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APICS CSCP Certified Supply Chain Professional Exam Practice Test

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Total 510 questions

Certified Supply Chain Professional Questions and Answers

Question 1

Which of the following risks is associated with outsourcing?

Options:

A.

Reduction of capital investment

B.

Economies of scale

C.

 Conflicting objectives 

D.

Increased flexibility

Question 2

A company desires to use customer relationship management (CRM) to enable supply chain collaboration. Implementation of CRM will enable the organization to most effectively:

Options:

A.

sell their products and services to customers by using economic incentives.

B.

provide supply chain visibility to customers and enable them to view the status of orders.

C.

provide means of identifying, capturing, and retaining customers by aligning all resources and capabilities.

D.

enable web-based order entry and electronic data interface.

Question 3

Risk pooling is a concept that suggests:

Options:

A.

demand variability is increased if demand is disaggregated across locations.

B.

demand variability is reduced if demand is disaggregated across locations.

C.

demand variability is increased if demand is aggregated across locations.

D.

demand variability is reduced if demand is aggregated across locations.

Question 4

Which of the following relationship activities is most impacted by a lack of trading partner trust?

Options:

A.

Collaboration

B.

Coordination

C.

Cooperation

D.

Communication

Question 5

A company currently produces a major component and is considering purchasing the component from a foreign supplier. Assuming they were to purchase from the foreign supplier, which of the following factors would most likely impact the domestic manufacturing operations?

Options:

A.

Direct cost of the component

B.

Supplier lead time fluctuations

C.

Accuracy of supplier forecasting

D.

Transportation cost from the supplier

Question 6

Which of the following actions is most likely to reduce the risk of product shortages for a company planning to use a subcontractor to produce some of its products?

Options:

A.

Sharing product demand forecasts with the subcontractor

B.

Conducting periodic compliance audits of the subcontractor

C.

Increasing safety stock for products to be produced by the subcontractor

D.

Including penalties for late deliveries in the contract with the subcontractor

Question 7

Shortly after implementation of a supplier quality management program, the customer's and supplier's measurements of an attribute differ. The most appropriate course of action is to:

Options:

A.

use the customer's data for the attribute.

B.

stop measuring performance for the attribute.

C.

redefine performance criteria.

D.

investigate data collection methods.

Question 8

In the Supply Chain Operations Reference (SCOR) model, which of the following metrics measures responsiveness of a supply chain?

Options:

A.

On-time delivery

B.

Perfect order fulfillment

C.

Order fulfillment cycle time

D.

Total inventory days of supply

Question 9

Qualitative extrinsic data are used with which of the following forecasting techniques?

Options:

A.

Time series

B.

Seasonality

C.

Delphi method

D.

Causal method

Question 10

Which of the following types of data most likely will be communicated between two parties who have formed a strategic alliance?

Options:

A.

Stochastic

B.

Proprietary

C.

Bill of material (BOM)

D.

Product specifications

Question 11

In a make-or-buy decision, if the product is modular and the company is dependent on knowledge and capacity, outsourcing most likely will be:

Options:

A.

company policy

B.

viewed as a way to reduce costs

C.

considered necessary

D.

considered risky

Question 12

A company has applied lean thinking and tools to its internal operations over the last several years. The company is now concerned about its ability to recover from a supply disruption. Which of the following actions would be most appropriate for the company to take to increase its resiliency?

Options:

A.

Arrange for multiple sources for key components.

B.

Maintain 1 week’s supply f safety stock for key components.

C.

Required the suppliers of key components to maintain safely stock

D.

Add capacity to enable quick recovery from a disruption

Question 13

When developing a supply chain strategy, which of the following actions would be used to evaluate the achievement of the long-term goals of a business?

Options:

A.

terminal drivers.

B.

Measure performance.

C.

less process variables

D.

Perform benchmarking.

Question 14

The most stringent measurement of fill rate to support product availability is:

Options:

A.

Line

B.

Order

C.

Value

D.

 Customer

Question 15

A clothing company focuses its attention on high-fashion products and rapid product development. Which of the following types of value is the company trying to create?

Options:

A.

Financial

B.

Customer

C.

Social

D.

Environmental

Question 16

Which of the following types of alignments between extended supply chain partners will yield the highest level of competitive advantage?

Options:

A.

Financial

B.

Social

C.

Process

D.

Strategic

Question 17

Due diligence for conflict- or high-risk-materials should include which of the following processes:

Options:

A.

a method to track the country of origin of materials when they leave the country.

B.

a system of controls and transparency regarding the traceability of materials through the supply chain.

C.

certification primarily by companies that are selling directly to consumers about the firm’s tier one suppliers.

D.

ability to provide documentation of the source materials when they are imported into United Nations countries.

Question 18

Which of the following conditions are most indicative of a company that is effectively managing its cash?

Options:

A.

Low accounts receivable, low inventory, high accounts payable

B.

High accounts receivable, low inventory, high accounts payable

C.

Low accounts receivable , high inventory, low accounts payable

D.

High accounts receivable, high inventory, low accounts payable

Question 19

Which of the following actions typically is most important when building a collaborative supply chain?

Options:

A.

Investing sufficient capital

B.

Building mutual trust

C.

Integrating information systems

D.

Developing a common culture

Question 20

Which of the following objectives is a major principle of theory of constraints (TOC) accounting when applied to a supply chain?

