CSCPModule1(3).doc

203. The correct answer is C. The firms have decided to move to a make-to-order environment, moving the push/pull frontier back to the manufacturer, which will reduce the bullwhip effect and the risk of inventory obsolescence, but at the risk of greater overtime and rush orders if there is a sudden spike in demand. A manufacturer, distributor, wholesaler, and retailer all agree to base their orders on actual consumer orders instead of performing detailed forecasts based on each partys Tier 1 customers actual orders. Which of the following will result, and what are the likely risks of this method?A. Pull moves back and push takes its place at the manufacturer but at the risk of inventory obsolescence or the bullwhip effect. B. Pull moves back and push takes its place at the manufacturer but at the risk of greater overtime or rush orders. C. Push moves back and pull takes its place at the manufacturer but at the risk of greater overtime or rush orders. D. Push moves back and pull takes its place at the manufacturer but at the risk of inventory obsolescence or the bullwhip effect204. The correct answer is D. From the perspective of the manufacturer, the supplier of metal to the sheet metal suppliers is on the second tier and may join in planning, but the manufacturer is otherwise concerned only with its ability to deliver and return goods as needed. SCOR is developed and maintained by the Supply-Chain Council. According to the Supply-Chain Operations Reference (SCOR) model, if a refrigerator manufacturing company is at the center of the model, the supplier of materials to the sheet metal supplier has only which of the following processes to perform in relation to the manufacturer?A. Plan, source, make, deliver, return B. Plan, source, return C. Make, source, deliver D. Plan, deliver, return205. The correct answer is C. The downside of complex, enterprisewide software systems is their potential to lock the enterprise into their assumptions and make process improvement difficult without simultaneous modifications to the complex system. The software would be chosen to increase synchronicity and velocity. Upgrades are generally part of the product and can always be purchased on a custom basis. Which of the following is a significant risk to consider when selecting a complex, enterprisewide software system?A. Decreased velocity of processes because of software complexity B. Decreased synchronicity of functions automated by the software C. Lack of flexibility to improve processes automated by the software D. Lack of future upgrade potential for the software 206. The correct answer is D. Leveragable materials are of high strategic importance but of low supply chain difficulty, so they are key areas where supply chain leverage can be applied to increase efficiencies and lower costs. Which of the following would a material be that was tightly linked to the companys brand equity even though it was basically a cheap but branded plastic toy that didnt require much quality?A. Direct/core competency materials B. Commodity materials C. Bottleneck materials D. Leveragable materials207. The correct answer is B. While squeezing excess costs out of an enterprise certainly has the potential to provide value to one or more stakeholders, it has to be done carefully. Any manager can reduce costs by reducing staff, cutting outlays for research or training, and delaying expenditures on equipment, but thats generally a recipe for immediate stagnation and eventual failure. Which of the following would be most likely to result in the creation of net financial value for a firm over the long term?A. Get labor cost concessions from employees and distribute these gains to all stakeholders evenly. B. Reinvest a sizable portion of profits into R&D, upgrades, and automation. C. Use increased market leverage to gain price concessions from suppliers. D. Transfer all gains from the company to price discounts to consumers to gain market share.208. The correct answer is C. When a system is producing goods at takt time, the rate of goods produced exactly equals the rate of customer demand for the goods. It is calculated as available production divided by rate of customer demand. If customer demand is running at 500 units per day and available production time is 300 minutes per day, what is the takt time?A. 6 seconds per unit B. 16.7 second per unit C. 36 seconds per unit D. 1.67 minutes per unit209. The correct answer is B. JIT reduces lot sizes to bring down inventory accumulation and the costs of holding and handling inventory. However, smaller lot sizes require more frequent orders, and that means more setups. As a consequence, JIT participants need to find ways to reduce setup time. In a JIT system, reduction in lot sizes may result in which of the following tradeoffs?A. Increased handling costs B. Increased cumulative setup time C. Increased holding costs D. Increased inventory accumulation210. The correct answer is C. Demand-driven supply chains require access to real demand data along the chain (visibility), trust and collaboration (including changing processes as needed) among partners, and agility. There will be no room for long changeover times between runs of different products; therefore, equipment, processes, work center layouts, or staffing may have to change. Members of a supply chain want to become demand-driven to reduce the bullwhip effect they are experiencing. Which of the following should each partner in the supply chain do?A. Adopt new enterprise software systems that match current operating processes as closely as possible. B. Improve their forecasting by basing the information on actual Tier 1 customer orders. C. Develop agility for more frequent changeovers, staffing, or process switching. D. Reduce their contracted or owned