Global Supply Chain Management Exam Review
Course Introduction
Global Supply Chain Management explores the strategies, processes, and technologies essential for managing the flow of goods, information, and finances across international borders. The course covers topics such as sourcing and procurement, logistics, transportation, risk management, sustainability, and the impact of global regulations. Students will analyze real-world case studies to understand the complexities of coordinating production and distribution networks in a globalized environment, as well as the challenges and opportunities presented by cultural diversity, trade agreements, and emerging markets. Emphasis is placed on developing skills to optimize efficiency, responsiveness, and resilience in global supply chains.
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Chapter 1: Operations and Productivity
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Sample Questions
Q1) Which of the following nets the largest productivity improvement?
A) increase output 15%
B) decrease input 15%
C) increase both output and input by 5%
D) increase output 10%, decrease input 3%
E) decrease input 10%, increase output 3%
Answer: B
Q2) Henry Ford and __________ are credited with the development of the moving assembly line.
Answer: Charles Sorensen
Q3) Henry Ford is noted for his contributions to
A) material requirements planning
B) statistical quality control
C) assembly line operations
D) scientific management
E) time and motion studies
Answer: C
Q4) Marketing, Production, and __________ are the three functions that all organizations must perform to create goods and services.
Answer: finance/accounting
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Chapter 2: Operations Strategy in a Global Environment
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Q1) How has Franz Colruyt achieved low-cost leadership?
List three specific examples and describe each briefly.
Answer: Several methods are listed in the text. Among these are no shopping bags, dim lighting, no voice mail, conversion of older buildings, Spartan offices.
Q2) Which of the international operations strategies uses the existing domestic model globally?
A) international strategy
B) global strategy
C) transnational strategy
D) multidomestic strategy
E) none of the above
Answer: D
Q3) Boeing's development of the 787 Dreamliner is an example of a company obtaining a competitive advantage through product differentiation/innovation.
A)True
B)False
Answer: True
Q4) The __________ strategy utilizes a standardized product across countries. Answer: global
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Chapter 3: Project Management
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Q1) A combination of effective Gantt chart use and other tactics allowed Delta to cut the average time for a plane layover by what % of the original 60 minute duration?
A) 33%, to 40 minutes
B) 50%, to 30 minutes
C) 20%, to 48 minutes
D) 25%, to 45 minutes
E) 40%, to 36 minutes
Answer: A
Q2) Which of the following statements concerning CPM activities is False?
A) The early finish of an activity is the early start of that activity plus its duration.
B) The late finish is the earliest of the late start times of all successor activities.
C) The late start of an activity is its late finish less its duration.
D) The late finish of an activity is the earliest late start of all preceding activities.
E) The early start of an activity is the latest early finish of all preceding activities.
Answer: D
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Chapter 4: Forecasting
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Q1) If a barbershop operator noted that Tuesday's business was typically twice as heavy as Wednesday's, and that Friday's business was typically the busiest of the week, business at the barbershop is subject to __________.
Q2) Organizations use which three major types of forecasts, including two that may fall outside the role of the operations manager?
A) strategic, tactical, and operational
B) economic, technological, and demand
C) exponential smoothing, Delphi, and regression
D) causal, time-series, and seasonal
E) departmental, organizational, and territorial
Q3) Gradual movement in time-series data over time is called
A) seasonal variation
B) a cycle
C) a trend
D) exponential variation
E) random variation
Q4) A time-series model uses a series of past data points to make the forecast.
A)True
B)False
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Chapter 5: Design of Goods and Services
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Q1) The four phases of the product life cycle are incubation, introduction, growth, and decline.
A)True B)False
Q2) A company is deciding if it should design an advertising system for use on Twitter©. The first option is to skip out on designing, with no net costs or gains. The second option is System A, which would result in additional sales of either $50,000 under good conditions or $10,000 under bad conditions. The final choice is System B, which would increase sales by $20,000 under both good and bad conditions. Suppose that good conditions are twice as likely as bad conditions. Which option should the company pursue if developing a system costs $25,000?
Q3) Provide some examples of recent product changes, i.e. new products that are replacing older ones.
Q4) State the benefits of implementing group technology.
Q5) An operations manager's most ethical activity is to enhance productivity while delivering desired goods and services. Unfortunately, this activity is not environmentally sound.
