Pretest Questions

1. This strategy combines elements of level production and

demand matching keeping the plant running near full capacity
for part of the cycle, allowing inventory to build up, and then
slows or shuts down to allow the inventory to shrink as
customers buy the product?
A) Supply matching
B) Level production
C) Bull-whip
D) Hybrid
Correct Answer: D)
Explanation: The Hybrid strategy combines elements of level
production and demand matching keeping the plant running
near full capacity for part of the cycle, allowing inventory to
build up.
2. For each product family there should exist one of three
operational approaches for determining when to produce the
product in relationship to customer orders and include all of the
following except?
A) Make to ship
B) Assemble to order
C) Make to order
D) Make to stock
Correct Answer: A)
Explanation: Supply-demand strategies include: Make to stock,
Make to order, and Assemble to order and does not include
make to ship.

3. Once you know the available capacity at a site, you can

compare it to the required capacity to see if you have a match
and if you don't have the required capacity at a work site then
there is a capacity ?
A) Gap
B) Discrepancy
C) Constraint
D) Problem
Correct Answer: C)
Explanation: Once you know the available capacity at a site, you
can compare it to the required capacity to see if you have a
match and if you don't have the required capacity at a work site
then there is a capacity constraint.
4. This is the point in the process for looking at orders and work
schedules to see specifically how available capacity will, or will
not, translate into the production necessity to meet demand
forecasts?
A) Resource planning
B) Capacity planning
C) Availability planning
D) Constraint planning
Correct Answer: B)
Explanation: Capacity planning-the process for looking at orders
and work schedules to see specifically how available capacity
will, or will not, translate into the production necessity to meet
demand forecasts.
5. The growing emphasis on supply chain collaboration has
resulted in new ways of thinking about design and the following
are various approaches to collaborative design except?

A) Design for inverse logistics

B) Design for the environment
C) Design for manufacture
D) Concurrent engineering
Correct Answer: A)
Explanation: Following are various approaches to collaborative
design Concurrent engineering, Design for manufacture, Design
for the environment and Design for reverse logistics not-design
for inverse logistics.
6. Like design for manufacture, describes the goal of a particular
form of collaborative design?
A) Design for inverse logistics
B) Design for the environment
C) Design for logistics
D) Concurrent engineering
Correct Answer: C)
Explanation: Like design for manufacture, design for logistics
describes the goal of a particular form of collaborative design.
7.Increased attention to ------ and designing for the environment
springs from customer demand, regulations, and plain oldfashioned ethics?
A) Design for reverse logistics
B) Design for the environment
C) Design for logistics
D) Concurrent engineering
Correct Answer: A)
Explanation: Increased attention to design for reverse logistics
and designing for the environment springs from customer
demand, regulations, and plain old-fashioned ethics

8. For each individual order, this cycle time starts with the order
receipt and ends with customer acceptance of the order?
A. Order production cycle time
B. Order shipping cycle time
C. Order dwell cycle time
D. Order fulfillment cycle time
ANS: D)
EXP: The order fulfillment cycle time starts with the order receipt
and ends with customers acceptance of the order.
9. SLR Electronics is a Japanese company that favors an
intermediate form of integrating their supply chain operations
called keiretsu. What is the relationship between suppliers and
customers like in this type of integration?
A. Suppliers and customers are completely dependent of each
other
B. Suppliers and customers are not completely dependent of
each other
C. Suppliers and customers are completely independent of each
other
D. Suppliers and customers are not completely independent of
each other
ANS: D
EXP: Japanese companies favor an intermediate form of
integration called keiretsu, in which suppliers and customers
are not completely independent but instead own significant
stakes in one another.
10. BK Law management sees goals as becoming irrelevant in

their firm. They have become status quo in their thinking and as
a result business is suering. Why is it crucial that a business
continue to set ever-higher standards and eliminate
complacency?
A. There is no stable state of business, only never-ending
change.
B. High standards are overrated and with a superb business plan
nothing needs to be changed.
C. Quality initiatives should always be looked at.
D. The people are to blame not management or goal
achievement.
ANS: A
EXP: The search for perfection has no endpoint. The
environment in which a firm does business constantly changes.
11. ABA Flowers, LLC would like to improve its business in a big
way, and knows that continuous improvement is crucial to its
success. Why is continuous improvement evolutionary and not
revolutionary?
A. It sets high goals and creates dramatic change, but does so
incrementally
B. It is crucial to budget abiding
C. It is the only way a business can be successful
D. It creates change and inspiration among employees and
improves productivity
E. It takes things slow and slow change is necessary for success
ANS: A
EXP: Small-step improvement may set very high goals and may
create dramatic change, but does so incrementally.
12. SSS Enterprises is examining the evolution of its supply

chains. As their supply chains have evolved across new frontiers,

they have noticed that they are in need of process
improvement. What specific areas should they not address?
A. Organization
B.. Technological Complexity
C. Scope
D. Cost
ANS: D
EXP: As supply chains evolve across new frontiers of
organization, technology, and scope they are in constant need
of process improvement.
13. Supply chains are dynamic and ever changing. Why is it that
supply chains change and require continuous reengineering
and process improvement?
A. A supply chain constantly expands, contracts, and
incorporates new stakeholders and new products.
B. A supply chain must keep up with competition in order to
achieve success.
C. A supply chain is process oriented.
D. A supply chain is constantly evolving.
ANS: A
EXP: Supply chains are dynamic and constantly expand,
contract, and incorporate new stakeholders and new products.
14. Customer complaints are one method of gaining
information. Company B has examined all of its customer
complaints but wants to gather more helpful information with
more control. What method should they use?
A. Focus groups
B. Defect measurement

