Sourcing
Which of the following costs are easy to evaluate when making purchase?
A Transportation cost
B Warranties
C Liability
D Damaged reputation
Correct: A
—>typically straightforward to calculate because they are based on tangible factors like distance, weight, volume, and shipping method
What is Supply Management?
The identification, acquisition, and management of inputs and supplier relationships.
What is logistics management?
Management of the movement and storage of materials at lowest cost while still meeting customers’ requirements.
Which of the following is not a risk of supply chain?
A Supplier financial problems
B Changes in government regulations
C Regular maintenance of company machinery
D Lack of transparency in the supply chain
Correct: C
Name 2 out of the 6 Supply Management Goals.
• Ensure timely availability of resources.
• Identify, assess, and mitigate supply chain risk.
• Reduce total costs.
• Enhance quality.
• Access technology and innovation.
• Foster sustainability.
Name 4 transportation modes (a form or method of transporting items).
-Truck
-Rail
-Air
-Water
-Pipeline
What is the difference between Insourcing & Outsourcing?
Insourcing acquires inputs from operational processes provided within the firm.
Outsourcing acquires inputs from operational processes provided by suppliers.
Which of the following relationships is least involved in the supplier relationships and emphasizes independence?
A Full Partnership
B Adversarial Relationship
C Cooperative Relationship
D Arm’s-Length Relationship
Correct: B
-adversarial relationships: Relationships characterized by distrust and limited communications.
Wrong:
-arm’s-length relationships: Relationships limited to simple purchasing transactions.
-cooperative relationships: Cooperative relationships seek to attain mutual goals but lack the commitment of full partnerships.
-full partnerships: Relationships that have close working relations, trust, mutual respect, and highly integrated operations.
Finish the following economy of distance sentence.
The cost per unit increases/decreases as the...
The cost per unit of distance decreases as the distance moved increases.
Name 4 Advantages of Outsourcing
-Capital is not needed for equipment and facilities
-Easier to add or remove capacity if demand changes
-Lower costs because suppliers gain economies of scale and suppliers often pay lower wages
-Increased flexibility to change technology or suppliers
How can Bottleneck Purchases be identified?
A high spend level & high risk
B low spend level & high risk
C high spend level & low risk
D low spend level & low risk
Correct: B
—> typically are not core to the firm’s performance, but lack of availability can cause delays
examples: rare raw materials, pharmaceutical ingredients
Which type of Consolidation refers to "Combining small shipments from different shippers that are going to the same market area".
A scheduled delivery consolidation
B pooled delivery consolidation
C market area consolidation
D economy of distance consolidation
Correct: B
-market area consolidation: Combining several small shipments from one shipper that are going to the same market area into one shipment.
-scheduled delivery consolidation: Establishing specific times when deliveries to customers will be made.
Name 2 Relevant Quantitative Costs when assessing Insourcing/Outsourcing.
-fixed costs per contract: Costs incurred at the start of production or the beginning of a new contract.
-fixed costs per order: Costs incurred each time an order is placed, regardless of the size of the order.
-variable costs: Costs that change in proportion to the quantity of units produced or service delivered.
What is the weighted-point model and How does it work?
weighted-point model: Establishes performance categories that are weighted according to importance
1. weight each performance category so the sum of the weights equals 100 percent
2. rate each supplier on each category using scales of 1 to 3 or 1 to 5
3. The rating for each category is then multiplied by the weight to get its score
Which type of Distribution Centers refers to "Splitting a large shipment into individual orders and arranging for local delivery to customers".
Hint: (Supplier—>Warehouse—>Customer)
A break-bulk
B warehouse consolidation
C cross-docking
D economy of scale consolidation
Correct A
warehouse consolidation: Combining shipments from a number of sources into one larger shipment going to a single location.
cross-docking: Combines break-bulk and warehouse consolidation activities.