COMPREHENSIVE Solution Manual for
Principles of Supply Chain Management: A
Balanced Approach, 6th Edition by Joel
Wisner, Keah-Choon Tan
Extensive Chapters 1-14| Expert Approved
Questions & Accurate Solutions
TB
Ac
Page | 1
er
, Solution and Answer Guide
Chapter 01: Answers to Questions/Problems
Table of Contents
Discussion Questions 1
Cases 7
Learning Objectives 7
Answers to Questions 7
Appendix 1.1 The Beer Game 8
Questions and Exercises 8
Discussion Questions
1. Define the term supply chain management in your own words and list its most important activities.
Correct Answer:
The Supply-Chain Council’s definition of supply chain management is ―managing supply and
demand, sourcing raw materials and parts, manufacturing and assembly, warehousing and inventory
tracking, order entry and order management, distribution across all channels, and delivery to the
customer.
These are also the most important activities; however, integration of key supply chain processes
might also be included in there.
2. Can a small business like a local sandwich or bicycle shop benefit from practicing supply chain
management? What would they most likely concentrate on?
Correct Answer:
Yes, any organization can implement at least some of the important concepts. A good place to start is
the rationalization or reduction of the supply base. Small businesses might also want to concentrate
on customers as a starting point.
3. Describe and draw a supply chain for a bicycle repair shop and list the important supply chain
members.
Correct Answer:
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,This will vary from student to student, but should include, for instance, parts suppliers, bicycle
suppliers, and other suppliers (i.e., helmet suppliers) and services (i.e., repair services) as first- tier
suppliers and bicycle owners as first-tier customers.
4. Can a bicycle repair shop have more than one supply chain? Explain.
Correct Answer:
Yes. Every repair item the firm stocks has potentially a different supply chain associated with it.
5. What is a cold chain? Why did it become so important in 2020?
Correct Answer:
A cold chain is an alliance of companies that can monitor and protect the temperature of perishable
products to maintain quality and safety from the point of origin through distribution to the final
consumer. Cold chains became a popular news item in 2020 as COVID-19 vaccines began to be
distributed globally by Pfizer and Moderna. The two vaccines must be stored and transported at sub-
zero temperatures.
6. How has the recent global pandemic impacted supply chain management?
Correct Answer:
In general, it made things more difficult, particularly for global supply chains—companies have gone
bankrupt, retailers have stopped buying regularly, ports have shut down unexpectedly, and many
purchases have gone online as people stayed home. Companies have had to react quickly to the
changes.
7. What roles do ―collaboration and ―trust play in the practice of supply chain management?
Correct Answer:
This is essential for process integration. Sharing information and determining joint strategies is part
of the process of integration and collaboration, and to do this, trust must be present between the
customer, focal firm, and supplier.
8. Why don’t firms just become more vertically integrated (for example buy out suppliers and
customers), instead of trying to manage their supply chains?
Correct Answer:
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, This could cause a loss of focus and keep managers and employees from doing their core
competencies, resulting in loss of performance.
9. What types of organizations would benefit the most from practicing supply chain management?
What sorts of improvements could be expected?
Correct Answer:
Firms with many suppliers, many complex products, large inventories, and many customers (in other
words, firms with many supply chains). Gains would be lower purchasing costs, lower carrying costs,
better product quality, and better customer service.
10. What are the benefits of supply chain management?
Correct Answer:
Reduction of the bullwhip effect, better buyer/supplier relationships, better quality, lower costs,
better customer service, higher demand, and more profits.
11. Can nonprofit, educational, or government organizations benefit from supply chain management?
How?
Correct Answer:
Yes. All services and organizations can benefit in terms of at least better customer service, better
inventory management, and cheaper purchase prices.
12. What does the term, ―third-tier supplier mean? What about ―third-tier customer? What about
the ―focal firm? Provide examples.
Correct Answer:
First-tier suppliers are the focal firm’s direct suppliers. Second-tier suppliers are the focal firm’s
suppliers’ direct suppliers. Third-tier suppliers are the focal firm’s suppliers’ suppliers’ suppliers.
Company A sells wood to Company B. Company B sells furniture to Company C. Company C sells
the furniture to Wal-Mart. Company A is Wal-Mart’s third-tier supplier. Similarly, the focal firm’s
customers’ customers’ customers are their third-tier customers. The focal firm just refers to the firm
in question, or in the topic of discussion.
