Supply Chain

What is the difference between logistics and supply chain management?

Logistics is the internal movement of goods between supply chain elements, and supply chain is the overarching idea and processes to get goods to the customer.

A computer company participates in a practice called __________ when it obtains the parts required to build their desktop computers from a variety of suppliers located in Mexico and India.

Outsourcing

A locally-owned takeout restaurant makes vegetarian soups using vegetables and herbs that are grown on-site.

This restaurant engages in ______for its menu items.

Insourcing

A national chain of retail outlets owns two of its upstream suppliers, a division that makes wiper blades.

This is an example of ______________.

Backward vertical integration

A shoe company needs upstream and downstream partners that can respond quickly to changing exercise trends and customer styles.

Which strategy would best meet this shoe company's needs?

An agile supply chain

If a company manufactures a product that experiences stable, predictable demand in an industry with little innovation, which type of supply chain would improve efficiency and minimize costs?

Lean supply chain

The American Trucking Association (ATA) forecasted a driver shortage as the current truckers retire and the demand for trucking services increases.

This shortage indicates which type of supply chain bottleneck?

Labor

Which supply-side risk is being addressed by the increasing number of technical school certification programs to support a specific industry demand like artificial intelligence (AI) or cybersecurity?

Insufficient skilled labor

Why do the operations of organizations seek to form important strategic alliances?

Because collaborations or partnerships are needed when operations increase outsourcing, which contributes to the need for supplier development

Why are strategic alliances important in operations management?

They are important because they allow organizations to focus on their core competencies rather than on trying to manage activities along the entire supply chain.

For vendor-managed inventory, what is needed in order to help the supplier plan production and provide the retailer with more goods, as needed?

A supplier having access to a retailer's sales data and inventory levels

A lumberyard typically mills approximately two million board feet of lumber per year, mostly of species native to that region. A recent disease outbreak has led to recommendations for civilians to isolate. This has reduced the availability of the lumber yard's workers.

Which category of bottleneck does this demonstrate?

Labor

A company produces outdoor furniture. A finish is applied to metal components and then cured using a heat treatment. Despite a large increase in demand, the company has been unable to ramp up production because there is only one oven that administers the heat treatment, and it is limited to 50 units per hour.

Which type of bottleneck exists in this situation?

Process

A pharmaceutical company produces several medications for mental illnesses. The production of one of the medications is being hindered by a new law prohibiting the transportation of a specific ingredient in amounts greater than 100 liters.

Which category of bottleneck does this demonstrate?

Regulatory

A meat-packing facility has a workforce of approximately 2,000 employees. Failed negotiations with the employee union has resulted in a strike, forcing production to a near halt.

Which type of bottleneck exists in this situation?

Labor

A company uses several chemicals in the production of its foam-based products. Based on company policy, each order from suppliers must be signed by the production manager. Production has been hindered lately because the production manager has been failing to sign the orders when needed.

Which category of bottleneck does this demonstrate?

Decision-making

A manufacturing facility has used a machine for several years to produce metal chains. The company is aware of the need to replace the machine with one that will operate at twice the speed. However, the current budget does not allow for the purchase of the new machine.

Which category of bottleneck does this demonstrate?

Financial

A company that sells paper operates at low profit margins. In order to increase profitability, the company prioritizes suppliers that are best able to keep costs down and minimize the amount of stock on hand.

Which strategy does this scenario demonstrate?

Lean supply chain

A manufacturer of wooden furniture works closely with a lumber supplier. The lumber supplier monitors the level of lumber on hand at the manufacturer's factory and makes deliveries when needed.

What is the strategy implemented in this scenario?

Vendor managed inventory

A grocery store sends daily reports of dairy sales to a dairy product distributor. The distributor monitors the stock of items at the grocery store and replenishes the stock as needed.

Which strategy does this scenario demonstrate?

Vendor managed inventory

A bakery sends daily data to its flour supplier. The supplier uses this data along with periodic inspections to coordinate its production of flour with the replenishment of the bakery's flour needs.

Which concept is illustrated in this example?

Vendor managed inventory

A retailer is reevaluating its selection of suppliers in an effort to make the supply chain more agile.

What is a benefit of this strategy?

More responsive production process

A clothing retailer is merging with a manufacturer of the clothing in order to increase profitability. The leaders responsible for the merger are seeking ways to make the supply chain for the clothing products more agile.

What is a benefit the retailer hopes to attain using this strategy?

Better met customer expectations