Question 1

Firms that target customers who value short response times need to be _________.
A)Located near consumers
B)Located far from consumers
C)Able to move from one place to another
D)All of the above.

Accepted Answer

Firms that target customers who value short response times need to be located close to the consumers. These firms must have facilities, with each location having low capacity. Thus, a decrease in the response time of a customer's desire increases the number of facilities required in the network.

Question 2

Outbound transportation costs per unit have a tendency to be higher than inbound because _____________.
A)Outbound lot sizes are larger
B)Outbound lot sizes are heavier
C)Outbound lot sizes need more space
D)All of the above.

Accepted Answer

Inbound transportation costs incur in bringing material into a facility, whereas outbound transportation costs are the costs incurred in sending material out of a facility, after it has been assembled or altered, usually combining several pieces of inbound materials into a single unit. Therefore, outbound transportation costs PER UNIT tend to be higher than inbound because they are larger, heavier and take up more space in transport.

Question 3

Total logistics costs are made up of ____________.
A)Inventory costs
B)Transportation costs
C)Facility costs
D)All of the above.

Accepted Answer

Total logistics costs are the sum of transportation, inventory, and facility costs for a supply chain network. As the number of facilities increases, total logistics costs first decrease, then increase gradually.

Question 4

What is/are the primary measure(s) used to evaluate different delivery network designs?
A)Customer service.
B)Cost components.
C)Both of the above.
D)None of the above.

Accepted Answer

Customer service and cost components are the primary measures used to evaluate different delivery network designs. Generally no distribution network will outperform other along all dimensions; thus it is important to ensure the strengths of the distribution network fit the strategic position of the firm.

Question 5

The biggest advantage of drop shipping is its ability to __________ at the manufacturer's.
A)Centralize inventories
B)Capitalize profits
C)Hold large amount of backlog
D)All of the above

Accepted Answer

The biggest advantage of drop-shipping is the ability to centralize inventories at the manufacturer. A manager can aggregate demand across all retailers that they supply and, as a result, the supply chain is able to provide a higher level of product availability with lower levels of inventory.

Question 6

Response times tend to be _____ when drop shipping is used.
A)Shorter
B)Longer
C)Neither
D)Average

Accepted Answer

Response times tend to be larger when drop-shipping is used because the order has to be transmitted from the seller to the manufacturer and shipping distances from the manufacturer's centralized site are usually longer.

Question 7

__________ is suited for a large variety of low demand, high value items where customers are willing to wait for delivery and accept several partial shipments.
A)Drop shipping
B)Direct shipping
C)Line shipping
D)Direct line shipping

Accepted Answer

Direct shipping is suited for a large variety of low demand, high value items where customers are willing to wait for delivery and accept several partial shipments. Manufacturer storage is also appropriate if it allows the manufacturer to postpone customization, thus decreasing inventories.

Question 8

In direct shipping, ________ has an output of lower costs due to aggregation.
A)Merchandise
B)Goods Sold
C)Inventory
D)All of the above.

Accepted Answer

In direct shipping, inventory has an output of lower costs due to aggregation. Benefits of aggregation are highest for low demand and high value items. Benefits are also very large if product customization can be postponed at the manufacturer.

Question 9

When compared to drop shipping, direct shipping has a ________ response time.
A)Longer.
B)Shorter.
C)Equal.
D)None of the above.

Accepted Answer

In direct shipping there is a longer response time than in drop shipping. This is due to the increased distance and two stages for order processing in direct shipping.

Question 10

A sophisticated information infrastructure is needed to allow ___________.
A)In transit merge
B)Out transit merge
C)In and Out transit merge
D)Backlog merge

Accepted Answer

A sophisticated information infrastructure is needed to allow in transit merges. Although the initial setup is difficult because it requires the integration of the carrier, manufacturer, and retailer, tracking itself becomes easier due to the merge that occurs at the carrier hub.

Question 11

Relative to manufacturer storage, ________ will require a higher level of inventory.
A)Distributor storage
B)Retailer storage
C)Vendor storage
D)All of the above.

Accepted Answer

Relative to manufacturer storage, distributor storage will require a higher level of inventory because the distributor/retailer/vendor warehouse aggregates demand uncertainty to a lower level than the manufacturer who is able to aggregate demand across all vendors/distributors/retailers.

Question 12

___________ creates new business designs and removes miscommunication and inter organizational tension.
A)Integrated Supply Chain Management
B)Inter-Organization Management
C)Customer Relationship Management
D)Supplier Relationship Management

Accepted Answer

ISCM creates a new business design, one that cuts across organizational boundaries and establishes direct communication, information, and structural links across firms. ISCM supports cross-organizational innovation by removing the waste caused by miscommunication, fragmentation, and inter organizational tension, as well as by leveraging the competencies of multiple organizations into a new competitive weapon.

