Question 1

A driving force behind the attention to OTC cycle variability is safety stock. The absolute length of the order cycle will influence demand inventory.

Accepted Answer

The length of the order cycle affects demand inventory, which in turn affects safety stock levels. Therefore, the statement is true.

Question 2

Process D1: Deliver Stocked Product in the Supply Chain Council SCOR Model is the same as the OTC cycle model.

Accepted Answer

The Deliver Stocked Product process in the SCOR Model is equivalent to the Deliver stage in the OTC (Order to Cash) cycle model. Both models are geared towards ensuring that the correct product is delivered to the customer in a timely and efficient manner.

Question 3

With the proper information on how a customer's interaction with the shipper drives the firm's costs, the firm can then segment its customers by profitability.

Accepted Answer

By understanding the costs associated with a customer's interaction with the shipper, a firm can identify its most profitable customers and prioritize them for special treatment or pricing. This helps in effective customer segmentation and maximizing profitability.

Question 4

"Order to cash" and "order cycle" are the same.

Accepted Answer

While "order to cash" and "order cycle" are related terms in the business process, they refer to different stages. "Order to cash" refers specifically to the process of receiving an order and processing payment, while "order cycle" is a broader term that encompasses the entire process of receiving and fulfilling an order, including procurement, manufacturing, and delivery.

Question 5

From a marketing perspective, logistics customer service can be thought of as a feature of the augmented product that adds value for the customer.

Accepted Answer

Logistics customer service can enhance the overall customer experience and satisfaction with a product or service, which ultimately increases its value to the customer. Therefore, it can be considered as a feature of the augmented product that adds value.

Question 6

There are ten principal activities to the OTC model.

Accepted Answer

The OTC (Open Trusted Technology Provider Standard) model outlines eight principal activities, not ten.

Question 7

Firms today are beginning to use techniques such as activity-based costing to more accurately allocate costs to customers based on the specific costs of servicing a customer's orders relative to how, how much, what, and when a customer orders.

Accepted Answer

This statement is true. Activity-based costing is used to allocate costs more accurately based on the specific costs of servicing a customer's orders relative to various factors such as order frequency, volume, product type, and delivery time.

Question 8

The buyer and seller look at order time from the same perspective.

Accepted Answer

The answer of The buyer and seller look at order...

Question 9

The identification of the product/service package for each customer segment is one of the easier activities in the CRM process.

Accepted Answer

Identifying the product/service package for each customer segment requires research and analysis of customer needs and preferences, and is often a complex and challenging activity in the CRM process.

Question 10

Customer service is of equal importance to both logistics and marketing.

Accepted Answer

Customer service is crucial in both logistics and marketing. In logistics, providing excellent customer service can enhance customer satisfaction and loyalty, leading to repeat business and positive word-of-mouth advertising. In marketing, good customer service can help to attract and retain customers and promote customer advocacy.

Question 11

Reserve Inventory and Determine Delivery Date has traditionally been referred to as order processing.

Accepted Answer

Reserve Inventory and Determine Delivery Date is a crucial step in fulfilling customer orders, hence it falls under the category of order processing.

Question 12

A stockout always results in a back order.

Accepted Answer

A stockout means that the company no longer has the product in stock to fulfill orders. A back order occurs when a customer places an order for a product that is out of stock and the company promises to fulfill the order at a later date when the product is available again. Therefore, a stockout does not always result in a back order.

Question 13

Most organizations employ all six definitions of customer service in their order management process.

Accepted Answer

Not all organizations employ all six definitions of customer service in their order management process, as the specific definitions and practices can vary based on the organization's industry, size, and customer service strategy.

Question 14

Activity-based costing works well in warehouse-type environments but does not work for
customer service applications.

Accepted Answer

This statement is false. Activity-based costing can be applied to a variety of industries and departments, including customer service applications. It helps to identify and allocate costs based on the activities and resources required for each service provided, leading to more accurate cost information and better decision-making.

Question 15

For the best service, all products should be available at all levels regardless of cost.

Accepted Answer

This statement is not necessarily true, as some products may not be feasible or appropriate for certain levels of service. For example, a luxury spa may not offer budget-priced products, as it may not align with their brand or target audience. Conversely, a budget hotel may not offer high-end products, as it may not be financially viable for their budget-conscious clientele. Ultimately, the availability of products should be tailored to the needs and expectations of each individual business and their target market.

Question 16

Dependability is not as important to a buyer as is absolute length of lead time.

Accepted Answer

Dependability is crucial for buyers who want their orders delivered on time and without any issues. While lead time is important, a dependable supplier who consistently meets deadlines and delivers quality products is often preferred over a supplier that may have a shorter lead time but is unreliable.

Question 17

There are five logistics performance metrics from the buyer's point of view.

Accepted Answer

The five logistics performance metrics from the buyer's point of view are cost, quality, delivery time, delivery reliability, and flexibility.

Question 18

There are four types of communications that exist between a buyer and a seller.

Accepted Answer

There are generally more than four types of communication between a buyer and a seller, including verbal, non-verbal, written, and digital communication, among others.

Question 19

Customer relationship management is a new concept only recently receiving attention.

Accepted Answer

Customer relationship management is not a new concept and has been around for several decades. It has only recently gained more attention and importance in the business world.

Question 20

Customer service is anything that touches the customer.

Accepted Answer

Customer service involves all interactions and experiences that a customer has with a company, from before the point of sale to after the purchase. This includes communication, product quality, delivery, returns, and more.

Quiz 8: Order Management and Customer Service