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MGT8803 > Supply Chain > Flashcards

Supply Chain Flashcards

1
Q

What are characteristics of a Responsive Supply Chain?

A

-High demand uncertainty
-High profit margins
-High levels of safety stock
-Prioritizes reducing lead time
-Suppliers are chosen for speed, flexibility, responsiveness and quality
-Have a greater reliance on fast/speedy modes of logistics

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2
Q

What are the characteristics of an Efficient Supply Chain?

A

-Predictable/Stable Demand
-Low demand uncertainty
-Low Profit Margins
-High average utilization rates
-High inventory turns and minimize inventory through the supply chain
-Reduce lead time as long as it doesn’t increase cost
-Suppliers selected for cost and quality
-Relies on low cost modes of logistics

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3
Q

When is a Decentralized Supply Chain more appropriate?

A

When there are many points of sale

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4
Q

How do Efficient and Responsive supply chains relate to Centralized vs Decentralized strategies?

A

-A centralized strategy needs an efficient supply chain
-A decentralized strategy needs a responsive supply chain

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5
Q

Why would a company consider Outsourcing?

A

-Lack of capacity in house
-Supplier has better technical capabilities
-To focus more on core capabilities

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6
Q

Why would a company want to Offshore?

A

-To be closer to offshore customers
-Offshore has better cost/price
-Offshore has better technical capabilities
-Faster response to offshore customer

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7
Q

What are some pitfalls of Offshoring?

A

-You may lose the ability to do the task offshore
-You many not get a good understanding of your overall product cost
-Exchange rates can be volatile
-you give up control over quality & cost

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8
Q

What is NOT a cost factor when considering offshoring that is not captive?

A

Real Estate costs

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9
Q

What are some conditions that are more conducive to a Centralized supply chain?

A

-Demand is stable
-Higher product availability
-Low distribution complexity

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10
Q

A centralized network configuration lends itself to which type of supply chain model?

A

Efficient

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11
Q

What are some supply chain characteristics (demand, inventory, lead times) of a Functional product?

A

-Low demand uncertainty
-Stable demand
-Long product life
-Low inventory costs
-Low profit margins
-Low product variety & high volume
-Low stockout & obsolescence cost

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12
Q

What’re reasons for outsourcing?

A

-Reduce and control costs
-increase flexibility and speed
-decrease lead times
-increase innovation capability
-focus on core capabilities & competencies
-gain access to world class capabilities
-free internal resources for other purposes
-insufficient resources are available internally
-share risks with partner company

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13
Q

What is NOT a driver of offshoring?

A

social drivers

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14
Q

What are cost drivers for offshoring?

A

-Exchange rate fluctuations
-Lower comparative cost factors: labor, material
-Falling communication, coordination, and material movement costs
- Economies of scale
-Cost and risk sharing in joint ventures

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15
Q

What are some pitfalls of offshoring?

A

-Inaccurate determination of overall product costs
-Lack of control over costs and quality
-Exchange Rate volatility
-Political uncertainty in the target market

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16
Q

What are some characteristics of a PULL system?

A

-Faster reactions to defects
-Operators only work when signalled
-No slack in the system

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17
Q

What is an advantage that a Decentralized strategy has over a Centralized strategy?

A

shorter shipping distances

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18
Q

What is the philosophy of Lean?

A

Eliminate waste

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19
Q

T/F In a traditional push system, throughput time will usually increase as WIP increases.

A

True

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20
Q

What’s the difference between a push and pull system?

A

A PUSH system keeps operators and materials busy while a PULL system keeps operators idle and material busy

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21
Q

What are some characteristics of a PULL system?

A
  • Faster reaction to defects
  • Operators only work when there’s a signal to produce
  • There’s no slack in the system(?)
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22
Q

T/F In a PULL system the production line is controlled by the first operation

A

False

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23
Q

What is a common internal strategy to match supply with demand?

A

sub-contract

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24
Q

What’s a common external strategy for matching supply and demand

A

promotion or sales

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25
Q

What’s the equation for Economic Order Qty?