Options:

A.

Total inventory reduction

B.

Maximize process utilization

C.

Maximize revenue generation

D.

Product design simplification

Question 21

A new distribution warehouse is added to an existing supply chain network. Which of the following factors primarily is responsible for the resulting overall reduction of customer delivery lead times?

Options:

A.

New material handling equipment improves the speed and efficiency of the pick/pack process.

B.

Increased safety stock levels in the overall network results in fewer stockouts and more on-time deliveries.

C.

The average travel time from the distribution warehouse to the customer is reduced.

D.

The territory for each distribution warehouse shrinks, resulting in fewer inbound transportation carriers.

Question 22

A company that produces a set of standard products, which are sold through multiple channels, would segment its sales by:

Options:

A.

brand.

B.

product.

C.

customer.

D.

region.

Question 23

On-time delivery performance in the supply chain can best be improved by aligning required capacity with what type of capacity?

Options:

A.

Demonstrated

B.

Rated

C.

Budgeted

D.

Theoretical

Question 24

A retailer that imports furniture from several manufactures in low-wage countries wants to reduce variability in quality. The retailer has proposed merging with one of the manufacturers and giving it sole responsibility for one product family. The proposed merger is an example of:

Options:

A.

parallel integration.

B.

internal integration.

C.

horizontal integration.

D.

vertical integration.

Question 25

Effective collaboration for item replenishment by external suppliers requires:

Options:

A.

accurate long-term forecasts.

B.

returnable plastic containers.

C.

close communication about component usage.

D.

a process for the reverse supply chain.

Question 26

A company plans to implement a new software application for inventory optimization. Which of the following actions will most likely reduce the implementation time?

Options:

A.

Purchase the new software and host it on secure cloud servers

B.

Develop the new software in-house and purchase additional hardware

C.

Purchase the new software and customize it

D.

Integrate the new software with supply chain partners

Question 27

Which of the following techniques is most effective for a company to sell high-volume products to multiple market segments?

Options:

A.

Market targeting

B.

Mass customization

C.

Mass production

D.

Commoditization

Question 28

A product should be designed for a manufacturing process with the smallest number of:

Options:

A.

operations, motions, and parts.

B.

raw materials and purchase parts.

C.

options to maximize cost savings.

D.

operating supplies.

Question 29

Which of the following outcomes is most likely a result of allocating excess capacity to a chain facility?

Options:

A.

Lower utilization which leads to higher cost

B.

Higher utilization which leads to higher cost

C.

High utilization which leads to lower cost

D.

Lower utilization which leads to lower cost

Question 30

A company wants to improve its transportation strategy to focus on its core manufacturing competence and reduce costs. Which of the following options is most likely to enable the company to achieve its objectives?

Options:

A.

Implement a transportation management system (TMS)

B.

Transition to leased transportation equipment

C.

Engage a third-party logistics (3PL) company

D.

Redesign the distribution network

Question 31

A company most likely would implement a supplier certification program to:

Options:

A.

improve the supplier's procurement process.

B.

abide by ISO standards.

C.

validate the supplier's compliance with requirements.

D.

implement point-of-sale (POS) terminals.

Question 32

An item must be added to inventory to support new business. Which of the following inputs should be considered to determine minimum inventory level?

Options:

A.

Consumption rate

B.

Qualified supplier

C.

ABC classification

D.

Number of sales transactions

Question 33

Which of the following attributes is an advanced functionality of a warehouse management system (WMS)?

Options:

A.

Inventory management

B.

Work order management

C.

Labor management

D.

Task management

Question 34

Which of the following documentation represents a carrier's method of charging for transportation services performed?

Options:

A.

Shipment manifest

B.

Bill of lading (B/L)

C.

Letter of credit (L/C)

D.

Freight invoice

Question 35

Which of the following warehousing approaches combines inventory from multiple suppliers into a consolidated shipment to a specific customer?

Options:

A.

Reverse logistics

B.

Cross-docking

C.

Bulk-breaking

D.

Drop shipping

Question 36

Which of the following supply chain areas utilize order management cost metrics?

Options:

A.

Distribution

B.

Inspection

C.

inbound freight

D.

Commodity management

Question 37

Which of the following factors is a key motivation for supply chain collaboration?

Options:

A.

Technology

B.

Traditional accounting methods

C.

Regular negotiations

D.

A common interest

Question 38

A company has recently implemented a vendor-managed inventory (VMI) program with several key suppliers but quality issues are disrupting production. Which of the following actions would be more effective in dealing with these issues?

Options:

A.

Tighten the quality tolerances

B.

Implement a supplier certification program

C.

Implement quality inspection at the receiving dock

D.

Charge back to the supplier the rework and scrap costs

Question 39

Raw material costs have been rising and much of the inventory has been in-house for several months. Which of the following inventory accounting methods would maximize reported company assets?

Options:

A.

Last in, first out (LIFO)

B.

First in, first out (FIFO)

C.

Activity-based cost

D.

Moving average cost

Question 40

A company redesigning their supply chain should review which of the following strategic levels first?

Options:

A.

transportation strategies

B.

Inventory policies

C.

Customer segmentation

D.

Flow of material through network

Question 41

Which of the following processes ensures that functional plans are consistent?

