SCMN EXAM 1 QUESTIONS WITH
ALL CORRECT ANSWERS
What makes supply chain planning difficult to do well? Lack of planning software,
Leaders don't care about it, Cross-organizational collaboration, Variation in customer
demand - Answer-cross- organizational collaboration
Which type of capacity planning strategy attempts to adjust capacity up and down to
match existing demand? Proactive capacity planning, Lagging capacity planning,
Collaborative capacity planning, Concurrent capacity planning - Answer-concurrent
capacity planning
T/F: Companies should plan supply chain activities based on their design capacity and
set the effective capacity as a stretch goal to pursue. - Answer-False
What is an appropriate approach for determining the overall production capabilities of
capital-intensive resources like machines and facilities? Demand Planning, Sales and
Operations Planning, Capacity Planning, Materials Resource Planning - Answer-
capacity planning
Which of the following statements regarding forecasting is TRUE? The best way to
improve forecast accuracy is to sell more goods in the marketplace, Ignore the inputs of
customers and suppliers into the forecasting process as they are biased, Ultimately,
better forecasts result in better customer service, lower costs, and improved
relationships, or The sole purpose of forecasting is to understand market trends and
demand for finished goods. - Answer-Ultimately, better forecasts result in better
customer service, lower costs, and improved relationships
When would it be most effective to use quantitative forecasting tools? When you really
don't know what else to do, When you are dealing with new products, When you have
historical data available, or When you are entering new geographic markets - Answer-
when you have historical data available
According to the Episode 3 articles, greater accuracy in supply planning does what for
an organization? It leads to higher asset utilization rates, It generates more production
line changeovers, It ensures higher levels of safety stock, or It makes demand sensing
possible - Answer-it leads to higher asset utilization rates
, According to the Episode 3 readings, planning for holiday demand is difficult for each of
the following reasons EXCEPT: Regional item preferences, Weather patterns, Day of
the week, or Inventory buffer locations - Answer-inventory buffer locations
Supply Chain management - Answer-the art of managing the flow of materials and
products, information, and financial resources from source to user
5 primary groups of supply chain management - Answer-suppliers, manufacturers,
distributors, retailers, consumers
Who is the most important participant in the supply chain - Answer-the consumer
What does SCM involve? - Answer-All activities that take place to get a product in your
hands- from raw material extraction to the minute you pull out your credit card and take
the final product home
Supply chain management is important because - Answer-it provides valuable
opportunities to create competitive advantage, develop collaborative, trusting
relationships, improve customer satisfaction, rationalize product touch points, and drive
out costs and achieve efficiencies
Why is SCM important to customers? - Answer-Product availability (time utility and
place utility) and fulfillment accuracy (the seven rights)
What are the seven rights? - Answer-Right product, right customer, right time, right
place, right condition, right quantity, and right cost
Why is SCM important to companies? - Answer-It helps companies outpace the
competition by managing their materials, products, and information flows (better, faster,
cheaper)
Key goals of SCM - Answer-customer car, competitiveness, efficiency, responsiveness,
resiliency
What does SCM focus on? - Answer-Planning and forecasting, supply management and
procurement, operations managements and production, and logistics and transportation
Three flows of supply chain - Answer-share the information (create visibility), deliver the
product (drive utility), and show me the money (release funds)
What are the challenges of SCM? - Answer-Product life cycles are shrinking, customers
are demanding customized products, competition is intensifying, and companies need
to be much more efficient
