Test 2 Flashcards
Why a corporation might make
Preserve technological secrets Reduce risk Avoid supplier dependency Greater assurance of supply Lower potential cost To take advantage of unused capacity
Six major procurement strategy areas
Assurance of supply
Cost avoidance/reduction
Competitive edge risk management and security
Environmental challenges and responsiveness
Supply chain support
Why a corporation might buy instead of make
Reduce risk
Lack of managerial or technological experience
Flexibility
Buying outside May open up markets
The ability to bring a product or service to market faster
Customer preference for a particular brand
Risk of outsourcing
Loss of control Exposure to supplier risk I.e. Financial Difficulty quantifying economies Unexpected costs Conversion costs
8 dimensions of quality
Features Reliability Aesthetics Performance Perceived quality Durability Conformance Serviceability
For six sigma there is emphasis on the DMAIC approach
Define, measure, analyze, improve, and control
What drives TQM
The goal of customer satisfaction and the systematic and continuous research process related to customer satisfaction.
Quality must be integrated throughout firm
All management and employees must commit to continuous improvement
What’s the difference between fixed order quantity and fixed time period order quantity
The fixed order quantity approach is perpetual and inventory is replaced in fixed amounts
The fixed time period approach the firm may chanel amount of orders based on a forecasted demand level taken at specific time intervals. Time triggers the model.
Why is safety stock held and what is the trade off for having it
Safety stock is held because of uncertainty in supply and or demand. The trade off is the cost of stocking out versus the cost of holding inventory
What are forms of inventory
Raw materials Resale items Purchased parts Packaging Work in progress Finished goods mRo items
What is inventory carrying cost
The expense associated with maintaining inventory
What are carrying cost components
Cost of capital
Taxes
Shelf life
Storage
What are some transportation industry segments
Air cargo Air passenger Motor freight Marine Railroad Intermodal Pipeline
Types of carriers/suppliers
Private Common Contract Exempt 3pl
Mode and carrier selection criteria
Performance Reliability and service quality Type of item Size Possibility of damage or loss Carrier financial situation Handling of claims
