APICS Certified Supply Chain Professional” LEARNING SYSTEM CSCP module eect Supply Chain Management Book 1 of 2 PW le kece scene uno) eee ee Gon Ren Cua cies cy Reema Nene an ne Seer Ny ee east Mens ae Mire a ac rrr Non esa ene cuea’ (el fer= eon Cee rans NenePreparing for the Certification Exam Studying the APICS CSCP Learning System combined with on-the-job knowledge, professional experience, and other APICS learning tools, such as the APICS Dictionary, is the most effective way to prepare for the APICS CSCP certification examination. The APICS CSCP Learning System is intended to cover the body of knowledge tested by the APICS CSCP certification examination; however, the APICS CSCP Learning System does not “teach the test.” The Learning System focuses on acquiring knowledge, whereas the exam tests the candidate’s ability to apply that knowledge in accordance with accepted industry standards, Content on the exam is based on real-world scenarios and requires candidates to apply the concepts in the APICS CSCP Learning System. While both the APICS CSCP Learning System and the APICS CSCP certification examination are based on the APICS CSCP Exam Content Manual (which is available for free download at www.LearnCSCP.com > Resource Center > Certification Exam Resources), they are developed independently of one another. To preserve exam integrity, specific exam questions and their breadth are not shared with the APICS CSCP Learning System developers. Intellectual Property and Copyright Notice All printed materials in the APICS CSCP Learning System and all material and information in the companion online component are owned by APICS and protected by United States copyright law as well as international treaties and protocols, including the Berne Convention. The APICS CSCP Learning System and the companion Access Code for the CSCP online component are for your personal educational use only and may not be copied, reproduced, reprinted, modified, displayed, published, transmitted (electronically or otherwise), transferred, sold, distributed, leased, licensed, adapted, uploaded, downloaded, or reformatted. In addition to being illegal, distributing CSCP materials in violation of copyright laws will limit the program’s usefulness. APICS invests significant resources to create quality professional development opportunities for its membership. Please do not violate APICS’ intellectual property rights or copyright laws. APICS Dictionary, 13" Edition Reference Definitions contained within the APICS CSCP Learning System are consistent with the APICS Dictionary, 13th edition. You may purchase the complete dictionary from the APICS bookstore. Module 1—Book I Checklist: Fundamentals of Supply Chain Management Section Start Date Completion Date Section Quiz Score* LA: Supply chain management concepts 1-B: Supply chain alignment with business strategy 1-C: Supply chain design and improvement considerations 1-D: Inventory management *Look for this test on the Web at www.LearnCSCP.com.Course Overview and Module 1: Fundamentals of Supply Chain Management Book 1 Module 1, Book 1 Contents 2013 APICS CSCP EXAM CONTENT MANUAL (ECM) COURSE OVERVIEW. MODULE 1: FUNDAMENTALS OF SUPPLY CHAIN MANAGEMENT Introduction Section A: Supply Chain Management Concepts It’s a World of Global, Complex, Interdependent Supply Chains. Basic Supply Chain The SCOR® Model: Linking Processes, Metrics, Best Practices, and Technologies Vertical versus Horizontal Integration . Supply Chain Management Objectives Supply Chain Management Benefits. Accounting and Financial Statement Basics Section B: Supply Chain Alignment with Business Strategy Business Strategy and Competitive Advantages. Organizational and Supply Chain Strategy, Prioritization, Capabilities, and Alignment. Resolving Misalignment or Gap: Section C: Supply Chain Design and Improvement Considerations. Understanding the Marketplace. Supply Chain Design Considerations Continuous Improvement... Section D: Inventory Management... The Need for Inventory... Aggregate and Item Inventory Management. Flow of Material. Functions of Inventory Inventory-Related Cost Categories. Effects of Inventory on the Financial Statements. © 2012 antes Version 3.1, 2013 Baton Aight seed Q rons tipoModule 1, Book 2 Contents Section E: Logistics Fundamentals .... Role of Logistics in Supply Chain Management. Logistics Service Providers—3PLs and 4PLs... Reverse Logistic .nsnee Section F: Market Segmentation . we Reasons to Identify and Understand Market Segment. Ways to Segment Markets... Understanding the Wants and Needs of Each Segment Section G: Demand Planning .. Forecasting Demand.. Demand Management... Linkages Among the Elements. Demand Management Funetional Responsibilities and Interfaces... Section H: Customer Relationship Management (CRM) Concepts Need for CRM.. Scope of CRM Elements of CRM. Benefits of CRM Implementing CRM. Need for and Uses of Customer Information i ‘in CRM. Section I: Supply Management Concepts ... Total Cost of Ownership Outsourcing and Offshoring Make-versus-Buy Analysis «00.0 Range of Buyer-Supplier Relationships, Developing Supply Plans ‘Supplier Relationship Management (SRM) .. Interrelationship between CRM and SRM Bibliography. Cumulative Course Index... © 2013 APICS Version 3.1, 2013 Edition Alike Q rome eeeAPICS Certified Supply Chain Professional™ (CSCP) Learning System This product is based on the APICS CSCP Exam Content Manual (ECM) developed by APICS. Although the text is based on the body of knowledge tested by the