OPMA 317 - Final Exam UPDATED
QUESTIONS AND CORRECT ANSWERS
Purchase vs Product Order Flow - CORRECT ANSWER Upstream vs. Downstream
What happens to fluctuations and why? - CORRECT ANSWER Fluctuations are
amplified due to a time lag
Beer Game: What caused people to act the way they did - CORRECT ANSWER Lack
of communication/cooperation and long lead times
Bullwhip Effect - CORRECT ANSWER Information going back through the supply
chain is distorted and then amplified. Members of the supply chain overreact to changes in
demand.
How does a long lead time affect decision making? - CORRECT ANSWER Panic -
when inventory does not instantly arrive and solve your growing backlog, you panic and
order even more
Business Implications of Supply Chain - CORRECT ANSWER Stockouts, excess
inventory, overtime costs, layoffs/re-hiring costs, expediting
Bullwhip Effect Measure - CORRECT ANSWER Bullwhip effect is present if variance
of orders/variance of demand is greater than 1
Stanley - Power Tools - CORRECT ANSWER Accurately predicted jump in demand
pre-Covid and kept their factories open in Mexico
How to incentivize cooperation/communication? - CORRECT ANSWER Provide
incentives to share information. Use vendor managed inventory.
, Mattel - CORRECT ANSWER Collected their own daily demand data in real time by
visiting stores
Collaborative Planning Forecasting & Replenishment example - CORRECT
ANSWER Canadian Tire has a 26-week planned order stream that is updated weekly
How to shorten lead times - CORRECT ANSWER Administrative lead = improve
information technology
Physical manufacturing lead = just in time production
Transportation lead = have suppliers geographically close by (on-shoring)
What to do if you cannot change the supply chain structure (ex. SMEs) - CORRECT
ANSWER Adapt and manage: The Aspirin Rule - once demand changes, don't panic,
just correct once
Beer Game Learning (3) - CORRECT ANSWER Change the supply chain structure
(communication & cooperation, shorter lead times). If you can't change the structure, adapt
and wait. Choose capable suppliers/the best teammate.
Keep a smooth supply chain - CORRECT ANSWER Don't offer significant
sales/discounts, if you have to, limit the quantity of items that can be bought at discounted
prices. Don't do lumpsum orders, order evenly.
What is a supply chain? - CORRECT ANSWER A network of facilities that procure
raw materials (purchasing) and distribute them. Managing inbound procurement and
outbound logistics.
Supply Chain Network - CORRECT ANSWER Suppliers -> Manufacturing ->
Distribution -> Customers
Why did supply chains extend globally? - CORRECT ANSWER To reduce labour
costs (now the lowest labour cost is in Ethiopia)
QUESTIONS AND CORRECT ANSWERS
Purchase vs Product Order Flow - CORRECT ANSWER Upstream vs. Downstream
What happens to fluctuations and why? - CORRECT ANSWER Fluctuations are
amplified due to a time lag
Beer Game: What caused people to act the way they did - CORRECT ANSWER Lack
of communication/cooperation and long lead times
Bullwhip Effect - CORRECT ANSWER Information going back through the supply
chain is distorted and then amplified. Members of the supply chain overreact to changes in
demand.
How does a long lead time affect decision making? - CORRECT ANSWER Panic -
when inventory does not instantly arrive and solve your growing backlog, you panic and
order even more
Business Implications of Supply Chain - CORRECT ANSWER Stockouts, excess
inventory, overtime costs, layoffs/re-hiring costs, expediting
Bullwhip Effect Measure - CORRECT ANSWER Bullwhip effect is present if variance
of orders/variance of demand is greater than 1
Stanley - Power Tools - CORRECT ANSWER Accurately predicted jump in demand
pre-Covid and kept their factories open in Mexico
How to incentivize cooperation/communication? - CORRECT ANSWER Provide
incentives to share information. Use vendor managed inventory.
, Mattel - CORRECT ANSWER Collected their own daily demand data in real time by
visiting stores
Collaborative Planning Forecasting & Replenishment example - CORRECT
ANSWER Canadian Tire has a 26-week planned order stream that is updated weekly
How to shorten lead times - CORRECT ANSWER Administrative lead = improve
information technology
Physical manufacturing lead = just in time production
Transportation lead = have suppliers geographically close by (on-shoring)
What to do if you cannot change the supply chain structure (ex. SMEs) - CORRECT
ANSWER Adapt and manage: The Aspirin Rule - once demand changes, don't panic,
just correct once
Beer Game Learning (3) - CORRECT ANSWER Change the supply chain structure
(communication & cooperation, shorter lead times). If you can't change the structure, adapt
and wait. Choose capable suppliers/the best teammate.
Keep a smooth supply chain - CORRECT ANSWER Don't offer significant
sales/discounts, if you have to, limit the quantity of items that can be bought at discounted
prices. Don't do lumpsum orders, order evenly.
What is a supply chain? - CORRECT ANSWER A network of facilities that procure
raw materials (purchasing) and distribute them. Managing inbound procurement and
outbound logistics.
Supply Chain Network - CORRECT ANSWER Suppliers -> Manufacturing ->
Distribution -> Customers
Why did supply chains extend globally? - CORRECT ANSWER To reduce labour
costs (now the lowest labour cost is in Ethiopia)
