Deck 13: Supply Chain Performance Measurement and Financial Analysis

Question 1

The focus on performance measurement is a recent event in industry.

Answer 1

False

Question 2

The current logistics management approach is supported by which performance measurement concepts?

A) Metrics
B) Total cost
C) Least total cost
D) The D1 concept developed by the Supply Chain Council.

Answer 2

C

Question 3

Another metric classification scheme that has been receiving increased attention is that developed by the Supply Chain Council and contained in the Supply Chain Operations and Reference (SCOR) model.

Answer 3

True

Question 4

Scorecards and key performance indicators (KPIs) are the same thing.

Question 5

An index combines two or more metrics into a single indicator.

Question 6

Gross margin equals:

A) sales - COGS.
B) sales + taxes - COGS.
C) COGS - sales.
D) COGS - taxes.

Question 7

Whether managers decide to focus on excellent service quality, low cost, or efficiency, the metrics they establish must be consistent with corporate strategy.

Question 8

The strategic profit model (SPM) makes the same calculations as a spreadsheet analysis but with two additional ratios, asset turnover and ROI.

Question 9

The cost of supply chain failures is calculated as the cost of _____ orders plus the cost of _____ orders.

A) rectified; refused
B) replacement; refused
C) rectified; returned
D) refused; returned

Question 10

Many organizations want to be effective and efficient, but simply stating these objectives is not adequate unless metrics are used to gauge whether these objectives are achieved.

Question 11

The two most important financial documents in an organization are the income statement and the debt-asset sheet.

Question 12

An "executive dashboard" is:

A) a small number (usually less than five) of KPIs.
B) used by senior management to track profits.
C) metrics used by an organization's suppliers.
D) a trend that has only recently developed.

Question 13

Scorecard and key performance indicators (KPIs) refer to:

A) sporting events.
B) metrics to manage logistics operations.
C) management's evaluation of supply chain staff.
D) measuring output.

Question 14

Another very important logistics service metric is order cycle time (OCT), which influences productivity, debt, cash flow, and profit.

Question 15

A metric is complex to define, usually involves a calculation or a combination of measurements, and is often in the form of a ratio.

Question 16

The equivalent sales increase for supply chain cost saving is found by dividing the cost saving by the organization's profit margin.

Question 17

Four major categories that provide a useful way to examine logistics and supply chain performance are time, quantity, cost, and supporting metrics.

Question 18

Another driving influence for supply chain reexamination has been the desire of organizations to change their supply chain focus from a "cost" center to:

A) a profit center.
B) a logistics-oriented system.
C) an investment center.
D) a value-adding activity.

Question 19

Supply chain management involves the control of raw material, in-process, and finished goods inventories.

Question 20

Customers and suppliers should be included in the development of metrics.

Question 21

Earnings before interest and taxes (EBIT) is calculated:

A) sales - cost of goods sold - total operating cost.
B) gross margin - total operating cost .
C) sales - transportation costs - warehouse costs - inventory carrying costs.
D) none of these answers.

Question 22

Discuss the revenue-cost savings connection and include the formula.

Question 23

What role should employees, in general, play in the development of performance metrics? Why is this role important?

Question 24

There are seven factors in the successful development of supply chain metrics. Name them, and select any two to discuss in more detail.

Question 25

Channel structure management includes decisions regarding the use of _____, channel inventories, information systems, and channel structure.

A) customers
B) outsourcing
C) order cycles
D) KPIs

Question 26

Discuss the differences between the terms metric, measure, and index.

Question 27

Discuss the supply chain financial impact on an organization.

Question 28

Effective order management can have an impact on:

A) reducing supply chain costs.
B) increasing revenues.
C) improving ROA.
D) all of these answers.

Question 29

Discuss the metric classification scheme that has been developed by the Supply Chain Council and defined in the Supply Chain Operations and Reference (SCOR) model to measure the performance of Process D1: Deliver Stocked Product.

Question 30

Which of the following is not a supply chain decision area regarding ROA improvement?

A) Channel structure management
B) Inventory management
C) Order management
D) Information management

Question 31

The decision to alter the supply chain process is essentially _____ issue.

A) a management
B) an optimization
C) a supply chain
D) a customer satisfaction

Question 32

In the SCOR model there are five major categories of metrics that need to be used to measure the performance of Process D1: reliability, _____, agility, costs, and asset management.

A) ROA
B) responsiveness
C) supply chains
D) cash-to-cash cycle

Question 33

What is the "order-to-cash" cycle?

Question 34

There are four major categories that provide a useful way for examining logistics and supply chain performance. They are time, _____, cost, and supporting metrics.

A) delivery
B) KPIs
C) competition
D) quality

Question 35

Which of the following is not an element of order management?

A) Reducing stockouts
B) Reducing order processing times
C) Optimizing mode mix
D) Optimizing order fill rate

Question 36

What is the best financial metric to show the profit an organization generates in relationship to assets utilized?

A) ROA
B) Profit
C) Return on net worth
D) Stock price