Test Bank For Operations Management Creating Value Along The Supply Chain 2nd Canadian Edition Roberta S Russell Bernard W Taylor Tiffany Bayley Ignacio Castillo

Test Bank for Operations Management: Creating Value Along the Supply Chain, 2nd Canadian Edi
Test Bank for Operations Management: Creating

Value Along the Supply Chain, 2nd Canadian Edition,
Roberta S. Russell, Bernard W. Taylor Tiffany Bayley
Ignacio Castillo
To download the complete and accurate content document, go to:

https://testbankbell.com/download/test-bank-for-operations-management-creating-val
ue-along-the-supply-chain-2nd-canadian-edition-roberta-s-russell-bernard-w-taylor-tiff
any-bayley-ignacio-castillo/
Visit TestBankBell.com to get complete for all chapters

CHAPTER 10
SUPPLY CHAIN MANAGEMENT: STRATEGY AND DESIGN
CHAPTER LEARNING OBJECTIVES
1. Define supply chains with respect to both manufacturing and services. A supply chain is
a network of suppliers, manufacturers, warehouses, distributors, and retailers who, through
coordinated plans and activities, develop products by converting raw materials to finished goods
inventory. It encompasses all the activities associated with the flow of materials and information
in the transformation of goods and services from raw materials to end consumers.
2. Explain characteristics and management strategies of the modern supply chain. Supply
chains require close collaboration, cooperation, and communication among members to be
effective. The responsiveness of supply chains to changing market requirements and their
overall efficiency are important issues in supply chain design and management. Build-to-order
(BTO) systems are successful business strategies in managing market-responsive supply
chains. Build-to-stock (BTS) or make-to-stock (MTS) supply chains fill customer orders from
stocks of inventory of finished products that are kept at various points in the network. Supply
chain members carry buffer (or extra) inventory at various stages of the supply chain to
minimize the negative effects of uncertainty and to keep goods and services flowing smoothly
from suppliers to customers. The bullwhip effect occurs when slight to Medium demand
variability becomes magnified as demand information is transmitted back upstream in the supply
chain.
3. Discuss sustainable supply chain practices and how they relate to quality
management. Sustainability has become one of the most visible recent trends in operations
and supply chain management. The impetus for, and commitment to, sustainability generally
comes from downstream in the supply chain and moves back upstream to include suppliers.
Companies have found that suppliers can account for as much as 80% of the resources
consumed in a product’s supply chain, and so many must work with and guide suppliers to
reduce the inefficient use of resources, reduce the use of raw materials, reduce waste, and
recycle; for example, improving fuel efficiency in a distribution fleet, having employees
telecommute, using eco-friendly packaging materials, and building energy-efficient facilities.
4. Discuss information technologies currently available for supply chain management.