Options:

A.

Strategic planning

B.

Sales and operations planning

C.

Project planning

D.

Master scheduling

Question 42

Which of the following metrics is the most appropriate measure of the availability of products to ship in a make-to-stock environment?

Options:

A.

Backlog level

B.

Fill rate

C.

Perfect order percentage

D.

Average customer order lead time

Question 43

Which of the following types of risk typically would be most difficult to plan for and mitigate?

Options:

A.

Currency fluctuation

B.

Forecast error

C.

Geopolitical

D.

Supplier performance

Question 44

The Global Reporting Initiative (GRI) is intended to:

Options:

A.

track the country's general business practices for country-to-country comparisons.

B.

provide guidance on best practices for preparing a sustainability report.

C.

allow for appropriate tariffs and fees for cross-border shipments.

D.

establish the minimum standards that a firm should achieve for best-in-class.

Question 45

A supervisor knows that employees have good ideas for improving department operations but are hesitant to share them. Which of the following tools would be most appropriate for encouraging the employees to participate in identifying opportunities?

Options:

A.

Tree diagram

B.

Pareto chart

C.

Process map

D.

Affinity diagram

Question 46

In order to decrease shipping costs, a shipper would take which of the following actions?

Options:

A.

Utilize less-than-truckload (LTL) shipments versus truckload (TL).

B.

Use a common carrier rather than a contract carrier.

C.

Decrease the weight shipped and use break-bulk shipments.

D.

Increase the weight shipped and consolidate shipments.

Question 47

Attaching a fuel tank cap to a fuel tank door on a car is an example of which of the following lean techniques?

Options:

A.

Five Ss

B.

Five whys

C.

Poka-yoke

D.

Kaizen

Question 48

A shipping company investing to reduce damages due to weather conditions is an example of:

Options:

A.

risk tolerance.

B.

risk exposure.

C.

risk mitigation.

D.

risk resilience.

Question 49

Goods can enter a country, undergo further modification, and then be exported without paying customs duties via which of the following designations?

Options:

A.

Bonded warehouse

B.

Trading bloc

C.

 Free trade zone (FTZ) 

D.

Citizen zone

Question 50

Which of the following techniques require close coordination between product and process design?

Options:

A.

Concurrent engineering

B.

Sequential engineering

C.

Priority planning

D.

Voice of the customer (VOC)

Question 51

Which of the following statements is true when selecting the mode of transportation to use in a global supply chain?

Options:

A.

The difference in cost of warehousing in different countries makes air transportation viable only for very lightweight items.

B.

When moving heavy items long distances, water transportation offers the lowest cost and highest availability in most countries.

C.

Pipeline usage is limited because of the high variable cost of operation and difficulty moving between pipelines

D.

The availability, specifications, and geographic reach of rail transportation varies greatly from country to country.

Question 52

Which of the following activities is an aspect of proper demand management?

Options:

A.

Prioritizing shop orders to meet demand

B.

Facilitating the use of resources to meet demand

C.

Using demand to calculate takt time

D.

Considering all sources of demand

Question 53

Which of the following tools will facilitate greater collaboration as the supply chain matures?

Options:

A.

Supplier relationship management (SRM) to select a vendor

B.

Customer relationship management (CRM) to automate the sales force

C.

Supply chain event management (SCEM) to increase visibility of changing situations

D.

Enterprise resources planning (ERP) to forecast demand

Question 54

A manufacturer of plastic components that are sold either directly or through distributors wants to identify the requirements of the end customers for each market segment. Which of the following approaches would be most appropriate?

Options:

A.

Analyzing the buying history for each of the market segments

B.

Asking the manufacturer's direct customers

C.

Conducting a market research project

D.

Sending samples of potential future products to the final customers

Question 55

A large manufacturer wanting to be more competitive in the global market place decided to outsource its transportation and return processing to other companies on a contractual basis. The companies providing the services would be referred to as:

Options:

A.

fourth party logistics providers.

B.

third party logistics providers.

C.

retail services providers.

D.

distribution services providers.

Question 56

Which of the following results can be expected from sharing a common understanding of demand and consumption patterns among supply chain participants?

Options:

A.

Improved transparency of collaboration relationships

B.

Increased performance in balanced scorecard

C.

Reduced inventory levels for key items

D.

Better synchronization of planning and operations

Question 57

Maintaining a long-term collaborative relationship with a trading partner requires:

Options:

A.

formal and informal communication.

B.

interconnected information systems.

C.

one partner regularly exercising power.

D.

standardized terms of agreement.

Question 58

Which of the following corporate strategies is most consistent with a flexible supply chain strategy?

Options:

A.

Being the low-price leader

B.

Providing the highest-quality service

C.

Providing mature products with stable sales

D.

Emphasizing the quality of the product

Question 59

Which of the following scenarios represents a correct application of the Supply-Chain Operations Reference-model (SCOR)?

Options:

A.

Sales and marketing refers to SCOR to improve demand generation.

B.

Production and engineering uses SCOR best practices to design a new "make" process flow.

C.

Distribution and logistics selects suppliers from the SCOR reference list.

D.

Marketing and development incorporates SCOR Level I metrics for new product design.

Question 60

A firm has identified groups of customers based on specific characteristics the customers desire from products and services the firm can provide. Characteristics include lead times, pricing tiers, and service levels. The firm is engaged in which of the following activities?