A)True B)False
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Chapter 6: Managing Quality
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Q1) A successful quality strategy features which of the following steps?
A) organization environment that fosters quality
B) understanding the principles of quality
C) engaging employees in the necessary activities for quality implementation
D) A and C
E) A, B, and C
Q2) A production manager at a pottery factory has noticed that about 70 percent of defects result from impurities in raw materials, 15 percent result from human error, 10 percent from machine malfunctions, and 5 percent from a variety of other causes. This manager is most likely using
A) a Pareto chart
B) a scatter diagram
C) a Taguchi loss function
D) a cause-and-effect diagram
E) a flowchart
Q3) Benchmarking requires the comparison of your firm to other organizations; it is not appropriate to benchmark by comparing one of your divisions to another of your divisions.
A)True
B)False
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Chapter 7: Statistical Process Control
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Q1) Repeated sampling of a certain process shows the average of all sample ranges to be 1.0 cm. The sample size has been constant at n = 5. What are the 3-sigma control limits for this R-chart?
Q2) The statistical definition of Six Sigma allows for 3.4 defects per million. This is achieved by a Cpk index of
A) 0
B) 1
C) 1.33
D) 1.67
E) 2
Q3) In most acceptance sampling plans, when a lot is rejected, the entire lot is inspected and all defective items are replaced. When using this technique the AOQ
A) worsens (AOQ becomes a larger fraction)
B) improves (AOQ becomes a smaller fraction)
C) is not affected, but the AQL is improved
D) is not affected
E) falls to zero
Q4) Why are x-bar and R-charts usually used hand in hand?
Q5) Can "in control" and "capable" be shown on the same chart?
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Chapter 8: Process Strategy
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Q1) Advances in technology
A) have impacted the manufacturing sector only
B) have had only limited impact on services
C) have failed to change the level of customer interaction with an organization
D) have had dramatic impact on customer interaction with services and with products
E) have dramatically changed health care, but have not changed retailing
Q2) How are modules useful in manufacturing processes?
Q3) Name the tools of process analysis and design. Describe them in a sentence or two each.
Q4) One essential ingredient of mass customization is modular design.
A)True
B)False
Q5) A(n) __________ uses symbols to analyze the movement of people or material.
Q6) Which of the following phrases best describes product focus?
A) low volume, high variety
B) finished goods are usually made to order
C) processes are designed to perform a wide variety of activities
D) high fixed costs, low variable costs
E) raw material inventories are high relative to the value of the product
Page 10
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Chapter9: Capacity and Constraint Management
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Q1) Consider a production line with five stations. Station 1 can produce a unit in 9 minutes. Station 2 can produce a unit in 10 minutes. Station three has two identical machines, each of which can process a unit in 12 minutes (each unit only needs to be processed on one of the two machines). Station 4 can produce a unit in 5 minutes. Station 5 can produce a unit in 8 minutes. Which station is the bottleneck station?
A) station 1
B) station 2
C) station 3
D) station 4
E) station 5
Q2) Which of the following represents a common way to manage capacity in the service sector?
A) appointments
B) reservations
C) changes in staffing levels
D) first-come, first served service rule
E) "early bird" specials in restaurants
Q3) In "drum, buffer, rope," the __________ acts like kanban signals.
Q4) Identify the tactics for matching capacity to demand.
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Chapter 10: Location Strategies
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Q1) Manufacturers may want to locate close to their customers, if the transportation of finished goods is expensive or difficult.
A)True
B)False
Q2) A jewelry store is more likely than a jewelry manufacturer to consider __________ in making a location decision.
A) transportation costs
B) cost of raw materials
C) parking and access
D) climate
E) taxes
Q3) In location decisions, intangible costs are easier to measure than tangible costs.
A)True
B)False
Q4) One reason for a firm locating near its competitors is the presence of a major resource it needs.
A)True B)False
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Chapter 11: Layout Strategies
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Q1) A(n) __________ is a special product-oriented arrangement of machines and personnel in what is ordinarily a process-oriented facility.
Q2) A process-oriented layout is the traditional way to support a product differentiation strategy.
A)True
B)False
Q3) McDonald's "Made for You" kitchen system represents a __________ use of layout decisions.
Q4) What is a servicescape?
How is it related to the retail layout problem?
What are the three elements of servicescape for dealing with these human issues?
