SCM Exam 1(Revised) with Complete
Solutions
4 types of control charts - ANS-1. x-bar chart
2. R chart
3. P charts
4. C charts
advantages of e-procurement - ANS--time saving
-cost saving
-accuracy
-real time
-mobility
-trackability
-management
-benefits to suppliers
Backward vertical integration (make) - ANS-refers to acquiring sources of supply
Blank Check Purchase Orders - ANS-a small value purchase order with a signed blank
check attached, usually at the bottom of the purchase order. Usually printed on a check
that is not valid for over a certain amount.
Blanket or Open-End Purchase Orders - ANS-A blanket purchase order covers a variety
of items and is negotiated for repeated supply over a fixed time period, such as
quarterly or yearly. The subtle difference of an open-end purchase order is that
additional items and expiration dates can be renegotiated.
break-even analysis - ANS-a tool for computing the cost-effectiveness of sourcing
decisions when cost is the most important criterion. Several assumptions underlie the
analysis:
1. all costs involved can be classified as fixed or variable
2. fixed cost remains the same within the range of analysis
3. a linear variable cost relationship exists
4. fixed cost of the make option is higher because of initial capital investment in
equipment
5. variable cost of the buy option is higher due to supplier profits
brief history of scm - ANS--traditional mass manufacturing
-inventory management, cost containment
-supplier and customer alliances; TQM
, -supply chain relationship formation, sustainability, social responsibility
-increased supply chain capabilities
bullwhip effect - ANS-ineffective communication between buyers and suppliers and
infrequent delivery of materials, combined with production based on poor forecasts
along a supply chain that results in either too little or too much inventory at various
points of storage and consumption. it causes an amplification of the variation in the
demand pattern along the supply chain
c-chart - ANS-count the number of defects per unit of output
Cause and Effect (events) - ANS--simple regression
-multiple regression
centralized purchasing - ANS-a single purchasing department, usually located at the
firm's corporate office, makes all the purchasing decisions, including order quantity,
pricing policy, contracting, negotiations, and supplier selection and evaluation.
Collaborative Planning, Forecasting, and Replenishment (CPFR) - ANS--a business
practice that combines the intelligence
of multiple trading partners in the planning & fulfillment of customer demands
-It links sales & marketing best practices, such as
category management, to supply chain planning
processes to increase availability while reducing
inventory, transportation & logistics costs
CPFR benefits - ANS--Strengthens partner relationships
-Provides analysis of sales & order forecasts
-Uses point-of-sale data, seasonal activity, promotions, to improve forecast accuracy
-Manages demand chain & eliminates problems before they appear
-Allows collaboration on future requirements & plans
-Uses joint planning & promotions management
-Integrates planning, forecasting and logistics activities
-Provides efficient category management & understanding of consumer purchasing
patterns
CPFR challenges - ANS--Difficulty in changing internal processes + behaviors
-Cost
-Trust
CPFR goals - ANS--Reduce supply chain inefficiencies
-Improve customer service
-Increase revenues and profitability
Credit Card/Corporate Purchasing Card (P-card) - ANS-credit cards with a
predetermined credit limit, usually not more than $5000, issued to authorized personnel
Solutions
4 types of control charts - ANS-1. x-bar chart
2. R chart
3. P charts
4. C charts
advantages of e-procurement - ANS--time saving
-cost saving
-accuracy
-real time
-mobility
-trackability
-management
-benefits to suppliers
Backward vertical integration (make) - ANS-refers to acquiring sources of supply
Blank Check Purchase Orders - ANS-a small value purchase order with a signed blank
check attached, usually at the bottom of the purchase order. Usually printed on a check
that is not valid for over a certain amount.
Blanket or Open-End Purchase Orders - ANS-A blanket purchase order covers a variety
of items and is negotiated for repeated supply over a fixed time period, such as
quarterly or yearly. The subtle difference of an open-end purchase order is that
additional items and expiration dates can be renegotiated.
break-even analysis - ANS-a tool for computing the cost-effectiveness of sourcing
decisions when cost is the most important criterion. Several assumptions underlie the
analysis:
1. all costs involved can be classified as fixed or variable
2. fixed cost remains the same within the range of analysis
3. a linear variable cost relationship exists
4. fixed cost of the make option is higher because of initial capital investment in
equipment
5. variable cost of the buy option is higher due to supplier profits
brief history of scm - ANS--traditional mass manufacturing
-inventory management, cost containment
-supplier and customer alliances; TQM
, -supply chain relationship formation, sustainability, social responsibility
-increased supply chain capabilities
bullwhip effect - ANS-ineffective communication between buyers and suppliers and
infrequent delivery of materials, combined with production based on poor forecasts
along a supply chain that results in either too little or too much inventory at various
points of storage and consumption. it causes an amplification of the variation in the
demand pattern along the supply chain
c-chart - ANS-count the number of defects per unit of output
Cause and Effect (events) - ANS--simple regression
-multiple regression
centralized purchasing - ANS-a single purchasing department, usually located at the
firm's corporate office, makes all the purchasing decisions, including order quantity,
pricing policy, contracting, negotiations, and supplier selection and evaluation.
Collaborative Planning, Forecasting, and Replenishment (CPFR) - ANS--a business
practice that combines the intelligence
of multiple trading partners in the planning & fulfillment of customer demands
-It links sales & marketing best practices, such as
category management, to supply chain planning
processes to increase availability while reducing
inventory, transportation & logistics costs
CPFR benefits - ANS--Strengthens partner relationships
-Provides analysis of sales & order forecasts
-Uses point-of-sale data, seasonal activity, promotions, to improve forecast accuracy
-Manages demand chain & eliminates problems before they appear
-Allows collaboration on future requirements & plans
-Uses joint planning & promotions management
-Integrates planning, forecasting and logistics activities
-Provides efficient category management & understanding of consumer purchasing
patterns
CPFR challenges - ANS--Difficulty in changing internal processes + behaviors
-Cost
-Trust
CPFR goals - ANS--Reduce supply chain inefficiencies
-Improve customer service
-Increase revenues and profitability
Credit Card/Corporate Purchasing Card (P-card) - ANS-credit cards with a
predetermined credit limit, usually not more than $5000, issued to authorized personnel