transportation modes to match the new lowered transport needs.211The correct answer is A. Develop multiple supply chains that are appropriate to each product line. Some companies, to achieve those full truckload shipments, will mix products. While thats a good strategy for speeding up delivery of some products in the mix, it may be highly inefficient for others. Take the high-dollar, lightweight items out of the truck, train, or container and fly them to their destinations. Which of the following is true advice for ensuring that ones supply chain is agile and flexible?A. Mixing products to achieve full truckload shipments may be highly inefficient for high-dollar, lightweight items. B. Cost efficiencies and velocity must take precedence in the supply chain such as always requiring that full truckloads are used. C. A manufacturers trends in demand are best monitored through visibility with Tier 1 customers. D. When designing products for maximum supply chain flexibility, putting customers on the design team will help create modular designs. 212. The correct answer is B. Quality initiatives are to be directed from the top down and implemented from the bottom up. Top management selects processes to improve. Selection of processes for improvement, according to quality methodology, should be done at which of the following levels?A. Regular employees (shop-floor labor, service workers, etc.) B. Top management C. Middle management D. Teams comprising all levels from top management to regular employees213. The correct answer is C. Setting a competitors performance on a process as your goal for the process in your organization is an example of competitive benchmarking. An organization sets a goal of reducing its lead time from four days to two days because another firm in its industry can offer two-day lead time. This is an example of which of the following?A. Process benchmarking B. Oliver Wight benchmarking C. Competitive benchmarking D. Best-in-class benchmarking 214. The correct answer is C. Depending upon the market being served, a supply chain may be managed with an eye to delivering one or more of the following values to its end customers: quality, affordability, availability, or service. A focus on quality, affordability, or availability indicates a focus on which of the following?A. Social value B. Collaborative value C. Customer value D. Financial value215. The correct answer is D. The developers of the balanced scorecard, Robert S. Kaplan and David Norton, believed that the traditional reliance on financial measures of performance placed too much emphasis on the past and too little on the present and future and, in addition, ignored other types of measures that contribute to success. The developers of the balanced scorecard approach to performance were concerned that traditional metrics placed too much emphasis on which of the following considerations?A. Current profitability B. Customer complaints C. Future performance objectives D. Past financial performance216. The correct answer is D. A Japanese method of root cause analysis referred to as Why? Why? Why? Why? Why? is based on the idea that its not always easy to identify the root cause of a customer complaint or other process failure; the first suggestion is likely to be the result of bias or superficial analysis. According to a noted Japanese approach to analyzing business process problems, why is it necessary to ask Why? as many as five times when seeking the cause of a process defect?A. There may be more than one cause for the defect. B. Most employees wont admit making an error the first few times they are asked. C. Most defects tend to have multiple causes, not just one. D. First responses tend to name superficial causes rather than the root causes. 217. The correct answer is A. At the heart of the GSCF model is the combination of customer relationship management and supplier relationship management, because these two processes create and manage the link between adjacent partners in the supply chain. The Global Supply Chain Forum (GSCF) defines supply chain management as the integration of key business processes from end user through original suppliers that provides products, services, and information that add value for customers and other stakeholders. Which two processes are considered to constitute the core of supply chain management in the GSCF model?A. Customer and supplier management B. Demand management and supplier management C. Customer service management and manufacturing flow management D. Order management and supplier relationship management 218. The correct answer is C. Volume growth measures the success of merchandizing efforts. Volume growth is a key performance indicator for which of the following?A. Customer service B. Supply chain variability C. Product merchandizing D. Replenishment219. The correct answer is D. The acceptable range of variability is the number of defects within a range of six sigmas (standard deviations) above and below the mean number of defects. The chart helps control the variability in a process. Which one of the following constitutes the range of acceptable variability on a six-sigma control chart?A. Zero variability B. Mean defects plus/minus 3 sigmas C. Mean defects plus 6 sigmas D. Mean defects plus/minus 6 sigmas 220. The correct answer is A. Quality initiatives are to be directed from the top down and implemented from the bottom up. Top management selects processes to improve. Selection of processes for improvement, according to quality methodology, should be done at which of the following levels?A. Top management B. Teams comprising all levels from top management to regular employees C. Regular employees (shop-floor labor, service workers, etc.) D. Middle management221. The correct answer is D. Order fill rate provides