C. Root cause analysis

D. Examination of control chart
ANS: A
EXP: Focus groups are another method that allows more control
than merely tracking customer complaints.
15. Company Y is looking for a position to be filled that is
directly related to supply chain management. Which of the
following attributes would not be considered a plus for this
position?
A. An understanding of electronic business systems
B. An understanding of the business model
C. The skill and experience necessary to manage critical
relationships
D. A working knowledge of assembly line processes
ANS: D
EXP: Positions directly related to supply chain management
require professionals with business systems, model, and cost
management ability along with the skill necessary to manage
critical relationships.
16. Leadership, whether inborn or teachable, exists outside the
organizational chart and is not always present in the manager,
even a good one. When is it easy to determine who is a good
leader and who is not?
A. When productivity is going well
B. In moments of crisis
C. When hiring people for jobs
D. During the interview process
ANS: B
EXP: During moments of crisis, it is easy to determine who is a

leader and who is not.

17. Osty Incorporated has undergone a security breech and is
now trying to salvage what was lost. Some of the key security
issues do not include which of the following?
A. Keeping supply chain information systems secure from denial
of service attacks
B. Ensuring the physical security modes of transportation and
storage
C. Complying with global antiterrorism initiatives
D. Meeting increased identification requirements
E. Sealing documents and oering a lock and key entrance only
ANS: E
EXP: Some of the key security issues do not include sealing
documents and oering lock and key entrance.
18. KGH Inc management team is sitting around the table
attempting to carry out process mapping. They have post-it
notes in hand and each team member is listing tasks identified
in the process, one per note. This process is called:
A. Brainstorming
B. Collaborative eort building
C. Relationship strengthening
D. Control chart analysis
ANS: A
EXP: One way to carry out process mapping is to schedule
brainstorming session for the improvement team.
19.. KGH Inc is conducting a brainstorming session. What are
some of the steps taken in order to assess key components of
the session?

A. Team members identify individual tasks and write on post-its

B. Team members stick the post-its on the chalkboard for
examination
C. Tasks are grouped by priority and budget weight
D. Tasks are grouped by themes and placed in order of
importance
ANS: C
EXP: Tasks should be grouped by themes and placed in order of
importance.
20. An airfreight company with on time performance and
competitive prices exhibits overall good company performance.
The company has adopted the customers mindset and this kind
of view of the companys performance.
A. Outside in view
B. Inside out view
C. All around view
D. Back and forward view
E. Behind the curtain view
ANS: A
EXP: When assessing a process, the company has to adopt the
customers mindset and an outside in view of the companys
performance.
21. STAY Cosmetics has noticed some erratic and unpredictable
changes in company performance. Delivery has changed and
slowed due to company cutbacks. This issue could cause which
of the following:
A. Disgruntled and unhappy customers
B. Employee clean-up appreciation
C. An increase in customer retention

D. Good scores on company survey

E. Six-sigma initiatives
ANS: A
EXP: This may well produce enough disgruntled customers that
a significant number would shift business to the more
predictable carrier.
22. Acme Auto, which started out as a single dealership, has a
vertical supply chain owning all links within its supply chain. The
company is experiencing explosive growth and is planning on
opening up an additional 500 dealerships nationwide calling for
them to switch to a lateral supply chain. Which of the following
is a benefit of lateral supply chain management?
A. The ability to be self-sucient
B. All divisions are completely visible to the parent company
C. The ability to remain in control
D. All company operations can be synchronized by directives
from the top.
E. The ability to outsource least eective areas of the business.
ANS: E
EXP: The ability to outsource least eective areas of a business is
a benefit of a lateral supply chain not a vertical supply chain.
23. Steves Steak House Franchise has abandoned the idea of
vertical integration and is now outsourcing to India all of their
packaging needs and materials. What is a negative aspect of
switching to a lateral strategy such as outsourcing?
A. More dicult to achieve economies of scale and scope
B. Business expertise and focus weakens

C. Communication technology becomes less eective

D. Pricing and quality go down
E. Synchronizing the activities of a lateral chain of independent
firms is more challenging
ANS: E
EXP: Despite the attractions of a lateral chain, however, the fact
remains that synchronizing the activities of a network of
independent firms can be enormously challenging..
24. In an eort to reduce cost and increase financial value Billys
Bike Barn is going to be enacting several cost cutting measures
to squeeze out excess costs. Which of the following is not a
downside to this strategy of cutting cost to increase financial
value?
A. Spending less in one area of the business will mean spending
more in another area
B. Cutting costs may result in a stagnation of business
C. The financial gain is spread out to all of the stakeholders
D. All the cost savings are sent to the consumers end of the
chain
E. The supply chain will suer from lack of financial sustenance
ANS: C
EXP: Having all the cost savings spread out to all of the
stakeholders is a strength of cost cutting and increases
eectiveness