Question Bank Part 1 to 10.pdf

Question No : 1 In addition to sales history, current customer orders, and forecasted demand, which of the following data sources should be used as part of a demand management process? A. Inventory levels B. Contractual obligations C. Customer profitability D. Scheduled marketing activities Question No : 2 Which of the following outcomes is a benefit typically expected of customer relationship management (CRM)? A. Reducing the size of the sales force by automating activities B. Gaining a better understanding of customer requirements C. Implementing automated inter-organizational processes D. Focusing sales efforts on the most profitable customers Question No : 3 A firm supplies products and services to a wide variety of industries with varying requirements for responsiveness and reliability. Many customers across these industries are not satisfied with the firms ability to meet the lead time and on time delivery requirements. Which of the following tools is most appropriate for the firm to use to improve customer service? A. Customer service ratio metrics B. Market segmentation C. Customer relationship management (CRM) D. Supply Chain Operations Reference (SCOR®) Question No : 4 A manufacturer can simplify the forecasting process by pooling demand forecasts for a product group and then: A. averaging total demand and spreading it evenly across all items. B. disaggregating demand to the item level based on marketing input. C. disaggregating demand to the item level based on historical proportions. D. allocating demand to each production site. Question No : 5 Demand management involves which of the following undertakings? A. Adjusting capacity to support expected demand B. Engaging in activities associated with customer relationship management C. Creating higher customer demand by improving performance in areas such as lead time and service levels D. Understanding events and managing activities that could influence future demand Question No : 6 The primary reason for a firm to pursue strategic supply chain activities is to: A. gain competitive advantage. B. reduce costs. C. increase productivity. D. decrease product lead time. Question No : 7 A firm supplies a single line of products to consumers using retail stores and on-line sales, distributors, and wholesalers. Currently the firm has common pricing and response times for sales in each sales channel. Which of the following tools is most appropriate to employ to improve profitability? A. Customer segmentation B. Customer-facing ordering systems C. Customer relationship management (CRM) D. Supply Chain Operations Reference (SCOR®) Question No : 8 A company manufactures special products for select customers. When demand for these products drops, the manufacturer can switch the production line to a commodity-type product that can be sold on the open market at reduced terms to generate cash. The company is executing a corporate strategy that is based on: A. customer focus and alignment. B. forecast accuracy. C. multiple downstream channels. D. multiple upstream supply chains. Question No : 9 Risk pooling enables a lower total inventory level without affecting service levels based on which of the following assumptions? A. Inventory turnover ratio can be reduced. B. Aggregate demand is more accurate than disaggregate demand. C. The planning time fence can be adjusted as needed. D. The supplier shares some risk for holding inventory. Question No : 10 A large wholesaler formerly owned a number of delivery trucks. The wholesaler sold all of its trucks and now purchases transportation services from fleet operators. This is an example of which of the following strategies? A. Selling and leasing back equipment. B. Renting equipment on consignment. C. Using a third-party logistics provider. D. Using an owner-operator fleet. Question No : 11 The process of gathering data about what customers need and ensuring that desired features are included in the design and initial planning phase of a new product or service is known as: A. a quick response program. B. quality function deployment. C. total quality management. D. early supplier involvement. Question No : 12 The question below is based on the following flowchart: Which of the following phrases most accurately describes the complete flow of demand information? A. From supplier to customer B. From customer to manufacturer C. From customer to supplier D. From supplier to manufacturer Question No : 13 The factors to consider in the make-or-buy decision include costs, proprietary knowledge, and: A. design history. B. available capacity. C. inventory balance. D. warehouse location. Question No : 14 Which of the following considerations is an important supply chain design decision? A. Product design B. Selecting supporting information systems C. Identifying labor force requirements D. Identifying training programs Question No : 15 The use of a seasonal index as a forecasting technique measures the ratio of the: A. average seasonal demand to the average demand for all periods. B. average demand for all periods to the average seasonal demand. C. average seasonal demand to the standard deviation of the demand for all periods. D. standard deviation of the seasonal demand to the standard deviation of demand for all periods. Question No : 16 A company's annual cost of goods sold is $350 million, and inventory carrying cost is 18%. The company averages four inventory turns. The cost savings resulting from increasing inventory turns from four to six would be: A. $29,000,000. B. $15,750,000. C. $10,500,000. D. $ 5,250,000. Question No : 17 An advantage of using a third-party logistics service (3PL) is improved: A. on-time delivery of shipments due to higher inventory levels. B. cost structure due to economies of scale. C. access to smaller markets due to localization. D. risk visibility due to inventory consolidation. Question No : 18 Incorporating supplier input into product and process design helps to: A. maintain quality. B. stabilize product costs. C. reduce time to market. D. save costs to the buyer. Question No : 19 Which of the following factors typically is the most significant impediment to implementing collaborative commerce? A. Technology barriers B. Security C. Corporate culture D. Return on investment (ROI) Question No : 20 The focus of collaborative supply chain management differs from a transactional approach by its emphasis on the: A. transportation of goods to the next link in the chain. B. flow of product information up to the next level of the chain. C. flow of demand information and cash up the chain. D. flow of supply into an organization. Question No : 21 Maintaining a long-term collaborative relationship with a trading partner requires: A. formal and informal communication. B. interconnected information systems. C. one partner regularly exercising power. D. standardized terms of agreement. Question No : 22 The primary reason for the evolution of the supply chain is: A. fewer rejects due to poor quality. B. increased on-time delivery. C. increased cost savings. D. increased communication. Question No : 23 Which of the following marketing strategies emphasizes offering services at a lower price than rival services with comparable features? A. Cost leadership B. Service differentiation C. Customer focus D. Market responsiveness Question No : 24 Which of the following attributes typically makes reverse logistics processes more complicated than outbound logistics processes? A. Lead times for shipments are more variable. B. Individual packages and cartons are less uniform. C. There are more regulations mandated by local governments. D. There is more competition for scarce transportation lanes. Question No : 25 The value that logistics provides within the supply chain can best be summarized as: A. satisfying customer expectations about availability and delivery at an acceptable total cost. B. meeting promised location and on-time delivery goals with minimal use of expediting. C. establishing inventory and delivery goals with various customers that fulfill the firm's profit objectives. D. providing accurate in-transit and delivery information to customers and salespeople. Question No : 26 Which of the following forecasting methods relies on the opinions of a panel of experts? A. Delphi technique B. Survey method C. Causal method D. Time series analysis Question No : 27 After identifying the potential causes for delays in communicating demand information up the supply chain, the trading partners should take which of the following actions? A. Implement a higher-speed data communications network. B. Change procedures so data is communicated more frequently. C. Identify the root causes for the delays. D. Map and analyze the value stream. Question No : 28 The main benefit of a mass customization product design strategy is to: A. sell high quantities of product to specific customer segments. B. achieve economies of scale in purchasing components. C. offer more product variety while keeping inventories low. D. avoid assembly of finished products. Question No : 29 Which of the following types of information would be an appropriate basis for a qualitative forecast? A. Leading indicators B. Market research data C. Order history D. Shipment history Question No : 30 The probability of customer dissatisfaction is highest when which of the following conditions exists? A. Customer expectations are clearly defined. B. Supplier execution is too low. C. There is a gap between expected performance and perceived performance. D. There is a gap between what was indicated and what was accomplished. Question No : 31 A company plans to maximize profitability by charging more for its products at retail locations than on its website. Which of the following segmentation strategies would best support this plan? A. Group B. Channel C. Regional D. Location Question No : 32 Keeping all other factors equal, a company typically will try to maintain higher service levels for products with: A. wider variety. B. shorter lead time. C. higher profit margins. D. lower sales volumes. Question No : 33 A company that produces standardized products and sells them through retailers via a responsive transportation system has decided to expand its sales with an online store for customized products. Which of the following distribution strategies would be the most appropriate for the business-strategy change? A. Local distribution centers serving retailers and online sales B. Centralized cross-docking facilities serving retailers and online sales C. A centralized distribution center serving retailers and direct shipment from the factory serving online sales D. A centralized distribution center serving retailers with transshipment arrangements serving online sales Question No : 34 A manufacturer uses standard costing, and a potential supplier uses activity-based costing. This difference most likely will have implications for which of the following types of future decisions? A. Price concessions B. Make-or-buy C. Distribution warehouse locations D. Freight terms Question No : 35 Which of the following organizational design choices is an example of vertical integration? A. Contracting with a third-party logistics provider B. Producing components used internally C. Externally staffing a customer service center D. Awarding a one-time trade show contract Question No : 36 A firm has identified groups of customers based on specific characteristics the customers desire from products and services the firm can provide. Characteristics include lead times, pricing tiers, and service levels. The firm is engaged in which of the following activities? A. Customer differentiation B. Order winner segregation C. Market segmentation D. Channel definition Question No : 37 Which of the following indicators is most appropriate to use as a measure of supply chain utilization? A. Production equipment productivity B. Net asset turnover C. Value-added productivity per employee D. Upside flexibility Question No : 38 A return material authorization (RMA) policy is used in reverse logistics to: A. physically transport returned items by using an efficient transportation mode. B. minimize the number of