Supply chain management study guide

What is supply chain management?

The management of the flow of goods and services, including all processes that transform raw materials into final products.

Define logistics in the supply chain.

Logistics involves the planning, execution, and control of the movement and placement of goods and services.

True or False: Supply chain management only focuses on manufacturing.

False. It encompasses sourcing, production, and distribution, involving multiple stakeholders.

What is the goal of supply chain management?

To maximize customer value while minimizing costs through efficient operations.

Fill in the blank: Supply chain management integrates ________ and ________.

procurement; distribution

What is demand forecasting?

The process of estimating future customer demand using historical data, market trends, and statistical tools.

Compare supply chain and supply chain network.

Supply chain: linear process; Supply chain network: interconnected entities across various locations.

What is inventory management?

The supervision of non-capitalized assets, or inventory, and stock items to ensure sufficient supply while minimizing costs.

Cause → Effect: Delayed shipments lead to ____.

Increased customer dissatisfaction and potential loss of sales.

What is the bullwhip effect?

A phenomenon where small fluctuations in demand at the retail level cause larger fluctuations up the supply chain.

Define sourcing in supply chain management.

The process of identifying, evaluating, and engaging suppliers to provide goods and services.

Give an example of a supply chain risk.

Natural disasters disrupting transportation routes can delay delivery and incite shortages.

What are supply chain stakeholders?

Entities involved in the supply chain, including suppliers, manufacturers, distributors, and customers.

True or False: Just-in-time inventory reduces holding costs.

True. It minimizes inventory levels by receiving goods only as needed.

What is supply chain visibility?

The ability to track products throughout the supply chain in real-time to improve decision-making.

Fill in the blank: The ________ connects suppliers, manufacturers, and customers.

supply chain

Sourcing → What does it involve?

Sourcing involves identifying and selecting suppliers, negotiating contracts, and acquiring goods or services needed for production.

Procurement vs. Purchasing: How do they differ?

Procurement encompasses the entire process of acquiring goods/services, while purchasing refers specifically to the transaction of buying.

True or False: Logistics is solely about transportation.

False. Logistics includes transportation, warehousing, inventory management, and order fulfillment.

What is inventory management?

Inventory management is the supervision of ordering, storing, and using a company’s inventory. It ensures optimal stock levels.

Fill in the blank: The ______ process involves managing the flow of goods to customers.

The distribution process involves managing the flow of goods to customers.

What is the purpose of demand forecasting?

Demand forecasting predicts future customer demand to optimize inventory levels and production planning.

Production planning → What does it include?

Production planning includes scheduling, resource allocation, and determining manufacturing processes to meet demand.

Cause → Effect: Poor supplier relationships lead to...

...delays in production, increased costs, and potential stockouts.

What are the key stages of the supply chain?

The key stages are sourcing, production, inventory management, and distribution.

Order fulfillment → What is it?

Order fulfillment is the process of receiving, processing, and delivering orders to customers.

True or False: Supply chain processes are isolated from one another.

False. Supply chain processes are interconnected and impact each other's efficiency and effectiveness.

What role does warehousing play in supply chains?

Warehousing provides storage for goods, allowing for timely distribution and inventory management.

Comparison: Just-in-Time vs. Traditional inventory.

Just-in-Time minimizes inventory levels to reduce costs, while Traditional maintains higher stock levels for availability.

What is supplier relationship management?

Supplier relationship management focuses on developing and maintaining positive relationships with suppliers for better performance.

True or False: Transportation includes only road transport.

False. Transportation includes road, rail, air, and sea methods.

How does reverse logistics function?

Reverse logistics involves the process of moving goods from their final destination back to the manufacturer for return, repair, or recycling.

Distribution channels → What are they?

Distribution channels are the pathways through which goods or services flow from producers to consumers.

What is lead time in supply chain management?

Lead time is the total time it takes from placing an order until it is received.

Fill in the blank: ______ logistics focuses on the movement of goods to the consumer.

Outbound logistics focuses on the movement of goods to the consumer.

What is the importance of supply chain visibility?

Supply chain visibility allows companies to track products in real-time, improving decision-making and responsiveness.

What is Supply Chain Cycle Time?

The total time taken from the initiation of a supply chain process to its completion. This includes production, transportation, and delivery time.

Fill in the blank: Supply Chain Efficiency is measured by _____ cost.

total

True or False: Higher inventory turnover indicates better supply chain performance.

True. Higher turnover suggests efficient inventory management and sales performance.

What metric compares actual performance to planned performance?

Key Performance Indicators (KPIs) track performance against goals to assess success.

What does On-Time Delivery measure?

The percentage of orders delivered by the promised date. It's critical for customer satisfaction.

Compare Order Fulfillment Rate and Fill Rate.

Order Fulfillment Rate measures complete orders delivered. Fill Rate assesses item availability for orders.

What is the formula for Total Supply Chain Cost?

The formula is: $\displaystyle TSC = P + T + I$, where P = production costs, T = transportation costs, I = inventory costs.

Cause → Effect: Delays in transportation result in _____ customer satisfaction.

lower

What does Perfect Order Rate indicate?

The percentage of orders delivered without issues (on time, complete, undamaged). It reflects supply chain excellence.

Inventory Accuracy is defined as _____.

how closely the recorded inventory matches the actual stock.

What is the purpose of Supply Chain Responsiveness?

To measure how quickly a supply chain can adapt to changes in demand or supply.

Short example of Cost of Poor Quality (COPQ).

If defective products lead to returns costing $5,000, this affects overall supply chain efficiency.

What is RFID technology?

Radio Frequency Identification (RFID) uses electromagnetic fields to automatically identify and track tags attached to objects. This technology enhances inventory accuracy and reduces theft.

True or False: Blockchain increases supply chain transparency.

True. Blockchain provides a secure and immutable ledger that allows all parties in the supply chain to verify transactions, thereby increasing transparency and trust.

How does IoT impact supply chains?

The Internet of Things (IoT) connects devices over the internet, enabling real-time data collection and analysis. This leads to improved tracking, predictive maintenance, and enhanced decision-making.

Comparison: traditional vs. automated warehouses.

- Traditional: labor-intensive, slower, prone to human error. - Automated: faster, efficient, reduced labor costs.

Fill in the blank: Cloud computing allows for __________ access to supply chain data.

real-time

What is 3D printing's role in supply chains?

3D printing enables on-demand production, reducing inventory costs and lead times. Example: A company can print replacement parts as needed instead of stocking them.

Cause: Increased data analytics use. Effect?

Enhanced decision-making and forecasting accuracy, leading to more efficient supply chain operations.

What is the role of AI in supply chain management?

Artificial Intelligence (AI) optimizes supply chain processes by analyzing large datasets for trends, automating decision-making, and improving demand forecasting.