Business Logistics & Transportation Chapter 1-4 Review

False

When a company utilizes a "make to stock" strategy, the company is also said to be using a "pull" business model

True

False

False

Cash-to-Cash Conversion is the time required to collect payment from the customer for goods sold

True

False

True

Manufacturing Postponement is where a standard or a base product is manufactured in sufficient quantities in order to realize economies of scale, while the finalization of some features of the product are delayed until after actual customer orders are received.

True

False

D

Which of the following statements is NOT accurate regarding Enterprise Resource Planning (ERP) systems?

A. ERP is the backbone of most firm's logistical information systems.

B. ERP maintains an integrated database of current and historical data

C. ERP processes most transactions across all business functions

D. All of the above are accurate statements about ERP

A

Which model is depicted in the following diagram?

A. Anticipatory or Push Model

B. Make-to-Order Model

C. Responsive or Pull Model

D. Collaborative Planning, Forecasting and Replenishment Model

D

Which customer perception of value focuses on achieving economies of scope in product/service presentation?

A. Relevancy Value

B. Economic Value

C. Perceived Value

D. Market Value

E. Social Value

False

Supply Chain Management is a channel and business organizational arrangement, based on acknowledged dependencies, and collaboration.

True

False

C

Which of the following is NOT a type of Postponement Strategy?

A. Assembly Postponement

B. Combined Postponement

C. Life Cycle Postponement

D. Time Postponement

E. Labeling Postponement

C

At which level of Supply Chain Information System Functionality are network/facility location and integration decisions made?

A. Transaction System

B. Management Control

C. Decision Analysis

D. Strategic Planning

D

If you were responsible for the supply chain set-up for a virtual reality camera product, which supply chain capabilities model would be the most appropriate to use?

A. Efficient

B. Traditional

C. Impassive

D. Responsive

C

A performance cycle consists of all of the following elements, EXCEPT?

A. Nodes or "links" in the logistics supply chain

B. Inventory

C. Logistics

D. Input and Output Requirements

False

The Traditional Cost Logistics Model focuses on achieving the lowest total cost across all functions of logistics overall.

True

False

True

The logistical value proposition consists of two elements; Service Benefit and Cost Minimization.

True

False

B

Which of the following logistics objectives involves "the elimination of operational disruptions"?

A. Responsiveness

B. Variance Reduction

C. Quality

D. Life Cycle Support

True

When identifying ways to improve the Logistics Performance Cycle, you must consider the Procurement Cycle, Manufacturing Support Cycle, and the Customer Accommodation Cycle

True

False

D

Which of the following are examples of functions that are within the scope of Logistics?

A. Procurement, Manufacturing, and Customer Accommodation

B. Customer Order Processing, Inventory Management, and Manufacturing

C. Manufacturing, Transportation, and Warehousing

D. Transportation, Inventory Management, and Customer Order Processing

D

Logistics includes the integration and management of all of the following activities, EXCEPT?

A. Customer Order Processing

B. Location Analysis

C. Inventory Management

D. Sourcing

E. Transportation

F. Packaging

G. Warehousing

H. Material Handling

I. Customer Service

False

Logistics and Supply Chain Management are essentially synonymous terms, i.e., that they have the same or nearly the same meaning.

True

False

True

Variations within each task in the customer delivery cycle will have an impact on the total time necessary to complete the customer delivery

True

False

False

All customers must be treated equally in terms of the service benefits the they are provided and the amount of logistical costs a company expends on each

True

False

True

Competition in an industry can raise the minimum standards that customer expects so that performance that meets customer expectations one year may result in extreme dissatisfaction next year.

True

False

C

Which one of the following is NOT a basic element of Customer Service?

A. Availability

B. Service Reliability

C. Value Management

D. Operational Performance

B

The "Perfect Order" is the ultimate in logistics service levels. Which one of the following is NOT an element of the Perfect Order?

A. Delivered on time

B. Delivered in near perfect condition

C. Delivered complete

D. Delivered with complete and accurate documentation

A

The first step in achieving Customer Success is to identify "unique or specific activities that firms can jointly develop to enhance their efficiency, effectiveness and relevancy". Which of the following terms represents this concept?

A. Value-added Services

B. Logistics Management

C. Spatial Convenience

D. Relationship Marketing

E

In general terms (from any prospective), who is the manufacturer's customer?

A. The end user of the company's products or services

B. Any supply chain partner

C. Any delivery location, including a home, business, distribution center, or plant

D. Any organization that takes ownership of the product between your company and the end user

E. A,C, & D

C

The amount of effort required by the customer to find and acquire a product or service can be reduced or eliminated through what supply chain service output?