returned items by involving product design and demand forecasting. C. reduce the cost of returned items by refusing to accept items that should not be returned. D. reclaim substantial value from returned items by recycling. Question No : 39 Compared to mass-media marketing, customer relationship management has the advantage of allowing the organization to: A. compete for customers based on service. B. reach a larger number of potential customers. C. reduce inventory to improve cash flow. D. focus on attracting new customers. Question No : 40 Which of the following actions typically would be the first step in implementing the philosophy of customer relationship management? A. Creating a customer-centric organization B. Developing a map of the customer segments C. Documenting the objectives for implementation D. Selecting an information technology solution Question No : 41 The most likely benefit of implementing a collaborative transportation management system is: A. lower distribution center operating costs. B. fewer transportation planners. C. less variability in picking and packing time. D. less variability in transportation costs. Question No : 42 A large manufacturer wanting to be more competitive in the global market place decided to outsource its transportation and return processing to other companies on a contractual basis. The companies providing the services would be referred to as: A. fourth party logistics providers. B. third party logistics providers. C. retail services providers. D. distribution services providers. Question No : 43 A manufacturer of plastic components that are sold either directly or through distributors wants to identify the requirements of the end customers for each market segment. Which of the following approaches would be most appropriate? A. Analyzing the buying history for each of the market segments B. Asking the manufacturer's direct customers C. Conducting a market research project D. Sending samples of potential future products to the final customers Question No : 44 Companies are more likely to consider the consequences of their product design decisions when they view the reverse supply chain as an extension of the: A. forward supply chain. B. marketing process. C. manufacturing process. D. sales and operations planning process. Question No : 45 A company has been delivering a global product that no longer appears profitable. Senior managements best response is to: A. analyze product profitability by market segment. B. discontinue the product based on eroding profitability. C. provide additional incentives to the sales force. D. increase promotional activity across all markets. Question No : 46 Compared to a blanket purchase order, a supplier alliance agreement is best differentiated by: A. efficient material replenishment processes. B. clearly identified roles for the buyer and seller. C. a shared vision of added value. D. a sole-source agreement. Question No : 47 Which of the following customer relationship management activities most appropriately is used for revenue generation? A. Generating customer leads B. Generating graphic sales models C. Measuring customer preferences D. Identifying customer margins Question No : 48 Which of the following actions typically would be considered part of a reverse logistics strategy? A. Offering a discount on new purchases when used products are returned B. Reducing the amount of packaging material used in shipping C. Manufacturing products in batches consistent with full-truckload shipments D. Batching returns of defective components to the suppliers Question No : 49 A company considers outsourcing its information technology support to a low-cost region on another continent. The company currently has no business presence there. Which of the following actions is most effective in helping to select a service provider? A. Contacting the country's consulate for leads B. Contacting the country's local government for recommendations C. Visiting several potential providers before making a selection D. Finding a trusted local business agent to help in the search Question No : 50 Continuous improvement is best described as: A. a never-ending effort to expose and eliminate root causes of problems. B. a never-ending effort by the management team to reduce cycle time. C. identifying and implementing big-step improvements within a process. D. a process in which a supplier commits to replenishing inventory based on demand without receiving replenishment orders. Question No : 51 A remanufacturer of equipment is most likely to have what type of supply chain? A. Modular logistics B. Reverse logistics C. Mixed model D. Lateral Question No : 52 Which of the following is the most important result when a company implements customer relationship management? A. Profits are maximized. B. Retention of key customers is increased. C. Product options are increased. D. Transaction costs are decreased. Question No : 53 Which of the following results can be expected from sharing a common understanding of demand and consumption patterns among supply chain participants? A. Improved transparency of collaboration relationships B. Increased performance in balanced scorecard C. Reduced inventory levels for key items D. Better synchronization of planning and operations Question No : 54 Using an independent service provider for logistics would be most appropriate in which of the following situations? A. A shoe company that wants to penetrate a foreign market B. A business that owns plants and warehouses globally C. A financial services company that wants to expand its services D. A cable television company that wants to add services Question No : 55 A main benefit of using customer relationship management (CRM) is: A. maximization of on-time delivery. B. minimization of product returns. C. identification of customers with high lifetime value. D. finding new markets for existing products and services. Question No : 56 A companys decision to charge different prices for the same service sold in different market segments is most likely based on which of the following metrics? A. Internal rate of return (IRR) B. Lifetime customer value (LCV) C. Net present value (NPV) D. Return on investment (ROI) Question No : 57 A media company offers a majority of its movies through a specific distributor. The media company is beginning to produce content for a new foreign market to which the distributor has exclusive access. To maximize savings and gain entry to this new market, the media company should: A. create a contract for the new market. B. enter into a partnership. C. form a strategic alliance. D. acquire the distributor. Question No : 58 The purpose of continuous improvement in the supply chain is to: A. eliminate the root causes of problems. B. improve interorganizational communication. C. develop better written procedures. D. reduce product costs. Question No : 59 Which of the following practices has improved management of the customer pipeline? A. Reverse auctions B. Sales force automation C. Finite capacity planning D. Point-of-purchase metrics Question No : 60 Which of the following benefits of supplier relationship management typically results from collaboration with a few critical suppliers? A. Automation of supplier sales activities B. Elimination of formal contracts C. Reduction in customer and supplier inventories D. Standardization of communications Question No : 61 Which of the following scenarios represents a correct application of the Supply-Chain Operations Reference-model (SCOR)? A. Sales and marketing refers to SCOR to improve demand generation. B. Production and engineering uses SCOR best practices to design a new "make" process flow. C. Distribution and logistics selects suppliers from the SCOR reference list. D. Marketing and development incorporates SCOR Level I metrics for new product design. Question No : 62 Medium-term demand management projections are used primarily to: A. complete strategic business planning of facilities. B. complete forecasts at the item level. C. aggregate demand for production planning. D. develop the master production schedule. Question No : 63 What is the primary role of marketing in supporting supply chain management? A. Selecting favored supplier partners B. Developing efficient customer channels C. Focusing on short-term forecasting accuracy D. Working with research and development on slow-moving products Question No : 64 Reverse supply chain activity typically peaks nearest the beginning of which of the following stages of the product life cycle? A. Introduction B. Growth C. Maturity D. Decline Question No : 65 Which of the following scenarios represents a correct application of the Supply-Chain Operations Reference-model (SCOR)? A. Sales and marketing refers to SCOR to improve demand generation. B. Production and engineering uses SCOR best practices to design a new "make" process flow. C. Distribution and logistics selects suppliers from the SCOR reference list. D. Marketing and development incorporates SCOR Level I metrics for new product design. Question No : 66 Which of the following situations is an example of inventory being held as a way to balance supply and demand? A. A manufacturer holds inventory of key components to maintain a level production schedule. B. A manufacturer of seasonal products builds finished-goods inventory before the peak selling period. C. A distributor maintains safety stock of slow-moving items at a central distribution center. D. A retailer stocks a variety of sizes and colors of a fast-selling item to avoid losing sales. Question No : 67 Supply chains delivering products or services are most able to respond quickly to changing market requirements when: A. products have been standardized. B. products have a modular design. C. production processes have been standardized. D. production processes have been simplified. Question No : 68 Which of the following levels in a supply chain network represents the most upstream external activity? A. Supplier to contractor B. Manufacturing to supplier C. Customer to distribution D. Customer to contractor Question No : 69 Compared to a global strategy, a multicountry strategy would be characterized by: A. strategy coordination across countries. B. preferred suppliers located in host countries. C. major strategic decisions coordinated centrally. D. products adapted to local needs. Question No : 70 When designing a supply chain for strategic advantage, a company first should consider: A. the impact on customers using Just-in-Time manufacturing. B. the financial stability of suppliers. C. matching the supply chain to product type. D. whether to use custom or standard parts. Question No : 71 The primary objective of supply chain management is: A. minimizing transportation costs. B. reducing inventory levels. C. taking a systems approach. D. implementing advanced technologies. Question No : 72 Which of the following strategies is used primarily for demand planning? A. Build-to-order scheduling B. Push-pull replenishment C. Collaborative planning, forecasting, and replenishment D. Vendor-managed inventory Question No : 73 A firm wants to lose customers that don't value the unique products and services the firm offers and to attract and retain customers that want what the firm offers. Engaging in this activity should allow the firm to: A. create a more loyal customer base. B. improve customer satisfaction rates. C. increase market share. D. target higher-profit customers. Question No : 74 Which of the following consequences is a result of shipping directly from the point of manufacture to the customer rather than through a distribution network? A. Delivery lead times are consistent. B. Risk pooling benefits are negated. C. Distribution overhead is increased. D. Order-fill rate is decreased. Question No : 75 Which of the following situations is an example of postponement? A. Shipments are broken down into small groups for reshipment. B. Shipments are consolidated immediately for reshipment. C. Production begins after a customer order is received. D. Partially assembled goods are assembled at a later stage. Question No : 76 Which of the following corporate strategies is most consistent with a