Q5) In assembly line balancing, the theoretical minimum number of workstations is
A) the ratio of the sum of all task times to cycle time
B) always (when a fraction) rounded upward to the next larger integer value
C) not always possible to reach when tasks are actually assigned to stations
D) all of the above
E) none of the above
Q6) Explain how a load-distance model helps solve problems in process layout.
Q7) Identify McDonald's "seven major innovations.
Page 13
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Chapter 12: Human Resources, Job Design, and Work Measurement
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Q1) The Hawthorne studies, which showed that there is a dynamic social system in the workplace, took place in the 1960s.
A)True
B)False
Q2) Activity charts help analyze
A) movement of people and materials
B) utilization of an operator and machine
C) body movements
D) activities that can cause injuries
E) unnecessary micro-motions
Q3) Which of the following is used by methods analysis in analyzing body movement at the workstation level?
A) MTM chart
B) flow diagram
C) operations chart
D) process chart
E) improvement chart
Q4) Identify the five components of job design.
Q6) What are predetermined time standards? Page 14
Q5) What impact did the Hawthorne studies have on human resource strategy?
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Page 15
Chapter 13: Supply-Chain Management
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Q1) __________ postpones final assembly of a product so the distribution channel can assemble it.
Q2) The following data are pulled from a recent Walsh Manufacturing annual report.
\(\begin{array} { l r }\underline{\text { Assets}}\\
\text { Raw material inventory } & \$ 120,000 \\ \text { Work-in-process inventory } & \$ 50,000 \\ \text { Finished goods inventory } & \$ 300,000 \\ \text { Property, plant \& equipment } & \$ 500,000 \\ \text { Other assets } & \underline{\$ 200,000} \\ \text { Total assets } & \$ 1,170,000\\\\\\
\underline{\text { Condensed Income Statement}}\\
\text { Revenue } & \$ 2,000,000 \\ \text { Cost of goods sold } & \$ 600,000 \\ \text { Other expenses } & \underline{\$ 1,000,000} \\ \text { Net income } & \$ 400,000 \end{array}\)
Calculate: (a) Percent invested in inventory, (b) Inventory turnover, and (c) Weeks of supply.
Q3) Identify three specific measures that indicate how well assets are utilized. What are the formulas for each measure?
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Page 16
Chapter 14: Outsourcing as a Supply-Chain Strategy
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Q1) __________ is the practice of procuring from external sources services or products that are normally part of an organization.
Q2) What do you think would be a major risk for a government trying to promote its country as a low-cost producer, filled with ready and willing outsourcing providers?
Q3) Has there been any political backlash in the United States resulting from outsourcing in foreign countries?
Explain.
Q4) Offshoring is the practice of procuring from foreign external sources services or products that are normally part of an organization.
A)True
B)False
Q5) Identify several outsourcing processes, that is, activities that firms should undertake when embarking on outsourcing.
Q6) Research data suggest that foreigners outsource far more services to the U.S. than American companies send abroad.
A)True
B)False
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Page 17
Chapter 15: Inventory Management
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Q1) Which of the following statements regarding the reorder point is <b>true</b>?
A) The reorder point is that quantity that triggers an action to restock an item.
B) There is a reorder point even if lead time and demand during lead time are constant.
C) The reorder point is larger than d x L if safety stock is present.
D) The fixed-period model has no reorder point.
E) All of the above are true.
Q2) ABC analysis is based on the presumption that carefully controlling all items is necessary to produce important inventory savings.
A)True
B)False
Q3) Describe ABC inventory analysis in one sentence. What are some policies that may be based upon the results of an ABC analysis?
Q4) When is a good time for cycle-counting personnel to audit a particular item?
Q5) What is MRO an acronym for?
What is the function of MRO inventories?
Q6) Describe the difference between a fixed-quantity and a fixed-period inventory system?
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Chapter 16: Aggregate Planning
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Q1) The only objective of aggregate planning is to minimize the cost of matching capacity to demand over the planning period.
A)True
B)False
Q2) One motive for using demand-influencing aggregate planning options is to create uses for excess capacity within an organization.
A)True
B)False
Q3) Describe the advantages and limitations of the graphical method of aggregate planning.