Information technology has become the most important enabler of effective supply chain
management. Some IT supply chain enablers include:
Electronic data interchange (EDI): a computer-to-computer exchange of business documents;
links supply chain members
Barcodes: an instantaneous computer record of the sale of a product; creates point-of-sale data
Radio frequency identification (RFID): sends product data from an item to a reader via radio
waves
Copyright © 2014 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited
Supply Chain Management: Strategy and Design 10 - 2
Internet: allows a business to communicate with customers and other businesses within its
supply chain anywhere in the world in real time; it eliminates geographic barriers, enabling
companies to access markets and suppliers around the world
5. Provide an overview of the four areas where information technology assists with
supply chain integration. Information technology is the key element in achieving supply chain
integration through four areas—information sharing, collaborative planning, workflow
coordination, and the adoption of new models and technologies.
Information sharing: reduces bullwhip effect, enables early problem detection, enables faster
response, and increases trust and confidence
Collaborative planning: reduces bullwhip effect, lowers costs, enables higher capacity utilization,
improves customer service levels
Coordinated workflow: enables production efficiencies, enables faster response, improves
service, enables products to get to market quicker
Adoption of new business models and technologies: enables penetration of new markets,
enables creation of new products, improves efficiency, allows for mass customization
6. Discuss tools for monitoring supply chain performance and calculate key performance
indicators. Three of the more widely used key performance indicators are:
Inventory turnover: computed by dividing the cost of goods sold (i.e., the cost of annual sales)
by the average aggregate inventory value
Inventory days of supply: the number of days that cash is tied up as inventory
Fill rate: the fraction of orders filled by a distribution centre within a specific time period
10 - 3 Test Bank for Operations Management: Creating Value Along the Supply Chain, Canadian Edition
TRUE-FALSE STATEMENTS
1. Globalization and advances in information technology are primary reasons why supply chain
management has become a competitive priority for companies.
Answer: True
Difficulty: Easy
Learning Objective: Define supply chains with respect to both manufacturing and services.
Section Reference: 10.1 Supply Chains
2. Supply chains for services are easier to define than supply chains for manufactured goods.
Answer: False
Difficulty: Easy
3. The supply chain for a service tends to be more compacted and less extended than a supply
chain for a manufactured good.
Answer: True
Difficulty: Medium
4. Because value chain and supply chain have similar meanings they are often used
interchangeably.
Answer: True
Difficulty: Medium
5. A supply chain encompasses only the activities associated with the flow of goods and
services.
Answer: False
Difficulty: Easy
Learning Objective: Explain characteristics and management strategies of the modern supply
chain.
Section Reference: 10.2 The Management of Supply Chains
6. Suppliers are upstream members of a supply chain.
Answer: True
Difficulty: Easy
chain.
7. Final end-use customers are upstream members of a supply chain.
Answer: False
Difficulty: Easy
chain.
8. Traditionally, each supply chain member was viewed as a separate, stand-alone entity
focused on its own goals.
Answer: True
Difficulty: Medium
chain.
9. Supply chain uncertainty and variability may result in incomplete and late orders.
Answer: True
Difficulty: Medium
chain.
10. Companies address uncertainty in their supply chains by holding extra inventory.
Answer: True
Difficulty: Medium
chain.
11. The bullwhip effect occurs when slight to moderate demand variability becomes magnified
as demand information is transmitted back upstream.
Answer: True
Difficulty: Medium
chain.
12. Increasing supply chain transparency only magnifies the bullwhip effect.
Answer: False
Difficulty: Medium
chain.
13. One way to cope with the bullwhip effect is for supply chain members to share demand
information.
Answer: True
Difficulty: Medium
chain.
14. Collaborative planning, forecasting, and replenishment (CPFR) is a useful tool supporting
supply chain integration.
Answer: True
Difficulty: Medium
chain.
15. Supply chain management focuses on integrating and managing the flow of manufactured
goods, services and related information.
Answer: True
Difficulty: Medium
chain.
16. Suppliers and customers rarely participate in the design of a supply chain.
Answer: False
Difficulty: Medium
chain.
17. Information is the essential link for coordination among all supply chain members.
Answer: True
Difficulty: Easy
Learning Objective: Discuss information technologies currently available for supply chain
management.
Section Reference: 10.4 Information Technology: A Supply Chain Enabler
18. E-business replaces physical exchange processes with electronic ones.
Answer: True
Difficulty: Easy
management.
19. A computer-to-computer exchange of business documents in a standard format is known as

electronic data interchange (EDI).
Answer: True
Difficulty: Easy
management.
20. Use of radio frequency identification (RFID) technology makes it possible for a customer to
determine production schedules.
Answer: False
Difficulty: Medium
management.
21. Enterprise Resource Planning (ERP) is software that helps integrate many of the supply
chain components by sharing and organizing information and data among supply chain
members.
Answer: True
Difficulty: Medium
management.
22. A supply chain consists of an integrated group of processes to source, make, and store
products.
Answer: False
Difficulty: Easy
Learning Objective: Provide an overview of the four areas where information technology assists
with supply chain integration.
Section Reference: 10.5 Supply Chain Integration
23. Fill rate is one of the three key performance indicators in measuring supply chain
performance.
Answer: True
Difficulty: Medium
Learning Objective: Discuss tools for monitoring supply chain performance and calculate key
performance indicators.
Section Reference: 10.6 Measuring Supply Chain Performance
24. The supply chain operations reference (SCOR) model reports the fraction of orders filled by
a distribution centre in a specific time period.
Answer: False
Difficulty: Easy
MULTIPLE CHOICE QUESTIONS
25. Supply chain processes include