flexible supply chain strategy? A. Being the low-price leader B. Providing the highest-quality service C. Providing mature products with stable sales D. Emphasizing the quality of the product Question No : 77 A manufacturer is the leader of a group of trading partners that are collaborating to improve customer service levels and profitability. Which of the following methodologies would be most appropriate for synchronizing supply and demand across the supply chain? A. Sales and operations planning B. Distribution requirements planning C. Supply Chain Operations Reference-model D. Supply chain event management Question No : 78 Which of the following outcomes occurs when direct shipping is used instead of a distribution network? A. Outbound transportation cost is reduced. B. Inventory velocity is reduced. C. Order-fill rates are reduced. D. Inventory obsolescence is reduced. Question No : 79 A company that sells engineered-to-order products is planning implementation of a supplier relationship management system (SRM) for direct materials. Which of the following factors is most likely to make the implementation difficult? A. Complexity of the purchasing process B. Cost of the application software upgrades C. Management of variable lead times D. Resistance of material suppliers Question No : 80 A company wants to implement a system for managing environmental compliance with legislative and regulatory requirements. Which of the following sustainability tools is most appropriate? A. ISO 14000 B. Global Reporting Initiative (GRI) C. ISO 26000 D. UN Global Compact Question No : 81 Inventory parameters established using analytic inventory techniques typically are based on balancing: A. supply and dependent demand. B. customer service and inventory costs. C. transportation and warehousing costs. D. inventory levels and decision-making costs. Question No : 82 A product design that can be produced to requirements even when conditions in the production process are unfavorable typically is known as what type of design? A. Universal B. Computer-aided C. Modular D. Robust Question No : 83 It is most appropriate to measure spending per customer as a proportion of profitability during which of the following phases of a supplier/customer relationship? A. Customer acquisition B. Customer retention C. Customer dependency D. Strategic customer care Question No : 84 The mission of the global reporting initiative (GRI) is to provide a: A. comparison of key metrics for companies in the same industries across the globe. B. feasible business plan that can be shown to global potential investors. C. trusted and credible framework for reports regarding sustainability practices. D. transparent collaboration between non-profit organizations and governments. Question No : 85 Which of the following measures effectively evaluates overall resources in a distribution warehouse? A. Throughput B. Cube utilization C. Filled pallet positions D. Labor efficiency Question No : 86 Potential customers of a company's new product have tight tolerance requirements. The company plans to purchase a critical component. To meet customer requirements, the company should first: A. implement statistical process control for the component. B. bring manufacturing of the critical component in-house. C. develop an alternate source of supply. D. certify the supplier of the component. Question No : 87 Which of the following processes would a company use to evaluate the risk profile for end- of-life planning for a product family? A. Distribution requirements planning B. Sales and operations planning C. Rough-cut capacity planning D. Production activity control Question No : 88 A company that has consistently achieved a high level of on-time delivery performance has decided to reduce its inventory level significantly. Which of the following outcomes is the most likely effect of that decision on the company's on time delivery performance? A. There will be no effect. B. It will decline and then stabilize at a lower level. C. It will improve and then stabilize at a higher level. D. It will decline until sales erode. Question No : 89 Direct shipment distribution typically offers which of the following advantages? A. Risk pooling is facilitated. B. Demand variability is reduced. C. Service levels are increased. D. Lead times are reduced. Question No : 90 A corporation must consider which of the following factors when selecting its enterprise resources planning system? A. Uniqueness of operations B. Corporate profitability C. MRP and MRP II processing D. Industry benchmarks Question No : 91 Benchmarking a firm's performance against industry competitors is most valuable because it can reveal: A. a competitor's manufacturing processes. B. a firm's leadership ranking relative to industry peers. C. which processes require improvement. D. that no further improvement is possible. Question No : 92 The globalization of a supply chain typically increases uncertainty and: A. production lead time. B. local competition. C. documentation complexity. D. product standardization. Question No : 93 Customizing can be an effective warehousing strategy because it allows a company to: A. allocate available storage space to optimize handling costs. B. address trade-offs between space and material handling needs. C. effectively design its inbound and outbound dock areas. D. add value to the product through modification, labeling, and packaging. Question No : 94 The strategy to implement supplier relationship management has been developed. The most appropriate next step is to: A. develop criteria for prospective partners. B. develop policies for alliances. C. select initial partners. D. conduct a pilot implementation. Question No : 95 When doing international business, a company's total line-haul costs will vary with the: A. weight shipped. B. distance shipped. C. pallets shipped. D. volume shipped. Question No : 96 Managing supply chain risks includes which of the following activities? A. Developing alternatives to key suppliers B. Setting aside funds for disruption-recovery efforts C. Charging each supply chain partner a portion of risk cost D. Creating extra inventory to cover disruptions in the supply chain Question No : 97 Which of the following ISO standards is used to assist organizations with sustainable development? A. ISO 31000 B. ISO 14001 C. ISO 26000 D. ISO 9001 Question No : 98 Which of the following statements about the use of bar code labels for product identification in the supply chain is true? A. They have been replaced by radio frequency identification tags. B. They can be read by devices 1 to 3 meters from the item. C. They facilitate the capture of information about the location of items. D. Each of the trading partners must apply a unique label. Question No : 99 Which of the following distribution approaches for a low-volume, high-variety product line typically will result in the highest level of customer service and the lowest total distribution costs? A. Direct shipment from plant to customers B. Shipment from a central distribution warehouse C. Shipment through a multi-echelon distribution network D. Outsourcing the distribution function Question No : 100 When an importer and manufacturer are operating in a free trade zone, payment of a customs duty is triggered when products are: A. returned. B. assembled. C. stored. D. distributed. Question No : 101 The best way to manage a business relationship is to measure performance to: A. cost of ownership metrics. B. quality targets. C. on-time delivery. D. agreed-upon metrics. Question No : 102 The transportation manager at a consumer goods manufacturer has decided to begin shipping full truckload rather than less-than-truckload quantities. Which of the following outcomes is likely following implementation of this decision? A. Inventory levels at the manufacturer will decrease. B. Lead times as seen by the customer will increase. C. Production efficiencies at the manufacturer will increase. D. Transportation costs as seen by the customer will increase. Question No : 103 The most appropriate reason for a business to comply with the United Nations (UN) Global Compact practices typically would be to: A. enhance the competitive advantage. B. gain access to proven management tools. C. reduce the threat of organized labor. D. reduce the cost of operating in multiple countries. Question No : 104 An effective procurement strategy for commodity products should focus on: A. driving down cost and reducing risk. B. spreading purchases equally across suppliers. C. selecting primary and alternate sources. D. selecting suppliers with value-added products. Question No : 105 A company produces and distributes a family of soft drinks in a single country. It has developed and will introduce a new family of soft drinks for weight- and health-conscious individuals. There currently are no competitors with nationwide distribution for this category of soft drinks. Which of the following supply chain strategies would be most appropriate for the two product families? A. Produce both product families to forecast and push through the distribution system. B. Produce both product families only after receipt of a distributor order. C. Produce the current product family to forecast and the new product family to order. D. Produce the current product family to order and the new product family to forecast. Question No : 106 A company's supply chain depends heavily on sourcing from international suppliers. Conditions increasingly threaten supply continuity. Which of the following actions is most appropriate? A. Source from domestic suppliers. B. Conduct a risk assessment. C. Carry additional safety stock. D. Spread logistics across multiple carriers. Question No : 107 Component commonality in manufacturing primarily allows a company to: A. optimize production runs for the components. B. use less-specialized machinery. C. decrease single-minute exchange of die processes. D. increase planning and control. Question No : 108 In an advanced planning system, which of the following modules feeds the master planning module? A. Purchasing planning B. Demand planning C. Distribution planning D. Fulfillment planning Question No : 109 A firm has discovered a product quality issue. What should be the first step in responding to this issue? A. Determine the root cause of the quality issue. B. Separate the non-conforming products. C. Trace the location of the faulty product in the supply chain. D. Replace faulty products when they are returned by the end user. Question No : 110 An increase in the inventory turnover rate for a supply chain typically would indicate that there has been a reduction in: A. prices to the end user. B. supply chain cost of sales. C. the manufacturer's inventory. D. the total supply chain inventory. Question No : 111 Which of the following actions would be most appropriate for an enterprise that has successfully integrated internal supply chain management systems and functions? A. Focusing on reducing setup times B. Implementing a firewall to limit access to supply and demand data C. Working with key suppliers to reduce costs and lead times D. Working with trading partners to reduce channel redundancies Question No : 112 Implementation of supply chain applications based on which of the following technologies is most likely to have the lowest fixed costs? A. Best of breed packages B. One integrated package C. Service-oriented architecture D. Software-as-a-service Question No : 113 When a company undertakes a win-back strategy without considering the profitability of customer accounts, it is neglecting which of the following key elements? A. Loyalty B. Scoring C. Segmentation D. Prospecting Question No : 114 A business is changing from a business to business model to a business to consumer model. Which of the following statements about this supply chain change is true? A. Returns from customers will decrease. B. Number of supplier orders will increase. C. Number of customer orders will increase. D. Average supplier order size will increase. Question No : 115 Which of the following strategies would increase overall supply chain risk? A. Single sourcing a product that makes the highest annual