A

Q=Sqrt(2S*D/H)
S = Ordering Cost
D = Yearly Demand
H = Holding Cost

26
Q

Where would the newsvendor model be least useful?

A

Items with long selling season

27
Q

T/F In the newsvendor problem, the optimal order quantity depends on the relative cost of stocking too much and stocking too little.

A

True

28
Q

What are causes of the Bullwhip Effect?

A

-Order Batching
-Gaming
-Inaccurate Forecasts
-Price Fluctuations

29
Q

What’s the definition of a forecast?

A

A prediction of future events that’s used for planning purposes.

30
Q

T/F Forecasts are almost always wrong

A

True

31
Q

T/F Demand can show random variation over time

A

True

32
Q

What are some patterns of demand?

A

Trends
Randomness
Autocorrelation
Seasonality

33
Q

What is the Bullwhip Effect?

A

The Increasing fluctuations in demand as one moves upstream in the supply chain

34
Q

T/F Trial and error can be used to determine the weights for a weighted moving average forecast

A

True

35
Q

What are the characteristics of Innovative products?

A

-High demand uncertainty
-Difficult to forecast/variable demand
-Short Product Life
-High Inventory cost
-High Profit margins
-High product variety & lower volume
-High stockout & obsolescence cost

36
Q

High demand uncertainty is associated with what type of product and supply chain?

A

Innovative Products and Responsive supply chains

37
Q

Difficult to forecast and variable demand are characteristics of which type of product and supply chain?

A

Innovative Products and Responsive supply chains

38
Q

Short Product life is associated with which type of product and supply chain?

A

Innovative products and Responsive supply chain

39
Q

High Inventory Costs are associated with which type of product and supply chain?

A

Innovative and Responive

40
Q

High profit margins are associated with which type of product and supply chain?

A

Innovative and Responsive

41
Q

High product variety and low volumes are associated with which type of product and supply chain?

A

Innovative & Responsive

42
Q

High stockout and obsolescence costs are associated with which type of product and supply chain?

A

Innovative and Responsive

43
Q

Low demand uncertainty is associated with which type of product and supply chain?

A

Functional and Efficient

44
Q

More predictable/stable demand is associated with which type of product and supply chain?

A

Functional and Efficient

45
Q

Long product life is associated with which type of product and supply chain?

A

Functional and Efficient

46
Q

Low inventory cost is associated with which type of product and supply chain?

A

Functional and Efficient

47
Q

Low profit margins are associated with which type of product and supply chain?

A

Functional and Efficient

48
Q

Low product variety and higher volumes are associated with which type of product and supply chain?

A

Functional and Efficient

49
Q

Low stockout and obsolescence costs are associated with which type of product and supply chain?

A

Functional and Efficient

50
Q

Logistics Strategy of Greater reliance on low cost modes

A

Efficient SC

51
Q

Logistics Strategy of Greater reliance on fast/speedy modes

A

Responsive SC

52
Q

Supplier Capability: primarily for cost and quality

A

Efficient

53
Q

Supplier Capability: Speed, Flexibility, and quality

A

Responsive

54
Q

Lead Time Strategy: Reduce lead time as long as it doesn’t increase cost

A

Efficient

55
Q

Lead Time Strategy: Invest aggressively in ways to reduce lead time

A

Responsive

56
Q

Inventory Strategy: Generate high turns an dminimize inventory throughout the supply chain

A

Efficient

57
Q

Inventory Strategy: Deploy significant buffer/safety stock of parts or finished goods

A

Responsive

58
Q

Capacity Strategy: Maintain high average utilization rate

A

Efficient

59
Q

Capacity Strategy: Deploy excess buffer capacity/capacity flexibility

A

Responsive

60
Q

Is Centralized or Decentralized most appropriate for High distribution cost per weight?

A

Decentralized

61
Q

T/F Decentralized SC have lower total inventory and safety stock

A

False, Centralized has lower inventory because of the pooling effect

MGT8803 (4 decks)

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