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供应链管理课后习题答案第一章1.纵向一体化的企业拥有、管理并运作所有相关的业务职能。
横向一体化的企业由一些独立运营的企业组成，公司总部提供品牌、指导和一般战略。
比较并对比这两种类型企业的供应链战略。
答：纵向一体化企业旨在使公司各业务成分之间的互动更紧密，而且经常集中地管理它们。
这样的结构，可以更容易地通过中央决策除去供应链中的不同部分之间的冲突来实现系统的整体目标。
在横向一体化公司，协调公司内部各业务的供应链通常是没有效益的。
事实上，如果横向一体化中的每个企业都专注于它的核心功能，并以最佳状态运行，就可能达到总体的全局最优效果。
2.考虑一个企业重新设计其物流网络。
为数不多的几个集中仓库的优点是什么？大量靠近最终用户的仓库的优点是什么？答：少数位于市中心的仓库，允许公司利用风险分担，以提高服务水平并降低库存水平和成本。
不过，对外运输成本通常较高，交货间隔期较长。
另一方面，企业可以通过建立更多的靠近最终用户的仓库，以减少对外运输成本和交货间隔期。
然而，这种类型的系统将会使总库存水平和成本增加、规模经济下降、仓储费用增加，并且可能增加对内运输费用。
3.考虑一个企业选择运输服务提供商。
使用卡车承运商的优点是什么？使用诸如UPS这样的包裹速递公司的优点是什么？答：企业对运输服务的选择在很大程度上取决于公司要运输的产品的类型和大小，库存和交付的策略，和对灵活性的需求：1.如果是大量而稳定的运送大件物品或小件物品从仓库到需求点（店），货车运输会更好。
一个很好的例子就是仓库到超市之间的杂货送货。
要注意，在本例中，我们希望的是卡车满载时货物达到卡车装载量。
2.如果由制造商/仓库直接递送顾客的是相对低成本的项目，那么用快递公司更合适。
此外，快递公司可以根据客户的个人需要灵活的提供不同的运输方式。
4.企业库存水平较高有什么优点？有什么缺点？库存水平低有什么优点和缺点？答：1.高库存水平i. 优点:订单满足率(服务水平)高和订单执行快速。
（完整版）供应链管理_第三版_Unit1_习题与答案Chapter 1Understanding the Supply ChainTrue/False1. A supply chain includes only the organizations directly involved in supplyingcomponents needed for manufacturing.Answer: FalseDifficulty: Moderate2. A supply chain could be more accurately described as a supply network orsupply web.Answer: TrueDifficulty: Moderate3. The objective of every supply chain is to maximize the overall value generated.Answer: TrueDifficulty: Easy4. Every supply chain must include all 5 stages.Answer: FalseDifficulty: Easy5. The cycle view of a supply chain holds that the processes in a supply chain aredivided into a series of activities performed at the interface between successivestages.Answer: TrueDifficulty: Moderate6. The push/pull view of a supply chain holds that theprocesses in a supply chainare divided into 2 categories depending on whether they are initiated in response to or in anticipation of customer orders.Answer: TrueDifficulty: Easy7. The objective of customer order entry is to maintain a record of product receiptand complete payment.Answer: FalseDifficulty: Hard8. The replenishment cycle occurs at the retailer/distributor interface.Answer: TrueDifficulty: Hard9. The manufacturing cycle occurs at the manufacturer/supplier interface.Answer: FalseDifficulty: Moderate10. The procurement cycle occurs at the manufacturer/supplier interface.Answer: TrueDifficulty: Easy11. The cycle view of the supply chain is useful when considering operationaldecisions, because it specifies the roles and responsibilities of each member of the supply chain.Answer: TrueDifficulty: Moderate12. The push/pull view of the supply chain is useful when considering strategicdecisions relating to supply chain design, because it categorizes processesbased on whether they are initiated in response to or in anticipation of customer orders.Answer: TrueDifficulty: Moderate13. Pull processes may also be referred to as reactive processes.Answer: TrueDifficulty: Easy14. Pull processes may also be referred to as speculative processes.Answer: FalseDifficulty: Easy15. All supply chain activities within a firm belong to one of three macro processes –CRM, ISCM and SRM.Answer: TrueDifficulty: Easy16. There is a close connection between the design and management of supplychain flows and the success of a supply chain.Answer: TrueDifficulty: EasyEssay/Problems1. Explain the 3 decision phases (categories) that must be made in a successfulsupply chain.Answer: The 3 decision phases that occur within a supply chain are supply chain strategy (or design), supply chain planningand supply chain operation. Decisions relate to the flow of information, product and funds. The difference between categories depends upon the frequency of each decision and the time frame over which it has an impact. During the supply chain strategy phase, a companydetermines what the chain’s configurations will be, how resources will beallocated, and what processes each stage will perform. This will establish thestructure of the supply chain for several years. Supply chain planning deals withdecisions with a time frame from 3 months up to a year. The planning phasemust work within the constraints established in the strategy phase. Planningdecisions include which markets to supply from which locations, subcontractingof manufacturing, inventory policies and timing and size of marketing promotions.The supply chain operation phase operates on a weekly or daily time horizon and deals with decisions concerning individual customer orders.Difficulty: Hard答：决策的3阶段发生在一个供应链的供应链战略（或设计），供应链与供应链运作。
供应链管理课后习题答案第一章1.纵向一体化的企业拥有、管理并运作所有相关的业务职能。
横向一体化的企业由一些独立运营的企业组成，公司总部提供品牌、指导和一般战略。
比较并对比这两种类型企业的供应链战略。
答：纵向一体化企业旨在使公司各业务成分之间的互动更紧密，而且经常集中地管理它们。
这样的结构，可以更容易地通过中央决策除去供应链中的不同部分之间的冲突来实现系统的整体目标。
在横向一体化公司，协调公司内部各业务的供应链通常是没有效益的。
事实上，如果横向一体化中的每个企业都专注于它的核心功能，并以最佳状态运行，就可能达到总体的全局最优效果。
2.考虑一个企业重新设计其物流网络。
为数不多的几个集中仓库的优点是什么？大量靠近最终用户的仓库的优点是什么？答：少数位于市中心的仓库，允许公司利用风险分担，以提高服务水平并降低库存水平和成本。
不过，对外运输成本通常较高，交货间隔期较长。
另一方面，企业可以通过建立更多的靠近最终用户的仓库，以减少对外运输成本和交货间隔期。
然而，这种类型的系统将会使总库存水平和成本增加、规模经济下降、仓储费用增加，并且可能增加对内运输费用。
3.考虑一个企业选择运输服务提供商。
使用卡车承运商的优点是什么？使用诸如UPS这样的包裹速递公司的优点是什么？答：企业对运输服务的选择在很大程度上取决于公司要运输的产品的类型和大小，库存和交付的策略，和对灵活性的需求：1.如果是大量而稳定的运送大件物品或小件物品从仓库到需求点（店），货车运输会更好。
一个很好的例子就是仓库到超市之间的杂货送货。
要注意，在本例中，我们希望的是卡车满载时货物达到卡车装载量。
2.如果由制造商/仓库直接递送顾客的是相对低成本的项目，那么用快递公司更合适。
此外，快递公司可以根据客户的个人需要灵活的提供不同的运输方式。
4.企业库存水平较高有什么优点？有什么缺点？库存水平低有什么优点和缺点？答：1.高库存水平i. 优点:订单满足率(服务水平)高和订单执行快速。
供应链管理第6版习题答案供应链管理第6版习题答案供应链管理是现代企业管理中的重要一环，它涉及到物流、采购、生产、销售等多个环节，对企业的运营效率和竞争力起着关键作用。
为了帮助学生更好地理解和掌握供应链管理的知识，教材通常会配套习题。
下面将为大家提供供应链管理第6版习题的答案，希望对大家的学习有所帮助。
1. 什么是供应链管理？答：供应链管理是指企业通过有效的协调和管理，使得从原材料供应商到最终消费者的整个生产和分销过程能够高效地进行，以满足市场需求并降低成本。
2. 供应链管理的目标是什么？答：供应链管理的目标是通过优化供应链中各个环节的协调和协作，实现供应链的高效运作，提高企业的运营效率和竞争力。
3. 供应链管理的主要挑战有哪些？答：供应链管理面临的主要挑战包括需求不确定性、供应链中各个环节之间的信息不对称、供应链中的风险管理等。
4. 供应链中的关键业务流程有哪些？答：供应链中的关键业务流程包括需求管理、供应管理、生产管理、物流管理和售后服务管理等。
5. 供应链中的物流管理包括哪些内容？答：物流管理包括物流规划、物流网络设计、运输管理、仓储管理和库存管理等。
6. 供应链中的采购管理的关键任务是什么？答：供应链中的采购管理的关键任务包括供应商选择、供应商评估、供应商关系管理和采购合同管理等。
7. 供应链中的生产管理的目标是什么？答：供应链中的生产管理的目标是实现生产计划的准时交付、生产成本的最小化和生产质量的最优化。
8. 供应链中的售后服务管理包括哪些内容？答：售后服务管理包括客户投诉处理、产品退换货管理、产品维修和保养等。
9. 供应链中的风险管理的关键任务是什么？答：供应链中的风险管理的关键任务包括风险识别、风险评估、风险应对和风险监控等。
10. 供应链中的信息技术在哪些方面发挥作用？答：供应链中的信息技术主要在需求预测、库存管理、物流跟踪、供应商协同和客户关系管理等方面发挥作用。
以上是对供应链管理第6版习题的答案的简要介绍。
供应链管理课后习题答案供应链管理课后习题答案一、概述供应链管理是现代企业管理的重要组成部分，它涉及到从原材料采购到产品销售的整个流程。
通过对供应链的管理，企业可以实现资源的优化配置，提高生产效率和产品质量，从而增加竞争力和利润。
以下是一些供应链管理课后习题的答案，希望能对大家的学习有所帮助。
二、供应链设计1. 什么是供应链设计？供应链设计是指在满足客户需求的前提下，通过合理的供应链网络设计和流程优化，实现企业资源的最优配置和供应链效率的最大化。
2. 供应链设计的关键要素有哪些？供应链设计的关键要素包括供应链网络结构、物流配送策略、库存管理策略、合作伙伴选择等。
3. 供应链网络结构有哪些类型？常见的供应链网络结构包括集中式供应链、分散式供应链、混合式供应链和虚拟供应链等。
4. 如何选择合适的供应链网络结构？选择合适的供应链网络结构需要考虑产品特性、市场需求、成本效益、风险管理等因素，综合评估不同结构的优缺点，以实现最佳的供应链设计。
三、供应链协调1. 什么是供应链协调？供应链协调是指通过信息共享、合作伙伴关系管理、业务流程优化等手段，实现供应链各环节之间的协同和协作，以提高供应链整体效能。
2. 供应链协调的重要性是什么？供应链协调可以减少信息滞后、降低库存水平、提高交付准确率，从而提高供应链的灵活性、响应速度和客户满意度。
3. 如何实现供应链协调？实现供应链协调需要建立有效的沟通机制、共享信息平台，加强合作伙伴之间的信任和合作，同时优化业务流程和决策机制。
四、供应链风险管理1. 什么是供应链风险管理？供应链风险管理是指通过识别、评估和应对供应链中的各种风险，以保障供应链的稳定运行和业务连续性。