profit B. Outsourcing a product that is not well suited to your operations C. Identify multiple sources for a product that has a potential for supply chain disruption D. Internally manufacturing a product that has a high level of technical intellectual property Question No : 116 In the Supply Chain Operations Reference-model (SCOR), the cash-to-cash cycle time for a manufacturing company is the number of days between which two of the following situations? A. Paying for raw materials and getting paid for the product B. Shipping the product from the warehouse and receiving it at the customer's location C. Paying for raw materials and sending an invoice to the customer D. Billing the customer and getting paid for the product Question No : 117 A toy company decides to buy more products from an overseas company to reduce costs. To make sure that goods clear customs more quickly, the company most likely would engage a: A. consolidator. B. overseas carrier. C. shipping association. D. freight forwarder. Question No : 118 The social dimension of sustainability typically would be addressed when developing and implementing policies regarding: A. accounting practices. B. biodiversity protection. C. conflicts of interest. D. waste reduction. Question No : 119 What is the primary benefit of using a central storage warehouse for all components rather than using point-of-use storage? A. Reduced need for bar codes and radio frequency identification technology B. Reduced material handling costs C. Ease of control and count accuracy D. Maintain a cleaner shop floor Question No : 120 Which of the following activities typically would be an appropriate application of the ISO 31000 Risk Management Principles and Guidelines? A. Calculating a risk index for each facility B. Establishing external risk communications processes C. Projecting the ability of a facility to recover from an event D. Preparing for risk management accreditation Question No : 121 Allowing for organizational restructuring is an example of which of the following steps in creating successful strategic alliances among suppliers? A. Managing multifaceted relationships B. Negotiating a win-win deal C. Planning for change D. Conducting pulse checks Question No : 122 Which of the following actions is in accordance with the Ten Principles in the United Nations (UN) Global Compact? A. Preventing a group of employees from forming a collective bargaining (union) group B. Paying different wages in different parts of the world for a given job classification C. Requiring an individual to pay a fee for consideration in hiring or promotion decisions D. Withholding certain employment opportunities from specific groups of people Question No : 123 A company originally based in Germany sets up companies in India, China, Vietnam, Mexico, and Brazil. It sources most of the raw materials locally and employs the local workforce to manage and produce finished goods. Most of the goods produced are consumed in the same country. The company can be classified as what type of enterprise? A. Globally integrated B. Domestic C. Multinational D. Virtual Question No : 124 Which of the following factors typically is most important in successfully implementing sales and operations planning (S&OP)? A. Involvement of specialists from all functional groups within an organization B. Creation of a dedicated S&OP organizational unit C. Involvement and accountability at senior management level D. Focus on 3 months to 18 months in the future Question No : 125 Which of the following strategies can be used to help manage global risks? A. Direct shipment B. Cross-docking C. Mass customization D. Flexibility Question No : 126 A manufacturer and the distributors of its products have decided to focus on price and product availability as strategic priorities. Which of the following values would be the most appropriate measure of customer service? A. Manufacturer's volume flexibility B. Order-fulfillment lead times C. Distributors' order-fill rates D. Supply chain inventory days of supply Question No : 127 When implementing e-commerce in the supply chain, a company's toughest challenge most likely will be: A. getting all vendors to computerize. B. translating data into universal standards. C. convincing the information technology department of the value. D. explaining the reason for change to customers. Question No : 128 The most important challenge to consider when sourcing globally is: A. the identification of sources capable of producing the materials. B. the availability of low-cost labor and energy. C. complying with specific import/export issues. D. balancing the difference between piece price and total cost. Question No : 129 Distribution from which of the following types of sites enables goods to enter a country, undergo further modification, and then be exported without paying customs duties? A. Public warehouse B. Value-added territory C. Free trade zone D. Customs clearing house Question No : 130 What are the steps in the supplier relationship process? A. Measure, fulfill, document, model B. Source, document, manage C. Measure, procure, fulfill, model D. Source, procure, fulfill, manage Question No : 131 A manufacturer offers a trade-in allowance on a new machine when the customer returns the old machine. The manufacturer reconditions the returned machine locally and then sells it on the used market for a profit. This program is an example of a focus on: A. environmentally sensitive engineering. B. gray box design. C. green manufacturing. D. sustainability in operations. Question No : 132 A manufacturer of consumer packaged goods with a single plant and nine regional distribution centers is considering reducing the number of distribution centers in its system. Reducing the number of distribution centers most likely will reduce fixed warehousing and the cost of: A. storing cycle inventory in the distribution centers. B. storing finished-goods inventory at the manufacturing plants. C. transportation from the distribution centers to the customer. D. transportation from the plant to the distribution centers. Question No : 133 The United Nations Global Compact uses 10 guiding principles to: A. reduce uncertainty for multinational firms regarding legal, import/export, labor, and environmental standards across countries. B. set minimum levels of compliance across a broad range of transactional areas for businesses operating in multiple geographic regions. C. align the needs of businesses to increase profitability and the needs of individual countries to ensure their specific legal requirements are met. D. help ensure that markets, commerce, technology, and finance promote advancement of economies and societies everywhere. Question No : 134 A company that is focused on customer relationship management is most likely to take which of the following actions for customers who have been profitable over time? A. Reduce the cost of serving them. B. Target them for higher margin services. C. Target them for greater attention. D. Charge them for administrative services used. Question No : 135 A company closely monitors supplier performance and notices recent late deliveries from one supplier. The supplier discloses flood damage at the plant. The company quickly shifts sourcing to a new supplier and has minimal loss of sales. Which of the following risk strategies reflects the company's actions? A. Achieving low cost through reaction B. Creating an adaptive supply chain community C. Reducing supply chain vulnerability D. Investing in redundancy Question No : 136 The demand side of a traditional warehouse management system primarily is concerned with: A. receiving incoming goods. B. assigning storage locations. C. assembling outbound orders. D. forecasting product demand. Question No : 137 A company that sells direct to industrial and commercial businesses has become successful by being responsive to the needs of its customers. The company currently produces in each country all of the products it sells in that country. Several countries in which the company operates have negotiated an agreement to establish a trading bloc. Which of the following actions by the company would be most appropriate if the agreement is implemented? A. Consolidate production outside the trading bloc to reduce total costs. B. Consolidate production within the trading bloc to reduce tariffs paid. C. Outsource the production of products with low sales volumes to reallocate capacity. D. Reassign products so that each is produced in a single facility within the trading bloc to get economies of scale. Question No : 138 What is the primary benefit of using modular rather than integral designs? A. Lower cost of manufacturing B. Increased product performance C. Greater responsiveness in marketing and production D. Reduced complexity of bills of material Question No : 139 A company is formally adhering to the principles of the UN Global Compact. After a review of their supply chain, they have found that a key supplier is in violation of the compact. The best action for the company to do first is: A. do nothing. The company is not responsible for compliance of suppliers. B. replace the supplier as soon as possible with a compliant supplier. C. notify the supplier of non-compliance. D. require the supplier to become compliant. Question No : 140 A company currently produces custom goods for a limited market. To increase market share, the company will implement a strategy to reduce the number of products it produces and reduce delivery lead time. The company can increase its chances of achieving the strategy by: A. using benchmark data for products in the same product groups. B. incorporating results from market surveys. C. involving customers in the product design process. D. using electronic communications to receive customer complaints. Question No : 141 A firm is undertaking a revision of its financial metrics to make them more comprehensive and has decided to use metrics such as return on investment (ROI), return on assets (ROA), and economic value added (EVA). This is an example of utilizing which of the following types of metrics? A. Activity based B. Stakeholder focused C. Financial sustainability D. Value chain Question No : 142 The process used to determine the impact of promotions, price discounts, and rebates on demand forecasts commonly is referred to as demand: A. planning. B. forecasting. C. aggregating. D. shaping. Question No : 143 Bar codes and radio frequency identification systems are key technologies in supply chain systems because they perform which of the following functions? A. Tracking truck locations on cross-country deliveries B. Facilitating timely and accurate data acquisition C. Providing paperless invoicing of goods D. Producing schedule broadcasts for suppliers Question No : 144 A company most likely would consider moving a portion of its manufacturing to a second location to: A. improve competitive advantage through cost control. B. avoid manufacturing downtime due to material shortages. C. maximize security for customer shipments. D. minimize the impact of natural disasters. Question No : 145 The customer who provides point-of-sale data remains the sole decision-maker regarding order quantities when what type of inventory strategy is used? A. Continuous replenishment B. Advanced continuous replenishment C. Vendor-managed replenishment D. Quick response Question No : 146 Which of the following actions is most likely to increase total supply chain risk? A. Standardizing components used in a product family B. Expanding operations to multiple locations C. Consolidating manufacturing locations D. Reducing the supplier base for commodity-type components Question No : 147 Which of the following warehousing tools enables wireless scanning of products? A. Magnetic stripes B. Universal product codes C. Radio frequency devices D. Local area network Question No : 148 A company's product cannot be sold beyond 12 months from the date of manufacture. The product contains hazardous material and must be returned to the factory to be neutralized. This situation is an example of product: A. reuse. B. remanufacturing. C. recovery. D. refurbishing. Question No : 149 A company