A. Waiting Time

B. Fill Rate

C. Spatial Convenience

D. Flexibility

True

Many firms establish their basic service platforms using two factors; (1) what their competitors are doing and/or industry accepted practices, and (2) the firm's overall marketing strategy.

True

False

D

The process for improving the overall performance of a business by better understanding and anticipating the wants and needs of customers is known as?

A. Customer-focused Marketing

B. Customer Accommodation

C. Customer Requirements Planning

D. Customer Relationship Management

True

Fill Rate measures the magnitude or impact of stockouts over time

True

False

D

Customer expectations are created by reducing or eliminating gaps? Which of the following is NOT a gap?

A. Satisfaction

B. Perception

C. Communication

D. Segmentation

E. Performance

F. Standards

G. Knowledge

False

ISO 9000 is a series of environmental management standards intended to assist organizations to manage the environmental effect of their business practices.

True

False

False

One result of an effective supplier certification program is an increase in the supplier base.

True

False

False

The most important objective in a procurement strategy is to ensure that the lowest purchase price is obtained from suppliers.

True

False

B

Procurement is the business function which focuses on issues related to the firms' supply base. Which of the following is NOT one of these focuses?

A. Ensuring continuous supply

B. Improving forecast accuracy

C. Improving the quality of the items being supplied

D. Supplier development

C

Which portfolio spend category involves commodity items where many alternatives of supply exist, supply risk is low, spend is high, and there are potential procurement savings?

A. Routine purchases

B. Bottleneck purchases

C. Leverage purchases

D. Critical purchases

B

Which purchasing strategy is described as increasing procurement leverage by reducing the total number of suppliers, while continuing to minimize risk?

A. User Buy

B. Volume Consolidations

C. Value Management

B

Which of the following accurately describes a difference between the "Purchasing" perspective and the "Procurement" perspective?

A. Purchasing is focused on looking up and down the supply chain for opportunities, while Procurement is focused on getting the lowest price for acceptable quality.

B. Purchasing is more transaction-focused, while Procurement is focused on building relationships with suppliers and customers.

C. Purchasing is concerned with operations beyond the first-tier suppliers, while Procurement is focused solely on first-tier suppliers.

D. Purchasing is involved in finding strategic sources of supply for products and services to better manage demand, while Procurement primary responds to the demands of the manufacturing plants.

False

The sum of all the costs associated with every activity in the supply stream of a product is known as the "Acquisition Cost"

True

False

False

In a successful Just-in-Time (JIT) purchasing program, the supplier schedules and controls the transportation and delivery of the subject material to the buyer as close to the place and time of consumption as possible.

True

False

True

An organization's process for evaluating the quality systems of key suppliers in an effort to eliminate incoming inspections is known as Supplier Certification

True

False

Supply Chain Management

consists of firms collaborating to leverage strategic positioning, and to improve operating efficiency

Supply Chain Strategy

Is a channel and business organizational arrangement, based on acknowledge dependency, and collaboration

Business Logistics

The coordination of projected requirement, procurement, physical movement, and storage of components, parts, raw materials, and semi-finished and finished goods, to achieve the optimum service level at minimal cost

customer service

the output of the logistics system

economic value

focus is on economies of scale in product and service creation, and striving to achieve the lowest total landed cost. (High quality at low cost) (provided through procurement and manufacturing strategy)

Market Value

focus on achieving economies of scope in product and/or service presentation (convenient product/service assortment and choice) (provided through the market and distribution strategy)

Relevancy Value

Means the right products and services (market value), at the right price (economic value), modified, sequenced, synchronized, and otherwise positioned in a manner that creates valuable segmental diversity (a unique product/service bundle) (provided through the supply chain strategy)

plan, source, make, deliver, return

the five basic supply chain activities

Supply Chain Information System (SCIS)

what is this called?

Enterprise Resource Planning (ERP)

an integrated database of current and historical data that processes most (if not all) transactions across all business function. (the backbone of a company's logistical information system)

enterprise integration and administration

- general administration

- accounts receivable and payable

- financial inventory accounting

- general ledger

- human resources

These modules are all part of:

Enterprise planning and monitoring

- Sales and operations planning (S&OP),

- Supply chain compliance,

- Supply chain visibility and event management (EMS)

These modules are all part of:

Enterprise Operations

Customer Relationship Management

Logistics

Manufacturing

Purchasing

Inventory Deployment

These modules are all part of:

Efficient Model

-designed to minimize cost

-ideal for functional products

Responsive Model

-designed to respond quickly to market demand

-ideal for innovative products

Anticipatory Business Model (Push Model)

-Make-to-stock

Responsive Business Model (Pull Model)

- make to order

-assemble to order

- engineer to order

postponement strategy

provide the greatest opportunity for supply chain professionals to minimize the risks of stock out and excess inventory by leaving the final configuration of a product to the last possible moment and moving those operations closer to the customer. reduce risk of performance issue. (hybrid of push and pull models)

manufacturing postponement

Where a standard or a base product is manufactured in sufficient quantities in order to realize economies of scale, while the finalization of some features of the product are delayed until after actual customer orders are received

Assembly Postponement

is relevant for companies with modular product design. Having base materials in modules, and a flexible design, it is possible to construct various end-products from the modules in one kit.

