SCM-L FINAL TEST 1-5

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1. 1) A unique feature of integrated logistics is: Complexity and scope

A) The newness of the concept of operations
B) Its fundamental similar to military operations
C) Complexity and scope of operations
D) The fact that it employs many people

2. What is the primary reason that responsiveness Information Technolo-

has decreased over the past two decades: gy
A) Improvement in Federal Highways
B) Better Sea Ports
C) Development of Double Stack Containers
D) Information Technology

3. A Supply Chain is best described by which of the A group of collabora-

following: tive companies
A) A group of cooperative carriers
B) A group of collaborative companies
C) A formal association of competitive companies
D) Two firms who create a strategic alliance

4. Which of the following best describes an integra- the link of critical parts
tive supply chain process: of a supply chain
A) Something that links together independent
parts
B) A concept that identifies independent parts
C) A conglomeration of functions
D) The link of critical parts of a supply chain

5. The concept of postponement: Seeks to reduce the

A) Involves two organizations working together to risk of anticipation
delay delivery
B) Involves strategic delay of the delivery
C) Seeks to reduce the risk of delivery
D) Seeks to reduce the risk of anticipation

6. Collaboration is the act of: Integrating compo-

A) Sharing secret information nents of a supply
B) Working with competitors chain

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C) Integrating components of a supply chain
D) Legal in selected supply chain arrangements

7. An integrated service supplier (ISP) seeks to: Provide critical opera-

A) Provide critical operational functionality in a tional functionality in a
supply chain supply chain
B) Specializes in providing a specialized service
C) Bring together two otherwise separate func-
tions
D) None of the above

8. The lowest total process cost: May be the lowest cost

A) Is always the sum of the lowest cost for each of each involved func-
involved function tion
B) May be the lowest cost of each involved func-
tion
C) Is the lowest cost of each involved function
D) Is a product of careful cost integration

9. The Anticipatory Business Model is best de- Driven by forecast

scribed by which statement:
A) Driven by forecast
B) Driven by information technology
C) Builds on the principles of time-based compe-
tition
D) Is a low risk strategy

10. The internet has increased business-to-business FALSE

connectivity.

11. Supply Chain Management promotes a network of TRUE

highly efficient interdependent businesses

12. There are eight critical supply chain processes TRUE

13. Collaboration is a fundamental part of Supply TRUE

Chain Management.

14. A third party service supplier is also a public FALSE

warehouse
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15. Process specialization involves the same con- FALSE

cepts as vertical integration.

16. The principle of postponement is new to the dis- FALSE

cipline of logistics.

17. Increased operational responsiveness is directly TRUE

related to information technology.

18. Enterprise extension is a diversification strategy. FALSE

19. Vertical integration and supply chain extension FALSE

are essentially the same concepts.

20. Transaction systems are characterized by all of A low volume of trans-

the following EXCEPT actions
A) Formalized rules, procedures, and standard-
ized communications
B) A low volume of transactions
C) A large volume of transactions
D) An operational, day-to-day focus

21. The foundation of the Supply Chain Information A strong transaction

Functionality pyramid is system
A) Formalized rules, procedures, and standard-
ized communications
B) Complex strategic planning
C) A strong transaction system
D) Informed decision analyses

22. Most SCIS development and implementation is Enhanced supply

now focused on chain system integra-
A) Formalized rules, procedures, and standard- tion and improved de-
ized communications cision-making
B) A low volume of transactions
C) A large volume of transactions
D) Enhanced supply chain system integration and
improved decision-making

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23. ________ is sometimes also referred to as a "data An integrated corpo-
warehouse". ratewide database
A) ERP
B) An integrated corporatewide database
C) A legacy system
D) The general ledger

24. The human resources module of the ERP systems Personnel profiles and
tracks their activity levels
A) Personnel profiles and their activity levels
B) The functions for invoice collection
C) The supply chain's ability to measure, monitor
and report cost
D) The timing and location of supply chain val-
ue-added processes

25. ________ systems are applications designed to CRM (Customer re-

facilitate information sharing between customers, lationship manage-
sales force, and operations management ment)
A) ERP (Enterprise resource planning)
B) TMS (Transportation management system)
C) Samp;OP (Sales and operations planning)
D) CRM (Customer relationship management)

26. ________ is the hardware and technical software Communication tech-

that facilitates information exchange between the nology
systems and physical infrastructures within the
firm and between supply chain partners.
A) Communication technology
B) Blockchain
C) Consumer connectivity
D) Reverse logistics