a) procurement.
b) production.
c) distribution.
d) all of the above.
Answer: d
Difficulty: Medium
26. The suppliers in a supply chain are referred to as ___ supply chain members.
a) downstream
b) midstream
c) upstream
d) none of the above
Answer: c
Difficulty: Easy
chain.
27. Distributors, warehouses, and retailers are referred to as ___ supply chain members.
a) downstream
b) upstream
c) procurement
d) none of the above
Answer: a
Difficulty: Easy
chain.
28. Which of the following is not a key to effective supply chain management?
a) communication among members
b) independence among members
c) collaboration among members
d) trust among members
Answer: b
Difficulty: Easy
chain.
29. Information sharing among supply chain members will typically result in all of the following
except
a) faster response times.
b) early problem detection.
c) an increased bullwhip effect.
d) greater trust and confidence among supply chain members.
Answer: c
Difficulty: Easy
chain.
30. Which of the following is not one of the three key performance indicators (KPI) used to
measure supply chain performance?
a) inventory turnover
b) postponement rate
c) inventory days of supply
d) fill rate
Answer: b
Difficulty: Medium
chain.
31. Supply chain management focuses on integrating and managing the flow of
a) services.
b) information.
c) goods.
d) all the above.
Answer: d
Difficulty: Medium
chain.
32. The bullwhip effect can

a) increase inventories.
b) increase demand.
c) increase customer service levels.
d) increase capacity.
Answer: a
Difficulty: Medium
chain.
33. All the following are approaches used in risk pooling within a supply chain except
a) reducing the number and variety of parts.
b) creating flexible capacity.
c) encouraging large orders.
d) combining inventories from multiple locations into one location.
Answer: c
Difficulty: Medium
chain.
34. Companies resist establishing green supply chains for all the following reasons except that
a) the market is soft for products with green attributes.
b) green manufacturing requires costly new equipment and practice.
c) green initiatives lower costs because fewer resources are consumed.
d) green practices face additional government, societal and social pressures.
Answer: c
Difficulty: Medium
Learning Objective: Discuss sustainable supply chain practices and how they relate to quality
management.
Section Reference: 10.3 “Green” Supply Chains
35. A computer-to-computer exchange of business documents in a standard format is known as

a) e-business.
b) electronic data interchange (EDI).
c) radio frequency identification (RFID).
d) point-of-sale data.
Answer: b
Difficulty: Easy
management.
36. All the following are enablers of efficient supply chain management except
a) bar codes.
b) price tags.
c) RFID tags.
d) the Internet.
Answer: b
Difficulty: Medium
management.
37. ___ is not a perceived advantage of radio frequency identification (RFID) technology.
a) Loss of personal privacy
b) Reduced stock-outs
c) Prevention of fraud or theft
d) Lower distribution costs
Answer: a
Difficulty: Medium
management.
38. Supply chain integration does not involve ___ among supply chain members.
a) providing information
b) collaborating on replenishment
c) reducing competition
d) coordinating work flows
Answer: c
Difficulty: Medium
Learning Objective: Provide an overview of the four areas where information technology assists
with supply chain integration.
Section Reference: 10.5 Supply Chain Integration
39. All of the following are performance metrics in the SCOR system, except
a) perfect order fulfillment.
b) production flexibility.
c) value-added productivity.
d) asset fulfillment.
Answer: d
Difficulty: Hard
40. Increased uncertainty and variability in a supply chain typically results in