Q4) One reason complex models have not found widespread use and application is that A) managers are lazy
B) managers cannot understand how they work
C) the models are inaccurate
D) good models are time-consuming and managers must often react swiftly to dynamic demand
E) the statement is False; complex models are widely used and accepted
Q5) Identify some firms that provide yield management software.
Q6) What is disaggregation?
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Chapter 17: Material Requirements Planning MRP and ERP
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Q1) The MPS calls for 50 units of Product A and 60 of B. There are currently 35 of Product B on hand. Each A requires 2 of Part C; each B requires 5 of C. There are 160 units of C available.
a. Calculate the net requirements for B.
b. Calculate the gross requirements for C.
c. Calculate the net requirements for C.
Q2) While ERP may provide a strategic advantage over competitors, it is so complex that many companies cannot adjust to it.
A)True
B)False
Q3) Each R requires 3 of component S and 3 of material A; each S requires 3 of part T. The lead time for assembly of R is 1 week. The lead time for the manufacture of S is 2 weeks. The lead time for material A is 1 week. The lead time for the procurement of T is 4 weeks.
a. Construct the time-phased product structure.
b. Construct the bill of material.
Q4) What is the "supermarket" as it is used in MRP? How does it alter the responsibility for dealing with lead-time offsets?
Q5) What are the advantages of enterprise resource planning (ERP)?
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Chapter 18: Short-Term Scheduling
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Sample Questions
Q1) Gantt charts are useful for scheduling jobs, but not for loading them.
A)True
B)False
Q2) At Morgan's Transformer Rebuilding, a set of five jobs is ready for dispatching to a machine center. The processing times and due dates for the jobs are given in the table below. Use shortest processing time to sequence the jobs, and calculate the average completion time, the average job lateness, and the average number of jobs in the machine center.
\[\begin{array} { | c | c | c | }
\hline \text { Job } & \text { Work Time (days) } & \text { Due Date (days) } \\
\hline \text { A } & 15 & 38 \\
\hline \text { B } & 13 & 28 \\
\hline \text { C } & 7 & 20 \\
\hline \text { D } & 18 & 50 \\
\hline \text { E } & 9 & 15 \\
\hline
\end{array}\]
Q3) __________ is an input-output control system that uses cards to manage the amount of work in a work center.
Q4) What are the criteria by which we evaluate sequencing rules?
Page 21
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Chapter 19: Just-In-Time and Lean Options
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Q1) The __________ is the time between the arrival of raw materials and the shipping of finished products.
Q2) Cross-training is a common JIT tactic to improve flexibility.
A)True
B)False
Q3) Daily demand is half of daily production. If setup and holding costs are equal, determine how Q and D are related.
Q4) The technique known as level schedules
A) requires that schedules be met without variation
B) processes many small batches rather than one large one
C) is known as "jelly bean" scheduling
D) is based on meeting one day's demand with that day's production
E) All of the above are true regarding level scheduling.
Q5) Which of the following is<b>not</b> a reason for variability?
A) Employees, machines, and suppliers produce units late.
B) Customer demand is unknown.
C) Employees, machines, and suppliers produce units that conform to standards.
D) Engineering drawings are inaccurate.
E) Drawings or specifications are incomplete.
Q6) What does TPS stand for?
Page 22
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Chapter 20: Maintenance and Reliability
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Q1) __________ is the probability that a machine part or product will function properly for a specified time under stated conditions.
Q2) A redundant part decreases reliability if the reliability of the redundant part is lower than that of the part it is backing up.
A)True
B)False
Q3) The academic service commonly referred to as "registration" consists of several smaller components: advising, registration for courses, fee assessment, financial aid calculations, and fee payment. Each of these modules operates independently and has some probability of failure for each student. If the five probabilities which accompany these services are 95%, 90%, 99%, 98%, and 99%, what is the "reliability" of the entire product from the student's perspective-the probability that all five will work according to plan?
Q4) The Everstart is a battery with an intended design life of 72 months. Stephanie Bradley recently put five of these batteries through accelerated testing (the company couldn't wait six years) to simulate failure patterns. The test results had one failure at 26 months, one failure at 32 months, one failure at 50 months, and one failure at 62 months. Calculate FR(%), FR(N), and MTBF.
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Chapter 21: Decision-Making Tools
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Q1) A(n) __________ is an occurrence or situation over which the decision maker has little or no control.