a measure of the success of the key process of replenishment. A high fill rate indicates good performance. Which of the following could be a key performance indicator (KPI) for replenishment?A. Inventory turns B. Volume growth C. Introduction lead time D. Order fill rate 222. The correct answer is B. The information in a supply chain flows upstream toward the supplier end, downstream toward the customer end, and also back and forth within the entities and between the chain and external entities, such as governments, markets, and competitors. Which of the following is true regarding a supply chain?A. Services may be part of a manufacturing supply chain but do not have a distinct supply chain themselves. B. Information flows upstream, downstream, and between network members and external entities. C. An electrical power producer that powers a manufacturers plant is downstream from the manufacturer. D. Cash flows downstream while materials flow upstream.223. The correct answer is A. SCOR can be applied to all product transactions, including services as well as material products. SCOR does not apply to any of the incorrect answers. (It does cover returns, but not all of postdelivery customer support.) SCOR is developed and maintained by the Supply-Chain Council. Which of the following is true of the Supply-Chain Operations Reference (SCOR) model?A. SCOR applies to all product transactions (physical material and service). B. SCOR applies to product development. C. SCOR applies to all areas of postdelivery customer support including returns. D. SCOR applies to demand generation in sales and marketing. 224. The correct answer is A. Total quality management (TQM) is associated with the strategy of continuous improvement, which focuses on small-stem changes in processes (not products). Continuous process improvement (as it is also called) defines itself as the never-ending search for perfection, not short-term initiatives with definite endpoints. Which of the following phrases best characterizes the approach to change in total quality management initiatives?A. Successive approximations of a perfected process B. Short-term initiatives with precisely defined endpoints C. Big step overhaul of whole systems D. Tight focus on the improvement of end-item features 225. The correct answer is A. The European Union has issued several directives regarding hazardous components of electronics products, including the Waste from Electronic Equipment directive (WEEE) and the directive restricting the use of heavy metals and retardants in electrical and electronic equipment (RoHS). Which one of the following authorities has issued directives mandating reporting, reduction, and recycling of heavy metals in end-of-life electronics products?A. European Union B. United States government C. Chinese government D. United Nations226. The correct answer is B. Leveragable materials are of high strategic importance but of low supply chain difficulty, so they are key areas where supply chain leverage can be applied to increase efficiencies and lower costs. Which of the following would a material be that was tightly linked to the companys brand equity even though it was basically a cheap but branded plastic toy that didnt require much quality?A. Direct/core competency materials B. Leveragable materials C. Bottleneck materials D. Commodity materials227. The correct answer is B. Possibly the most common mistake in this regard is to send all cost savings all the way to the consumers end of the chain, which in this case is the shareholders. And perhaps most challenging of all in a lateral supply chain is the need for productive sharing of any financial gains. As noted earlier, a powerful nucleus firm can gather in the benefits of an alteration in the placement of inventory (or any other process change) at the expense of other stakeholders such as the independent brokers. A nucleus firm in the banking industry uses independent brokers to market new stock issues and has been successful in this channel. After investing some profits in the firm itself, they choose to reward their stockholders by distributing all remaining profits in a special dividend even though independent brokers are prohibited from owning these shares. Which of the following has this firm forgotten to account for in its creation of financial value?A. It takes money to make money. B. Gains must be fairly distributed among stakeholders. C. Independent brokers should be rewarded through social incentives and reminded that shareholders must come first. D. Tradeoffs must not be self-defeating.228. The correct answer is C. A company at Stage 3 will make advances such as carrying out warehousing and transportation decisions in tandem to achieve the optimal balance of cost-effectiveness and customer service. At this point, the nucleus firm may begin to take a step toward integration with the external members of the chain by contracting with a logistics supplier. What is the minimum level of enterprise evolution in which a firm might use a logistics supplier to integrate with external members and also internally combine warehousing and transportation activities to optimize cost versus customer service?A. Stage 1: Multiple dysfunction B. Stage 2: Semifunctional enterprise C. Stage 3: Integrated enterprise D. Stage 4: Extended enterprise229. The correct answer is C. The correct answer is 75 days: 80 days (cash to cash) + 25 days (payables) - 30 days (inventory) = 75 days receivables. The cash-to-cash cycle (or cash conversion cycle) is the number of days between the time a firm pays for raw materials and the time it receives payment for finished goods. The equation for calculating the cash-to-cash cycle is Cash-to-Cash Cycle Time = Average Inventory Collection Period + Average Receivables Processing Period -