2. 常见的供应链风险有哪些？常见的供应链风险包括市场需求波动、供应商倒闭、物流延误、自然灾害等。
3. 如何进行供应链风险管理？供应链风险管理需要建立风险识别和评估机制，制定相应的风险应对策略，同时建立灵活的供应链网络和备份计划，以应对不同的风险情况。
供应链管理课后习题答案第一章、供应链管理导论1.供应链的结构特征是什么？将供应商、制造商、分销商、零售商、直到最终用户连成一个整体的功能网链结构。
2.何谓供应链管理？简述供应链管理与传统企业管理的区别和联系。
供应链管理就是使以核心企业为中心的供应链运作达到最优化，以最低的成本，另供应链从采购开始，到满足最终用户的所有过程，包括工作流、实物流、信息流、资金流等均高效率运作，把合适的产品，以合理的价格，及时准确的送到消费者手中。
区别：①传统企业的运营思想是生产是为了销售，而供应链企业运营的思想是按订单准时生产、快速响应客户需求②传统企业的管理手段是控制库存、降低库存成本，而供应链管理的手段是供应链企业协同创新、共创价值③传统企业提高生产效率的主要方法是扩大批量、增加规模效应，而供应链企业提高效率的主要方法是提升企业的柔性和敏捷性联系：供应链管理主要是以物流运行作为流程的，是开放性的，传统企业只是供应链管理中的一个环节，是闭环的。
3.供应链管理的关键在于实现企业内部及企业之间资源的集成。
从这个角度，分析互联网在供应链管理中的重要地位。
从管理难度的角度：现在的客户关系管理、企业资源计划等系统使得管理更加容易，尤其是对于一些全球性企业和跨区域企业从效率的角度：通过IT系统，从客户需求到计划、采购、生产、运输等供应链的整个过程更加迅速、高效。
当然也包括上下游企业和核心企业之间的沟通。
从成本的角度：管理难度下降，效率提升，这实际上降低了企业的成本4.电子商务将成为21世纪最主要的商业模式之一，它将对企业传统的业务流程带来巨大变革。
请阐述供应链管理对我国企业成功实施电子商务的重要意义。
基于电子商务的供应链的管理的主要内容涉及订单处理、生产组织、采购管理、运输与配送管理、库存管理、客户服务、支付管理等，供应链管理可促进电子商务的发展，使资源在供应链网络中合理流动，来缩短交货周期、降低库存，并且通过提供自助交易的自助式服务以降低成本，提高速度和精确性，增强企业竞争力。
供应链管理-第三版-Unit1-习题与答案Chapter 1Understanding the Supply ChainTrue/False1. A supply chain includes only the organizations directly involved insupplying components needed for manufacturing.Answer: FalseDifficulty: Moderate2. A supply chain consists of all parties involved, directly or indirectly,in fulfilling a customer request.Answer: TrueDifficulty: Moderate3. A supply chain could be more accurately described as a supply network orsupply web.Answer: TrueDifficulty: Moderate4. The objective of every supply chain is to maximize the overall valuegenerated.Answer: TrueDifficulty: Easy5. The objective of every supply chain is to maximize the value generatedfor the manufacturing component of the supply chain.Answer: FalseDifficulty: Moderate6. Every supply chain must include all 5 stages.Answer: FalseDifficulty: Easy7. The cycle view of a supply chain holds that the processes in a supplychain are divided into a series of activities performed at the interface between successive stages. Answer: TrueDifficulty: Moderate8. The cycle view of a supply chain holds that the processes in a supplychain are divided into 2 categories depending on whether they areinitiated in response to or in anticipation of customer orders.Answer: FalseDifficulty: Moderate9. The push/pull view of a supply chain holds that the processes in asupply chain are divided into 2 categories depending on whether they are initiated in response to or in anticipation of customer orders.Answer: TrueDifficulty: Easy10. The push/pull view of a supply chain holds that the processes in asupply chain are divided into a series of activities performed at theinterface between successive stages.Answer: FalseDifficulty: Easy11. The objective of the customer arrival process is to maximize theconversion of customer arrivals to customer orders.Answer: TrueDifficulty: Moderate12. The objective of the customer arrival process is to ensure that ordersare quickly and accurately entered and communicated to other affectedsupply chain processes.Answer: FalseDifficulty: Moderate13. The objective of customer order entry is to ensure that orders arequickly and accurately entered and communicated to other affected supply chain processes.Answer: TrueDifficulty: Moderate14. The objective of customer order entry is to maintain a record of productreceipt and complete payment.Answer: FalseDifficulty: Hard15. The replenishment cycle occurs at the retailer/distributor interface.Answer: TrueDifficulty: