Supply Chain Management: Final Exam
What is supply chain management? - (correct Answer) - The design and execution of relationships and
flows that connect the parties and processes across a supply chain.
Drivers of SCM - (correct Answer) - - Visibility
- Consumer Behavior
- Speed
- Competition
- Information Technology
What is a supply chain and its components? (Upstream, downstream, tier suppliers). Be able to identify
the position in the supply chain. - (correct Answer) - A supply chain is the global network of
organizations and activities involved in designing, transforming, consuming, and disposing of goods and
services.
The supply chain flows downstream (to consumer) and upstream (to suppliers).
Tier 3 supplier --> Tier 2 supplier --> Supplier --> Manufacturer --> Distributor --> Retailer --> Consumer
What is difference between goods and services? - (correct Answer) - Goods:
- Tangible
- Can be inventoried
- Little customer contact
- Long lead times
- Capital-intensive
- Quality is easy to assess
,- Material is being transformed
Services:
- Intangible
- Can't be inventoried
- Extensive customer contact
- Short lead times
- Labor-intensive
- Quality is difficult to asses
- Information or customer are being transformed
According to ISM, what is the operational importance of SCM? - (correct Answer) - - Provide an
interrupted flow of materials and services to operating systems
- Keep inventory investment at a minimum
- Maximize quality
- Find and develop competent sources of supply
- Standardize requirements for products/services
- Purchase materials and services at the lowest total cost of ownership
- Foster cross-functional relationships
Understand customer value and the value proposition. How is value created and captured? - (correct
Answer) - Customer Value: The difference between what a customer gets from a product, and what he
or she has to give in order to get it.
Value Proposition: A set of benefits or values a company promises to deliver to customers to satisfy their
needs.
The goal of supply chain is to create and capture value. The more value an organization creates, the
more profitable it will be. A company has to be attractive to its customers and has to offer different
things from what is offered by competitors.
,1. Understand value
2. Create value
3. Communicate value
4. Capture value
What is the difference between customer satisfaction and perceived customer value? - (correct Answer)
- Customer satisfaction: The extent to which a product's perceived performance matches a buyer's
expectations. It is meeting or exceeding customer expectations.
Customer perceived value: The difference between total customer value and total customer cost.
What is digital darwinism? - (correct Answer) - The evolution of consumer behavior when society and
technology evolve faster than the ability to adapt.
Implies that organizations which cannot adapt to the new demands placed on them for surviving in the
information age are doomed to extinction.
Different levels of strategic planning in supply chain- strategic, tactical, operational, and the type of
decision to apply to each. - (correct Answer) - Strategic Planning
- Overall mission and target business long term
- Overall values, directions and goals
- Corporate Strategy
- What business should we be in? What is our mission?
Tactical Planning
- Business Strategy/SBU
- Shorter time horizon
- How do we compete? Which customers will we target? What will we offer? Which supply
chain/operations management capabilities will we employ?
- Overall cost leader, differentiation, focus market segmentation, and quality focus
, Operational/Functional Planning
- Operations Strategy
- How do we best support the overall SBU (Business) strategy?
- Structure/Infrastructure
- Competitive priorities
- Create capabilities that support a set of value propositions
- How functions
Be able to define a critical customer and the customer needs assessment of order winners, losers and
qualifiers. Be able to determine order winner, loser and qualifier characteristics. - (correct Answer) -
Key/critical customers: A customer that the firm has targeted as being important to its future success.
It is important for operations managers to know what product features and delivery terms key
customers consider important, what they are willing to pay, and what they consider acceptable.
These product-specific traits can be classified into one of three categories:
Order winners- Why customers choose your firm?
Ex: Better performance or lower price.
Order qualifiers- Minimum standards to be met.
Ex: Availability, price, or conformance quality.
Order losers- Why customers avoid your firm? Poor performance can cause the loss of current or future
customers.
Ex: When an online retailer fails to deliver an order in a timely manner, a customer might cancel the
order and refuse to place orders in the future.
