Exam 1 True/False

The first decade of the twenty-first century was a period of rapid change for organizations, especially businesses
True
A key element in Wal-Mart’s ability to discount brand name products was an understanding of the criticality of efficiency in its logistics and supply chain system
True
Globalization has had little effect on consumers
False
Supply and demand has become less volatile as managers become more adept at controlling the elements
False
Outsourcing is a fairly new concept
False
SAB should examine their off-shore purchasing policy, even though the products are sourced from the U.S.
True
It is expected that some or all of the BRIC countries (Brazil, Russia, India, & China) will replace the so-called VISTA (Vietnam, Indonesia, South Africa, Turkey and Argentina) as low cost producers of various products and services
False
The world economy still favors the United States and European countries, even though China and India can participate in the global economy much more readily
False
It is predicted that social networks such as Facebook and Twitter will influence supply chains because of their impact on customer demand and the speed of information transfers
True
The U.S. transportation system was deregulated in the 1930’s and 1940’s in response to economic conditions and World War 2
False
Even though there are references to supply chain management in the 1980’s , SCM did not capture the attention of senior-level management until the 1990’s
True
Supply chain managers no longer need to worry about sub optimization in light of todays technology
False
The utility created through the basic marketing activities is known as place utility
False
Transportation is the physical movement or flow of goods
True
During the 1990’s and 2000’s, logistics costs as a percentage of gross national product declined
True
An aircraft manufacturer is a good example of an organization with a heavy inbound flow and a simple outbound flow
True
Acme Battery distributes its batteries to warehouses, where they are store until orderly by a retailer. The warehouses are located close by the retail markets served. This is the logistics channel approach to logistics
True
In a logistics system, warehousing should be optimized at the expense of related logistics activities, such as transportation and procurement
False
The mathematical calculation of the point of equality between systems under analysis is used for short-run/static analysis
False
To hold down distribution cost, the lowest close carrier should always be used
False
The inverse relationship that exists between the cost of lost sales and inventory costs is the inventory effect
True
Globalization is not considered to be one of the external factors driving change in logistics
False
The third era of globalization is said to have begun around the year 2000. The significant characteristic of this era is that it is being powered by individuals and smaller organizations in contrast to the countries of the first era and the large companies of the second era
True
The supply chain should manage four important flows, namely, materials, and products, information, financials, and demand
True
Operating globally has become harder to accomplish for individuals and small companies
False
The terms of a demise charter transfers full control of the chartered vessel to the charterer
True
Customs Trade Partnership Against Terrorism (C-TPAT) is a mandatory program in which importers must participate
False
The North American Free Trade Agreement has removed all trade barriers between the U.S, Canada, and Mexico
False
A maquiladora plant can be located anywhere in South America
False
Ocean transportation offsets slower service with lower rates than other modes
True
A firm using air transportation cannot use the same packaging for international shipping as for domestic shipping because many cargo aircraft are not pressurized
False
A Foreign Freight Forwarder is unregulated by the government
False
Export Trading Companies and Export Management Companies are essentially the same
False
An importer can store goods in a bonded warehouse for up to three years without paying duty
True
Soft issues such as social and cultural concerns should not present a challenge for supply chain managers, whose role is to focus on the physical side of supply chain execution
False
Many organizations have directed significant attention toward working more closely with supply chain partners, including not only customers and suppliers but also various types of logistics suppliers
True
A horizontal relationship refers to firms on the same level in the supply chain
False
The range of relationships with 3PL’s ranges from being a vendor to being a vertical supplier
False
The first stage in the process model for forming and sustaining supply chain relationships involves the process by which a manufacturer becomes fully aware of its logistics and supply chain needs
True
Drivers and facilitators are internal issues that an organization must address before seeking a 3PL
False
Once a 3PL provider is chosen, it is not necessary for an organization to seek continuous improvements as the 3PL will handle that function
False
Collaboration is usually defined as a “business practice that encourages individual organizations to share information and resources for the benefit of all”
True
A Third Party Logistics firm is defined as a company that owns trucks and warehouses so as to offer integrated services
False
Outsourcing and contract logistics are terms sometimes used to describe third-party logistics
True
A financial based 3PL is a firm that takes a financial interest in an organization in order to underwrite the outsourcing of that firms logistics
False
The most frequently outsourced function is freight bill payment
False
The “IT gap” refers to the difference between the internal IT capabilities of 3PL users and the IT expertise of the 3PL providers
False
Outbound-to-customer logistics systems are also referred to as physical distribution
True
Materials management and physical supply are terms that cannot be used interchangeably
False
Demand management might be defined as focused efforts to estimate and manage customers demand, with the intention of using this information to shape operating decisions
True
Phantom demand is created by over-ordering during peak demand
True
The essence of demand management is to estimate and manage customer demand so that demand and supply are balanced to the point where there are zero stockouts and zero safety stocks
False
External balancing methods involve managing production and inventory flexibility to help offset the imbalance of supply and demand
False
Forecasting has become extremely accurate, especially since the development of the S&OP process
False
Dependent demand is directly influenced by independent demand
True
A weighted moving average assigns higher weights to more recent periods
True
Exponential shooting can use constants higher than 1, but not more than 5
False
Adjusting a forecast for seasons basically uses a combination of seasonal factors and average demand to arrive at an adjusted forecast
True
While there are four types of forecast error measures that can be used, none are foolproof
True
A sales and operations planning process (S&OP) can produce a forecast internally that all functional areas agree upon and can execute
True
Collaborative planning, forecasting, and replenishment (CPFR) has not been considered to be a good process, as it excludes transportation
False
A channel of distribution is controlled by the marketing departments, which selects the physical structures and intermediaries through which the products flow
False
An important observation to note about channel structure is that it involves the elements of fixed costs versus variable costs
True
Integrated fulfillment is preferred to dedicated fulfillment
False
Customer service is anything that touches the customer
True
Most organizations employ all six definitions of customer service in their management process
False
Customer relationship management is a new concept only recently receiving attention
False
Firms today are beginning to use techniques such as activity-based costing to more accurately allocate costs to customers based on the specific costs of serving a customers orders relative to how, how much, what, and when a customer orders
True
The identification of the product/service package for each customer segment is one of the easier activities in the CRM process
False
Activity-Based costing works well in warehouse-type environments but does not work or customer service applications
False
With the proper information on how a customers interaction with the shipper drives the firms costs, the firm can then segment its customers by profitability
True
“Order to cash” and “order cycle” are the same
True
“Order to cash” and “replenishment cycle” are the same
False
The buyer and seller look at order time from the same perspective
Flase
Process D1: Deliver stocked product in the supply chain council SCOR model is the same as the OTC cycle model
True
There are ten principal activities to the OTC model
False
Reserve inventory and determined delivery date has traditionally been referred to as order processing
True
A driving force behind the attention to OTC cycle variability is safety stock. The absolute length of the order cycle will influence demand inventory
True
Customer service is of equal importance to both logistics and marketing
True
From a marketing perspective, logistics customer service can be thought of as a feature of the argument product that adds value for the customer
True
Dependability is not as important to a buyer as is absolute length of lead time
False
There are four types of communications that exist between a buyer and a seller
False
There are five logistics performance metrics from the buyers point of view
True
A stockout always results in a back order
False
For the best service, all products should be available at all levels regardless of cost
False
By using the latest information technology it is possible to substitute information for inventory and other logistics expenses
True
The manufacturer must lead the channel design process regardless of the relative market power and financial strength of the members of the supply chain
False