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Test bank For Chapter 1 - Introduction to Supply Chain Management 6th Edition by Bowersox
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Test bank For Chapter 1 - Introductionto Supply Chain Management 6th Edition
by Bowersox
What is a Supply Chain? - ANS-Any organization anywhere in the world, offering a product or a
service has a supply chain
-Products and services are created from materials, equipment, labor, time, money, and other
resources
--Producing and delivering products and services requires suppliers, manufacturers, and
customers; all of which make up a supply chain
-A supply chain can be very simple or very complex
-Supply chains exist in organizations that are:
--Large or small
--Public or private
--For-Profit or Not-for-Profit
Structure of a Supply Chain - ANS-Suppliers (external) - raw material suppliers --> intermediate
suppliers --> finished material or service suppliers -->
-Manufacturer (internal) - finished product manufacturer (insourced and/or outsourced) -->
-Customers (external) - wholesaler & distributor customers --> retail customers --> consumers
-Facilitated through the use of Logistics - inventory management, warehousing, truck, rail, air,
water, pipeline
-A supply chain consists of the flow of products to materials from suppliers to manufacturers to
customers
Supply Chain Management Flow - ANS1. Starts with understanding the flow
2. Integrates all partners within the end-to-end supply chain
3. Is conducted through defined processes
Supply Chain Tiers - ANS-Suppliers:
--Tier 1 = Direct Supplier
--Tier 2 = Indirect Supplier
--Tier 3 = Indirect Supplier
--Tier n = Indirect Suppliers
-Customers:
--Tier 1 = Direct Customer
--Tier 2 = Indirect Customer
--Tier 3 = Indirect Customer
--Tier n = Indirect Customer
, -Some suppliers and some customers can be both Tier 1 and Tier 2
Supply Chain Management - ANS-The coordination of a network of otherwise independent
trading partners creating a desired product or service, and moving it from suppliers, through
manufacturing, and out to customers when and where they want it
-SCM is the way business gets done. It is execution process of any business
Supply Chain - Supply Chain Operations Research (SCOR) Model - ANS-Each trading partner
has to PLAN, SOURCE, MAKE, and DELIVER their part of the supply in order to satisfy the
underlying demand for the product or service
The Value of Supply Chain Management - ANS-Supply Chain Management creates value by
managing the process of all of those independent trading partners so that they can collaborate
with one another in an efficient, effective, and cost conscious way
The Goals of Supply Chain Management - ANS1. Increase Customer Service --> Getting the
products and services that customer want to them, when and where they want them, at the
lowest possible cost **while simultaneously**
2. Reducing Inventory and Operating Expenses --> Achieving #1 above while keeping your
inventory as low as possible and also keeping your costs as low as possible
-In line with this goal, the two main reasons that companies implement SCM are to:
1. Achieve cost savings
2. Better coordinate resources
Supply Chains in the Service Industry - ANS-Service firms offer intangible products, meaning
products that cannot be physically touched
-What customers are actually paying for in the service industry is the labor and the intellectual
property of the service provider
-Customers are also much more directly involved in the delivery of services than they are in the
supply of a physical product
-While the service itself is not tangible, it frequently involves work on a tangible item provided by
the customer
--You must "supply" your car for the automotive repair service
--You must "supply" your clothes for dry cleaning service
--You must "supply" your financial data for tax preparation service
Supply Chains in the Service Industry (Continued) - ANS-Service products cannot generally be
produced in advance or inventories
-Services are typically produced and consumed simultaneously, and in almost every service
offering, the service cannot start until the customer arrives and actively participates
-Many services require the use of facilitating goods which are tangible elements that are used
along with the service provided
-Ex: Banks --> Cash & coins, office supplies, computers, records
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