ships from its manufacturing facilities directly to its warehouses. If the number of warehouses increases, transportation costs between manufacturing facilities and warehouses most likely will: A. increase. B. decrease. C. not change. D. become less predictable. Question No : 150 The most common method for coping with demand variability in the manufacture of products with a lengthy cycle time is to have: A. higher raw material inventory. B. higher finished-goods inventory. C. lower finished-goods inventory. D. lower raw material inventory. Question No : 151 Which of the following export documents is used as the basis for the valuation of goods for insurance purposes and for assessment of duties? A. Export license B. Export declaration C. Bill of lading D. Commercial invoice Question No : 152 What are the three principle categories of forecasting methods? A. Seasonal, trend, and promotional events B. Moving average, exponential smoothing, and Holt-Winters C. Qualitative, extrinsic, and intrinsic D. Annual, monthly, and daily requirements Question No : 153 Market segmentation is important within the logistics function because it: A. leads to profitable exchanges with the customer and creates intrinsic customer value B. supports transactional marketing priorities for successful commodity exchanges to customers globally C. enables companies to position their products throughout the distributor network based on customer need D. creates perception in the mind of the customer as available products and services are exchanged Question No : 154 The employees at a convenience store are trained to ask customers purchasing snack foods whether they also would like to purchase a beverage. This situation is an example of: A. cross-selling. B. customer service. C. product marketing. D. selling an upgrade. Question No : 155 A company most likely would implement a supplier certification program to: A. improve the supplier's procurement process. B. abide by ISO standards. C. validate the supplier's compliance with requirements. D. implement point-of-sale (POS) terminals. Question No : 156 A company develops annual forecasts for key products and enters into annual contracts with key suppliers based on the forecasts. Which of the following benefits would the company most likely receive from this approach? A. Shorter delivery lead times B. Lower prices C. Improved service D. Higher-quality products Question No : 157 Which of the following activities occurs as part of the sales and operations planning process? A. Time fences are matched to master production schedule horizons. B. The next quarter's forecasts are presented by sales staff to finance and operations personnel at the final meeting. C. Strategic plans are adjusted based on changing operating situations. D. Plans are converted to financial projections and capacity requirements. Question No : 158 The benefit most likely to result from a collaborative forecasting process is: A. improvement in forecast accuracy. B. improvement in forecast responsiveness. C. reduction of the coefficient of variation. D. reduction of forecasting effort. Question No : 159 A company that is having difficulties prioritizing resources against a long list of improvement projects should use which of the following processes? A. Control chart B. Competitive benchmarking C. Pareto analysis D. Six Sigma Question No : 160 An office furniture manufacturer observed that customers preferred to configure desks based on their available office space. To keep product costs to a minimum, yet satisfy customer needs, the company should choose which of the following design strategies? A. Modularity B. Component commonality C. Mass customization D. Standardization Question No : 161 An advanced planning system differs primarily from enterprise resources planning by: A. optimizing operations scheduling. B. translating plans into action. C. concentrating on production. D. linking to the transportation management system. Question No : 162 In order to optimize delivery routing and load planning as well as to provide advanced shipment notifications (ASN's), which of the following technology platforms should be implemented to plan and manage the above operations? A. Electronic Date Interchange (EDI) B. Enterprise Resource Planning (ERP) C. Event Management System (EMS) D. Transportation Management System (TMS) Question No : 163 Which of the following factors is the most appropriate measure of delivery performance for finished goods? A. Perfect order fulfillment B. On-time delivery C. Load efficiency D. Available-to-promise Question No : 164 Which of the following statements indicates an attribute of international commercial terms (Incoterms)? A. They are required contract terms for international trade. B. Each term implies the responsibilities of the buyer and seller. C. Discounts and surcharges are identified by the terms. D. The terms are reviewed annually by the International Chamber of Commerce. Question No : 165 A key assumption of the economic order quantity (EOQ) is that: A. future demand cannot be projected. B. the rate of demand is continuous and constant. C. reorder frequency is fixed. D. as the lot size decreases, the setup cost per unit decreases. Question No : 166 A company has an asset turnover ratio of 1.8, inventory of $3,000, a 20% profit margin, and $5,000 in total assets. What is the total sales volume for the company? A. $ 5,400 B. $ 9,000 C. $15,000 D. $25,000 Question No : 167 A company uses cash-to-cash cycle time to assess how long it takes from: A. receiving inventory from the supplier to paying the invoice from the supplier. B. receiving inventory from the supplier to invoicing the customer. C. paying the supplier for inventory received to receiving payment from the customer. D. invoicing a customer to receiving payment from the customer. Question No : 168 Which of the following strategies is most appropriate for managing unknown risks in a global supply chain? A. Vertical integration B. Technology integration with suppliers C. Investing in redundancy D. Strengthening supplier relationships Question No : 169 A master production schedule serves a company best by functioning as a: A. dispatch list. B. forecast system buffer. C. priority planning tool. D. supplier scheduling system. Question No : 170 Which of the following supply chain strategies should be chosen if the lead-time for a product is long and the demand is not predictable? A. Inventory positioning B. Pull replenishment C. Continuous replenishment D. Push system Question No : 171 Which two of the following tools should be used with an enterprise resources planning system to build realistic supply chain models and to plan the most profitable flow of goods across the chain? A. An advanced planning and scheduling system and simulators B. An inventory planning and management system and simulators C. A vendor managed inventory system and customer relationship management D. Customer activity planning and logistics management Question No : 172 To ensure a successful relationship, trading partners must adapt their organizations to leverage advantages found in cross-supply-chain collaboration because: A. customers and suppliers are not interactive. B. cross-functional support can be offered only by the central source. C. all entities are collectively responsible for growth of revenue and profits. D. risks in supplier/customer negotiations are reduced. Question No : 173 A company that manufactures complex mechanical assemblies to customer order and ships them directly to the customer is implementing manufacturing cells. The benefit most likely to result from this effort is a reduction in the: A. number of component shortages. B. production planning horizon. C. time to fill customer orders. D. response time to a request for quote. Question No : 174 Outsourcing is most appropriate when a product is: A. modular and independent of knowledge and capacity. B. modular and dependent on knowledge and capacity. C. integral and independent of knowledge and capacity. D. integral and dependent on knowledge and capacity. Question No : 175 Top management typically plans an organization's long-term future by isolating new opportunities and threats and identifying growth objectives during the process known as: A. resource planning. B. sales and operations planning. C. corporate strategizing. D. financial planning. Question No : 176 Which of the following actions by trading partners is most likely to reduce the goods that will be processed by the reverse supply chain? A. Contracting with a third party to process returned goods B. Designing products that are easy to disassemble C. Working to delay regulations that require accepting returns D. Providing support and service that meet customer needs Question No : 177 Compared to the traditional enterprise resources planning (ERP) system, an electronic business system (EBS) is preferred for today's e-business solution because EBS: A. is more flexible and functional. B. is the backbone of outsourcing services. C. has converged with Web-based applications to form a grouping of business software functions. D. encompasses e-procurement as a traditional purchasing function. Question No : 178 A firm has captured the following information for a product family: The cash-to-cash cycle time is how many days? A. 41 B. 44 C. 62 D. 74 Question No : 179 A company is considering relocating production to a lower-wage country. Volatility in which of the following areas most likely would impact profitability without modifying product landed costs? A. Labor costs B. Currency exchange rates C. Commodity prices D. Product quality Question No : 180 A company exports products to emerging markets. Which of the following approaches would be used to enhance compliance, minimize risks, and connect supply chain activities? A. Logistics network planning B. Distribution requirements planning C. Supply chain event management D. Global trade management Question No : 181 A company discovers that several high-volume customers have very erratic ordering patterns. Which of the following actions is most likely to reduce variability? A. Checking the demand status multiple times daily B. Establishing Internet-enabled collaborative relationships C. Implementing electronic data interchange transactions D. Increasing safety-stock levels for items these customers order Question No : 182 When profit impact is high and supply risk is low for an item, which of the following procurement strategies is most likely to be effective and successful? A. Leveraging purchasing power B. Forming a long-term partnership C. Automating the procurement process D. Ensuring continuous supply Question No : 183 On-time delivery performance in the supply chain can best be improved by aligning required capacity with what type of capacity? A. Demonstrated B. Rated C. Budgeted D. Theoretical Question No : 184 Point-of-sale information fails to measure actual demand most likely because: A. holidays interrupt typical sales patterns. B. inventory levels are inaccurate. C. there is lag time in the system. D. data about lost sales cannot be captured. Question No : 185 A company may reduce its amount of safety stock by: A. substituting information for inventory. B. increasing the number of retailers. C. increasing the number of producers. D. changing to a push system. Question No : 186 A manufacturer has direct relationships with its tier 1 suppliers. Which of the following supplier capabilities is a benefit to the manufacturer establishing a direct relationship with lower-tier suppliers? A. Provides smaller lot sizes B. Provides components with short lead times C. Provides Just in Time deliveries D. Provides information about impending shifts in the economy Question No : 187 Pull strategy typically would be the most appropriate strategy when customer demand uncertainty is: A. high, and supplier lead time is long. B. high, and supplier lead time is short. C. low, and supplier lead time is long. D. low, and supplier lead time is short. Question No : 188 Variation in upstream requirements can be reduced by increasing: A. demand visibility. B. production capacity. C. product features. D. safety stock. Question No : 189 Which of the