Hard16. The replenishment cycle occurs at the distributor/manufacturer interface.Answer: FalseDifficulty: Hard17. The replenishment cycle is initiated when a supermarket runs out ofstock of a particular item.Answer: TrueDifficulty: Hard18. The replenishment cycle is initiated when customers load items intendedfor purchase into their carts.Answer: FalseDifficulty: Hard19. The manufacturing cycle occurs at the distributor/manufacturer interface.Answer: TrueDifficulty: Moderate20. The manufacturing cycle occurs at the manufacturer/supplier interface.Answer: FalseDifficulty: Moderate21. The production scheduling process in the manufacturing cycle is similarto the order entry process in the replenishment cycle.Answer: TrueDifficulty: Hard22. The production scheduling process in the manufacturing cycle is similarto the order fulfillment process in the replenishment cycle.Answer: FalseDifficulty: Hard23. The procurement cycle occurs at the manufacturer/supplier interface.Answer: TrueDifficulty: Easy24. The procurement cycle occurs at the retailer/distributor interface.Answer: FalseDifficulty: Easy25. The cycle view of the supply chain is useful when consideringoperational decisions, because it specifies the roles andresponsibilities of each member of the supply chain.Answer: TrueDifficulty: Moderate26. The cycle view of the supply chain is useful when consideringoperational decisions, because it categorizes processes based on whether they are initiated in response to or in anticipation of customer orders.Answer: FalseDifficulty: Moderate27. The push/pull view of the supply chain is useful when consideringstrategic decisions relating to supply chain design, because itcategorizes processes based on whether they are initiated in response to or in anticipation of customer orders. Answer: TrueDifficulty: Moderate28. The push/pull view of the supply chain is useful when consideringstrategic decisions relating to supply chain design, because itspecifies the roles and responsibilities of each member of the supplychain.Answer: FalseDifficulty: Moderate29. Pull processes may also be referred to as reactive processes.Answer: TrueDifficulty: Easy30. Pull processes may also be referred to as speculative processes.Answer: FalseDifficulty: Easy31. Push processes may also be referred to as speculative processes.Answer: TrueDifficulty: Easy32. Push processes may also be referred to as reactive processes.Answer: FalseDifficulty: Easy33. All supply chain activities within a firm belong to one of three macroprocesses – CRM, ISCM and SRM.Answer: TrueDifficulty: Easy34. There is a close connection between the design and management of supplychain flows and the success of a supply chain.Answer: TrueDifficulty: EasyMultiple Choice1. Which of the following is not a stage within a typical supply chain?a. Customersb. Retailersc. Wholesalers/Distributorsd. Manufacturerse. All of the above are stages within a typical supply chain. Answer: eDifficulty: Easy2. Which of the following is not a stage within a typical supply chain?a. Customersb. Retailersc. Wholesalers/Distributorsd. Merchandiserse. Component/Raw material suppliersAnswer: dDifficulty: Easy3. Supply chain profitability isa. not correlated to the value generated by the various stages ofthe supply chain.b. the total profit to be shared across all supply chain stages.c. the difference between the revenue generated from the customer and the overall cost across