Deck 10: Supply Chain Rationalization and Role Shifting

Question 1

As managers at IBM discovered, the key to managing complexity is for SC managers to understand the ________ and________ of complexity.

A) customers, suppliers
B) nature, sources
C) drivers, architects
D) results, outcomes

Answer 1

nature, sources

Question 2

The _________ manager's mandate is to develop reliable sources of _________ that can deliver high-quality, low cost materials and services on time every time.

A) sourcing, supply
B) marketing, sales persons
C) production, tools
D) personnel, supplies

Answer 2

sourcing, supply

Question 3

As the rationalization process progressed, Chrysler developed the understanding and freed up the resources needed to build more __________ relationships with its most important suppliers.

A) competitive
B) synergistic
C) collaborative
D) innovative

Answer 3

collaborative

Question 4

Sophisticated _________ can be a valuable tool in SC network design.

A) optimization modeling
B) design
C) people skills
D) manufacturing processes

Question 5

Until the essential first steps of_________ are well underway, managers are not likely to have the time or the focus needed to tame the challenges of SC complexity.

A) SC design
B) business development
C) product development
D) consolidation

Question 6

_________ has magnified the complexity challenge.

A) SCM
B) Competition
C) Globalization
D) Top management

Question 7

The study of SC systems suggests that added complexity is often a ________.

A) burden
B) bane
C) necessity
D) impossibility

Question 8

Careful, and often complex, analysis can help a company achieve the goal of network design: maximum _________ at minimal cost.

A) service
B) profits
C) sales
D) production

Question 9

_________ complicate network design.

A) Value-additions
B) Marketing strategies
C) Acquisitions
D) Production uncertainties

Question 10

Companies like General Motors and Unilever have struggled for years to overcome the costly _________ that arises from a decentralized structure.

A) business
B) loss
C) duplication
D) tax structure

Question 11

Minimizing _________ helped Honda and Toyota achieve both productivity and quality advantages that helped them take share from GM and Ford.

A) suppliers
B) SKU options
C) employee count
D) supplier contracts

Question 12

The small margins for CAT's new line of equipment also meant that _________had to be minimized.

A) value
B) price
C) profit
D) distribution costs

Question 13

At GM, over time global fiefdoms emerged, creating redundant _________ and limiting the sharing of ideas and components across product lines.

A) operations
B) messages
C) leaders
D) departments

Question 14

Designing a company's _________ network, which may include manufacturing facilities, distribution centers, and retail outlets, is a complex task.

A) sales
B) supplier
C) customer
D) operating

Question 15

The quest to reduce unnecessary _________ by finding the right balance between local autonomy and central control is and dynamic.

A) waste
B) change
C) complexity
D) costs

Question 16

Unfortunately, many potentially detrimental decisions go undiscovered, hidden by ________.

A) management
B) marketing
C) profits
D) SC Complexity

Question 17

A company's organizational structure influences complexity. The real issue is _________ -is it centralized or decentralized?

A) decision-making authority
B) purchasing
C) management control
D) physical structure

Question 18

But, Amazon.com has discovered that even in cyberspace it is to manage both _________ and _________ complexity profitably.

A) supplier, customer
B) asset, liability
C) profit, loss
D) breadth, depth

Question 19

_________'s ambitious goal to become the world's largest automaker by 2010 has forced it to expand worldwide operations at a pace that has strained its human and technological resources.

A) Toyota
B) GM
C) Ford
D) Chrysler

Question 20

Building _________ relationships is almost impossible when scarce resources are consumed managing a large and unwieldy supply base.

A) collaborative
B) long lasting
C) marketing
D) profitable

Question 21

The preferred approach to evaluating suppliers is on the basis of total order performance criteria including cost, quality, delivery, responsiveness, and innovation.

Question 22

A low-price supplier in a developing country will stay as a low-cost option regardless of global transportation costs.

Question 23

The addition of 10 countries to the European Union in 2004 changed consumption patterns as well as production and distribution requirements for companies operating in Europe.

Question 24

Achieving true optimality in a dynamic global marketplace is a great ideal and is generally an attainable long-term goal.

Question 25

Experience suggests that companies struggle least with breadth complexity.

Question 26

The asymmetrical power relationship between suppliers and customers in SC relationships makes the discussion of customer base rationalization a sensitive topic.

Question 27

The choice of the multiple sourcing model suggests a close, collaborative relationship.

Question 28

Suppliers typically possess the channel power, not the customers.

Question 29

Centralization leverages scale to reduce costs.