Options:

A.

Customer differentiation

B.

Order winner segregation

C.

Market segmentation

D.

Channel definition

Question 61

Which of the following factors typically is the most significant impediment to implementing collaborative commerce?

Options:

A.

Technology barriers

B.

Security

C.

Corporate culture

D.

Return on investment (ROI)

Question 62

The factors to consider in the make-or-buy decision include costs, proprietary knowledge, and:

Options:

A.

design history.

B.

available capacity.

C.

inventory balance.

D.

warehouse location.

Question 63

Which of the following consequences is a result of shipping directly from the point of manufacture to the customer rather than through a distribution network?

Options:

A.

Delivery lead times are consistent.

B.

Risk pooling benefits are negated.

C.

Distribution overhead is increased.

D.

Order-fill rate is decreased.

Question 64

The question below is based on the following flowchart:

Question # 64

Which of the following phrases most accurately describes the complete flow of demand information?

Options:

A.

From supplier to customer

B.

From customer to manufacturer

C.

From customer to supplier

D.

From supplier to manufacturer

Question 65

Which of the following attributes typically makes reverse logistics processes more complicated than outbound logistics processes?

Options:

A.

Lead times for shipments are more variable.

B.

Individual packages and cartons are less uniform.

C.

There are more regulations mandated by local governments.

D.

There is more competition for scarce transportation lanes.

Question 66

The use of a seasonal index as a forecasting technique measures the ratio of the:

Options:

A.

average seasonal demand to the average demand for all periods.

B.

average demand for all periods to the average seasonal demand.

C.

average seasonal demand to the standard deviation of the demand for all periods.

D.

standard deviation of the seasonal demand to the standard deviation of demand for all periods.

Question 67

The focus of collaborative supply chain management differs from a transactional approach by its emphasis on the:

Options:

A.

transportation of goods to the next link in the chain.

B.

flow of product information up to the next level of the chain.

C.

flow of demand information and cash up the chain.

D.

flow of supply into an organization.

Question 68

Compared to mass-media marketing, customer relationship management has the advantage of allowing the organization to:

Options:

A.

compete for customers based on service.

B.

reach a larger number of potential customers.

C.

reduce inventory to improve cash flow.

D.

focus on attracting new customers.

Question 69

Which of the following organizational design choices is an example of vertical integration?

Options:

A.

Contracting with a third-party logistics provider

B.

Producing components used internally

C.

Externally staffing a customer service center

D.

Awarding a one-time trade show contract

Question 70

A return material authorization (RMA) policy is used in reverse logistics to:

Options:

A.

physically transport returned items by using an efficient transportation mode.

B.

minimize the number of returned items by involving product design and demand forecasting.

C.

reduce the cost of returned items by refusing to accept items that should not be returned.

D.

reclaim substantial value from returned items by recycling.

Question 71

A main benefit of using customer relationship management (CRM) is:

Options:

A.

maximization of on-time delivery.

B.

minimization of product returns.

C.

identification of customers with high lifetime value.

D.

finding new markets for existing products and services.

Question 72

A firm supplies a single line of products to consumers using retail stores and on-line sales, distributors, and wholesalers. Currently the firm has common pricing and response times for sales in each sales channel. Which of the following tools is most appropriate to employ to improve profitability?

Options:

A.

Customer segmentation

B.

Customer-facing ordering systems

C.

Customer relationship management (CRM)

D.

Supply Chain Operations Reference (SCOR®)

Question 73

A company manufactures special products for select customers. When demand for these products drops, the manufacturer can switch the production line to a commodity-type product that can be sold on the open market at reduced terms to generate cash. The company is executing a corporate strategy that is based on:

Options:

A.

customer focus and alignment.

B.

forecast accuracy.

C.

multiple downstream channels.

D.

multiple upstream supply chains.

Question 74

Companies are more likely to consider the consequences of their product design decisions when they view the reverse supply chain as an extension of the:

Options:

A.

forward supply chain.

B.

marketing process.

C.

manufacturing process.

D.

sales and operations planning process.

Question 75

Which of the following situations is an example of inventory being held as a way to balance supply and demand?

Options:

A.

A manufacturer holds inventory of key components to maintain a level production schedule.

B.

A manufacturer of seasonal products builds finished-goods inventory before the peak selling period.

C.

A distributor maintains safety stock of slow-moving items at a central distribution center.

D.

A retailer stocks a variety of sizes and colors of a fast-selling item to avoid losing sales.

Question 76

Which of the following actions typically would be considered part of a reverse logistics strategy?

Options:

A.

Offering a discount on new purchases when used products are returned

B.

Reducing the amount of packaging material used in shipping

C.

Manufacturing products in batches consistent with full-truckload shipments

D.

Batching returns of defective components to the suppliers

Question 77

Which of the following customer relationship management activities most appropriately is used for revenue generation?

Options:

A.

Generating customer leads

B.

Generating graphic sales models

C.

Measuring customer preferences

D.

Identifying customer margins

Question 78

A remanufacturer of equipment is most likely to have what type of supply chain?

Options:

A.

Modular logistics

B.

Reverse logistics

C.

Mixed model

D.

Lateral

Question 79

Which of the following actions typically would be the first step in implementing the philosophy of customer relationship management?

