of trucks sent to customers by providing one shipment with a mix of different products

Question 61

What are requirements of cross-docking?

Answer 61

• Automated material handling • Warehouse Management Systems • Order processing systems • Quality control systems • Strong relationships among supply chain partners

Question 62

What is reverse logistics especially important in?

Answer 62

Especially important in online retail

Question 63

What is value added services?

Answer 63

Providing additional value to the customer, such as postponement in packaging, labeling, or even small final assembly

Question 64

What manages all or part of another firm’s logistics, transportation, and/or warehousing?

Answer 64

Third party logistics companies (3PL's)

Question 65

What are also called Integrated Service Providers (ISPs)?

Answer 65

Third party logistics companies (3PL's)

Question 66

What are examples of major third party logistics companies?

Answer 66

UPS, FedEx, Ryder, Ceva Logistics

Question 67

What are benefits of new service facilities?

Answer 67

• New service facilities far more common than new factories and warehouses – Much less expensive • Multiple sites close to customers • Location decision closely tied to the market selection decision

Question 68

What logistics services do 3PL's provide?

Answer 68

– Intermodal transportation – Order processing, tracking and fulfillment and returns – Inventory and warehouse management – JIT delivery to assembly line – Sales support

Question 69

True or false: A favorable business climate in facility location decision making might include government legislation of tax abatements?

Answer 69

FALSE

Question 70

What does proximity to customers help with in regards to facility location?

Answer 70

Makes rapid delivery easier

Question 71

What is business climate in regards to facility location?

Answer 71

Can include presence of similar‐sized businesses, businesses in the same industry, and other foreign companies

Question 72

What is the goal of total costs in regards to facility location?

Answer 72

Object is to minimize overall cost

Question 73

What is infrastructure in regards to facility location?

Answer 73

Adequate road, rail, air, and sea transportation along with energy and telecommunications

Question 74

What is quality of labor in regards to facility location?

Answer 74

Educational and skill levels must match needs

Question 75

What do suppliers support in regards to facility location?

Answer 75

Proximity of important suppliers supports lean production

Question 76

What are free trade zones in regards to facility location?

Answer 76

A closed facility into which foreign goods can be brought without being subject to the normal customers requirements

Question 77

What method is widely used, because it allows for diverse factors?

Answer 77

Factor rating system

Question 78

What method is used for locating single facilities that considers existing facilities, the distances between them, and the volumes of goods to be shipped between them?

Answer 78

Centroid method

Question 79

What method does not include special shipping costs for less than a full load?

Answer 79

Centroid method

Question 80

What method assumes inbound and outbound transportation costs are equal?

Answer 80

Centroid method

Question 81

True or false: Facility location analysis considers the competitive imperative of locating near the appropriate labor pool to take advantage of high technical skills?

Answer 81

TRUE. The educational and skill levels of the labor pool must match the company's needs

Question 82

True or false: Because the world is becoming more highly interconnected, the proximity of an important supplier's plants is not crucial in supporting lean production methods?

Answer 82

FALSE. A high-quality and competitive supplier base makes a given location suitable. The proximity of important suppliers' plants also supports lean production methods

Question 83

True or false: Facility location decisions are made using analytical techniques that are able to weigh a large number of different variables equally?

Answer 83

FALSE. Analytical techniques assist the decisions but seldom weigh different variables equally

Question 84

Which of the following is not a criterion that influences manufacturing plant or warehouse facility location decisions? A. Proximity to customers B. Historical cost C. Infrastructure of a country D. Quality of labor E. Business climate

Answer 84

Historical cost

Question 85

Which of the following is a plant location methodology good for locating a single facility within a set of existing facilities based in distances and volumes of goods shipped? A. Factor-rating systems B. Centroid method C. Decision trees D. Linear programming E. Regression analysis

Answer 85

Centroid method. The centroid method is a technique for locating single facilities that considers the existing facilities, the distances between them, and the volumes of goods to be shipped