BMGT372 EXAM 1 WITH COMPLETE SOLUTIONS
Define SCM - ANSWER consists of firms collaborating to leverage strategic
positioning and to improve operating efficiency.
What is the primary goal of supply chains today? - ANSWER Primary goal:
customer service OR efficiency and effectiveness
Enabler of SC: information technology
What does a SC consist of? - ANSWER •Maintaining product flow in the face of
disruption or disaster
•Sourcing goods in a cost-effective manner without exploitation
•Managing your firm's reputation when your channel partners fail
•Adapting to change in global market
•Learning how to compete in foreign markets
•Maintaining competitive advantage
What is the overarching goals of SCM - ANSWER efficiency and effectiveness.
concept of flows - ANSWER What flows: financial, physical, information
Nature of flows: bi-directional (processes, communication), interrelated,
constant
What is the significance of dependency in chains?
or what does " "Supply chains are a strategic choice" mean? - ANSWER SC
represents a strategic choice by those participating in it. It is a group effort and
every party is working together for a common purpose.
Therefore, we would like to have as much cooperation, coordination, and
communication as possible
What is the proper level of optimality when considering the elements and
components of a supply chain? - ANSWER Proper level of optimality: doesn't
matter if you optimize a level of the SC if you fail to optimize the entire supply
chain
Focus on more than just the focal firm
What are the primary types of utility provided by an efficient and effective supply
chain? - ANSWER 1. Locational utility: Decisions on location have a direct
,impact on the movement of products, distances traveled, cost of transportation,
the ability to quickly respond to markets, and ultimately customer satisfaction
2. Time/Place utility: transportation enables logistics to provide place utility
*form utility is created in manufacturing- SC is responsible to maintain the form,
not create it
What are the components or functional elements of supply chains. - ANSWER
suppliers - manufacturers - distributors - retailers - customers
Components of logistics: order management, inventory, transportation,
warehousing, materials handling, packaging
Define systems approach to studying supply chain management. - ANSWER
Systems approach: systems that exist within firm, the enterprise and the
channel aka the entire SC
ex. Functional areas- production, finance, HR, marketing
Systems integration:
•Decision making and activities are coordinated
•Communications is effective and constant
•Coordination is maximized
•Cooperation is achieved
What are the primary concerns or goals of the systems approach? - ANSWER 1.
Focus on total cost: want to have a SC that is designed to operate at the lowest
possible cost given a particular level of CS
2. Take advantage of trade-offs: if trying to create some level of optimality, focus
on the entire SC not just the focal firm
3. Avoid sub-optimization: overachieving in one area may be detrimental to the
SC as a whole
Know the benefits of an integrated supply chain - ANSWER Integration facilitates
efficiency and effectiveness. Integration within the channel of distribution
should result in lower costs, higher profits, higher levels of customer service
because it:
1. Eliminates duplicate or non-productive work
2. Creates specialization of activities by firms within channel
3. Synergies and system cooperation
Understand why integration is difficult to achieve. - ANSWER 1. Firms revert to a
"me first" attitude - focus on own goals, not channel goals
2. Not confident that all members would profit equally- mistrust
, Define "functional shiftability." - ANSWER functional shiftability: you can shift the
function but you can't eliminate the function
ex. You can't eliminate the middleman if they add value to the SC process
Define the bullwhip effect. - ANSWER Bullwhip effect characteristics: distortion
of information about true customer demand- inaccurate information moves up
the SC
What are the primary causes of the bullwhip effect? - ANSWER demand forecast
not updated, order batching, price fluctuations, rationing and shortage gaming
Impact on efficiency: the inaccurate information causes each stage in the SC to
carry more inventory to compensate for the lack of info.
How can you mitigate against the bullwhip effect - ANSWER move to a
collaborative approach (competition should be among supply chains not firms)
Shift from anticipatory to responsive approach
List and understand the major constraints of a channel. - ANSWER Capacity,
information, competencies, capital, human resource
How might constraints be overcome in the short-run; long-run? - ANSWER ???
What is the concept of integrative management and the current thinking on how
to achieve integration within the supply chain. - ANSWER Integrative
management: move from function to process
Focusing on improving the efficiency of specific functions will lead to
improvements in the overall process
Challenge: redirect emphasis from functionality to process, the concept of trade
offs
Define 3PL's. - ANSWER a company's use of third-party businesses to outsource
elements of the company's distribution and fulfillment services.
Typical 3PL: transportation and warehousing
What are the arguments for and against 3PLs - ANSWER Advantages: the third
party most likely specializes in that segment of the business, so they may do it
more efficiently than you. They also may have more connections and networks.