Options:

A.

Creating a customer-centric organization

B.

Developing a map of the customer segments

C.

Documenting the objectives for implementation

D.

Selecting an information technology solution

Question 80

The main benefit of a mass customization product design strategy is to:

Options:

A.

sell high quantities of product to specific customer segments.

B.

achieve economies of scale in purchasing components.

C.

offer more product variety while keeping inventories low.

D.

avoid assembly of finished products.

Question 81

A manufacturer uses standard costing, and a potential supplier uses activity-based costing. This difference most likely will have implications for which of the following types of future decisions?

Options:

A.

Price concessions

B.

Make-or-buy

C.

Distribution warehouse locations

D.

Freight terms

Question 82

A media company offers a majority of its movies through a specific distributor. The media company is beginning to produce content for a new foreign market to which the distributor has exclusive access. To maximize savings and gain entry to this new market, the media company should:

Options:

A.

create a contract for the new market.

B.

enter into a partnership.

C.

form a strategic alliance.

D.

acquire the distributor.

Question 83

Which of the following forecasting methods relies on the opinions of a panel of experts?

Options:

A.

Delphi technique

B.

Survey method

C.

Causal method

D.

Time series analysis

Question 84

Which of the following types of information would be an appropriate basis for a qualitative forecast?

Options:

A.

Leading indicators

B.

Market research data

C.

Order history

D.

Shipment history

Question 85

Which of the following practices has improved management of the customer pipeline?

Options:

A.

Reverse auctions

B.

Sales force automation

C.

Finite capacity planning

D.

Point-of-purchase metrics

Question 86

A company considers outsourcing its information technology support to a low-cost region on another continent. The company currently has no business presence there. Which of the following actions is most effective in helping to select a service provider?

Options:

A.

Contacting the country's consulate for leads

B.

Contacting the country's local government for recommendations

C.

Visiting several potential providers before making a selection

D.

Finding a trusted local business agent to help in the search

Question 87

Which of the following strategies is used primarily for demand planning?

Options:

A.

Build-to-order scheduling

B.

Push-pull replenishment

C.

Collaborative planning, forecasting, and replenishment

D.

Vendor-managed inventory

Question 88

The primary objective of supply chain management is:

Options:

A.

minimizing transportation costs.

B.

reducing inventory levels.

C.

taking a systems approach.

D.

implementing advanced technologies.

Question 89

Compared to a global strategy, a multicountry strategy would be characterized by:

Options:

A.

strategy coordination across countries.

B.

preferred suppliers located in host countries.

C.

major strategic decisions coordinated centrally.

D.

products adapted to local needs.

Question 90

In addition to sales history, current customer orders, and forecasted demand, which of the following data sources should be used as part of a demand management process?

Options:

A.

Inventory levels

B.

Contractual obligations

C.

Customer profitability

D.

Scheduled marketing activities

Question 91

An advantage of using a third-party logistics service (3PL) is improved:

Options:

A.

on-time delivery of shipments due to higher inventory levels.

B.

cost structure due to economies of scale.

C.

access to smaller markets due to localization.

D.

risk visibility due to inventory consolidation.

Question 92

The purpose of continuous improvement in the supply chain is to:

Options:

A.

eliminate the root causes of problems.

B.

improve interorganizational communication.

C.

develop better written procedures.

D.

reduce product costs.

Question 93

Which of the following marketing strategies emphasizes offering services at a lower price than rival services with comparable features?

Options:

A.

Cost leadership

B.

Service differentiation

C.

Customer focus

D.

Market responsiveness

Question 94

Medium-term demand management projections are used primarily to:

Options:

A.

complete strategic business planning of facilities.

B.

complete forecasts at the item level.

C.

aggregate demand for production planning.

D.

develop the master production schedule.

Question 95

Which of the following levels in a supply chain network represents the most upstream external activity?

Options:

A.

Supplier to contractor

B.

Manufacturing to supplier

C.

Customer to distribution

D.

Customer to contractor

Question 96

The most likely benefit of implementing a collaborative transportation management system is:

Options:

A.

lower distribution center operating costs.

B.

fewer transportation planners.

C.

less variability in picking and packing time.

D.

less variability in transportation costs.

Question 97

Which of the following indicators is most appropriate to use as a measure of supply chain utilization?

Options:

A.

Production equipment productivity

B.

Net asset turnover

C.

Value-added productivity per employee

D.

Upside flexibility

Question 98

Demand management involves which of the following undertakings?

Options:

A.

Adjusting capacity to support expected demand

B.

Engaging in activities associated with customer relationship management

C.

Creating higher customer demand by improving performance in areas such as lead time and service levels

D.

Understanding events and managing activities that could influence future demand

Question 99

Compared to a blanket purchase order, a supplier alliance agreement is best differentiated by:

Options:

A.

efficient material replenishment processes.

B.

clearly identified roles for the buyer and seller.

C.

a shared vision of added value.

D.

a sole-source agreement.

Question 100

Using an independent service provider for logistics would be most appropriate in which of the following situations?

Options:

A.

A shoe company that wants to penetrate a foreign market

B.

A business that owns plants and warehouses globally

C.

A financial services company that wants to expand its services

D.

A cable television company that wants to add services

Question 101

What is the primary role of marketing in supporting supply chain management?

Options:

A.

