OM 300 UPDATED ACTUAL QUESTIONS
AND CORRECT ANSWERS COMPLETE
STUDY GUIDE
●● Why is supply chain management strategically important?
Answer: It affects cost, quality, delivery speed, reliability, flexibility,
inventory, and responsiveness to customers.
●● Which activities are commonly part of supply chain management?
Answer: Sourcing, purchasing, supplier relations, production
coordination, transportation, warehousing, distribution, order fulfillment,
and information sharing.
●● Which six sourcing strategies are emphasized in Chapter 11?
Answer: Many suppliers, few suppliers, vertical integration, joint
ventures, keiretsu networks, and virtual companies.
●● What is the many-suppliers sourcing strategy?
Answer: Using competition among numerous suppliers, usually with an
emphasis on low prices and short-term purchasing.
●● What is the few-suppliers sourcing strategy?
, Answer: Building long-term relationships with a small number of
committed suppliers.
●● What is vertical integration?
Answer: Developing the ability to produce goods or services previously
purchased, or purchasing a supplier or distributor.
●● What is a joint venture?
Answer: A formal collaboration in which companies combine resources
to pursue a shared opportunity.
●● What is a keiretsu network?
Answer: A group of collaborating companies that combines features of
few suppliers, vertical integration, and long-term partnerships.
●● What is a virtual company?
Answer: A company that relies on flexible supplier relationships to
provide services and expertise as needed.
●● What are common supply chain risks, and how can they be reduced?
Answer: Risks include supplier failure, quality problems, delays,
information loss, political or economic problems, and disasters; tactics
include backup suppliers, monitoring, contracts, secure systems,
insurance, and geographic diversification.
AND CORRECT ANSWERS COMPLETE
STUDY GUIDE
●● Why is supply chain management strategically important?
Answer: It affects cost, quality, delivery speed, reliability, flexibility,
inventory, and responsiveness to customers.
●● Which activities are commonly part of supply chain management?
Answer: Sourcing, purchasing, supplier relations, production
coordination, transportation, warehousing, distribution, order fulfillment,
and information sharing.
●● Which six sourcing strategies are emphasized in Chapter 11?
Answer: Many suppliers, few suppliers, vertical integration, joint
ventures, keiretsu networks, and virtual companies.
●● What is the many-suppliers sourcing strategy?
Answer: Using competition among numerous suppliers, usually with an
emphasis on low prices and short-term purchasing.
●● What is the few-suppliers sourcing strategy?
, Answer: Building long-term relationships with a small number of
committed suppliers.
●● What is vertical integration?
Answer: Developing the ability to produce goods or services previously
purchased, or purchasing a supplier or distributor.
●● What is a joint venture?
Answer: A formal collaboration in which companies combine resources
to pursue a shared opportunity.
●● What is a keiretsu network?
Answer: A group of collaborating companies that combines features of
few suppliers, vertical integration, and long-term partnerships.
●● What is a virtual company?
Answer: A company that relies on flexible supplier relationships to
provide services and expertise as needed.
●● What are common supply chain risks, and how can they be reduced?
Answer: Risks include supplier failure, quality problems, delays,
information loss, political or economic problems, and disasters; tactics
include backup suppliers, monitoring, contracts, secure systems,
insurance, and geographic diversification.