27. The pharmaceutical industry is highly affected by High; ease

counterfeiting because of the ________ value of
products and ________ of falsifying raw material.
A) High; ease
B) High; difficulty
C) Low; ease
D) Low; difficulty
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28. All of the following are benefits of blockchain EX- Decreased scalability
CEPT
A) Better security
B) Increased innovation
C) Decreased scalability
D) Enhanced transparency

29. The ________ manages, and in many cases initi- WMS

ates the transactions that receive, store, retrieve
and ship product from the warehouse.
A) CMS
B) TMS
C) YMS
D) WMS

30. Dwell time is: The ratio of asset idle

A) A key component of system design time to total time re-
B) The ratio of asset idle time to total time required quired to complete a
to complete a mission mission
C) The total time inventory is waiting to be
processed.
D) A key concept in manufacturing efficiency

31. A unique feature of integrated logistics is: Its complexity and

A) The newness of the concept scope of operations
B) Its fundamental similarity to military opera-
tions
C) Its complexity and scope of operations
D) The fact that it employees many people

32. Basic logistics service is a concept that: Describes the level

A) Describes the level of service provided all es- of service provided
tablished customers all established cus-
B) Is involved in designing a network tomers
C) Only involves availability
D) None of the above

33. A logistics performance cycle is:

A) A format for improved measurement of cost
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and service. The basic unit of sup-
B) The basic unit of supply chain design and op- ply chain design and
erational control operational control
C) An important form of transportation measure-
ment
D) Typically echeloned

34. A flow through facility is: Also often called a

A) Typically found in the beverage industry cross-dock facility
B) Also often called a cross-dock facility
C) A specialized warehouse that performs val-
ue-added services
D) Dedicated to the support of an integrated ser-
vice provider.

35. The "Pareto Principle" is: Used in logistics to de-

A) Unique to logistical performance measurement velop fine line invento-
B) A concept developed in manufacturing to inte- ry classification
grate logistics and procurement
C) Used in logistics to develop fine line inventory
classification
D) Seldom the result of logistics system design

36. Service reliability is best described as: The quality dimen-

A) The measure of availability that is most critical sion of logistics perfor-
in system design mance
B) Dealing with speed and consistency of order
cycle performance.
C) The quality dimension of logistics performance
D) The key attribute of transportation integration

37. The primary reason that total logistics cost has Inventory has de-
reduced as a percentage of GDP is: creased as a percent
A) Inventory has increased as a percent of total of total cost
cost
B) Inventory has decreased as a percent of total
cost
C) Transportation has decreased as a percent of
total cost
D) Nominal GDP has increased
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38. The work of logistics involves: Transportation, inven-

A) Order processing, inventory, and manufactur- tory, order processing,
ing warehousing, and fa-
B) Inventory, transportation, manufacturing and cility network design
procurement
C) Manufacturing, customer accommodation, and
purchasing
D) Transportation, inventory, order processing,
warehousing, and facility network design

39. Logistics cost has declined as a percent of GDP TRUE

over the past 25 years.

40. Service reliability involves logistical quality TRUE

41. Total cost was not typically the way managers TRUE
viewed logistics prior to the 1960's.

42. The logistics value proposition is based solely on FALSE

cost minimization.

43. The work of logistics is all about transportation FALSE

planning and execution.

44. Logistical system design is driven by careful inte- FALSE

gration of all operational components to minimize
total cost

45. Transportation cost drives a firm's focus on FALSE

speed and consistency

46. Facility network design is the function of total FALSE

cost minimization.

47. Procurement and manufacturing are an integral FALSE

part of integrated logistics.

48. Echeloned distribution structure facilitates direct FALSE

delivery.
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49. Efficiency as contrasted to effectiveness is the FALSE

primary goal of logistics.

50. Performance cycle uncertainty is a key concern in TRUE

logistical operations.

51. The goal of cycle synchronization is achievement TRUE

of planned time performance.

52. Performance Cycle variance is a prime determi- TRUE

nant of safety stock.