Selecting favored supplier partners

B.

Developing efficient customer channels

C.

Focusing on short-term forecasting accuracy

D.

Working with research and development on slow-moving products

Question 102

A firm wants to lose customers that don't value the unique products and services the firm offers and to attract and retain customers that want what the firm offers. Engaging in this activity should allow the firm to:

Options:

A.

create a more loyal customer base.

B.

improve customer satisfaction rates.

C.

increase market share.

D.

target higher-profit customers.

Question 103

Continuous improvement is best described as:

Options:

A.

a never-ending effort to expose and eliminate root causes of problems.

B.

a never-ending effort by the management team to reduce cycle time.

C.

identifying and implementing big-step improvements within a process.

D.

a process in which a supplier commits to replenishing inventory based on demand without receiving replenishment orders.

Question 104

Incorporating supplier input into product and process design helps to:

Options:

A.

maintain quality.

B.

stabilize product costs.

C.

reduce time to market.

D.

save costs to the buyer.

Question 105

Which of the following considerations is an important supply chain design decision?

Options:

A.

Product design

B.

Selecting supporting information systems

C.

Identifying labor force requirements

D.

Identifying training programs

Question 106

Keeping all other factors equal, a company typically will try to maintain higher service levels for products with:

Options:

A.

wider variety.

B.

shorter lead time.

C.

higher profit margins.

D.

lower sales volumes.

Question 107

A company currently produces custom goods for a limited market. To increase market share, the company will implement a strategy to reduce the number of products it produces and reduce delivery lead time. The company can increase its chances of achieving the strategy by:

Options:

A.

using benchmark data for products in the same product groups.

B.

incorporating results from market surveys.

C.

involving customers in the product design process.

D.

using electronic communications to receive customer complaints.

Question 108

Benchmarking a firm's performance against industry competitors is most valuable because it can reveal:

Options:

A.

a competitor's manufacturing processes.

B.

a firm's leadership ranking relative to industry peers.

C.

which processes require improvement.

D.

that no further improvement is possible.

Question 109

The transportation manager at a consumer goods manufacturer has decided to begin shipping full truckload rather than less-than-truckload quantities. Which of the following outcomes is likely following implementation of this decision?

Options:

A.

Inventory levels at the manufacturer will decrease.

B.

Lead times as seen by the customer will increase.

C.

Production efficiencies at the manufacturer will increase.

D.

Transportation costs as seen by the customer will increase.

Question 110

Which of the following actions is in accordance with the Ten Principles in the United Nations (UN) Global Compact?

Options:

A.

Preventing a group of employees from forming a collective bargaining (union) group

B.

Paying different wages in different parts of the world for a given job classification

C.

Requiring an individual to pay a fee for consideration in hiring or promotion decisions

D.

Withholding certain employment opportunities from specific groups of people

Question 111

The strategy to implement supplier relationship management has been developed. The most appropriate next step is to:

Options:

A.

develop criteria for prospective partners.

B.

develop policies for alliances.

C.

select initial partners.

D.

conduct a pilot implementation.

Question 112

A company that is focused on customer relationship management is most likely to take which of the following actions for customers who have been profitable over time?

Options:

A.

Reduce the cost of serving them.

B.

Target them for higher margin services.

C.

Target them for greater attention.

D.

Charge them for administrative services used.

Question 113

Which of the following outcomes occurs when direct shipping is used instead of a distribution network?

Options:

A.

Outbound transportation cost is reduced.

B.

Inventory velocity is reduced.

C.

Order-fill rates are reduced.

D.

Inventory obsolescence is reduced.

Question 114

A company's supply chain depends heavily on sourcing from international suppliers. Conditions increasingly threaten supply continuity. Which of the following actions is most appropriate?

Options:

A.

Source from domestic suppliers.

B.

Conduct a risk assessment.

C.

Carry additional safety stock.

D.

Spread logistics across multiple carriers.

Question 115

A manufacturer of consumer packaged goods with a single plant and nine regional distribution centers is considering reducing the number of distribution centers in its system. Reducing the number of distribution centers most likely will reduce fixed warehousing and the cost of:

Options:

A.

storing cycle inventory in the distribution centers.

B.

storing finished-goods inventory at the manufacturing plants.

C.

transportation from the distribution centers to the customer.

D.

transportation from the plant to the distribution centers.

Question 116

A firm has discovered a product quality issue. What should be the first step in responding to this issue?

Options:

A.

Determine the root cause of the quality issue.

B.

Separate the non-conforming products.

C.

Trace the location of the faulty product in the supply chain.

D.

Replace faulty products when they are returned by the end user.

Question 117

Which of the following actions is most likely to increase total supply chain risk?

Options:

A.

Standardizing components used in a product family

B.

Expanding operations to multiple locations

C.

Consolidating manufacturing locations

D.

Reducing the supplier base for commodity-type components

Question 118

Which of the following warehousing tools enables wireless scanning of products?

Options:

A.

Magnetic stripes

B.

Universal product codes

C.

Radio frequency devices

D.

Local area network

Question 119

A corporation must consider which of the following factors when selecting its enterprise resources planning system?

Options:

A.

Uniqueness of operations

B.

Corporate profitability

C.

MRP and MRP II processing

D.

