PART III
EXAMINATION QUESTIONS
CHAPTER 2: THE SUPPLY-CHAIN CONCEPT
Multiple Choice Questions
1.According to Professor Mentzer and colleagues, the supply-chain concept
originated in what discipline?
a.marketing
b.operations
c.logistics
d.production
(c; p. 36)
2. A ____________ encompasses all activities associated with the flow and
transformation of goods from the raw material stage, through to the end user, as well as the associated information flows.
a.production line
b.supply chain
c.marketing channel
d.warehouse
(b; p. 36)
3.Which of the following is not one of the processes in the SCOR model?
a.sell
b.plan
c.make
d.return
(a; p. 38)
4.The current SCOR model identifies ____________ key processes associated
with supply-chain management.
a.three
b.four
c.five
d.six
(c; p. 38)
5.The text suggests that logistics has an important role in all SCOR processes
except:
a.make
b.source
c.deliver
d.plan
(d; p. 38)
6.It has been suggested that company-versus-company competition might be
superseded in the twenty-first century by:
a.region-to-region
b.country-to-country
c.industry-to-industry
d.supply chain-to-supply chain
(d; p. 39)
7.Which of the following are not key attributes of supply-chain management?
a.inventory control
b.leveraging technology
c.customer power
d. a long-term orientation
e.all are key attributes
(e; p. 39)
8.Contemporary supply chains should be fast and ____________.
a.lean
b.agile
c.interactive
d.relevant
(b; p. 40)
9.An organization’s ability to respond to changes in demand with respect to
volume and variety refers to ____.
a.responsiveness
b.leanness
c.agility
d.relevancy
(c; p. 40)
10.W hich of the following is not associated with relational exchanges?
a.independence
b.trust
https://www.doczj.com/doc/3b18452606.html,mitment
d.shared benefits
(a; p. 40)
11.A ccording to the text, ____________ has been at the center of the changes
taking place that affect the supply chain.
a.logistics
b.warehousing
c.technology
d.customer power
(c; p. 41)
12.W hat has been referred to as the greatest force of commodization known to
man, for both goods and services?
a.McDonald’s
b.The Internet
c.Wal-Mart
d.Logistics
(b; p. 41)
13.T he two key factors that have sparked much of the technological change
affecting supply chains are ____________ and ____________.
a.EDI, ERP
https://www.doczj.com/doc/3b18452606.html,puting power, ERP
c.EDI, Internet
https://www.doczj.com/doc/3b18452606.html,puting power, Internet
(d; p. 41)
14.T he bullwhip effect:
a.is an ineffective way to motivate warehouse employees
b.applies to rodeos and has nothing to do with supply-chain
management
c.refers to the “swaying” motion associated with triple trailers
d.refers to variability in demand orders among supply-chain
participants
(d; p. 42)
15.W hich of the following is not a way to reduce inventory levels?
a.supply-push replenishment
b.smaller, more frequent orders
https://www.doczj.com/doc/3b18452606.html,e of premium transportation
d.elimination of slower moving products
(a; p. 42)
16.A supply-chain council:
a.ensures that unfair trade practices don’t happen in supply ch ains
b.is comprised of all relevant CEOs
c.meets periodically to evaluate supply-chain performance
d.is a lobbying group concerned with promoting favorable supply-chain
legislation
(c; p. 43)
17.C ovisint, an on-line trading exchange, is an example of co-opetition in the
____________ industry.
a.fast-food
b.office supply
c.sporting goods
d.automotive
(d; p. 44)
18.W hich of the following is not a method of supply chain coordination?
a.co-opetition
b.dovetailing
c.placing personnel from one supply-chain participant into the facility
of another participant
d.supply-chain councils
e.all are methods
(b; pp. 43–44)
19.W hich of the following represents a method of supply chain coordination?
a.dovetailing
b.co-opetition
c.benchmarking
d.nesting
(b; p. 44)
20.W hich of the following is not a barrier to supply-chain management?