following outcomes is an expected benefit of effectively implementing supply chain event management software? A. Inventory data are captured in real time. B. Files are transferred from one corporation to another. C. Notifications of variances from plans are triggered. D. Communication protocols between companies are standardized. Question No : 190 A company plans to benchmark its shipping reliability compared to other companies in the industry. Which measurement is most appropriate to benchmark in this case? A. Perfect order fulfillment B. Upside supply chain flexibility C. Order fulfillment cycle time D. Total inventory days of supply Question No : 191 A company understates current revenue forecasts and delays the delivery of orders to meet the forecast. The most likely result of this practice is that shipments will peak: A. at the beginning of reporting periods. B. randomly throughout reporting periods. C. at both the beginning and end of reporting periods. D. at the end of reporting periods. Question No : 192 A firm decides to reduce the number of distribution centers it uses. Which of the following outcomes is the most likely result of this change? A. Order-fill rate will increase. B. Total safety stock will increase. C. Delivery lead time will decrease. D. Outbound transportation cost will decrease. Question No : 193 If a firm has 35 days of accounts payable outstanding and 55 days invested in inventory, and its cash-to- cash cycle time is 90 days, what is the number of days of accounts receivable? A. 70 B. 90 C. 110 D. 180 Question No : 194 A company operates under a make-to-order policy, and its supplier operates under a make- to-stock policy. Which of the following risks poses the greatest threat? A. Inventory risk for the company B. Inventory risk for the supplier C. Debt leverage risk for the company D. Debt leverage risk for the supplier Question No : 195 Which of the following variables is the most appropriate customer-facing goal used to determine the target inventory level? A. Inventory turns B. Level of service C. Total delivery cost D. Delivery lead time Question No : 196 A firm has identified key benefits for developing a strategic alliance and has selected appropriate supply chain partners. Which of the following actions should the firm take to build a successful alliance with a supplier who is also a competitor? A. Establish an internal committee to limit shared information. B. Negotiate contracts that maximize the firm's profits. C. Instruct employees to ignore the competitive aspect of the relationship. D. Encourage employees to cooperate with the supplier. Question No : 197 A company has outsourced a high volume of assembly work to top-tier suppliers, thereby reducing the overall number of suppliers they directly manage. Which of the following actions must the company perform to mitigate risk? A. Monitor lead times at sub-tier suppliers B. Maintain direct relationships with sub-tier suppliers C. Execute all terms of contracts at sub-tier suppliers D. Purchase all critical components for assembly at the company Question No : 198 Which of the following processes ensures that functional plans are consistent? A. Strategic planning B. Sales and operations planning C. Project planning D. Master scheduling Question No : 199 Which of the following conditions are most indicative of a company that is effectively managing its cash? A. Low accounts receivable, low inventory, high accounts payable B. High accounts receivable, low inventory, high accounts payable C. Low accounts receivable , high inventory, low accounts payable D. High accounts receivable, high inventory, low accounts payable Question No : 200 Which of the following actions is most likely to improve customer perceptions about delivery performance provided by a firm? A. Shipping orders early whenever possible B. Increasing the order-fill rate C. Increasing inventory velocity for key products D. Implementing a pull inventory replenishment system Question No : 201 In determining warehouse velocity, the average inventory level is calculated by dividing the annual sales through the warehouse by the: A. total square footage of the warehouse. B. inventory turnover rates for the warehouse. C. annual weight through the warehouse. D. annual cube through the warehouse. Question No : 202 An operations manager wants to measure variability in the delivery time of insurance policies to clients. Which of the following quality tools most appropriately would show the level of variability? A. Pareto chart B. Histogram C. Scatterplot D. Check sheet Question No : 203 Which of the following actions best exemplifies an appropriate demand management strategy? A. Reducing costs in the procurement of goods B. Prioritizing demand when supply is constrained C. Maximizing sales orders from customers D. Updating the sales and operations planning (S&OP) to changes in production capacity Question No : 204 A company produces to stock and sells its products to distributors. The factor that most likely will contribute to the risk of loss in inventory investment is the: A. accuracy of demand forecasts. B. replenishment lead time. C. level of product quality. D. variability in supply. Question No : 205 Which of the following activities typically is included in a warehouse management system? A. Invoicing B. Freight-bill auditing C. Order processing D. Vehicle routing Question No : 206 A supplier has decided to improve its forecast accuracy by reducing the information lead time from the retailer. Which of the following actions would be most appropriate to achieve the desired result? A. Eliminating sales and promotions B. Decentralizing demand information C. Reducing its quoted lead time D. Utilizing electronic data interchange Question No : 207 Which of the following characteristics typically is a feature of supplier relationship management? A. Supplier employees are located at the firm's facilities. B. Inventory is verified before the supplier ships the goods. C. Performance of both firms is measured and reported regularly. D. The supplier is the sole source for the goods. Question No : 208 Which of the following activities is critical to successful synchronization of supply and demand throughout a supply chain? A. Sharing demand information B. Placing large orders to obtain lower prices C. Reducing the number of deliveries D. Maintaining increased inventories Question No : 209 Organizations that change from a traditional purchasing perspective to a supply chain perspective most likely will adopt techniques related to: A. product pricing. B. value stream analysis. C. centralized decision making. D. sourcing multiple suppliers. Question No : 210 Which of the following benefits should a supplier expect to receive by becoming a certified supplier? A. Reduction in redundant processes with buyer B. Increase in price of items sold C. Increase in access to competitive information D. Reduction in number of items utilizing vendor-managed inventory Question No : 211 Which of the following factors is most important to consider when deciding on offshore outsourcing of manufacturing to a supplier? A. Size of the supplier organization B. Total cost of ownership C. Supplier performance history D. Supplier certification Question No : 212 Value stream mapping is a useful tool primarily because it: A. redefines supply chain relationships. B. is completed in 1 or 2 days. C. is used to improve efficiency in a specific area. D. looks at the entire supply chain rather than an isolated process. Question No : 213 Which of the following activities is the most appropriate use of an advanced planning and scheduling system? A. Selecting the target market for a product B. Optimizing transportation routes C. Creating a daily demand forecast D. Identifying constraints within a facility Question No : 214 Which of the following outcomes is most likely a result of allocating excess capacity to a supply chain facility? A. Lower utilization which leads to higher cost B. Higher utilization which leads to higher cost C. Higher utilization which leads to lower cost D. Lower utilization which leads to lower cost Question No : 215 Which of the following outcomes most likely is the primary reason for outsourcing production of a new product? A. Increase control of the supply chain B. Increase flexibility of the supply chain C. Reduce required capital investment D. Reduce the need for skilled workers Question No : 216 The primary risk that must be considered when lean practices are applied to a supply chain network is: A. decreased operations flexibility. B. decreased inventory availability. C. increased total ordering costs. D. increased customer returns. Question No : 217 Standardization of supply chain processes is most likely to facilitate achievement of which of the following activities? A. Reducing the total cost of ownership B. Tracking the effects of improvement initiatives C. Creating project consensus D. Understanding of operational metrics Question No : 218 The make-to-stock model is an effective inventory strategy when the product: A. has a long manufacturing lead time. B. has a limited set of features. C. is designed by the customer. D. is frequently out of stock. Question No : 219 Which of the following tools is most appropriate to use to determine projects that will achieve the greatest net benefits? A. Pareto diagram B. Fishbone diagram C. Process flow diagram D. Operation process chart Question No : 220 When trying to decide whether to outsource its customer relationship management function, a company primarily should consider which of the following factors? A. Location of the service provider B. Internal controls of the company C. Compatibility of computer hardware D. Transaction costs Question No : 221 Which of the following strategies typically will require the lowest inventory investment and deliver the shortest lead time? A. Producing finished goods to forecast and shipping directly to customers B. Producing finished goods to forecast and distributing through a multi-echelon network C. Producing subassemblies to forecast and doing final assembly and shipping from the factory D. Producing subassemblies to forecast and doing final assembly and shipping from regional centers Question No : 222 A manufacturer of fast-moving consumer goods wants to implement a process improvement method to increase flexibility and decrease the risk of obsolete inventory. Which of the following approaches is most likely to help reach these goals? A. Lean manufacturing B. Advanced planning and scheduling C. Six sigma D. Total quality management Question No : 223 A large, global third party logistics provider (3PL) is contemplating the switch to the use of ethanol- based fuel in its truck fleet and wants to identify the impact of this change on food prices. Which of the following attributes of the triple bottom line (TBL) are part of this trade off decision? A. Organizational, financial and social B. Social, financial and environmental C. Social, environmental and organizational D. Organizational, financial and environmental Question No : 224 Which of the following tools is most important in developing strategic sourcing? A. Price break analysis B. Network analysis C. Blanket purchase order D. Spend analysis Question No : 225 The relative speed at which all transactions within the supply chain process occur is known as: A. the cycle time. B. velocity. C. latency. D. throughput. Question No : 226 A primary reason for enhancing supply chain security is to: A. meet government requirements. B. reduce insurance costs. C. improve lead time. D. protect brand image. Question No : 227 A company that locates manufacturing facilities in different countries so that an economic downturn in one country most likely will be offset by business in another country is employing what type of strategy? A. Speculative B. Hedge C. Flexible D. Forecast Question No : 228 The theory of constraints (TOC) works best in an environment where the: A. product mix for the operation changes daily. B. constraint cannot be easily managed. C. constraint cannot be easily identified. D. constraint persists long enough to be managed effectively. Question No : 229 An organization is partnering