Packaging Postponement

when goods, that might be offered in different packages (size of package, etc.) are not packaged until the last moment. This practice allows for the storage of finished products unpacked, and minimize the risks of excessive stocks.

Labeling Postponement

when product differentiation takes place only by a putting the labels on the package. This type of postponement is useful, when companies use different markets.

Time Postponement

Refers to a situation where a fully stocked inventory is maintained at one or only a few strategic locations

When customer orders are received, orders are either delivered directly to the customer or expedited to the local distributor

Useful for economies of scale along with responsiveness to customer

Ex. high cost parts and assemblies/ "hub-and-spoke"

Combined Postponement

In combination, manufacturing and time (or geographic) postponement involves keeping the basic products centralized and performing the final product customization at the destination distributor, rather than at the manufacturing site

Cash-to-Cash Conversion

the time required to convert raw material or inventory purchases into sales revenue

dwell time

the ratio of time that an asset sits idle to the time required to satisfy its supply chain mission

cash spin

potential benefits of reducing assets across a supply chain

Offshoring

moving manufacturing and distribution operations to countries with favorable labor costs and tax laws

logistics

The part of supply chain management that plans, implements, and controls the flow and storage of goods from the point of origin to point of consumption. Includes activities such as:

-location analysis

-customer ordering processing

-inventory management

-warehousing

-material handling

-packaging

-transportation

-customer service

Logistics Planning

Attempts to answer the questions of what, when and how, and it takes place at three different levels: strategic, tactical , and operational. The major difference between them is the planning horizon

Strategic Planning

long-range planning where the time horizon is longer than one year (long term)

tactical planning

involves an intermediate time horizon, usually less than a year (

operational planning

short range, with decision frequently made on an hourly or daily basis (now)

Logistical Value Proposition

consists of a commitment to key customer expectations and requirements at a minimum cost. The two elements of this value proposition are:

- service benefit

- cost minimization

traditional cost model

focused on achieving the lowest possible cost for each individual function of logistics (ignore impact to cost)

total cost model

Focused on achieving the lowest total cost across all functions of logistics overall (consider impact to cost)

functions of logistical work

are interrelated

procurement

concerned with purchasing and arranging inbound movement of materials, parts, and/or finished inventory from suppliers into manufacturing or assembly plants, warehouses or retail stores

manufacturing support

concentrates on managing work-in-process inventory as it flows between stages of manufacturing in support of the Master Production Schedule (MPS)

market distribution

Dealing with the varied aspects of serving customers. The end objective of logistics is the movement of finished product to customers.

Integrating Logistics

involves achieving the following 6 objectives simultaneously

1. responsiveness

2. variance reduction

3. inventory reduction

4. shipment consolidation

5. quality

6. life cycle support

single chain echelon structured logistics

direct delivery

2 chains

multi channel echelon structured logistics

Logistics Performance Cycle

represents elements of work necessary to complete the logistics related to customer accommodation, manufacturing or procurement

transactional marketing

A traditional strategy with a focus on creating successful individual transactions between the company and its customers (TACTICAL)

relationship marketing

A new strategy with a focus on the development of long-term relations with key supply chain participants in an effort to develop and retain long-term preference and loyalty (LONG TERM RELATIONSHIPS)

space, time, and quantity and assortment

Four discrepancies that must be overcome to enable the basic exchange of goods and services

Spatial convenience

the amount of shopping time and effort will be required on the part of the customer

lot size

the number of units to be purchased in each transaction

waiting time

The amount of time the customer must wait between ordering and receiving products

Product variety and assortment

differs by supply chain

customer service, customer satisfaction, customer success

mix of services, both generic and custom, in order to accommodate a range of customer requirements. The levels of customer accommodation.

with the right amount, of the right product, at the right time, and the right place, in the right condition, at the right price, with the right information

what are the 7 R's

availability

the capacity to have inventory when desired by a customer

fill rate

measures the magnitude or impact of stockouts over time

stockout

occurs when a firm has no product available to fulfill customer demand

Orders shipped complete

requires shipping everything that a customer orders to count as a complete shipment

Operational Performance

Deals with the time required to deliver a customer's order

speed

the elapsed time from when a customer established a need to order until the product is delivered