SCMN Exam 1 Questions and Answers With Verified Solutions 2025
Supply Chain management - ✔✔the art of managing the flow of materials and products, information,
and financial resources from source to user
5 primary groups of supply chain management - ✔✔suppliers, manufacturers, distributors, retailers,
consumers
Who is the most important participant in the supply chain - ✔✔the consumer
What does SCM involve? - ✔✔All activities that take place to get a product in your hands- from raw
material extraction to the minute you pull out your credit card and take the final product home
Supply chain management is important because - ✔✔it provides valuable opportunities to create
competitive advantage, develop collaborative, trusting relationships, improve customer satisfaction,
rationalize product touch points, and drive out costs and achieve efficiencies
Why is SCM important to customers? - ✔✔Product availability (time utility and place utility) and
fulfillment accuracy (the seven rights)
What are the seven rights? - ✔✔Right product, right customer, right time, right place, right condition,
right quantity, and right cost
Why is SCM important to companies? - ✔✔It helps companies outpace the competition by managing
their materials, products, and information flows (better, faster, cheaper)
Key goals of SCM - ✔✔customer car, competitiveness, efficiency, responsiveness, resiliency
What does SCM focus on? - ✔✔Planning and forecasting, supply management and procurement,
operations managements and production, and logistics and transportation
, Three flows of supply chain - ✔✔share the information (create visibility), deliver the product (drive
utility), and show me the money (release funds)
What are the challenges of SCM? - ✔✔Product life cycles are shrinking, customers are demanding
customized products, competition is intensifying, and companies need to be much more efficient
7 principles of SCM - ✔✔segment customers based on service needs, customize the logistics network,
drive operations from demand, differentiate product closer to the customer, source strategically,
develop supply chain wide technology strategy, and use supply chain spanning performance measures
Node - ✔✔a fixed point in a supply chain where valued added processes take place. Goods are
processed, transformed, mixed, held, or sold at nodes
Link - ✔✔the transformation method used to connect the nodes (plants, warehouses, stores) in a supply
chain
Centralized network design - ✔✔activities are concentrated at a single node. The network is designed
around it (LL Bean)
Decentralized network design - ✔✔similar activities tale place at multiple regional nodes that make up
the overall network (kroger)
Characteristics of a centralized network design - ✔✔national distribution, lower inventory investment,
lower level safety stock, lower cost of inbound transportation, higher cost of outbound transportation,
and effective service levels
Characteristics of a decentralized network design - ✔✔regional distribution, greater inventory
investment, higher safety stock, higher cost of inbound transportation, lower cost of outbound
transportation, highly effective service levels
Direct delivery - ✔✔point-to-point service, higher transportation cost, minimal inventory, no backup
stock, very low handling costs, no facility investment (newspaper)
Supply Chain management - ✔✔the art of managing the flow of materials and products, information,
and financial resources from source to user
5 primary groups of supply chain management - ✔✔suppliers, manufacturers, distributors, retailers,
consumers
Who is the most important participant in the supply chain - ✔✔the consumer
What does SCM involve? - ✔✔All activities that take place to get a product in your hands- from raw
material extraction to the minute you pull out your credit card and take the final product home
Supply chain management is important because - ✔✔it provides valuable opportunities to create
competitive advantage, develop collaborative, trusting relationships, improve customer satisfaction,
rationalize product touch points, and drive out costs and achieve efficiencies
Why is SCM important to customers? - ✔✔Product availability (time utility and place utility) and
fulfillment accuracy (the seven rights)
What are the seven rights? - ✔✔Right product, right customer, right time, right place, right condition,
right quantity, and right cost
Why is SCM important to companies? - ✔✔It helps companies outpace the competition by managing
their materials, products, and information flows (better, faster, cheaper)
Key goals of SCM - ✔✔customer car, competitiveness, efficiency, responsiveness, resiliency
What does SCM focus on? - ✔✔Planning and forecasting, supply management and procurement,
operations managements and production, and logistics and transportation
, Three flows of supply chain - ✔✔share the information (create visibility), deliver the product (drive
utility), and show me the money (release funds)
What are the challenges of SCM? - ✔✔Product life cycles are shrinking, customers are demanding
customized products, competition is intensifying, and companies need to be much more efficient
7 principles of SCM - ✔✔segment customers based on service needs, customize the logistics network,
drive operations from demand, differentiate product closer to the customer, source strategically,
develop supply chain wide technology strategy, and use supply chain spanning performance measures
Node - ✔✔a fixed point in a supply chain where valued added processes take place. Goods are
processed, transformed, mixed, held, or sold at nodes
Link - ✔✔the transformation method used to connect the nodes (plants, warehouses, stores) in a supply
chain
Centralized network design - ✔✔activities are concentrated at a single node. The network is designed
around it (LL Bean)
Decentralized network design - ✔✔similar activities tale place at multiple regional nodes that make up
the overall network (kroger)
Characteristics of a centralized network design - ✔✔national distribution, lower inventory investment,
lower level safety stock, lower cost of inbound transportation, higher cost of outbound transportation,
and effective service levels
Characteristics of a decentralized network design - ✔✔regional distribution, greater inventory
investment, higher safety stock, higher cost of inbound transportation, lower cost of outbound
transportation, highly effective service levels
Direct delivery - ✔✔point-to-point service, higher transportation cost, minimal inventory, no backup
stock, very low handling costs, no facility investment (newspaper)