Industry benchmarks

Question 120

Which of the following distribution approaches for a low-volume, high-variety product line typically will result in the highest level of customer service and the lowest total distribution costs?

Options:

A.

Direct shipment from plant to customers

B.

Shipment from a central distribution warehouse

C.

Shipment through a multi-echelon distribution network

D.

Outsourcing the distribution function

Question 121

A toy company decides to buy more products from an overseas company to reduce costs. To make sure that goods clear customs more quickly, the company most likely would engage a:

Options:

A.

consolidator.

B.

overseas carrier.

C.

shipping association.

D.

freight forwarder.

Question 122

Bar codes and radio frequency identification systems are key technologies in supply chain systems because they perform which of the following functions?

Options:

A.

Tracking truck locations on cross-country deliveries

B.

Facilitating timely and accurate data acquisition

C.

Providing paperless invoicing of goods

D.

Producing schedule broadcasts for suppliers

Question 123

Direct shipment distribution typically offers which of the following advantages?

Options:

A.

Risk pooling is facilitated.

B.

Demand variability is reduced.

C.

Service levels are increased.

D.

Lead times are reduced.

Question 124

The process used to determine the impact of promotions, price discounts, and rebates on demand forecasts commonly is referred to as demand:

Options:

A.

planning.

B.

forecasting.

C.

aggregating.

D.

shaping.

Question 125

The customer who provides point-of-sale data remains the sole decision-maker regarding order quantities when what type of inventory strategy is used?

Options:

A.

Continuous replenishment

B.

Advanced continuous replenishment

C.

Vendor-managed replenishment

D.

Quick response

Question 126

When doing international business, a company's total line-haul costs will vary with the:

Options:

A.

weight shipped.

B.

distance shipped.

C.

pallets shipped.

D.

volume shipped.

Question 127

Which of the following ISO standards is used to assist organizations with sustainable development?

Options:

A.

ISO 31000

B.

ISO 14001

C.

ISO 26000

D.

ISO 9001

Question 128

Which of the following strategies can be used to help manage global risks?

Options:

A.

Direct shipment

B.

Cross-docking

C.

Mass customization

D.

Flexibility

Question 129

Which of the following statements about the use of bar code labels for product identification in the supply chain is true?

Options:

A.

They have been replaced by radio frequency identification tags.

B.

They can be read by devices 1 to 3 meters from the item.

C.

They facilitate the capture of information about the location of items.

D.

Each of the trading partners must apply a unique label.

Question 130

A company is formally adhering to the principles of the UN Global Compact. After a review of their supply chain, they have found that a key supplier is in violation of the compact. The best action for the company to do first is:

Options:

A.

do nothing. The company is not responsible for compliance of suppliers.

B.

replace the supplier as soon as possible with a compliant supplier.

C.

notify the supplier of non-compliance.

D.

require the supplier to become compliant.

Question 131

Which of the following factors typically is most important in successfully implementing sales and operations planning (S&OP)?

Options:

A.

Involvement of specialists from all functional groups within an organization

B.

Creation of a dedicated S&OP organizational unit

C.

Involvement and accountability at senior management level

D.

Focus on 3 months to 18 months in the future

Question 132

A company that sells direct to industrial and commercial businesses has become successful by being responsive to the needs of its customers. The company currently produces in each country all of the products it sells in that country. Several countries in which the company operates have negotiated an agreement to establish a trading bloc. Which of the following actions by the company would be most appropriate if the agreement is implemented?

Options:

A.

Consolidate production outside the trading bloc to reduce total costs.

B.

Consolidate production within the trading bloc to reduce tariffs paid.

C.

Outsource the production of products with low sales volumes to reallocate capacity.

D.

Reassign products so that each is produced in a single facility within the trading bloc to get economies of scale.

Question 133

A company wants to implement a system for managing environmental compliance with legislative and regulatory requirements. Which of the following sustainability tools is most appropriate?

Options:

A.

ISO 14000

B.

Global Reporting Initiative (GRI)

C.

ISO 26000

D.

UN Global Compact

Question 134

It is most appropriate to measure spending per customer as a proportion of profitability during which of the following phases of a supplier/customer relationship?

Options:

A.

Customer acquisition

B.

Customer retention

C.

Customer dependency

D.

Strategic customer care

Question 135

When a company undertakes a win-back strategy without considering the profitability of customer accounts, it is neglecting which of the following key elements?

Options:

A.

Loyalty

B.

Scoring

C.

Segmentation

D.

Prospecting

Question 136

The demand side of a traditional warehouse management system primarily is concerned with:

Options:

A.

receiving incoming goods.

B.

assigning storage locations.

C.

assembling outbound orders.

D.

forecasting product demand.

Question 137

Which of the following measures effectively evaluates overall resources in a distribution warehouse?

Options:

A.

Throughput

B.

Cube utilization

C.

Filled pallet positions

D.

Labor efficiency

Question 138

Allowing for organizational restructuring is an example of which of the following steps in creating successful strategic alliances among suppliers?

Options:

A.

Managing multifaceted relationships

B.

Negotiating a win-win deal

C.

Planning for change

D.

Conducting pulse checks

Question 139

When an importer and manufacturer are operating in a free trade zone, payment of a customs duty is triggered when products are:

Options:

A.

returned.

B.

assembled.

C.

stored.

D.

distributed.