a) faster deliveries.
b) more accurate order fulfillment.
c) larger inventories.
d) lower costs.
Answer: c
Difficulty: Medium
41. One way to reduce the bullwhip effect is for supply chain members to
a) make ordering decisions independently of each other.
b) create demand forecasts independently of other supply chain members.
c) share demand forecasts with other supply chain members.
d) restrict information flows between supply chain members.
Answer: c
Difficulty: Medium
42. Inventory turnover is computed by

a) dividing the cost of goods sold by the average aggregate inventory value.
b) dividing the average aggregate inventory value by costs of goods sold.
c) multiplying the average aggregate inventory value by cost of goods sold.
d) subtracting cost of goods sold from the average aggregate inventory value.
Answer: a
Difficulty: Hard
43. A company that produces small electric motors for treadmills had cost of goods sold last
year of $241,000,000. The average value of inventory for raw materials, work-in-process, and
finished goods are shown in the table below:
Raw Materials $12,379,000

Work-In-Process $7,631,000
Finished Goods $9,275,000
If the company operates 365 days a year, the days of supply being held in inventory is
a) 44.35.
b) 27.39.
c) 8.23.
d) 0.1215.
Answer: a
Difficulty: Hard
44. A company that produces specialized video equipment had cost of goods sold last year of
$127,000,000. The average value of inventory for raw materials, work-in-process, and finished
goods are shown in the table below:

If the company operates 50 weeks per year, then the number of inventory turns would be
a) 0.0979.
b) 4.3795.
c) 8.9784.
d) 10.2090.
Answer: d
Difficulty: Hard
45. A company that produces specialized video equipment had cost of goods sold last year of

If the company operates 50 weeks per year, then the weeks of supply in inventory would be
a) 4.898.
b) 0.098.
c) 10.209.
d) 35.75.
Answer: a
Difficulty: Hard
46. A company that produces printer cartridges had cost of goods sold last year of

If the company operates 50 weeks per year, then the number of inventory turns would be
a) 3.720.
b) 2.493.
c) 13.4546.
d) 28.33.
Answer: c
Difficulty: Hard
47. A company that produces printer cartridges had cost of goods sold last year of

If the company operates 50 weeks per year, then the weeks of supply in inventory would be
a) 3.716.
b) 2.493.
c) 13.4546.
d) 28.33.
Answer: a
Difficulty: Hard
48. The fraction of orders filled by a distribution centre or warehouse within a specific time
period is referred to as the
a) inventory turnover.
b) inventory supply time.
c) fill rate.
d) aggregate orders processed.
Answer: c
Difficulty: Medium
49. Which of the following is not a key performance indicator used in supply chain
management?
a) fill rate
b) days of supply
c) cost of goods
d) inventory turns.
Answer: c
Difficulty: Medium
SHORT-ANSWER ESSAY QUESTIONS
50. What is a supply chain?
Answer: A supply chain encompasses all activities associated with the flow and transformation
of goods and services from the raw materials stage through to the end user (customer), as well
as the associated information flows. In essence, it is all the assets, information, and processes
that provide “supply”.
Difficulty: Easy
chain.
51. Who are the upstream and downstream supply chain members?
Answer: The supply chain begins with suppliers. These suppliers are referred to as upstream
supply chain members while the distributors, warehouses, and eventual end-use customers are
referred to as downstream supply chain members.
Difficulty: Medium
chain.
52. What processes comprise the supply chain and how are the processes integrated?
Answer: The supply chain can be viewed as an integrated group of business processes and
activities with the same goal—providing customer satisfaction. These processes include the
procurement of services, materials, and components from suppliers; production of the products
and services; and distribution of products to the customer including taking and filling orders.
Information and information technology tie these processes together and integrates them into
the supply chain.
Difficulty: Medium
chain.
53. What is the bullwhip effect and how does it occur?
Answer: The bullwhip effect is created when supply chain members make ordering decisions
with an eye to their own self-interest and/or they do not have accurate demand information from
adjacent supply chain members. Distorted information or the lack of information, such as
inaccurate demand data of forecasts from the customer can ripple back upstream through the
supply chain and magnify demand variability at each stage. This can result in high buffer
inventories, poor customer service, missed production schedules, wrong capacity plans,
inefficient shipping, and high costs. This phenomenon is known as the bullwhip effect. It occurs
when slight to moderate demand variability becomes magnified as demand information is
transmitted back upstream in the supply chain.
Difficulty: Medium
chain.
54. List and define four information technology supply chain enablers.
Answer: Some of the more important supply chain enablers include:

Electronic data interchange (EDI) which links supply chain members for order processing,
accounting, inventory control, and distribution.
Radio frequency identification (RFID) which uses radio waves to transfer data between a
scanner and an item such as a package or shipping container.
Bar codes which contain identifying information about products as they flow through the supply
chain including product description, item number, source and destination, handling procedures,
etc.
Internet which allows companies to communicate with suppliers, customers, shippers, and other
businesses around the world, instantaneously.
Difficulty: Medium
chain.
55. List and explain the three key supply chain performance indicators.
Answer: Students should address inventory turns, average aggregate value of inventory, and fill
rates.
Difficulty: Medium
chain.
56. What is the role of information and information technology in managing the supply chain?
Answer: Information is the essential link that ties together all supply chain members and
processes. Computers and information technology enable real-time, on-line communications
throughout the supply chain enabling the efficient flow of products and services through the
supply chain. Supply chain experts like to use the phrase: “in modern supply chain
management, information replaces inventory.” While not literally true, some inventory is needed
in the supply chain, information does change the way the supply chain is managed which can
reduce the need for high levels of inventory.
Difficulty: Medium
management.
Test Bank for Operations Management: Creating Value Along the Supply Chain, 2nd Canadian Edi
LEGAL NOTICE
Copyright © 2014 by John Wiley & Sons Canada, Ltd. or related companies. All rights
reserved.
The data contained in these files are protected by copyright. This manual is furnished
under licence and may be used only in accordance with the terms of such licence.
The material provided herein may not be downloaded, reproduced, stored in a retrieval
system, modified, made available on a network, used to create derivative works, or
transmitted in any form or by any means, electronic, mechanical, photocopying,
recording, scanning, or otherwise without the prior written permission of John Wiley &
Sons Canada, Ltd.
Visit TestBankBell.com to get complete for all chapters

Test Bank For Operations Management Creating Value Along The Supply Chain 2nd Canadian Edition Roberta S Russell Bernard W Taylor Tiffany Bayley Ignacio Castillo

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Test Bank For Operations Management Creating Value Along The Supply Chain 2nd Canadian Edition Roberta S Russell Bernard W Taylor Tiffany Bayley Ignacio Castillo

Uploaded by

Copyright:

Available Formats

Test Bank for Operations Management: Creating Value Along the Supply Chain, 2nd Canadian Edi

Test Bank for Operations Management: Creating

To download the complete and accurate content document, go to:

Visit TestBankBell.com to get complete for all chapters

4. Discuss information technologies currently available for supply chain management.

Section Reference: 10.2 The Management of Supply Chains

6. Suppliers are upstream members of a supply chain.

7. Final end-use customers are upstream members of a supply chain.

Section Reference: 10.2 The Management of Supply Chains

18. E-business replaces physical exchange processes with electronic ones.

19. A computer-to-computer exchange of business documents in a standard format is known as

MULTIPLE CHOICE QUESTIONS

25. Supply chain processes include

32. The bullwhip effect can

35. A computer-to-computer exchange of business documents in a standard format is known as

40. Increased uncertainty and variability in a supply chain typically results in

42. Inventory turnover is computed by

Raw Materials $12,379,000

Raw Materials $6,189,000

Raw Materials $6,189,000

Raw Materials $7,367,528

Raw Materials $7,367,528

Finished Goods $16,523,451

SHORT-ANSWER ESSAY QUESTIONS

50. What is a supply chain?

53. What is the bullwhip effect and how does it occur?

Answer: Some of the more important supply chain enablers include:

Visit TestBankBell.com to get complete for all chapters

You might also like