Sourcing Decisions In A Supply Chain

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Questions Bank

Understanding the Supply Chain
Supply Chain Performance: Achieving Strategic Fit and Scope
Supply Chain Drivers and Metrics
Designing Distribution Networks and Applications to e-Business
Network Design in the Supply Chain
Designing Global Supply Chain Networks
Demand Forecasting in a Supply Chain
Aggregate Planning in a Supply Chain
Sales and Operations Planning: Planning Supply and Demand in a Supply Chain
Coordination in a Supply Chain
Managing Economies of Scale in the Supply Chain: Cycle Inventory
Managing Uncertainty in a Supply Chain: Safety Inventory
Determining the Optimal Level of Product Availability
Transportation in a Supply Chain
Sourcing Decisions in a Supply Chain
Pricing and Revenue Management in a Supply Chain
Sustainability and the Supply Chain

All Questions

Question 1

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Sourcing processes include the selection of suppliers, design of supplier contracts, product design collaboration, procurement of material, and evaluation of supplier performance.

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Question 2

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A good supplier scoring and assessment process will primarily track performance along the price dimension when evaluating a supplier.

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Question 3

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Design collaboration ensures that any design changes are communicated effectively to all parties involved with designing and manufacturing the product.

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Question 4

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The goal of procurement is to enable orders to be placed and delivered on schedule at the lowest possible price.

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Question 5

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Effective sourcing processes within a firm can improve profits for the firm and total supply chain surplus in a variety of ways.

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Question 6

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As the replenishment lead time from a supplier grows, the amount of safety inventory that needs to be held by the buyer also grows in direct proportion to the replenishment lead time.

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Question 7

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A reliable supplier has low variability of lead time, whereas an unreliable supplier has high variability.

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Question 8

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As the replenishment lot size grows, the cycle inventory at the firm grows, thus increasing the cost of holding inventory.

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Question 9

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Quantity discounts lower the unit cost and tend to increase the required batch size.

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Question 10

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The value of better information coordination will be linked to the amount of variability introduced into the supply chain as a result of the bullwhip effect.

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Question 11

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Supplier viability can be especially important if the supplier is providing mission-critical products and it would be easy to find a replacement for them.

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Question 12

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Having multiple sources ensures a degree of competition and also the possibility of a backup, should a source fail to deliver.

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Question 13

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Unless adding a supplier with a unique and valuable capability clearly adds to total cost, the firm's supply base may be too small.

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Question 14

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To improve overall profits, the supplier must design a contract that requires the buyer to share in some of the supplier's demand uncertainty.

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Question 15

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Buyback contracts counter double marginalization by lowering the cost of overstocking for the retailer.

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Question 16

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Revenue-sharing contracts counter double marginalization by decreasing the cost per unit charged to the retailer, thus effectively decreasing the cost of understocking.

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Question 17

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Quantity flexibility contracts counter double marginalization by giving the retailer the ability to modify the order based on improved forecasts closer to the point of sale.

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Question 18

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Two-part tariffs and threshold contracts can be used to counter double marginalization and increase agent effort in a supply chain.

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Question 19

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The procurement process for indirect materials should focus on decreasing the transaction cost for each order.

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Question 20

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Supplier performance analysis should be used to build a portfolio of suppliers with similar strengths.

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