Question 13

Integrated Supply Chain Management provides unique opportunities for creating added consumer value, which leads to ________
A)Attaining faster innovation
B)Lowering costs
C)Greater flexibility
D)All of the above.

Accepted Answer

The key to an effective ISCM implementation is to target service enhancements to the needs of specific customer segments. If the implementation is successful it will provide unique opportunities for creating added consumer value, which may result in attaining faster innovation, greater flexibility, and lower costs.

Question 14

A balanced supply chain segmentation approach requires the identification of reasonably sized groupings of customers that have _______________.
A)Similar requirements and expectations
B)Similar size and wants
C)Different desires and wants
D)None of the above.

Accepted Answer

The development of a balanced supply chain segmentation approach requires the identification of reasonably sized groupings of customers that have similar requirements and expectations. Typical factors that are part of a segmentation analysis include buying relationships, order-taking and billing requirements, and ordering and delivery complexities.

Question 15

A vital technique in measuring supply chain opportunities is gathering key information from customers through customer service surveys. Well-designed customer service surveys accomplish several things, including:
A)Speed of delivery.
B)Delivery reliability.
C)Order completeness.
D)All of the above.

Accepted Answer

Providing a quantitative understanding of key customer requirements for each of the basic features of the service profile includes speed of delivery, delivery reliability, order completeness, product availability, and also billing features.

Question 16

ISCM implementation creates unique opportunities for the technology aspect of the function. Which of the following is a way ISCM helps technology?
A)Implementation of databases.
B)Use of state-of-the-art equipment.
C)Implementation of Internet.
D)Implementation of OBAs.

Accepted Answer

An integrated supply chain management helps create new opportunities by participating in the identification and implementation of new databases and information technology enablers for key supply chain transactions.

Question 17

The starting point of an effective supply chain in its design and rollout is gaining detailed knowledge of __________.
A)Consumer expectations
B)Product placement
C)Consumers' reason of selection
D)All of the above.

Accepted Answer

The starting point of an effective supply chain in its design and rollout is gaining detailed knowledge of consumer expectations, product placement, and consumers reason of selection. It is also important to determine how well the current supply chain is delivering against customer expectations so that improvements can be focused on those areas where major problems or opportunities exist.

Question 18

________ Information is a key to effective supply chain.
A)Subjective
B)Objective
C)Superlative
D)All of the above.

Accepted Answer

Objective information is key to effective supply chain visioning. While a number of sources of information can be harvested from the supply chain, benchmarking remains one of the most powerful tools available to ISCM visioning.

Question 19

________ is the process of analyzing, collecting, and using valuable data about the structure and performance of comparable processes within or across an organization.
A)Objective analysis
B)Benchmarking
C)Segment marking
D)None of the above.

Accepted Answer

Benchmarking is the process of gathering, analyzing, and using data about the structure and performance of comparable processes within or across organizations. Benchmarking is one of the best ways to gain consensus and motivation for process improvement by emphasizing the evaluation of current performance against a definable standard.

Question 20

_________ provides insight into the profitability of various segments of SCM.
A)Customer segment analysis
B)Chain profitability analysis
C)Customer profitability analysis
D)Chain segment analysis

Accepted Answer

Customer profitability analysis provides insight into the profitability of various segments, helping channel partners focus on creating competitive strength in those areas where their efforts will yield the greatest payoff.

Quiz 4: Design and Improvement

Firms that target customers who value short response times need to be _________.

Outbound transportation costs per unit have a tendency to be higher than inbound because _____________.

Total logistics costs are made up of ____________.

What is/are the primary measure(s) used to evaluate different delivery network designs?

The biggest advantage of drop shipping is its ability to __________ at the manufacturer's.

Response times tend to be _____ when drop shipping is used.

__________ is suited for a large variety of low demand, high value items where customers are willing to wait for delivery and accept several partial shipments.

In direct shipping, ________ has an output of lower costs due to aggregation.

When compared to drop shipping, direct shipping has a ________ response time.

A sophisticated information infrastructure is needed to allow ___________.

Relative to manufacturer storage, ________ will require a higher level of inventory.

___________ creates new business designs and removes miscommunication and inter organizational tension.

Integrated Supply Chain Management provides unique opportunities for creating added consumer value, which leads to ________

A balanced supply chain segmentation approach requires the identification of reasonably sized groupings of customers that have _______________.

A vital technique in measuring supply chain opportunities is gathering key information from customers through customer service surveys. Well-designed customer service surveys accomplish several things, including:

ISCM implementation creates unique opportunities for the technology aspect of the function. Which of the following is a way ISCM helps technology?

The starting point of an effective supply chain in its design and rollout is gaining detailed knowledge of __________.

________ Information is a key to effective supply chain.

________ is the process of analyzing, collecting, and using valuable data about the structure and performance of comparable processes within or across an organization.

_________ provides insight into the profitability of various segments of SCM.