13. What is the bullwhip effect and what causes it? How would you try to reduce the bullwhip effect?
TB
Correct Answer:
Ac
Page | 4
er
Principles of Supply Chain Management: A
Balanced Approach, 6th Edition by Joel
Wisner, Keah-Choon Tan
Extensive Chapters 1-14| Expert Approved
Questions & Accurate Solutions
TB
Ac
Page | 1
er
, Solution and Answer Guide
Chapter 01: Answers to Questions/Problems
Table of Contents
Discussion Questions 1
Cases 7
Learning Objectives 7
Answers to Questions 7
Appendix 1.1 The Beer Game 8
Questions and Exercises 8
Discussion Questions
1. Define the term supply chain management in your own words and list its most important activities.
Correct Answer:
The Supply-Chain Council’s definition of supply chain management is ―managing supply and
demand, sourcing raw materials and parts, manufacturing and assembly, warehousing and inventory
tracking, order entry and order management, distribution across all channels, and delivery to the
customer.
These are also the most important activities; however, integration of key supply chain processes
might also be included in there.
2. Can a small business like a local sandwich or bicycle shop benefit from practicing supply chain
management? What would they most likely concentrate on?
Correct Answer:
Yes, any organization can implement at least some of the important concepts. A good place to start is
the rationalization or reduction of the supply base. Small businesses might also want to concentrate
on customers as a starting point.
3. Describe and draw a supply chain for a bicycle repair shop and list the important supply chain
members.
Correct Answer:
TB
Ac
Page | 2
er
,This will vary from student to student, but should include, for instance, parts suppliers, bicycle
suppliers, and other suppliers (i.e., helmet suppliers) and services (i.e., repair services) as first- tier
suppliers and bicycle owners as first-tier customers.
4. Can a bicycle repair shop have more than one supply chain? Explain.
Correct Answer:
Yes. Every repair item the firm stocks has potentially a different supply chain associated with it.
5. What is a cold chain? Why did it become so important in 2020?
Correct Answer:
A cold chain is an alliance of companies that can monitor and protect the temperature of perishable
products to maintain quality and safety from the point of origin through distribution to the final
consumer. Cold chains became a popular news item in 2020 as COVID-19 vaccines began to be
distributed globally by Pfizer and Moderna. The two vaccines must be stored and transported at sub-
zero temperatures.
6. How has the recent global pandemic impacted supply chain management?
Correct Answer:
In general, it made things more difficult, particularly for global supply chains—companies have gone
bankrupt, retailers have stopped buying regularly, ports have shut down unexpectedly, and many
purchases have gone online as people stayed home. Companies have had to react quickly to the
changes.
7. What roles do ―collaboration and ―trust play in the practice of supply chain management?
Correct Answer:
This is essential for process integration. Sharing information and determining joint strategies is part
of the process of integration and collaboration, and to do this, trust must be present between the
customer, focal firm, and supplier.
8. Why don’t firms just become more vertically integrated (for example buy out suppliers and
customers), instead of trying to manage their supply chains?
Correct Answer:
TB
Ac
Page | 3
er
, This could cause a loss of focus and keep managers and employees from doing their core
competencies, resulting in loss of performance.
9. What types of organizations would benefit the most from practicing supply chain management?
What sorts of improvements could be expected?
Correct Answer:
Firms with many suppliers, many complex products, large inventories, and many customers (in other
words, firms with many supply chains). Gains would be lower purchasing costs, lower carrying costs,
better product quality, and better customer service.
10. What are the benefits of supply chain management?
Correct Answer:
Reduction of the bullwhip effect, better buyer/supplier relationships, better quality, lower costs,
better customer service, higher demand, and more profits.
11. Can nonprofit, educational, or government organizations benefit from supply chain management?
How?
Correct Answer:
Yes. All services and organizations can benefit in terms of at least better customer service, better
inventory management, and cheaper purchase prices.
12. What does the term, ―third-tier supplier mean? What about ―third-tier customer? What about
the ―focal firm? Provide examples.
Correct Answer:
First-tier suppliers are the focal firm’s direct suppliers. Second-tier suppliers are the focal firm’s
suppliers’ direct suppliers. Third-tier suppliers are the focal firm’s suppliers’ suppliers’ suppliers.
Company A sells wood to Company B. Company B sells furniture to Company C. Company C sells
the furniture to Wal-Mart. Company A is Wal-Mart’s third-tier supplier. Similarly, the focal firm’s
customers’ customers’ customers are their third-tier customers. The focal firm just refers to the firm
in question, or in the topic of discussion.
13. What is the bullwhip effect and what causes it? How would you try to reduce the bullwhip effect?
TB
Correct Answer:
Ac
Page | 4
er