53. ) In providing service outputs to consumers, a waiting time

disadvantage of Internet retailers compared to
store-based retailers arises in:
A) product variety and assortment
B) lot size
C) price
D) waiting time

54. In general, offering consumers higher levels of results in higher lo-

service output in terms of greater spatial conve- gistics and distribution
nience or product variety: cost
A) has little impact on logistics and distribution
cost
B) results in lower logistics and distribution cost
C) results in higher logistics and distribution cost
D) does not impact configuration of a supply
chain

55. The most exacting measure of logistics perfor- orders shipped com-
mance regarding availability is: plete
A) Stockout frequency
B) orders shipped complete
C) fill rate
D) average number of items on hand

56. Which of the following is not one of the "service price

outputs" of a supply chain:
A) lot size
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B) waiting time
C) price
D) spatial convenience

57. Numerous studies have been performed concern- average about 8%

ing retail stockouts. While results vary, generally
the studies find that stockouts:
A) are extremely rare
B) average about 8%
C) are less frequent for items that are being
specifically promoted by a retailer
D) average about 20%

58. Jones Company promised a customer that the communication gap

customer would receive at least 98% of all items
ordered. In fact, the customer received 95% of the
items. This is an example of which "gap" in the
customer satisfaction model?

59. The difference between a "customer success" fo- customer satisfaction

cus" and a "customer satisfaction" focus is that: deals with expecta-
A) customer satisfaction is more difficult to tions, customer suc-
achieve cess deals with re-
B) customer success deals with expectations of quirements
customers, satisfaction deals with their require-
ments
C) customer satisfaction deals with expectations,
customer success deals with requirements.
D) there really isn't any difference

60. Providing perfect orders to a customer would be customer service

a key aspect of which customer accommodation
focus?
A) customer service
B) customer satisfaction
C) customer success
D) customer happiness

61. Jones Company makes every effort to consistent- customer satisfaction

ly meet the expectations of all of its customers. It
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is clear that Jones company is focused on:
A) customer service
B) customer satisfaction
C) customer happiness
D) customer success

62. Providing value-added services is a critical as- customer success

pect of:
A) customer service
B) customer satisfaction
C) customer happiness
D) customer success

63. From a strategic perspective, companies should realize different cus-

strive to: tomer accommoda-
A) provide customer success to all customers tion approaches may
B) realize different customer accommodation ap- be appropriate for dif-
proaches may be appropriate for different cus- ferent customers
tomers
C) decern/be aware that all customers desire
close customer success types of relationships
D) never refuse to do business with a customer

64. Alpha Company has a performance standard of a performance gap

97% fill rate. Last month it achieved a 94% fill rate.
This is an example of:
A) a knowledge gap
B) a standards gap
C) a performance gap
D) a perception gap

65. On-time delivery is an aspect of a company's per- operational perfor-

formance in: mance
A) availability
B) operational performance
C) malfunction recovery
D) speed

66. FALSE

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Since Walmart* and Target are both mass mer-
chandisers it is likely that they both have the same
logistical service requirements from suppliers.

67. Providing greater spatial convenience to cus- TRUE

tomers typically requires greater logistics ex-
pense.

68. Companies should strive to offer the same fill rate FALSE
performance on all items they stock.

69. Good logistics practice involves developing oper- FALSE

ations in which malfunctions never occur.

70. A company has identified that there are 5 critical FALSE

components of a "perfect order" It establishes
a 97% standard on each of these components.
Assuming it achieves this standard, it can expect
that its overall perfect order performance is 97%.

71. Achieving customer satisfaction with logistical TRUE

performance does not mean that customers will
be loyal.

72. Customers may be dissatisfied with a company TRUE

even if that company consistently provides per-
fect order performance.

73. A customer success program in a company FALSE

should focus on every customer the company
serves.

74. In developing strategy for customer accommoda- FALSE

tion, low-profitability customers should never be
candidates for a customer success relationship

75. A firm which provides logistics service that is FALSE

superior to its competitors can be sure that cus-
tomers are satisfied.

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76. Knowing the location and status of inventory and visibility
resources is referred to as:
A) intelligence
B) visibility
C) knowledge
D) integration

77. Which of the following illustrates a typical conflict operations prefers

in objectives between sales and operations? long lead times, sales
A) operations prefers many product variation, prefers short lead
sales prefers few product variations times.
B) operations prefers long lead times, sales
prefers short lead times.
C) operations prefers maximized revenue, sales
prefers maximized production
D) operations prefers responsive schedules,
sales prefers stable schedules

78. When a company implements its monthly S&OP Determining the busi-
process, the process should begin with: ness planning vs fi-
A) Developing and specifying the constraints re- nancial objectives
lated to manufacturing capabilities
B) Determining the business planning vs financial
objectives
C) Looking at existing orders from major cus-
tomers
D) Gathering information from sales and market-
ing

79. Which of the following is NOT a benefit of S&OP? the S&OP process
A) the S&OP process eliminates the need to have eliminates the need to
finished goods inventory have finished goods
B) the S&OP process results in better customer inventory
service
C) the S&OP process provides better visibility into
future capacity problems
D) the S&OP process provides a single set of
numbers to run the business.

