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Chapter 3
Supply Chain Drivers and Obstacles
True/False
The major drivers of supply chain performance are customers, facilities, inventory, transportation, and information.
Answer: False
Difficulty: Moderate
The two major types of facilities are production sites and storage sites.
Answer: True
Difficulty: Moderate
Inventory is an important supply chain driver because changing inventory policies can dramatically alter the supply chain’s efficiency and responsiveness.
Answer: True
Difficulty: Moderate
Information is potentially the biggest driver of performance in the supply chain as it directly affects each of the other drivers.
Answer: True
Difficulty: Easy
A facility with little excess capacity will likely be no more or less efficient per unit of product it produces than one with a lot of unused capacity.
Answer: False
Difficulty: Easy
The high utilization facility will have no more difficulty responding to demand fluctuations than one with a lot of unused capacity.
Answer: False
Difficulty: Easy
Warehouse unit storage is the warehousing methodology that uses a traditional warehouse to store all of one type of product together.
Answer: False
Difficulty: Moderate
The components of inventory decisions include capacity, cycle inventory, safety inventory, seasonal inventory, and sourcing.
Answer: False
Difficulty: Easy
Cycle inventory is inventory that is built up to counter predictable variability in demand.
Answer: False
Difficulty: Easy
Seasonal inventory is inventory that is built up to counter predictable variability in demand.
Answer: True
Difficulty: Moderate
A company’s ability to find a balance between responsiveness and efficiency that best matches the needs of the customer it is targeting is the key to achieving strategic fit.
Answer: True
Difficulty: Moderate
Many obstacles, such as growing product variety and shorter life cycles, have made it increasingly difficult for supply chains to achieve strategic fit.
Answer: True
Difficulty: Moderate
Essay/Probl
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