a.regulatory and political considerations
https://www.doczj.com/doc/3b18452606.html,ck of top management commitment
c.reluctance to share, or use, relevant data
d.incompatible corporate cultures
e.all are barriers
(e; pp. 44–46)
21.D ata mining:
a.is illegal in the United States
b.is synonymous with marginal analysis
c.looks for patterns and relationships in relevant data
d.can only be done by grocery stores
(c; p. 45)
22.L ooking for patterns and relationships in relevant data refers to:
a.data warehousing
b.marginal analysis
c.correlation analysis
d.data mining
(d; p. 45)
23.W hich of the following is false?
a.ERP systems tend to be relatively strong when it comes to logistics
and supply chain requirements.
b.Installing ERP systems can take several years to complete.
c.ERP systems offer tremendous potential for increasing organizational
effectiveness and efficiency.
d.Installing ERP systems can be expensiv
e.
e.All of the above are true.
(a; pp. 45–46)
24.S upply chains can be integrated by having various parties enter into and
carry out long-term mutually beneficial agreements. These agreements are known by several names. Which of the following is not one of these names?
a.partnerships
b.strategic alliances
c.third-party arrangements
d.contract logistics
e.all of the above are correct
(e; p. 46)
25.T here are three primary methods that organizations can pursue when
attempting to integrate their supply chains. Which of the following is not one of them?
a.vertical integration
b.intensive distribution
c.formal contracts
https://www.doczj.com/doc/3b18452606.html,rmal agreements
(b; p. 47)
26.A ll of the following are factors that distinguish contemporary third-party
logistics from earlier efforts except:
a.there tends to be a formal contract in contemporary 3PL
b.contemporary 3PL focuses on customized offerings
c.contemporary 3PL has a transactional focus
d.contemporary 3PL focuses on mutual benefits
(c; p. 48)
27.W hat is a fourth-party logistics provider?
a. a third-party logistics provider that has been in existence for at least
25 years
b. a third-party logistics provider that has achieved ISO 9000
certification
c. a logistics intermediary that specializes in one logistics activity (e.g.,
transportation, warehousing)
d. a general contractor that coordinates the activities of third-party
logistics providers
(d; p. 49)
28.W hich of the following statements about supply-chain software is false?
a.many supply-chain software packages are developed for specific,
rather than general, applications
b.supply-chain software packages can focus on specific functional
activities such as transportation and warehousing
c.supply-chain software packages can focus on specific supply-chain
processes such as customer relationship management
d.supply-chain software packages can attempt to simultaneously
optimize supply-chain processes across organizations
e.all are true
(a; pp. 49–50)
29.T he supply-chain management philosophy emerged in which decade?
a.1960s
b.1970s
c.1980s
d.1990s
(d; p. 36)
30.A lthough nearly any organization can be part of a supply chain, supply-chain
management requires:
a.the involvement of third-party logistics companies
b.overt management efforts by the organizations in a supply chain
c.the participation of world-class organizations
d.at least one organization to be a multinational company
(b; p. 37)
31.A distinguishing feature of the JIT II concept is that:
a.supplier and customer facilities are located in the same industrial
park
b.only expedited transportation is used
https://www.doczj.com/doc/3b18452606.html,panies must have ISO 9000 certification to participate
d.suppliers have on-site offices at a particular customer
(d; p. 39)
32.W hat company developed the supplier integration program known as JIT II?
a.Procter & Gamble
b.Gap
c.Bose
d.McDonald’s
(c; p. 39)
33.C ontemporary supply chains should be agile and ____________.
a.fast
b.lean
c.interactive
d.relevant
(a; p. 40)
34.W hich of the following is false?
