供应链简答题（英语）

供应链简答题（英语）1.1Explainthe3decisionphases(categories)thatmustbemadeinasuccessfulsupplychain.Answer:The3decisionphasesthatoccurwithinasupplychainaresupplychainstrategy(ordesign),supplychainplanningandsupplychainoperation.Decisionsrelatetotheflowofinformation,productandfunds.Thedifferencebetweencategoriesdependsuponthefrequencyofeachdecisionandthetimeframeoverwhichithasanimpact.Duringthesupplychainstrategyphase,acompanydetermineswhatthechain’sconfigurationswillbe,howresourceswillbeallocated,andwhatprocesseseachstagewillperform.Thiswillestablishthestructureofthesupplychainforseveralyears.Supplychainplanningdealswithdecisionswithatimeframefrom3monthsuptoayear.Theplanningphasemustworkwithintheconstraintsestablishedinthestrategyphase.Planningdecisionsincludewhichmarketstosupplyfromwhichlocations,subcontractingofmanufacturing,inventorypoliciesandtimingandsizeofmarketingpromotions.Thesupplychainoperationphaseoperatesonaweeklyordailytimehorizonanddealswithdecisionsconcerningindividualcustomerorders.Difficulty:Hard1.2.Describethecycleviewoftheprocesseswithinasupplychain.Answer:Thecycleviewdividesthesupplychainintoaseriesof4cyclesbetweenthe5differentstagesofasupplychain.Thecyclesarethecustomerordercycle,replenishmentcycle,manufacturingcycleandprocurementcycle.Thecustomerordercycleoccursatthecustomer/retailerinterfaceandincludesallprocessesdirectlyinvolvedinreceivingandfillingthecustomer.Thereplenishmentcycleoccursattheretailer/distributorinterfaceandincludesallprocessesinvolvedinreplenishingretailerinventory.Themanufacturingcycletypicallyoccursatthedistributor/manufacturer(orretailer/manufacturer)interfaceandincludesallprocessesinvolvedinreplenishingdistributor(orretailer)inventory.Theprocurementcycleoccursatthemanufacturer/supplierinterfaceandincludesallprocessesnecessarytoensurethatthematerialsareavailableformanufacturingaccordingtoschedule.Difficulty:Moderate1.3.Explainthepush/pullviewoftheprocesseswithinasupplychain.Answer:Thepush/pullviewofthesupplychaindividessupplychainprocessesintotwocategoriesbasedonwhethertheyareexecutedinresponsetoacustomerorderorinanticipationofcustomerorders.Pullprocessesareinitiatedinresponsetoacustomerorder.Pushprocessesareinitiatedandperformedinanticipationofcustomerorders.Thepush/pullboundaryseparatespushprocessesfrompullprocesses.Thisviewisveryusefulwhenconsideringstrategicdecisionsrelatingtosupplychaindesign,becauseitforcesamoreglobalconsiderationofsupplychainprocessesastheyrelatetothecustomer.Difficulty:Moderate1.4.Explainthethreemacroprocesseswithinasupplychain.Answer:AllprocesseswithinasupplychaincanbeclassifiedintothreemacroprocesseswhichareCustomerRelationshipManagement(CRM),InternalSupplyChainManagement(ISCM),andSupplierRelationshipManagement(SRM).CustomerRelationshipManagement(CRM)includesallprocessesthatfocusontheinterfacebetweenthefirmanditscustomerssuchasmarketing,sales,callcentermanagementandordermanagement.InternalSupplyChainManagement(ISCM)includesallprocessesthatareinternaltothefirmsuchaspreparationofdemandandsupplyplans,preparationofinventorymanagementpolicies,orderfulfillmentandplanningofcapacity.SupplierRelationshipManagement(SRM)includesallprocessesthatfocusontheinterfacebetweenafirmanditssupplierssuchasevaluationandselectionofsuppliers,negotiationofsupplytermsandcommunicationregardingnewproductsandorders.Difficulty:Moderate1.5.Explainwhysupplychainflowsareimportant.Answer:Supplychainflowsareimportant,becausethereisacloseconnectionbetweenthedesignandmanagementofsupplychainflows(product,information,andcash)andthesuccessofasupplychain.Thesuccessofmanycompaniescanbedirectlytracedtothedesignandmanagementofanappropriatesupplychain.Thefailureofmanybusinessescanbelinkeddirectlytotheirinabilitytoeffectivelydesignandmanagesupplychainflows.Difficulty:Moderate2.1.Discussthetwokeystothesuccessorfailureofacompany.Answer:Acompany’ssuccessorfailureisthuscloselylinkedtothefollowingkeys:1.Thecompetitivestrategyandallfunctionalstrategiesmustfittogethertoformacoordinatedoverallstrategy.Eachfunctionalstrategymustsupportotherfunctionalstrategiesandhelpafirmreachitscompetitivestrategygoal.2.Thedifferentfunctionsinacompanymustappropriatelystructuretheirprocessesandresourcestobeabletoexecutethesestrategiessuccessfully.Difficulty:Hard2.2.Listandexplainthethreebasicstepstoachievingstrategicfit.Answer:Therearethreebasicstepstoachievingstrategicfit:1.Understandingthecustomerandsupplychainuncertainty.Firstacompanymustunderstandthecustomerneedsforeachtargetedsegmentandtheuncertaintythesupplychainfacesinsatisfyingtheseneeds.Theseneedshelpthecompanydefinethedesiredcostandservicerequirements.Thesupplychainuncertaintyhelpsthecompanyidentifytheextentofdisruptionanddelaythesupplychainmustbepreparedfor.2.Understandingthesupplychaincapabilities.Therearemanytypesofsupplychains,eachofwhichisdesignedtoperformdifferenttaskswell.Acompanymustunderstandwhatitssupplychainisdesignedtodowell.3.Achievingstrategicfit.Ifamismatchexistsbetweenwhatthesupplychaindoesparticularlywellandthedesiredcustomerneeds,thecompanywilleitherneedtorestructurethesupplychaintosupportthecompetitivestrategyoralteritsstrategy.Difficulty:Moderate2.3.Listtheattributesalongwhichcustomerdemandfromdifferentsegmentscanvary.Answer:Ingeneral,customerdemandfromdifferentsegmentsmayvaryalongseveralattributesasfollows:ThequantityoftheproductneededineachlotTheresponsetimethatcustomersarewillingtotolerateThevarietyofproductsneededTheservicelevelrequiredThepriceoftheproductThedesiredrateofinnovationintheproductDifficulty:Moderate2.4.Listtheabilitiesincludedinsupplychainresponsiveness.Answer:Supplychainresponsivenessincludesasupplychain’sabilitytodothefollowing:RespondtowiderangesofquantitiesdemandedMeetshortleadtimesHandlealargevarietyofproductsBuildhighlyinnovativeproductsMeetaveryhighservicelevelHandlesupplyuncertaintyDifficulty:Moderate3.1.Listanddefinethefourmajordriversofsupplychainperformance.Answer:Facilitiesaretheplacesinthesupplychainnetworkwhereproductisstored,assembled,orfabricated.Thetwomajortypesoffacilitiesareproductionsitesandstoragesites.Inventoryisallrawmaterials,workinprocess,andfinishedgoodswithinasupplychain.Inventoryisanimportantsupplychaindriverbecausechanginginventorypoliciescandramaticallyalterthesupplychain’sefficiencyandresponsiveness.Transportationentailsmovinginventoryfrompointtopointinthesupplychain.Transportationcantaketheformofmanycombinationsofmodesandroutes.Informationconsistsofdataandanalysisconcerningfacilities,inventory,transportation,andcustomersthroughoutthesupplychain.Informationispotentiallythebiggestdriverofperformanceinthesupplychainasitdirectlyaffectseachoftheotherdrivers.Difficulty:Moderate3.2.Explainthebasictrade-offbetweenresponsivenessandefficiencyforeachofthemajordriversofsupplychainperformance.Answer:Thefundamentaltrade-offwhenmakingfacilitiesdecisionsisbetweenthecostofthenumber,location,andtypeoffacilities(efficiency)andthelevelofresponsivenessthatthesefacilitiesprovidethecompany’scustomers.Thefundamentaltrade-offwhenmakinginventorydecisionsisbetweenresponsivenessandefficiency.Increasinginventorywillgenerallymakethesupplychainmoreresponsivetothecustomer.Thischoice,however,comesatacostastheaddedinventorydecreasesefficiency.Therefore,asupplychainmanagercanuseinventoryasoneofthedriversforreachingthelevelofresponsivenessandefficiencythecompetitivestrategytargets.Thefundamentaltrade-offfortransportationisbetweenthecostoftransportingagivenproduct(efficiency)andthespeedwithwhichthatproductistransported(responsiveness).Thetransportationchoiceinfluencesotherdriverssuchasinventoryandfacilities.Whensupplychainmanagersthinkaboutmakingtransportationdecisions,theyframethedecisionintermsofthistrade-off.Goodinformationsystemscanhelpafirmimprovebothitsresponsivenessandefficiency.Theinformationdriverisusedtoimprovetheperformanceofotherdriversandtheuseofinformationisbasedonthestrategicpositiontheotherdriverssupport.Accurateinformationcanhelpafirmimproveefficiencybydecreasinginventoryandtransportationcosts.Accurateinformationcanimproveresponsivenessbyhelpingasupplychainbettermatchsupplyanddemand.3.3.Explaintheroleofeachofthemajordriversofsupplychainperformance.Answer:Facilitiesarethewhereofthesupplychainifwethinkofinventoryaswhatisbeingpassedalongthesupplychainandtransportationashowitispassedalong.Theyarethelocationstoorfromwhichtheinventoryistransported.Withinafacility,inventoryiseitherprocessedortransformedintoanotherstate(manufacturing)oritisstoredbeforebeingshippedtothenextstage(warehousing).Inventoryexistsinthesupplychainbecauseofamismatchbetweensupplyanddemand.Animportantrolethatinventoryplaysinthesupplychainistoincreasetheamountofdemandthatcanbesatisfiedbyhavingproductreadyandavailablewhenthecustomerwantsit.Anothersignificantroleinventoryplaysistoreducecostbyexploitinganyeconomiesofscalethatmayexistduringbothproductionanddistribution.Inventoryisspreadthroughoutthesupplychainfromrawmaterialstoworkinprocesstofinishedgoodsthatsuppliers,manufacturers,distributors,andretailershold.Inventoryisamajorsourceofcostinasupplychainandithasahugeimpactonresponsiveness.Thelocationandquantityofinventorycanmovethesupplychainfromoneendoftheresponsivenessspectrumtotheother.Inventoryalsohasasignificantimpactonthematerialflowtimeinasupplychain.MaterialflowtimeisthetimethatelapsesbetweenthepointatwhichAnotherimportantareawhereinventoryhasasignificantimpactisthroughput.Inventoryandflowtimearesynonymousinasupplychain.Managersshoulduseactionsthatlowertheamountofinventoryneededwithoutincreasingcostorreducingresponsiveness,becausereducedflowtimecanbeasignificantadvantageinasupplychain.Transportationmovesproductbetweendifferentstagesinasupplychain.Liketheothersupplychaindrivers,transportationhasalargeimpactonbothresponsivenessandefficiency.Fastertransportation,whetherintheformofdifferentmodesoftransportationordifferentamountsbeingtransported,allowsasupplychaintobemoreresponsivebutreducesitsefficiency.Thetypeoftransportationacompanyusesalsoaffectstheinventoryandfacilitylocationsinthesupplychain.Informationcouldbeoverlookedasamajorsupplychaindriverbecauseitdoesnothaveaphysicalpresence.Information,however,deeplyaffectseverypartofthesupplychain.Itsimpactiseasytounderestimateasinformationaffectsasupplychaininmanydifferentways.Informationservesastheconnectionbetweenthesupplychain’svariousstages,allowingthemtocoordinateandbringaboutmanyofthebenefitsofmaximizingtotalsupplychainprofitability.Informationisalsocrucialtothedailyoperationsofeachstageinasupplychain.Forinstance,aproductionschedulingsystemusesinformationondemandtocreateaschedulethatallowsafactorytoproducetherightproductsinanefficientmanner.Awarehousemanagementsystemusesinformationtocreatevisibilityofthewarehouse’sinventory.Thecompanycanthenusethisinformationtodeterminewhetherneworderscanbefilled.Difficulty:Hard3.4.Explaintheroleofeachofthemajordriversofsupplychainperformanceinthecompetitivestrategy.Answer:Facilitiesandtheircorrespondingcapacitiestoperformtheirfunctionsareakeydriverofsupplychainperformanceintermsofresponsivenessandefficiency.Forexample,companiescangaineconomiesofscalewhenaproductismanufacturedorstoredinonlyonelocation;thiscentralizationincreasesefficiency.Thecostreduction,however,comesattheexpenseofresponsiveness,asmanyofacompany’scustomersmaybelocatedfarfromtheproductionfacility.Theoppositeisalsotrue.Locatingfacilitiesclosetocustomersincreasesthenumberoffacilitiesneededandconsequentlyreducesefficiency.Ifthecustomerdemandsandiswillingtopayfortheresponsivenessthathavingnumerousfacilitiesadds,however,thenthisfacilitiesdecisionhelpsmeetthecompany’scompetitivestrategygoals.Inventoryplaysasignificantroleinasupplychain’sabilitytosupportafirm’scompetitivestrategy.Ifafirm’scompetitivestrategyrequiresaveryhighlevelofresponsiveness,acompanycanuseinventorytoachievethisresponsivenessbylocatinglargeamountsofinventoryclosetothecustomer.Conversely,acompanycanalsouseinventorytomakeitselfmoreefficientbyreducinginventorythroughcentralizedstocking.Thelatterstrategywouldsupportacompetitivestrategyofbeingalow-costproducer.Thetrade-offimplicitintheinventorydriverisbetweentheresponsivenessthatresultsfrommoreinventoryandtheefficiencythatresultsfromlessinventory.Theroleoftransportationinacompany’scompetitivestrategyfiguresprominentlywhenthecompanyisconsideringthetargetcustomer’sneeds.Ifafirm’scompetitivestrategytargetsacustomerthatdemandsaveryhighlevelofresponsiveness,andthatcustomeriswillingtopayforthisresponsiveness,thenafirmcanusetransportationasonedriverformakingthesupplychainmoreresponsive.Theoppositeistrueaswell.Ifacompany’scompetitivestrategytargetscustomerswhosemaindecisioncriterionisprice,thenthecompanycanusetransportationtolowerthecostoftheproductattheexpenseofresponsiveness.Asacompanymayusebothinventoryandtransportationtoincreaseresponsivenessorefficiency,theoptimaldecisionforthecompanyoftenmeansfindingtherightbalancebetweenthetwo.Informationisadriverwhoseimportancehasgrownascompanieshaveusedittobecomebothmoreefficientandmoreresponsive.Thetremendousgrowthoftheimportanceofinformationtechnologyisatestimonytotheimpactinformationcanhaveonimprovingacompany.Likealltheotherdrivers,however,evenwithinformation,companiesreachapointwhentheymustmakethetrade-offbetweenefficiencyandresponsiveness.Difficulty:Hard4.1.Explainthemeasuresofcustomerservicethatareinfluencedbythestructureofthedistributionnetwork.Answer:Responsetimeisthetimebetweenwhenacustomerplacesanorderandreceivesdelivery.Productvarietyisthenumberofdifferentproducts/configurationsthatacustomerdesiresfromthedistributionnetwork.Availabilityistheprobabilityofhavingaproductinstockwhenacustomerorderarrives.Customerexperienceincludestheeasewithwhichthecustomercanplaceandreceivetheirorder.Italsoincludespurelyexperientialaspects,suchasthepossibilityofgettingacupofcoffeeandthevaluethatthesalesstaffprovides.Ordervisibilityistheabilityofthecustomertotracktheirorderfromplacementtodelivery.Returnabilityistheeasewithwhichacustomercanreturnunsatisfactorymerchandiseandtheabilityofthenetworktohandlesuchreturns.Difficulty:Moderate响应时间是从客户下订单到接收交付之间的时间。产品品种是在分销网络中客户需要的不同的产品/配置的数量。可得性是客户订单到达时产品库存满足顾客需要的概率。客户体验包括客户可以下并接收订单的难易程度。此外，还包括纯粹的体验方面，如获得一杯咖啡的可能性和销售人员提供的价值。订单可视度是客户能够跟踪他们的订单从下单到交付安置的能力。返还的可行性是客户可以返回不满意的商品的难易程度和分销网络处理这种退货的能力。Answer:Asthenumberoffacilitiesinasupplychainincreases,theinventoryandresultinginventorycostsalsoincrease.Todecreaseinventorycosts,firmstrytoconsolidateandlimitthenumberoffacilitiesintheirsupplychainnetwork.Outboundtransportationcostsperunittendtobehigherthaninboundcostsbecauseinboundlotsizesaretypicallylarger.Increasingthenumberofwarehouselocationsdecreasestheaverageoutbounddistancetoacustomerandmakesoutboundtransportationdistanceasmallerfractionoftotaldistancetraveledbytheproduct.Thus,aslongasinboundtransportationeconomiesofscalearemaintained,increasingthenumberoffacilitiesdecreasestotaltransportationcost.Facilitycostsdecreaseasthenumberoffacilitiesisreduced,becauseaconsolidationoffacilitiesallowsafirmtoexploiteconomiesofscale.Asthenumberoffacilitiesincreases,totallogisticscostsfirstdecreaseandthenincrease.Eachfirmshouldhaveatleastthenumberoffacilitiesthatminimizetotallogisticscosts.Asafirmwantstofurtherreducetheresponsetimetoitscustomers,itmayhavetoincreasethenumberoffacilitiesbeyondthepointthatminimizeslogisticscosts.Afirmshouldaddfacilitiesbeyondthecost-minimizingpointonlyifmanagersareconfidentthattheincreaseinrevenuesbecauseofbetterresponsivenessisgreaterthantheincreaseincostsbecauseoftheadditionalfacilities.Ingeneral,nodistributionnetworkwilloutperformothersalongalldimensions.Thus,itisimportanttoensurethatthestrengthsofthedistributionnetworkfitwiththestrategicpositionofthefirm.Difficulty:Hard5.1.Explainhowsupplychainnetworkdesigndecisionsareclassified.Answer:Supplychainnetworkdesigndecisionsincludethelocationofmanufacturing,storage,ortransportation-relatedfacilitiesandtheallocationofcapacityandrolestoeachfacility.Supplychainnetworkdesigndecisionsareclassifiedasfollows:1.Facilityrole:Whatroleshouldeachfacilityplay?Whatprocessesareperformedateachfacility?2.Facilitylocation:Whereshouldfacilitiesbelocated?3.Capacityallocation:Howmuchcapacityshouldbeallocatedtoeachfacility?4.Marketandsupplyallocation:Whatmarketsshouldeachfacilityserve?Whichsupplysourcesshouldfeedeachfacility?Difficulty:Moderate6.1Discusstheroleofcycleinventoryinthesupplychain.Answer:Theprimaryroleofcycleinventoryistoallowdifferentstagesinthesupplychaintopurchaseproductinlotsizesthatminimizethesumofthematerial,ordering,andholdingcost.Ifamanagerwereconsideringtheholdingcostalone,heorshewouldreducethelotsizeandcycleinventory.Economiesofscaleinpurchasingandordering,however,motivateamanagertoincreasethelotsizeandcycleinventory.Amanagermustmakethetrade-offthatminimizesthetotalcostwhenmakingthelotsizingdecision.Ideally,cycleinventorydecisionsshouldbemadeconsideringthetotalcostacrosstheentiresupplychain.Inpractice,however,eachstageoftenmakesitscycleinventorydecisionsindependently.Aswediscusslaterinthechapter,thispracticeincreasesthelevelofcycleinventoryaswellasthetotalcostinthesupplychain.Anystageofthesupplychainexploitseconomiesofscaleinitsreplenishmentdecisionsinthefollowingthreetypicalsituations:1.Afixedcostisincurredeachtimeanorderisplacedorproduced.2.Thesupplierofferspricediscountsbasedonthequantitypurchasedperlot.3.Thesupplieroffersshort-termdiscountsorholdstradepromotions.Cycleinventoryexistsinasupplychainbecausedifferentstagesexploiteconomiesofscaletolowertotalcost.Thecostsconsideredincludematerialcost,fixedorderingcost,andholdingcost.Thesupplychainoperationphaseoperatesonaweeklyordailytimehorizonanddealswithdecisionsconcerningindividualcustomerorders.Difficulty:Hard6.2.Describetheimpactoftradepromotionsoncycleinventory.Answer:Manufacturersusetradepromotionstoofferadiscountedpriceandatimeperiodoverwhichthediscountiseffective.Thegoaloftradepromotionsistoinfluenceretailerstoactinawaythathelpsthemanufacturerachieveitsobjectives.Afewofthekeygoals(fromthemanufacturer’sperspective)ofatradepromotionareasfollows:1.Induceretailerstousepricediscounts,displays,oradvertisingtospursales.2.Shiftinventoryfromthemanufacturertotheretailerandthecustomer.3.Defendabrandagainstcompetition.Inresponsetoatradepromotion,theretailerhasthefollowingoptions:1.Passthroughsomeorallofthepromotiontocustomerstospursales.2.Passthroughverylittleofthepromotiontocustomersbutpurchaseingreaterquantityduringthepromotionperiodtoexploitthetemporaryreductioninprice.Thefirstactionlowersthepriceoftheproductfortheendcustomer,leadingtoincreasedpurchasesandthusincreasedsalesfortheentiresupplychain.Thesecondactiondoesnotincreasepurchasesbythecustomerbutincreasestheamountofinventoryheldattheretailer.Asaresult,thecycleinventoryandflowtimewithinthesupplychainincrease.Tradepromotionsleadtoasignificantincreaseinlotsizeandcycleinventorybecauseofforwardbuyingbytheretailer.Thisgenerallyresultsinreducedsupplychainprofitsunlessthetradepromotionreducesdemandfluctuations.Theretailercanjustifytheforwardbuyingbecauseitdecreaseshistotalcost.Incontrast,themanufacturercanjustifythisactiononlyiftheyhaveeitherinadvertentlybuiltupalotofexcessinventoryortheforwardbuyallowsthemanufacturertosmoothdemandbyshiftingitfrompeaktolow-demandperiods.Inpractice,manufacturersoftenbuildupinventoryinanticipationofplannedpromotions.Duringthetradepromotion,thisinventoryshiftstotheretailer,primarilyasaforwardbuy.Iftheforwardbuyduringtradepromotionsisasignificantfractionoftotalsales,manufacturersendupreducingtherevenuestheyearnfromsalesbecausemostoftheproductissoldatadiscount.Theincreaseininventoryandthedecreaseinrevenuesoftenleadstoareductioninmanufacturerprofitsasaresultoftradepromotions.Totalsupplychainprofitsalsodecreasebecauseofanincreaseininventory.Difficulty:Hard7.1.Discusstheroleofsafetyinventoryinthesupplychainandthetrade-offsinvolved.Answer:Theprimaryroleofsafetyinventoryisprovidingproductavailabilityforcustomerswhendemandandsupplyareuncertain.Thetrade-offthatasupplychainmanagermustconsiderwhenplanningsafetyinventoryinvolveproductavailabilityandinventoryholdingcosts.Ononehand,raisingthelevelofsafetyinventoryincreasesproductavailabilityandthusthemargincapturedfromcustomerpurchases.Ontheotherhand,raisingthelevelofsafetyinventoryincreasesinventoryholdingcosts.Thisissueisparticularlysignificantinindustrieswhereproductlifecyclesareshortanddemandisveryvolatile.Carryingexcessiveinventorycanhelpcounterdemandvolatilitybutcanreallyhurtifnewproductscomeonthemarketanddemandfortheproductininventorydriesup.Theinventoryonhandthenbecomesworthless.Intoday’sbusinessenvironment,firmsexperiencegreatpressuretoimproveproductavailabilitywhileincreasingproductvarietythroughcustomization.Asaresult,marketshavebecomeincreasinglyheterogeneousanddemandforindividualproductsisveryunstableanddifficulttoforecast.Boththeincreasedvarietyandtheincreasedpressureforavailabilitypushfirmstoincreasethelevelofsafetyinventorytheyhold.Atthesametime,productlifecycleshaveshrunk.Thisincreasestherisktofirmsofcarryingtoomuchinventory.Thus,akeytothesuccessofanysupplychainistofigureoutwaystodecreasethelevelofsafetyinventorycarriedwithouthurtingthelevelofproductavailability.Difficulty:Hard7.2.Discussthevariousmeasuresofproductavailability.Answer:Productavailabilityreflectsafirm’sabilitytofillacustomerorderoutofavailableinventory.Astockoutresultsifacustomerorderarriveswhenproductisnotavailable.Thereareseveralwaystomeasureproductavailability.Allavailabilitymeasuresaredefinedonaverageoveragiventimeframe,whichcanrangefromhourstoayear.Productfillrate(fr)isthefractionofproductdemandthatissatisfiedfromproductininventory.Itisequivalenttotheprobabilitythatproductdemandissuppliedfromavailableinventory.Orderfillrateisthefractionofordersthatarefilledfromavailableinventory.Inamulti-productscenario,anorderisfilledfrominventoryonlyifallproductsintheordercanbesuppliedfromtheavailableinventory.Orderfillratestendtobelowerthanproductfillratesbecauseallproductsmustbeinstockforanordertobefilled.Cycleservicelevel(CSL)isthefractionofreplenishmentcyclesthatendwithallthecustomerdemandbeingmet.Areplenishmentcycleistheintervalbetweentwosuccessivereplenishmentdeliveries.TheCSLisequaltotheprobabilityofnothavingastockoutinareplenishmentcycle.ObservethataCSLof60percentwilltypicallyresultinamuchhigherfillrate.Thedistinctionbetweenproductfillrateandorderfillrateisnotsignificantinasingleproductsituation.Whenafirmissellingmultipleproducts,however,thisdifferencemaybesignificant.Forexample,ifmostordersinclude10ormoredifferentproductsthataretobeshipped,anout-of-stocksituationofoneproductresultsintheordernotbeingfilledfromstock.Thefirminthiscasemayhaveapoororderfillrateeventhoughithasgoodproductfillrates.Trackingorderfillratesisimportantwhencustomersplaceahighvalueontheentireorderbeingfilledsimultaneously.Difficulty:Moderate7.3.Describethetwotypesoforderingpoliciesandtheimpacteachhasonsafetyinventory.Answer:Areplenishmentpolicyconsistsofdecisionsregardingwhentoreorderandhowmuchtoreorder.ThesedecisionsdeterminethecycleandsafetyinventoriesalongwiththefrandtheCSL.Thereareseveralformsthatreplenishmentpoliciesmaytake.Werestrictattentiontotwoinstances:1.Continuousreview:Inventoryi