with a supplier. The most appropriate tool to ensure that the supplier has the necessary capabilities is: A. a supplier-input-process-output-customer diagram. B. supplier certification. C. supplier relationship management. D. supplier performance evaluation. Question No : 230 What is the appropriate supply chain strategy for a product with low demand uncertainty and high economies of scale? A. Pull B. Push C. Push-pull D. Postponement Question No : 231 Which of the following tradeoffs should be considered when selecting logistics options? A. Safety stock levels and customer service levels B. Inventory levels and scheduling operations C. Transportation cost and speed of delivery D. Centralized and decentralized distribution network Question No : 232 Variability in product design can best be reduced by: A. initiating 100% product inspection. B. outsourcing the design process. C. broadening design specifications. D. applying Six Sigma principles. Question No : 233 Which of the following supplier performance factors typically is most critical for organizations that outsource production? A. Speed B. Reliability C. Flexibility D. Malfunction recovery Question No : 234 A company recently implemented a new supplier rating system. Data was collected from the enterprise resources planning system about each vendor's rating for cost, quality, and delivery over 12 months. A cutoff point was established for poor performers. The responsible purchasing agent then scheduled meetings with each supplier. Which of the following actions is most appropriate to take with suppliers whose ratings were below the cutoff point? A. Discuss ways to raise the ratings for the next review period. B. Tell the suppliers they are on probation for 3 months. C. Immediately cancel outstanding contracts with those suppliers. D. Ask the suppliers to explain the poor performance. Question No : 235 The most appropriate frequency for the sales and operations planning process typically is: A. weekly. B. monthly. C. quarterly. D. annually. Question No : 236 Incorporating information technology into its supply chain allows a company to efficiently: A. collect, store, encode, process, analyze, transmit, receive, and print data. B. manage order entry, scheduling, warehousing, and order tracking. C. incorporate elements of Six Sigma into supplier relationships. D. upgrade enterprise resources planning revisions in a timely and secure manner. Question No : 237 A company has limited visibility of global customer sales. Which of the following methods is the most appropriate way to sense and respond to customer demand? A. Point of sale B. Sales and operations planning C. Demand-driven supply network D. Customer relationship management Question No : 238 Which of the following constituents typically must provide information first to effectively improve supply chain design? A. Supplier B. Distribution system C. Manufacturing D. Customer Question No : 239 A firm experiences a supply chain interruption from a second-tier supplier. Which of the following actions is the firm likely to take to minimize future interruptions? A. Require the supplier to submit weekly cycle count reports. B. Require the supplier to implement a sales and operations planning process. C. Map the supplier's supply chain to identify risks and opportunities. D. Conduct an ISO 14001 audit of the supplier. Question No : 240 Which of the following outcomes is an advantage of automating the request-for-quote process? A. Reducing cycle time B. Disposing of excess inventories C. Centralization of product service content D. Enabling contract management Question No : 241 Which of the following factors should be considered when establishing an inventory policy? A. Customer demand B. Selling price history C. Historical service levels D. Number of customers Question No : 242 Which of the following measures typically would be considered an aspect of the environmental impact of a supply chain? A. Amount of funds invested in infrastructure improvements B. Hours of employee education about environmental stewardship C. Weight and volume of packaging materials used D. Total number of people making a living wage Question No : 243 Which of the following circumstances best describes a roadblock to implementing customer relationship management and supplier relationship management? A. Concern about conflicts of interest with partners in the supply chain B. Lack of defined industry standards C. Deterioration of customer service levels D. Increased access to information for supply chain partners Question No : 244 A common benefit of including an automatic identification system (AIS) at the point of sale (POS) in retail stores is improved: A. shipment traceability. B. unit inventory precision. C. sales revenue tracking. D. information integrity of freight bills. Question No : 245 A supply chain visibility application helps an organization by: A. planning raw material requirements. B. removing outliers from independent demand forecasts. C. providing flexibility in customer delivery locations. D. providing comprehensive information from any point of contact. Question No : 246 Which of the following metrics would be most appropriate for a group of trading partners that is trying to gain competitive advantage through supply chain reliability? A. Cash-to-cash cycle time B. Supply chain response time C. Order-fill rate performance D. Value-added productivity per employee Question No : 247 Which of the following fill rates is the most rigorous measure of a firm's availability performance? A. Line B. Item C. Order D. Value Question No : 248 A manufacturer of consumer goods has purchased one of its distributors. The distributor's inventory system is archaic and will not integrate into the manufacturer's enterprise resources planning (ERP) system. Which of the following approaches is the most appropriate long-term solution for the manufacturer? A. Buy a complete ERP system that includes seamlessly integrated distribution. B. Buy a warehouse management system that integrates into the ERP system. C. Run the existing warehouse inventory system and update the ERP system manually. D. Hire a software contractor to write an interface with batch update to the ERP system. Question No : 249 Which of the following methodologies is most appropriate to use to drive continuous improvement? A. Define-measure-analyze-improve-control process B. Kanban C. Poka-yoke D. Pareto analysis Question No : 250 Which of the following factors are fundamental to transportation performance? A. Full truck loads, maintenance, discounts B. Quality, Just-in-Time, invoicing C. Contract performance, order tracking, flexibility D. Cost, speed, delivery consistency Question No : 251 Which of the following issues recently has caused companies to rethink implementation or continued use of a Just-in-Time system? A. The upward trend in inventory carrying costs B. The reduced number of potential suppliers C. The elimination of billing documents D. Higher transportation costs Question No : 252 A supplier disputes a low rating generated by a company's enterprise resources planning (ERP) system. Which of the following actions by the purchasing agent is most appropriate? A. Advise the ERP information technology manager that there is a flaw in the rating system. B. Scrap the vendor rating system until the company can figure out what is wrong. C. Compare the vendor and company detail records, and interview company employees who handled the data. D. Tell the supplier that, regardless of the disputed claims, the supplier must improve performance. Question No : 253 Measurement of service to the customer should consider which of the following strategic priorities? A. Cash flow B. Responsiveness C. Order cycle time D. Forecast accuracy Question No : 254 The practice of purchasing items in large quantities and requesting that shipments be delivered directly to customers is referred to as: A. drop shipping. B. cross-docking. C. breaking bulk. D. freight equalization. Question No : 255 Prioritizing customer needs is best accomplished by: A. sharing information with key customers. B. installing a new enterprise resources planning system. C. responding to customer requests in the order they are received. D. establishing policies and procedures for honoring customer requests. Question No : 256 Some firms that have licensed other companies to manufacture their products run the risk of: A. losing market share. B. the other companies becoming competitors. C. the products becoming a commodity. D. the products being overpriced. Question No : 257 A service company has decided to create a customer-focused business and has identified the following steps in the process: 1. Analyze information to reach the root cause 2. Measure Existing performance 3. Monitor the process until solution becomes ingrained 4. Define/Determine the nature of problem 5. Improve the process Which of the following sequences of steps is correct for implementing the company's decision? A. 2, 1, 4, 3, 5 B. 4, 2, 1, 5, 3 C. 3, 5, 2, 4, 1 D. 4, 2, 5, 1, 3 Question No : 258 A manufacturer experiences frequent changes in product technology and market preferences, resulting in new product introductions each year. Which of the following sourcing strategies would be most appropriate? A. Sole sourcing B. Multiple sourcing C. Long-term contracting D. Strategic partnering Question No : 259 A manufacturer is the sole supplier of a product family. It sells to regional distributors that sell to retailers. The manufacturer uses batch production processes that have long setup times. All nodes in the supply chain have agreed to pursue a quick response to changes in the level of demand as a competitive priority. Which of the following factors is most likely to hinder their pursuit of this competitive priority? A. Information technology standards B. Information sharing practices C. Contractual terms and conditions D. Manufacturing lot sizes Question No : 260 Which of the following situations is a consequence of global operations? A. Decreased logistic cost B. Increased logistic complexity C. Reduced product variety D. Longer lead times Question No : 261 The lowest-cost supply network design requires balancing inventory costs and which of the following types of costs? A. Administrative B. Manufacturing C. Transportation D. Sales and marketing Question No : 262 A firm expands distribution of its products into additional countries. Some customers initiate order batching, which could lead to which of the following outcomes? A. Bullwhip effect B. Price fluctuations C. Rationing D. Better forecasting Question No : 263 Companies interested in developing programs to pinpoint customer loyalty rely on customer relationship management tools that produce which of the following outputs? A. Transaction management B. Forecast, process, and information sharing C. Churn analysis and prediction D. Event and service management Question No : 264 Which of the following objectives is the primary driver in the design and implementation of lean process management? A. Reducing the level of inventory B. Decreasing the cash-to-cash cycle C. Integrating processes between departments D. Satisfying customer requirements Question No : 265 Which of the following techniques allows users to automate the notification of appropriate parties when exceptions to specific business rules occur? A. Enterprise resources planning B. Supply chain event management C. Advanced planning and scheduling D. Automatic identification and data capture Question No : 266 The use of kanban for item replenishment by external suppliers requires: A. accurate long-term forecasts. B. returnable plastic containers. C. close communication about component usage. D. a process for the reverse supply chain. Question No : 267 Which of the following actions by a group of trading partners is most likely to improve the flow of funds among them? A. Increasing the level of information sharing and collaboration B. Negotiating a single set of terms for the trading partners C. Reducing the time allowed for the timely payment discount D. Implementing links among their information systems Question No : 268 The primary reason to establish a