the supply chain.d. the total revenue generated by the distributor stage of thesupply chain.e. b and c onlyAnswer: eDifficulty: Difficult4. Successful supply chain management requires which of the following decision phases?a. supply chain strategy/designb. supply chain planningc. supply chain operationd. all of the abovee. a and b onlyAnswer: dDifficulty: Moderate5. The decision phases in a supply chain includea. production scheduling.b. customer relationship management.c. supply chain operation.d. supply chain orientation.e. all of the aboveAnswer: cDifficulty: Moderate6. The cycle view of a supply chain holds thata. the processes in a supply chain are divided into 2 categories.b. the processes in a supply chain are divided into a series of activities performed at the interface between successive stages.c. all processes in a supply chain are initiated in response to a customer order.d. all processes in a supply chain are performed in anticipation of customer orders.e. None of the above are true.Answer: bDifficulty: Moderate7. The push/pull view of a supply chain holds thata. the processes in a supply chain are divided into a series of activities performed at the interface between successive stages.b. all processes in a supply chain are initiated in response to a customer order.c. all response in a supply chain are performed in anticipation of customer orders.d. the processes in a supply chain are divided into 2 categories depending on whether they are initiated in response to or in anticipation of customer orders.e. None of the above are true.Answer: dDifficulty: Moderate8. Which of the following is not a cycle in the supply chain cycle view?a. Analysis cycleb. Customer order cyclec. Replenishment cycled. Manufacturing cyclee. Procurement cycleAnswer: aDifficulty: Moderate9. Which of the following is not a cycle in the supply chain cycle view?a. Customer order cycleb. Replenishment cyclec. Manufacturing cycled. Procurement cyclee. All of the above are part of the supply chain cycle view.Answer: eDifficulty: Moderate10. The customer order cycle occurs at thea. customer/retailer interface.b. retailer/distributor interface.c. distributor/manufacturer interface.d. manufacturer/supplier interface.e. none of the aboveAnswer: aDifficulty: Easy11. Which of the following is not a process in the customer order cycle?a. Customer arrivalb. Customer qualificationc. Customer order entryd. Customer order fulfillmente. Customer order receivingAnswer: bDifficulty: Moderate12. Customer arrival refers toa. the point in time when the customer has access to choices and makes a decision regarding a purchase.b. the customer informing the retailer of what they want to purchase and the retailer allocating product to the customer.c. the process where product is prepared and sent to the customer.d. the process where the customer receives the product and takesownership.e. none of the aboveAnswer: aDifficulty: Moderate13. The objective of the customer arrival process is toa. get the correct orders to customers by the promised due date at the lowest possible cost.b. maintain a record of product receipt and complete payment.c. maximize the conversion of customer arrivals to customer orders.d. ensure that orders are quickly and accurately entered and communicated to other affected supply chain processes.e. none of the aboveAnswer: cDifficulty: Easy14. Customer order entry isa. the point in time when the