Lower cost
Disadvantages: giving up control!
Define SCM - ANSWER consists of firms collaborating to leverage strategic
positioning and to improve operating efficiency.
What is the primary goal of supply chains today? - ANSWER Primary goal:
customer service OR efficiency and effectiveness
Enabler of SC: information technology
What does a SC consist of? - ANSWER •Maintaining product flow in the face of
disruption or disaster
•Sourcing goods in a cost-effective manner without exploitation
•Managing your firm's reputation when your channel partners fail
•Adapting to change in global market
•Learning how to compete in foreign markets
•Maintaining competitive advantage
What is the overarching goals of SCM - ANSWER efficiency and effectiveness.
concept of flows - ANSWER What flows: financial, physical, information
Nature of flows: bi-directional (processes, communication), interrelated,
constant
What is the significance of dependency in chains?
or what does " "Supply chains are a strategic choice" mean? - ANSWER SC
represents a strategic choice by those participating in it. It is a group effort and
every party is working together for a common purpose.
Therefore, we would like to have as much cooperation, coordination, and
communication as possible
What is the proper level of optimality when considering the elements and
components of a supply chain? - ANSWER Proper level of optimality: doesn't
matter if you optimize a level of the SC if you fail to optimize the entire supply
chain
Focus on more than just the focal firm
What are the primary types of utility provided by an efficient and effective supply
chain? - ANSWER 1. Locational utility: Decisions on location have a direct
,impact on the movement of products, distances traveled, cost of transportation,
the ability to quickly respond to markets, and ultimately customer satisfaction
2. Time/Place utility: transportation enables logistics to provide place utility
*form utility is created in manufacturing- SC is responsible to maintain the form,
not create it
What are the components or functional elements of supply chains. - ANSWER
suppliers - manufacturers - distributors - retailers - customers
Components of logistics: order management, inventory, transportation,
warehousing, materials handling, packaging
Define systems approach to studying supply chain management. - ANSWER
Systems approach: systems that exist within firm, the enterprise and the
channel aka the entire SC
ex. Functional areas- production, finance, HR, marketing
Systems integration:
•Decision making and activities are coordinated
•Communications is effective and constant
•Coordination is maximized
•Cooperation is achieved
What are the primary concerns or goals of the systems approach? - ANSWER 1.
Focus on total cost: want to have a SC that is designed to operate at the lowest
possible cost given a particular level of CS
2. Take advantage of trade-offs: if trying to create some level of optimality, focus
on the entire SC not just the focal firm
3. Avoid sub-optimization: overachieving in one area may be detrimental to the
SC as a whole
Know the benefits of an integrated supply chain - ANSWER Integration facilitates
efficiency and effectiveness. Integration within the channel of distribution
should result in lower costs, higher profits, higher levels of customer service
because it:
1. Eliminates duplicate or non-productive work
2. Creates specialization of activities by firms within channel
3. Synergies and system cooperation
Understand why integration is difficult to achieve. - ANSWER 1. Firms revert to a
"me first" attitude - focus on own goals, not channel goals
2. Not confident that all members would profit equally- mistrust
, Define "functional shiftability." - ANSWER functional shiftability: you can shift the
function but you can't eliminate the function
ex. You can't eliminate the middleman if they add value to the SC process
Define the bullwhip effect. - ANSWER Bullwhip effect characteristics: distortion
of information about true customer demand- inaccurate information moves up
the SC
What are the primary causes of the bullwhip effect? - ANSWER demand forecast
not updated, order batching, price fluctuations, rationing and shortage gaming
Impact on efficiency: the inaccurate information causes each stage in the SC to
carry more inventory to compensate for the lack of info.
How can you mitigate against the bullwhip effect - ANSWER move to a
collaborative approach (competition should be among supply chains not firms)
Shift from anticipatory to responsive approach
List and understand the major constraints of a channel. - ANSWER Capacity,
information, competencies, capital, human resource
How might constraints be overcome in the short-run; long-run? - ANSWER ???
What is the concept of integrative management and the current thinking on how
to achieve integration within the supply chain. - ANSWER Integrative
management: move from function to process
Focusing on improving the efficiency of specific functions will lead to
improvements in the overall process
Challenge: redirect emphasis from functionality to process, the concept of trade
offs
Define 3PL's. - ANSWER a company's use of third-party businesses to outsource
elements of the company's distribution and fulfillment services.
Typical 3PL: transportation and warehousing
What are the arguments for and against 3PLs - ANSWER Advantages: the third
party most likely specializes in that segment of the business, so they may do it
more efficiently than you. They also may have more connections and networks.
Lower cost
Disadvantages: giving up control!