80.
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Which of the following is NOT a key to making S&OP should focus
S&OP work in an organization. 12-18 months into the
A) S&OP should be executed monthly future
B) S&OP should have a clear leader
C) S&OP should focus 12-18 months into the fu-
ture
D) None of the above

81. In recent years some companies have begun to Collaborative Plan-

work closely with their customers and/or suppli- ning, Forecasting, and
ers by sharing information to develop forecasts Replenishment
of demand. The procedure they are following is
known as:
A) Coordinated Forecasting of requirements
B) Joint planning of Demand Forecasts
C) Collaborative Planning, Forecasting, and Re-
plenishment
D) Conjoint Analysis and Forecasting

82. If Dell computer is making a forecast for the next Total number of lap-
year, which of the following forecasts would most tops with 2 Giga-
likely have the largest forecast error (as measure byte RAM, 80 Giga-
by the percentage error)? byte hard drive and
A) Total number of computers (laptops and desk- 16x DVD drive to be
tops) to be sold next year in US sold next year in US
B) Total number of laptops to be sold next year in
US
C) Total number of desktop to be sold next year in
US
D) Total number of laptops with 2 Gigabyte RAM,
80 Gigabyte hard drive and 16x DVD drive to be
sold next year in US

83. What is the Mean Absolute Deviation (MAD)? Explanation: MAD is

the average of the
absolute value of the
error.
MAD=300+200+100/3=20

84.
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The Mean Absolute Percentage Error (MAPE) is STEP 1.FIND AB-
approximately: SOULE VALUE (ACU-
TAL DEMAND - FOR-
CAST DEMAND)
STEP 2. FIND AB-
SOLUTE PERCE-
NATE ERROR = AB-
SOLUTE VALUE /
ACUTAL DEMAND)
STEP 3. THE SUM
OF ABSOLUTE PER-
CENTAGE ERROR /
BY THE NUMBER OF
PERIODS)

85. Which function typically needs the most detailed logistics

forecasts and therefore typically deals with the
highest forecast error?

86. Accurate forecasting is most critical; all of the above

A) when lead times are long
B) when there are high economies of scale in
manufacturing
C) when there are high economies of scale in
transportation
D) all of the above

87. The component of a forecast that is impossible to irregular

predict is:
A) base demand
B) trend
C) promotional
D) irregular

88. Which of the following is not a time series tech- simulation

nique of forecasting?
A) simulation
B) exponential smoothing
C) moving average
D) adaptive smoothing
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89. As a forecasting technique, moving average: is useful when only

A) is useful when only base and irregular demand base and irregular de-
components exist mand components ex-
B) is never useful ist
C) is useful when demand patterns repeat with
cyclic, trend, or seasonal components
D) is useful when there is a strong relationship be-
tween demand and certain independent variables

90. It has been clearly demonstrated that quantitative FALSE

techniques of forecasting always result in less
forecast error than qualitative techniques.

91. To effectively implement Sales and Operations FALSE

Planning, sales and marketing people should de-
velop marketing plans based on their forecast
of demand while operations should develop the
production plan based on their own forecast of
demand.

92. S&OP is a process that applies only to manufac- FALSE

turing organizations.

93. Good supply chain visibility is achieved when a FALSE

firm is able to identify its shipments and its inven-
tory.

94. S&OP is primarily concerned with implementation FALSE

of advanced planning information technology.

95. To insure that S&OP is most effectively imple- FALSE

mented, a company should establish a specific
department charged with S&OP responsibility.

96. CPFR involves joint planning of forecasts be- TRUE

tween customers and suppliers

97. TRUE

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A company that has a responsive supply chain
capability is less reliant on forecasting than a
company that has an anticipatory supply chain.

98. Of the various components of a forecast, the most TRUE

controllable is the promotional component.

99. Use of statistical forecasting techniques removes FALSE

the need for managerial judgment in forecasting.

100. It is generally easier to provide an accurate fore- FALSE

cast of SKU level demand than it is to provide an
accurate forecast of total demand.

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