customer has access to choices and makes a decision regarding a purchase.b. the customer informing the retailer of what they want to purchase and the retailer allocating product to the customer.c. the process where product is prepared and sent to the customer.d. the process where the customer receives the product and takes ownership.e. none of the aboveAnswer: bDifficulty: Moderate15. The objective of customer order entry is toa. get the correct orders to customers by the promised due date at the lowest possible cost.b. maintain a record of product receipt and complete payment.c. maximize the conversion of customer arrivals to customer orders.d. ensure that orders are quickly and accurately entered and communicated to other affected supply chain processes.e. none of the aboveAnswer: dDifficulty: Easy16. Customer order fulfillment refers toa. the point in time when the customer has access to choices and makes a decision regarding a purchase.b. the customer informing the retailer of what they want to purchase and the retailer allocating product to the customer.c. the process where product is prepared and sent to the customer.d. the process where the customer receives the product and takes ownership.e. none of the aboveAnswer: cDifficulty: Moderate17. The objective of customer order fulfillment is toa. get the correct orders to customers by the promised due date at the lowest possible cost.b. maintain a record of product receipt and complete payment.c. maximize the conversion of customer arrivals to customer orders.d. ensure that orders are quickly and accurately entered and communicated to other affected supply chain processes.e. none of the aboveAnswer: aDifficulty: Easy18. Customer order receiving isa. the point in time when the customer has access to choices and makes a decision regarding a purchase.b. the customer informing the retailer of what they want to purchase and the retailer allocates product to the customer.c. the process where product is prepared and sent to the customer.d. the process where the customer receives the product and takes ownership.e. none of the aboveAnswer: dDifficulty: Moderate19. The replenishment cycle occurs at thea. customer/retailer interface.b. retailer/distributor interface.c. distributor/manufacturer interface.d. manufacturer/supplier interface.e. none of the aboveAnswer: bDifficulty: Easy20. The processes involved in the replenishment cycle includea. retail order receiving.b. retail order entry.c. retail order trigger.d. retail order fulfillment.e. all of the aboveAnswer: eDifficulty: Moderate21. The processes included in the replenishment cycle include all of the following excepta. retail order receiving.b. retail order entry.c. retail order trigger.d. retail order fulfillment.e. none of the aboveAnswer: eDifficulty: Moderate22. The processes included in the replenishment cycle includea. order arrival.b. production scheduling.c. retail trigger.d. manufacturing.e. receiving.Answer: cDifficulty: Moderate23. The replenishment cycle is initiated whena. the customer walks into the supermarket.b. the customer calls a mail order telemarketing center.c. customers load items intended for purchase into their carts.d. a supermarket runs out of stock of a particular item.e. a product is received into stock at a store.Answer: dDifficulty: Hard24. The manufacturing cycle occurs at thea. customer/retailer interface.b. retailer/distributor