a.supply chains should employ a long-term orientation
b.supply-chain management cannot be successful without information
sharing
c.partnerships must involve formal, contractual agreements
d. a long-term orientation tends to be predicated on relational
exchanges
(c; pp. 40–41)
35.T he variability in demand orders among supply-chain participants:
a.cannot be controlled
b.refers to the bullwhip effect
c.can be controlled with electronic order placement
d.is more pronounced in relational exchanges
(b; p. 42)
True-False Questions
1.The supply-chain concept originated in the logistics literature. (True, p. 36)
2.Customers are not included as part of supply chains. (False, pp. 36–37)
3.Supply-chain management requires overt management efforts by the
organizations within the supply chain. (True, p.37)
4.The SCOR model identifies four key processes associated with supply-chain
management. (False, p. 38)
5.JIT II is a supplier integration program that allows different suppliers to
interact with each other on a regular basis. (True, p. 39)
6.Logistics has involvement in at least four of the key processes identified in
the SCOR model. (True, p. 38)
7.Because customer needs and wants change relatively quickly, supply chains
should be fast and lean. (False, p. 40)
8.With respect to supply chains, relevancy focuses on an organization’s ability
to respond to changes in demand with respect to volume and variety. (False, p. 40)
9.Supply chains should employ a long-term orientation with various
participants. (True, p. 40)
10.F ormal partnerships are more likely than informal ones to result in improved
long-term supply-chain performance. (True, p. 41)
11.P ower retailers have been at the center of changes taking place that affect
the supply chain. (False, p. 41)
12.T he Internet has been referred to as the greatest force of commodization
known to man, for both goods and services. (True, p. 41)
13.E nhanced communications across organizations in a supply chain is only
dependent on the technological capabilities of the organizations. (False, p.
42)
14.V ariability in demand orders among supply-chain participants is known as
the bubble effect. (False, p. 42)
15.I nventory control in supply-chain management is attempting to move from
“stops and starts” to continuous flow. (True, p. 42)
16.S upply chain disruptions (e.g., delayed shipments) that occurred in the
wake of the terrorist attacks in September 2001 have caused some supply chains to reassess their emphasis on inventory reduction. (True, p. 42)
17.S upply-chain councils refer to lobbying groups concerned with promoting
favorable supply-chain legislation. (False, p. 43)
18.C o-opetition is a concept that suggests that companies can be competitors
in some situations while working together in other situations. (True, p. 44) 19.C ovisint is an on-line trading exchange that represents an example of co-
opetition in the grocery industry. (False, p. 44)
20.R egulatory considerations present a bigger obstacle than political
considerations to supply-chain management. (False, p. 44)
21.T he overall global climate for business has shifted toward allowing more
cooperation among firms—which should help supply-chain management.
(True, p. 44)
22.T op management is sometimes hesitant to fully commit to supply-chain
management. (True, p. 45)
23.D ata warehousing is a technique that looks for patterns and relationships in
the relevant data. (False, p. 45)
24.A lthough customer loyalty programs (e.g., frequent shopper cards) can
provide highly detailed data to companies, there are some who believe that these programs potentially violate a customer’s right to privacy. (True, p.
45)
25.M ost ERP systems tend to be relatively weak when it comes to logistics and
supply chain requirements. (True, p. 45)
26.C orporate cultures should be an irrelevant consideration when designing a
supply chain. (False, p. 46)
27.A n individual firm can only be involved in one supply chain at a time. (False,
p. 46)
28.T he most common examples of vertical integration today are some lines of
paint and automotive tires. (True, p. 47)
29.I ntensive distribution is one of the methods that organizations can pursue
when attempting to integrate their supply chains. (False, p. 47)
https://www.doczj.com/doc/3b18452606.html,rmal agreements offer supply-chain participants more flexibility than
other methods of supply-chain integration. (True, p. 47)
31.C ontemporary third-party logistics has existed since about 1975. (False, p.
48)
32.C ontemporary third-party logistics tends to be characterized by
standardized, as opposed to customized, offerings. (False, p. 48)
33.A fourth-party logistics provider should be viewed as a general contractor
whose primary purpose is to insure that third-party logistics providers are working toward relevant supply-chain goals. (True, p. 49)
34.T he fourth-party logistics concept appears to be best suited to small
companies that need logistical assistance in only one or two functional areas. (False, p. 49)
35.A s a general rule, supply-chain software packages look to coordinate and
integrate functions, processes, and/or systems across multiple supply-chain participants. (True, p. 50)