APICS CSCP exam, program developers do not have access to the exam questions. Therefore, reading the text does not guarantee a passing score. ‘The references in this manual have been selected solely on the basis of their educational value to the APICS CSCP certification program and on the content of the material. APICS does not endorse any services or other materials that may be offered or recommended by the authors or publishers of books and publications listed in this module. Every effort has been made to ensure that all information is current and correct. However, laws and regulations are constantly changing. Therefore, this product is distributed with the understanding that the publisher and authors are not offering legal or professional services. Acknowledgments ‘We would like to thank the following dedicated subject matter experts who shared their time, experience, and insights during the initial development and subsequent updates of the CSCP Learning System: Greg P. Allgair Curtis Brewer, CFPIM, CIRM, CSCP Jashobrata Bose, CSCP ‘Al Bukey, CFPIM, CIRM, CSCP Jestis Campos Cortés, CPIM, CIRM, C.P.M., PMP, CPAM, CQIA, CEI, CSCP, CPSM, CPF, PLS Lue Chalmet, Ph.D, CFPIM, CSCP Prashant Choudhary, CSCP David N. Dadich, CSCP, LSS Blackbelt Prasanta K. Dash, CSCP, PMP Sudripto De, CSCP Amaud Deshais, CPIM, CIRM, SCP, CPM, CPSM Alan Downs, CPIM, CSCP Ralph G. Fariello, CFPIM, CIRM, scp Laura E, Gram, CSCP Janice M. Gullo, CFPIM, CSCP Amit Kumar Gupta, BE, CSCP Joni Holeman, CFPIM, CIRM, CSCP Bric P. Jack, Ph.D., CPIM, CSCP Rajesh Kumar Jagadeeswaran, CPIM, cscP © 2013 APICS All rights reserved Dave Jankowski, CFPIM, CSCP Julie Jenson, CPIM, CSCP Honey Johnson, CFPIM, CIRM, CPM, CSCP Rajesh Kamat, CSCP Prakash Kanagalekar, CPIM, CSCP Jack Kerr, CPIM, CSCP, C.P.M. Jose Lara Mike Loughman, CSCP Giuseppe Lovecchio, CFPIM, CSCP ‘Thiagu Mathan, CSCP Richard Merritt, CFPIM, CSCP, CPM. Steven J. Miller, CSCP Alan L. Milliken, CFPIM, CIRM, scp Paulo Mondolfo, CPIM, CSCP Peter W. Murray, CIRM Mike Okrent, Ph.D., CIRM, CSCP Kasthuri Rengan Ponnambalam, cscP Gautam Chand Pradhan, CPIM, CSCP David Rivers, CFPIM, CIRM, CSCP Maryanne Ross, CFPIM, CIRM, cscP Kimber Rueff, CPIM, CIRM, CSCP, CPM. Ignacio Sanchez-Chiappe Carolyn Sly, CPIM, CSCP, C.P.M, Pam Somers, CPIM, CIRM, CSCP Chad Stricklin Shashank Tilak, CPIM, CSCP Huan-Jau (Arthur) Tseng, CFPIM, ‘csc Dave Turbide, CFPIM, CIRM. Sudeep Valmiki, CSCP Rosemary Van Treeck, CPIM, CIRM, cscP ‘Wout Verwoerd, CFPIM, CIRM, cscP Robert Vokurka, Ph.D., CFPIM, CIRM, CSCP, C.P.M. Eddie J. Whitfield, CPIM, CIRM, ‘cscP Vivek Wikhe, CSCP Blair Williams, Jonah, CFPIM, CSCP ® Version 3.1, 2013 Edition Pin 10% poser as eyo papeAPICS CSCP Exam Content Manual This manual is in effect from January 1, 2013, through December 2013. Visit apics.org/ECMerrata for APICS CSCP Exam Content Manual errata. The references in this manual have been selected solely on the basis of their educational value to the APICS CSCP certification program and on the content of the material. APICS does not endorse any services or other materials that may be offered or recommended by the authors or publishers of books and publications listed in this manual. ©2013 APICS The Association for Operations Management 8430 West Bryn Mawr Avenue, Suite 1000 Chicago, IL 60631-3439 USA Phone: 1-800-444-2742 or +1-773-867-1777 Fax: #1-773-639-3000 No portion of this document may be reproduced under any circumstances. CSCP is a registered trademark of APICS. Stock #09031-2013Table of Contents Letter to Candidates . ECM Introduction oes About the APICS CSCP Examination... Question Format . Taking the Test ... ECM-3 ECM-3 Interpreting Test Scores Studying for the APICS CSCP Exam. APICS CSCP References. soos ECM3, Terminology .... ‘Additional Resources for APICS CSCP Candidates... ECM-4 APICS CSCP Learning System -ECM-4 APICS CSCP Instructor-Led Review Courses. .ECM-4 APICS Educational Programs... sevnnees ECM. APICS Certified in Production and Inventory Management (CPIM) Basics of Supply Chain Management (BSCM) Review Course and Examination. APICS CSCP Certification Maintenance: Continuing Professional Development .. The Importance of Certification Maintenance ..... APICS Code of Ethics .. APICS Certified Supply Chain Profes: Scope of the Subject Matter APICS CSCP Content ... Content Outline Key Terminology... Supplemental Glossary Bibliography Sample Questions. Answers to Sample Questions..... CSCP Exam Content Manual iLetter to Candidates Dear Can late: On behalf of all the members of APICS The Association for Operations Management and the Certified Supply Chain Professional (CSCP) Subcommittee, | want to thank you for your interest in the APICS CSCP program. APICS is the global leader and premier source of the body of knowledge in operations management, including production, inventory, supply chain, purchasing, and logistics. Since 1957, individuals and companies have relied on APICS for its superior training, internationally recognized certifications, comprehensive resources, and worldwide network of accomplished industry professionals. The APICS CSCP program is primarily intended for professionals in supply chain management and is, designed to test the candidate's knowledge of and ability to apply the supply chain management body of knowledge. By earning the APICS CSCP designation, candidates have demonstrated their understanding of supply chain management best practices. The APICS CSCP program will help you advance your career while giving you validated foundational