Q2) A decision-maker using the maximax criterion on the problem below would choose Alternative __________ because the maximum of the row maximums is __________. \[ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~{ \text { States of Nature } } \\
\begin{array} { | l | c | c | c | }
\hline & 1 & 2 & 3 \\
\hline \text { Alternative A } & 50 & 55 & 60 \\
\hline \text { Alternative B } & 30 & 50 & 80 \\
\hline \text { Alternative C } & 70 & 80 & 70 \\
\hline \text { Alternative D } & - 100 & - 10 & 140 \\
\hline
\end{array}\]
A) A; 60
B) B; 80
C) C; 70
D) D; -100
E) D; 140
Q3) The square symbol used in drawing a decision trees represents a __________ node.
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Chapter 22: Linear Programming
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Q1) The difference between minimization and maximization problems is that
A) minimization problems cannot be solved with the corner-point method
B) maximization problems often have unbounded regions
C) minimization problems often have unbounded regions
D) minimization problems cannot have shadow prices
E) None of the above are true.
Q2) A shadow price (or dual value) reflects which of the following in a maximization problem?
A) the marginal gain in the objective realized by subtracting one unit of a resource
B) the market price that must be paid to obtain additional resources
C) the increase in profit that would accompany one added unit of a scarce resource
D) the reduction in cost that would accompany a one unit decrease in the resource
E) none of the above
Q3) Linear programming is an appropriate problem-solving technique for decisions that have no alternative courses of action.
A)True
B)False
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Chapter 23: Transportation Models
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Q1) The Northwest-Corner rule's biggest flaw is that
A) it ignores costs
B) it cannot generate feasible solutions
C) it never generates ideal solutions
D) it ignores shipping time
E) There are no major flaws.
Q2) A transportation problem with 8 sources and 6 destinations will have an optimal solution that uses at most 13 of the 48 possible routes.
A)True
B)False
Q3) The transportation model is an excellent tool for minimizing shipping costs among existing facilities, but it is not useful when firms consider new facility locations.
A)True
B)False
Q4) When is it necessary to add dummy sources or destinations to a transportation problem?
Q5) A transportation problem requires exactly as many origins as destinations. A)True
B)False
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Chapter 24: Waiting-Line Models
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Q1) A queuing model which follows the M/M/1 assumptions has = 2 and = 3. The average number in the system is A) 2/3
B) 1
C) 1.5
D) 2
E) 6
Q2) There is only one bay and one type of service at an automatic car wash. Provide the most likely characteristics of this system.
a. name of model
b. number of channels
c. number of phases
d. arrival rate distribution
e. service time distribution
f. population size
g. queue discipline
Q3) A(n) __________ is a discrete probability distribution that often describes the arrival rate in queuing theory.
Q4) Provide an example of a limited or finite population for a queue.
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Chapter 25: Learning Curves
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Q1) The second unit of production took 9 hours. If the learning curve is 90% how long did the first unit take?
A) 9 hours
B) 10 hours
C) 8.1 hours
D) 8.5 hours
E) none of the above
Q2) __________ are based on the premise that people and organizations get better at their tasks as the tasks are repeated.
Q3) What can cause a learning curve to vary from a smooth downward slope?
Q4) The fundamental premise underlying learning curve analysis is that
A) tasks can be easily learned in organizations
B) organizations and people become better at their tasks as the tasks are repeated
C) learning takes place when people in organizations change
D) total labor costs decrease as the number of production units increases
E) doubling output cuts labor requirements per unit in half
Q5) Failure to consider the effects of learning can lead to __________ of labor needs.
Q6) What is the basic premise underlying the learning curve?
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Chapter 26: Simulation
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Q1) Simulation provides optimal solutions to problems.
A)True
B)False
Q2) Which of the following is <b>not </b>an application of simulation in the area of operations?
A) personnel scheduling
B) truck dispatching
C) plant (or facility) layout
D) inventory management using EOQ principles
E) inventory planning and control
Q3) Monte Carlo simulations applied to queuing problems have what advantage?
A) simpler
B) Arrival distribution does not need to be a Poisson distribution.
C) Unloading rates can vary randomly.
D) B and C
E) A, B, and C
Q4) Simulation models that are based on the generation of random numbers may fail to give the same solution in repeated use to any particular problem.
A)True
B)False
Page 29
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