Question 140

A company ships from its manufacturing facilities directly to its warehouses. If the number of warehouses increases, transportation costs between manufacturing facilities and warehouses most likely will:

Options:

A.

increase.

B.

decrease.

C.

not change.

D.

become less predictable.

Question 141

A company most likely would consider moving a portion of its manufacturing to a second location to:

Options:

A.

improve competitive advantage through cost control.

B.

avoid manufacturing downtime due to material shortages.

C.

maximize security for customer shipments.

D.

minimize the impact of natural disasters.

Question 142

A manufacturer and the distributors of its products have decided to focus on price and product availability as strategic priorities. Which of the following values would be the most appropriate measure of customer service?

Options:

A.

Manufacturer's volume flexibility

B.

Order-fulfillment lead times

C.

Distributors' order-fill rates

D.

Supply chain inventory days of supply

Question 143

A manufacturer offers a trade-in allowance on a new machine when the customer returns the old machine. The manufacturer reconditions the returned machine locally and then sells it on the used market for a profit. This program is an example of a focus on:

Options:

A.

environmentally sensitive engineering.

B.

gray box design.

C.

green manufacturing.

D.

sustainability in operations.

Question 144

Which of the following processes would a company use to evaluate the risk profile for end-of-life planning for a product family?

Options:

A.

Distribution requirements planning

B.

Sales and operations planning

C.

Rough-cut capacity planning

D.

Production activity control

Question 145

Customizing can be an effective warehousing strategy because it allows a company to:

Options:

A.

allocate available storage space to optimize handling costs.

B.

address trade-offs between space and material handling needs.

C.

effectively design its inbound and outbound dock areas.

D.

add value to the product through modification, labeling, and packaging.

Question 146

A company that sells engineered-to-order products is planning implementation of a supplier relationship management system (SRM) for direct materials. Which of the following factors is most likely to make the implementation difficult?

Options:

A.

Complexity of the purchasing process

B.

Cost of the application software upgrades

C.

Management of variable lead times

D.

Resistance of material suppliers

Question 147

In the Supply Chain Operations Reference-model (SCOR®), the cash-to-cash cycle time for a manufacturing company is the number of days between which two of the following situations?

Options:

A.

Paying for raw materials and getting paid for the product

B.

Shipping the product from the warehouse and receiving it at the customer's location

C.

Paying for raw materials and sending an invoice to the customer

D.

Billing the customer and getting paid for the product

Question 148

Which of the following activities typically would be an appropriate application of the ISO 31000 Risk Management Principles and Guidelines?

Options:

A.

Calculating a risk index for each facility

B.

Establishing external risk communications processes

C.

Projecting the ability of a facility to recover from an event

D.

Preparing for risk management accreditation

Question 149

A company closely monitors supplier performance and notices recent late deliveries from one supplier. The supplier discloses flood damage at the plant. The company quickly shifts sourcing to a new supplier and has minimal loss of sales. Which of the following risk strategies reflects the company's actions?

Options:

A.

Achieving low cost through reaction

B.

Creating an adaptive supply chain community

C.

Reducing supply chain vulnerability

D.

Investing in redundancy

Question 150

The social dimension of sustainability typically would be addressed when developing and implementing policies regarding:

Options:

A.

accounting practices.

B.

biodiversity protection.

C.

conflicts of interest.

D.

waste reduction.

Question 151

Implementation of supply chain applications based on which of the following technologies is most likely to have the lowest fixed costs?

Options:

A.

Best of breed packages

B.

One integrated package

C.

Service-oriented architecture

D.

Software-as-a-service

Question 152

The globalization of a supply chain typically increases uncertainty and:

Options:

A.

production lead time.

B.

local competition.

C.

documentation complexity.

D.

product standardization.

Question 153

A business is changing from a business to business model to a business to consumer model. Which of the following statements about this supply chain change is true?

Options:

A.

Returns from customers will decrease.

B.

Number of supplier orders will increase.

C.

Number of customer orders will increase.

D.

Average supplier order size will increase.

Question 154

The most important challenge to consider when sourcing globally is:

Options:

A.

the identification of sources capable of producing the materials.

B.

the availability of low-cost labor and energy.

C.

complying with specific import/export issues.

D.

balancing the difference between piece price and total cost.

Question 155

Potential customers of a company's new product have tight tolerance requirements. The company plans to purchase a critical component. To meet customer requirements, the company should first:

Options:

A.

implement statistical process control for the component.

B.

bring manufacturing of the critical component in-house.

C.

develop an alternate source of supply.

D.

certify the supplier of the component.

Question 156

Inventory parameters established using analytic inventory techniques typically are based on balancing:

Options:

A.

supply and dependent demand.

B.

customer service and inventory costs.

C.

transportation and warehousing costs.

D.

inventory levels and decision-making costs.

Question 157

An effective procurement strategy for commodity products should focus on:

Options:

A.

driving down cost and reducing risk.

B.

spreading purchases equally across suppliers.

C.

selecting primary and alternate sources.

D.

selecting suppliers with value-added products.

Question 158

An increase in the inventory turnover rate for a supply chain typically would indicate that there has been a reduction in:

Options:

A.

prices to the end user.

B.

supply chain cost of sales.

C.

the manufacturer's inventory.

D.

the total supply chain inventory.

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Total 510 questions