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Supply Chain Management, 5e (Chopra/Meindl) Chapter 15 Sourcing Decisions in a Supply Chain 15.1 True/False Questions 1) Purchasing, also known as procurement, is the process used to rate supplier performance. Answer: FALSE Diff: 2 Topic: 15.1 The Role of Sourcing in a Supply Chain Learning Outcome: Compare and contrast different sourcing strategies including outsourcing and insourcing 2) Sourcing processes include the selection of suppliers, design of supplier contracts, product design colla
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   Supply Chain Management, 5e  (Chopra/Meindl)Chapter 15 Sourcing Decisions in a Supply Chain 15.1 True/False Questions1) Purchasing, also known as procurement, is the process used to rate supplier performance.Answer FA! #$iff %Topic 15.1 The &ole of ourcing in a uppl' (hain!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing%) ourcing processes include the selection of suppliers, design of supplier contracts, product design colla*oration, procurement of material, and e+aluation of supplier performance.Answer T&#$iff %Topic 15.1 The &ole of ourcing in a uppl' (hainAA( - Anal'tic kills!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing) For man' firms, price has traditionall' *een the onl' dimension that suppliers ha+e *een compared on.Answer T&#$iff %Topic 15.1 The &ole of ourcing in a uppl' (hain!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing) There are man' supplier characteristics other than price, such as lead time, relia*ilit', 0ualit', and design capa*ilit' that impact the total cost of doing *usiness with a supplier.Answer T&#$iff 1Topic 15.1 The &ole of ourcing in a uppl' (hain!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing5) A good supplier scoring and assessment process will primaril' track performance along the  price dimension when e+aluating a supplier.Answer FA! #$iff %Topic 15.1 The &ole of ourcing in a uppl' (hainAA( - Anal'tic kills!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing 151(op'right 2 %31 Pearson #ducation, 4nc. pu*lishing as Prentice all  6) $esign colla*oration ensures that an' design changes are communicated effecti+el' to all  parties in+ol+ed with designing and manufacturing the product.Answer T&#$iff %Topic 15.1 The &ole of ourcing in a uppl' (hainAA( - Anal'tic kills!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing7) The goal of procurement is to ena*le orders to *e placed and deli+ered on schedule at the lowest possi*le price.Answer T&#$iff %Topic 15.1 The &ole of ourcing in a uppl' (hain!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing8) The role of sourcing planning and anal'sis   is to anal'9e spending across +arious suppliers and component categories to identif' opportunities for decreasing the total cost.Answer T&#$iff 1Topic 15.1 The &ole of ourcing in a uppl' (hainAA( - Anal'tic kills!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing:) (ost of ;oods old <(; ) represents less than %3 percent of sales for most ma=or manufacturers.Answer FA! #$iff 1Topic 15.1 The &ole of ourcing in a uppl' (hain!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing13) #ffecti+e sourcing processes within a firm can impro+e profits for the firm and total suppl' chain surplus in a +ariet' of wa's.Answer T&#$iff %Topic 15.1 The &ole of ourcing in a uppl' (hainAA( - Anal'tic kills!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing 15%(op'right 2 %31 Pearson #ducation, 4nc. pu*lishing as Prentice all  11) >hen designing a sourcing strateg', it is important for a firm to *e clear on the factors that ha+e the least influence on performance and target impro+ement on those areas.Answer FA! #$iff %Topic 15.1 The &ole of ourcing in a uppl' (hain!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing1%) upplier performance must *e rated on se+eral factors other than purchase price *ecause the'all impact the total suppl' chain cost.Answer T&#$iff %Topic 15. sing Total (ost to core and Assess uppliersAA( - Anal'tic kills!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing1) As the replenishment lead time from a supplier grows, the amount of safet' in+entor' that needs to *e held *' the *u'er also grows in direct proportion to the replenishment lead time.Answer FA! #$iff Topic 15. sing Total (ost to core and Assess uppliers!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing1) A relia*le supplier has low +aria*ilit' of lead time, whereas an unrelia*le supplier has high +aria*ilit'.Answer T&#$iff %Topic 15. sing Total (ost to core and Assess uppliers!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing15) The less fle?i*le a supplier is, the less lead time +aria*ilit' he will displa' as order 0uantities change.Answer FA! #$iff %Topic 15. sing Total (ost to core and Assess uppliersAA( - Anal'tic kills!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing 15(op'right 2 %31 Pearson #ducation, 4nc. pu*lishing as Prentice all  16) As the replenishment lot si9e grows, the c'cle in+entor' at the firm grows, thus increasing the cost of holding in+entor'.Answer T&#$iff %Topic 15. sing Total (ost to core and Assess uppliers!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing17) Qualit' has little effect on the lead time taken *' the supplier to complete the replenishment order or the +aria*ilit' of this lead time.Answer FA! #$iff %Topic 15. sing Total (ost to core and Assess uppliersAA( - Anal'tic kills!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing18) ourcing a product o+erseas ma' ha+e lower product cost *ut will generall' incur a higher in*ound transportation cost.Answer T&#$iff 1Topic 15. sing Total (ost to core and Assess uppliersAA( - $'namics of the ;lo*al #conom'!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing1:) Quantit' discounts lower the unit cost and tend to increase the re0uired *atch si9e.Answer FA! #$iff 1Topic 15. sing Total (ost to core and Assess uppliers!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing%3) The +alue of *etter information coordination will *e linked to the amount of +aria*ilit' introduced into the suppl' chain as a result of the *ullwhip effect.Answer T&#$iff Topic 15. sing Total (ost to core and Assess uppliers!earning utcome (ompare and contrast different sourcing strategies including outsourcing and insourcing 15(op'right 2 %31 Pearson #ducation, 4nc. pu*lishing as Prentice all
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