customer-dedicated warehouse is to: A. integrate and consolidate an assortment of inventory. B. position inventory to improve response time. C. balance inventory with consumption. D. equalize inbound and outbound logistics costs. Question No : 269 Which of the following changes often leads to higher levels of inventory? A. Decrease in customer service level B. Decrease in vendor lead times C. Increase in economies of scale D. Increase in warehouse holding costs Question No : 270 A procurement manager wants to reduce costs on commodity items. Which of the following actions is likely to result in the greatest savings? A. Conducting a supplier review and recertification B. Renegotiating contracts with commodity suppliers C. Standardizing and eliminating redundant items D. Leveraging group purchasing power Question No : 271 A typical advantage of a production outsourcing strategy for a company focusing on agility as a competitive priority is that: A. monitoring costs are decreased. B. production lead time is increased. C. product quality is increased. D. product introduction time is decreased. Question No : 272 A retailer wants to partner with its suppliers to implement automatic replenishment of inventories and joint sales forecasts. Which of the following supply chain management technologies most likely would support the retailer's strategy? A. Advanced planning and scheduling B. Collaborative planning, forecasting, and replenishment C. Supplier relationship management applications D. Radio frequency identification (RFID) tags Question No : 273 Which of the following statements describes a continuous replenishment strategy in a retail environment? A. Retailers make replenishment decisions. B. Retailers prepare individual orders and share sales data with vendors to improve customer service. C. Vendors use sales data and prepare shipments to maintain the desired level of inventory. D. Vendors take full control of inventory policy. Question No : 274 Which of the following behaviors is appropriate for a progressive company that is responding to changes in its supply chain? A. Pursuing cost reduction continuously B. Developing multiple supply chains for different product lines C. Ensuring demand before committing to a change in the supply chain D. Designing products for maximum lifetime Question No : 275 Marketing affects supply chain management decisions primarily by its involvement in: A. analyzing economic indicators. B. pricing, placing, and promoting products. C. determining product requirements. D. determining forecast error. Question No : 276 A company handling sale of product discarded by consumers is what type of provider? A. Third party logistics (3PL) B. Reverse logistics C. Fourth party logistics (4PL) D. Warehousing Question No : 277 Turning the request-for-quotes process into a real-time auction setting most likely will: A. improve product quality. B. increase process costs. C. reduce cycle time. D. reduce bid cost. Question No : 278 E-business allows a firm to capitalize on the use of systems that: A. speed the receipt of e-mails between companies. B. permit real-time use of supply chain data. C. permit the use of batch-processed data. D. ensure security of proprietary data. Question No : 279 A supervisor knows that employees have good ideas for improving department operations but are hesitant to share them. Which of the following tools would be most appropriate for encouraging the employees to participate in identifying opportunities? A. Tree diagram B. Pareto chart C. Process map D. Affinity diagram Question No : 280 Which of the following technologies directly enables pulling products through the supply chain? A. Automatic identification system (AIS) B. Point of sale (POS) system C. Customer relationship management (CRM) D. Supply chain event management (SCEM) Question No : 281 Which of the following attributes is an example of both supply and operational risk? A. Quality B. Order quantities C. Robust processes D. Product mix Question No : 282 The primary focus of lean manufacturing is: A. eliminating activities that do not add value. B. reducing inventory levels. C. optimizing production activities. D. maximizing the output of constraints. Question No : 283 The primary contribution from an enterprise resources planning system in building supply chain capability is: A. real-time manufacturing planning. B. improved decision making. C. ease of implementation. D. timely order tracking. Question No : 284 Which of the following costs is an example of ordering cost? A. Inspection labor B. Obsolescence C. Cost of capital invested D. Insurance Question No : 285 A company uses multiple ingredients to make a product that is sold in multiple countries. Each country requires country-specific labels. A third-party supplier provides the country- specific labels. The most appropriate push-pull interface is: A. raw materials to product. B. product to labels. C. finished product with labels. D. customer to finished product. Question No : 286 A manufacturer with operations in an area prone to natural disasters is reviewing its sustainability strategy. Which of the following production strategies should the company implement to reduce the risk of supply interruptions? A. Centralized B. Decentralized C. Make-to-order D. Engineer-to-order Question No : 287 Which of the following statements best identifies the value of using a supplier rating system? A. It provides an objective means for a company to determine outstanding suppliers. B. It allows customers to post chargebacks to suppliers. C. It offers a company an effective way to control suppliers' delivery processes. D. It ensures that all suppliers are using the same quality standards to manufacture products. Question No : 288 Which of the following characteristics is typical of a highly complex product when compared with a simple commodity product? A. Lower product cost B. Longer cycle time C. Increased ability to change D. Lower profitability Question No : 289 A disadvantage of capable-to-promise (CTP) when compared to available-to-promise (ATP) is: A. the loss of potential sales based on earlier allocations. B. it does not include inventory levels. C. it requires the purchase of additional equipment. D. it requires more complex calculations. Question No : 290 Qualitative forecasting methods are most appropriate for projecting demand for: A. commodity products. B. families of products. C. breakthrough products. D. raw materials. Question No : 291 The profit margin for a product that is currently made in the company's facility has decreased during the past 2 years. Which of the following factors should be considered when deciding whether to make or buy the product? A. Production capabilities B. Transportation capabilities C. Distribution channels D. Landed cost Question No : 292 ABC Corporation is implementing a website that connects clothing distributors and retailers with many different garment manufacturers from whom they can buy finished goods. This website would be an example of: A. virtual auction site. B. intranet commerce. C. a vertical exchange. D. an Internet storefront. Question No : 293 Effective sales and operation planning (S&OP) is most likely to result in which of the following benefits? A. Better customer service B. Better product quality C. Lower product cost D. Lower work-in-process (WIP) inventory Question No : 294 One operation in a four-stage process has been producing more than required and is causing elevated levels of work in process. Which of the following approaches would be most appropriate to address the situation? A. Kano B. Kanban C. Kaizen D. Keiretsu Question No : 295 Which of the following steps is first in developing a product differentiation strategy? A. Study customer needs B. Define customer segments C. Determine design modifications D. Establish competitive priorities Question No : 296 A large retailer has negotiated buyback contracts with several suppliers. The suppliers typically will need which of the following systems to effectively implement the contracts? A. Point-of-sale tracking B. Well-developed reverse logistics C. Monitoring the retailer's revenue D. Sales incentives to reward the retailer Question No : 297 What benefit does Radio Frequency Identification (RFID) technology provide for a high- volume, low- cost manufacturer? A. Reduces store thefts B. Eliminates the effects of bullwhip C. Eliminates stock out at store level D. Reduces number of touch points in pallet handling Question No : 298 Which of the following performance indicators can be used to measure the effectiveness of a vendor- managed inventory program? A. Number of inventory receipts B. Inventory usage C. Inventory returns D. In-stock rate Question No : 299 A project team has received 30 improvement ideas from subject matter experts in the business. Which of the following continuous improvement tools would be most appropriate to use to sequence implementation timing based on an agreed-upon weighted criteria? A. Affinity diagram B. Matrix diagram C. Prioritization matrix D. Interrelationship digraph Question No : 300 A company used Global Reporting Initiative guidelines to complete a self-assessment. Which of the following actions would be the most appropriate next step? A. Share information with all stakeholders B. Obtain top management support C. Identify action items D. Conduct gap analysis Question No : 301 A juice manufacturer wants to determine the time required to convert a dollar spent on materials into a dollar received in sales. Which of the following metrics would be most appropriate to make this determination? A. Activity-based costing B. Inventory carrying cost C. Cash-to-cash cycle time D. Average financial turnover Question No : 302 The most appropriate strategy for a firm that makes and sells a wide range of items typically would be to domestically source items that have which of the following characteristics? A. Short product life cycle and many variations B. Short product life cycle and few variations C. High labor value and low transport uncertainty D. High labor value and high transport uncertainty domestically Question No : 303 A company is aggressively pursuing improvements in the financial performance of its supply chain. The company should first focus its efforts on which of the following metrics? A. Process takt time B. Cycle count accuracy C. Number of inventory turns D. Number of first-tier suppliers Question No : 304 Use of a centralized distribution center rather than a decentralized distribution network typically results in which of the following consequences? A. Distribution system overhead is higher. B. Customer delivery time is shorter. C. Total transportation costs are lower. D. Safety stock levels are lower. Question No : 305 A distributor has a network consisting of a central distribution center serving five regional distribution centers that ships to multiple retailers. The distributor wants to reduce inventory while maintaining product availability. Which of the following actions is most likely to produce the desired outcome? A. Centralizing inventory for slow-moving items B. Reducing the quoted price for slow-moving items C. Implementing cross-docking at the central distribution center D. Implementing continuous replenishment at the regional centers Question No : 306 Which of the following continuous improvement methodologies focuses on reduction of defects by reducing process variation? A. Just-in-Time (JIT) B. Kaizen C. Six Sigma D. Theory of constraints Question No : 307 Horizontal and vertical exchanges of secure data among supply chain partners are facilitated best by: A. the intranet. B. a portal. C. a Web site. D. e-mail. Question No : 308 In the analysis of costs, fixed costs are those that are: A. independent of the volume of output. B. dependent on the utilization of the asset. C. inversely proportionate to the volume of output. D. constant through the useful life of the asset. Question No : 309 A company is having trouble with raw material deliveries and decides to develop a supplier certification program. The certification process most appropriately would start with which of the followin

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