Question 30

As companies pursue a supplier optimization program, they often focus exclusively on their existing supply base. This is the optimal approach.

Question 31

The desire to more strategically manage the supply base has led companies to launch a supplier _________ initiative.

A) acquisition
B) reduction
C) base increase
D) development

Question 32

Managing the number and type of individual items, known as SKUs, that a company must handle to meet customer needs creates headaches for SC managers.

Question 33

The _________ base at many companies is even more numerous and complex than the supply base.

A) employee
B) financial
C) customer
D) competitor

Question 34

However, many companies, especially multinationals and those that have grown through acquisitions do not retain decentralized, often redundant, operations.

Question 35

Poor logistics hampers service and destroys profitability.

Question 36

Rigorous optimization almost always leads to a change in the composition of the supply base.

Question 37

According to a Cap Gemini study, most companies have seriously begun to rationalize their supply chains.

Question 38

Rationalization efforts decrease SC visibility, helping managers understand the consequences of changes in SC structure.

Question 39

Make-buy analysis should be considered as part of the supplier identification and evaluation process.

Question 40

To ensure against supply disruptions and to create leverage to drive costs down, most companies have sourced the same item from multiple suppliers.

Question 41

What practices are companies adopting to mitigate the costs of logistical complexity?
To mitigate the costs of logistical complexity, companies have adopted the following practices:
Advanced technology
Outsourcing
Insourcing
Innovative practices

Question 42

The greater the desired collaboration with potential suppliers, the more important broad-based participation is from the stakeholders.

Question 43

Functional shiftability decreases the efficiency of the entire chain to enhance end customer value.

Question 44

What are some of the factors that reduce a company's ability to achieve true optimality?

Question 45

How did Caterpillar manage complexity when they were designing a new line of equipment?

Question 46

How did Toyota try to solve the problem of Toyota's Camry dropping from America's highest- quality vehicle in 2000 to number 8 in 2004?

Question 47

Standardizing parts tends to increase the number of suppliers.

Question 48

Eliminating unnecessary complexity frees up time and resources so that proactive SC managers can look for opportunities to shift value-added activities among SC members.

Question 49

On-line bidding events identify potential qualified suppliers from around the world and encourage them to bid for a contract in real time.

Question 50

All of the skills represented by the diverse team members are needed to develop the commodity sourcing strategy.

Question 51

Why is the transition from the old to the new supply base the most step in the optimization process?

Question 52

What can we learn from the few disciplined companies that handle complexity well?

Question 53

What led to the economic recession in American manufacturing industry in the 1980's?

Question 54

Under pressure from top management or caught up in management fads, sourcing managers may tend to translate rationalization as reduction.

Question 55

Unique or sophisticated products like car engines are usually sourced from a small number of suppliers.

Question 56

Fill in the Blank(s)
Where is complexity found? In SCM, complexity is

Question 57

Tiering can dramatically reduce the number of supply relationships a company must manage.

Question 58

To determine the right number of suppliers for each commodity, a systematic supply-base optimization process should be used.

Question 59

What practices are companies using to find a right balance between local autonomy and central control?

Question 60

How did decentralization affect General Motors? How are they trying to remedy these effects?

Question 61

Fill in the Blank(s)
Involving in the analysis may help key decision makers realize that another supplier is better positioned to meet the company's needs.

Question 62

Fill in the Blank(s)
Global competition dictates a need for

Question 63

Fill in the Blank(s)
Supply-base is part of an overall sourcing strategy.

Question 64

Fill in the Blank(s)
Moreover, most companies are under constant pressure to profitably grow

Question 65

Fill in the Blank(s)
When discussing the design of operating networks, industrial engineers often talk about .

Question 66

Fill in the Blank(s)
SC managers often describe their logistics system as a

Question 67

Fill in the Blank(s)
Shifts in can likewise change operating realities overnight.

Question 68

Fill in the Blank(s)
is a fundamental value-added activity that must be performed in every supply chain.

Question 69

Fill in the Blank(s)
relies on local knowledge to build relationships and promote rapid response.

Question 70

Fill in the Blank(s)
For many years, the standard modus operandi was to use for most purchased inputs.

Question 71

Fill in the Blank(s)
To compile a valid list of potential suppliers, the commodity team must examine the of the suppliers.

Question 72

Fill in the Blank(s)
is the process of systematically evaluating the company's operating network, suppliers, customers, and product offerings to find and eliminate inefficiencies and redundancies.

Question 73

Fill in the Blank(s)
has always believed that building quality relationships with a smaller number of suppliers is a sound long-term investment.