What is supply chain management? - (correct Answer) - The design and execution of relationships and
flows that connect the parties and processes across a supply chain.
Drivers of SCM - (correct Answer) - - Visibility
- Consumer Behavior
- Speed
- Competition
- Information Technology
What is a supply chain and its components? (Upstream, downstream, tier suppliers). Be able to identify
the position in the supply chain. - (correct Answer) - A supply chain is the global network of
organizations and activities involved in designing, transforming, consuming, and disposing of goods and
services.
The supply chain flows downstream (to consumer) and upstream (to suppliers).
Tier 3 supplier --> Tier 2 supplier --> Supplier --> Manufacturer --> Distributor --> Retailer --> Consumer
What is difference between goods and services? - (correct Answer) - Goods:
- Tangible
- Can be inventoried
- Little customer contact
- Long lead times
- Capital-intensive
- Quality is easy to assess
,- Material is being transformed
Services:
- Intangible
- Can't be inventoried
- Extensive customer contact
- Short lead times
- Labor-intensive
- Quality is difficult to asses
- Information or customer are being transformed
According to ISM, what is the operational importance of SCM? - (correct Answer) - - Provide an
interrupted flow of materials and services to operating systems
- Keep inventory investment at a minimum
- Maximize quality
- Find and develop competent sources of supply
- Standardize requirements for products/services
- Purchase materials and services at the lowest total cost of ownership
- Foster cross-functional relationships
Understand customer value and the value proposition. How is value created and captured? - (correct
Answer) - Customer Value: The difference between what a customer gets from a product, and what he
or she has to give in order to get it.
Value Proposition: A set of benefits or values a company promises to deliver to customers to satisfy their
needs.
The goal of supply chain is to create and capture value. The more value an organization creates, the
more profitable it will be. A company has to be attractive to its customers and has to offer different
things from what is offered by competitors.
,1. Understand value
2. Create value
3. Communicate value
4. Capture value
What is the difference between customer satisfaction and perceived customer value? - (correct Answer)
- Customer satisfaction: The extent to which a product's perceived performance matches a buyer's
expectations. It is meeting or exceeding customer expectations.
Customer perceived value: The difference between total customer value and total customer cost.
What is digital darwinism? - (correct Answer) - The evolution of consumer behavior when society and
technology evolve faster than the ability to adapt.
Implies that organizations which cannot adapt to the new demands placed on them for surviving in the
information age are doomed to extinction.
Different levels of strategic planning in supply chain- strategic, tactical, operational, and the type of
decision to apply to each. - (correct Answer) - Strategic Planning
- Overall mission and target business long term
- Overall values, directions and goals
- Corporate Strategy
- What business should we be in? What is our mission?
Tactical Planning
- Business Strategy/SBU
- Shorter time horizon
- How do we compete? Which customers will we target? What will we offer? Which supply
chain/operations management capabilities will we employ?
- Overall cost leader, differentiation, focus market segmentation, and quality focus
, Operational/Functional Planning
- Operations Strategy
- How do we best support the overall SBU (Business) strategy?
- Structure/Infrastructure
- Competitive priorities
- Create capabilities that support a set of value propositions
- How functions
Be able to define a critical customer and the customer needs assessment of order winners, losers and
qualifiers. Be able to determine order winner, loser and qualifier characteristics. - (correct Answer) -
Key/critical customers: A customer that the firm has targeted as being important to its future success.
It is important for operations managers to know what product features and delivery terms key
customers consider important, what they are willing to pay, and what they consider acceptable.
These product-specific traits can be classified into one of three categories:
Order winners- Why customers choose your firm?
Ex: Better performance or lower price.
Order qualifiers- Minimum standards to be met.
Ex: Availability, price, or conformance quality.
Order losers- Why customers avoid your firm? Poor performance can cause the loss of current or future
customers.
Ex: When an online retailer fails to deliver an order in a timely manner, a customer might cancel the
order and refuse to place orders in the future.