interface.c. distributor/manufacturer interface.d. manufacturer/supplier interface.e. none of the aboveAnswer: cDifficulty: Easy25. The processes involved in the manufacturing cycle includea. receiving.b. manufacturing and shipping.c. production scheduling.d. order arrival.e. all of the aboveAnswer: eDifficulty: Moderate26. The processes involved in the manufacturing cycle includea. order trigger.b. production scheduling.c. order fulfillment.d. order entry.e. manufacturing order analysis.Answer: bDifficulty: Moderate27. The production scheduling process in the manufacturing cycle is similar to thea. order receiving process in the replenishment cycle.b. order fulfillment process in the replenishment cycle.c. order entry process in the replenishment cycle.d. order trigger process in the replenishment cycle.e. none of the aboveAnswer: cDifficulty: Hard28. The manufacturing and shipping process in the manufacturing cycle is equivalent to thea. order receiving process in the replenishment cycle.b. order fulfillment process in the replenishment cycle.c. order entry process in the replenishment cycle.d. order trigger process in the replenishment cycle.e. none of the aboveAnswer: bDifficulty: Hard29. The procurement cycle occurs at thea. customer/retailer interface.b. retailer/distributor interface.c. distributor/manufacturer interface.d. manufacturer/supplier interface.e. none of the aboveAnswer: dDifficulty: Easy30. The relationship between the manufacturer and supplier during the procurement cycle is very similar to the relationship betweena. customer and retailer.b. retailer and distributor.c. retailer and manufacturer.d. distributor and manufacturer.e. manufacturer and customer.Answer: dDifficulty: Moderate31. The cycle view of the supply chain is useful when considering operational decisions, becausea. it categorizes processes based on whether they are initiated inresponse to or in anticipation of customer orders.b. it specifies the roles and responsibilities of each member of the supply chain.c. processes are identified as either reactive or speculative.d. it focuses on processes that are external to the firm.e. it focuses on processes that are internal to the firm.Answer: bDifficulty: Hard32. The push/pull view of the supply chain is useful when considering strategic decisions relating to supply chain design, becausea. it categorizes processes based on whether they are initiated in response to or in anticipation of customer orders.b. it specifies the roles and responsibilities of each member of the supply chain.c. it clearly defines the processes involved and the owners of each process.d. it focuses on processes that are external to the firm.e. it focuses on processes that are internal to the firm.Answer: aDifficulty: Hard33. Which of the following statements about pull processes is accurate?a. May also be referred to as speculative processes.b. Execution is initiated in anticipation of customer orders.c. At the time of execution, demand must be forecast.d. May also be referred to as reactive processes.e. None of the above are accurate.Answer: dDifficulty: Easy34. Which of the following is not an accurate statement about pull processes?a. May also be referred to as speculative processes.b. Execution is initiated in response to a customer order.c. At the time of execution, demand is known with certainty.d. May also be referred to as reactive processes.e. All of the above are accurate.Answer: aDifficulty: Easy35. Which of the following statements about push processes is accurate?a. May also be referred to as speculative processes.b. Execution is initiated in response to customer orders.c. At the time of execution, demand is known with certainty.d. May also be referred to as reactive processes.e. None of the above are accurate.Answer: aDifficulty: Easy36. Which of the following is not an accurate statement about push processes?a. May also be referred to as speculative processes.b. Execution is initiated in anticipation of customer orders.c. At the time of execution, demand must be forecast.d. May also be referred to as reactive processes.e. All of the above are accurate.Answer: dDifficulty: Easy37. Supply chain macro processes include which of the following?a. Customer Relationship Management (CRM)b. Internal Supply Chain Management (ISCM)c. Supplier Relationship Management (SRM)d. all of the abovee. none of the aboveAnswer: dDifficulty: Easy38. Supply chain macro processes include which of the following?a. Internal Relationship Management (IRM)b. Customer Relationship Management (CRM)c. External Relationship Management (ERM)d. Supply Chain Relationship Management (SCRM)e. none of the aboveAnswer: bDifficulty: Moderate39. Supply chain macro processes include which of the following?a. Internal Relationship Management (IRM)b. External Relationship Management (ERM)c. Supplier Relationship Management (SRM)d. Supply Chain Relationship Management (SCRM)e. none of the aboveAnswer: cDifficulty: Moderate40. Activities involved in the Customer Relationship Management (CRM) macro process includea. planning of internal production and storage.b. order fulfillment.c. marketing.d. supply planning.e. demand planning.Answer: cDifficulty: Hard41. Activities involved in the Customer Relationship Management (CRM) macro process include all of the following excepta. demand planning.b. marketing.c. sales.d. order management.e. call center management.Answer: aDifficulty: Hard42. Activities involved in the Internal Supply Chain Management (ISCM) macro process includea. marketing.b. order fulfillment.c. sales.d. order management.e. call center management.Answer: bDifficulty: Hard43. Activities involved in the Internal Supply Chain Management (ISCM) macro process include all of the following excepta. planning of internal production and storage.b. order fulfillment.c. supply planning.d. demand planning.e. order management.Answer: eDifficulty: Hard44. Activities involved in the Supplier Relationship Management (SRM) macro process includea. planning of internal production and storage.b. order fulfillment.c. supply planning.d. supplier evaluation and selection.e. order management.Answer: dDifficulty: Moderate45. Activities involved in the Supplier Relationship Management (SRM) macro process include all of the following excepta. negotiation of supply terms.b. design collaboration.c. supply planning.d. supplier evaluation and selection.e. supply collaboration.Answer: cDifficulty: Hard46. The phenomenal success of 7-Eleven Japan is attributed toa. being in the right place at the right time.b. its supply chain design and management ability.c. having 9000 locations.d. serving fresh food.e. none of the aboveAnswer: bDifficulty: Moderate47. A key issue facing Toyota isa. developing an internet marketing system.b. whether to specialize in a particular market.c. design of its global production and distribution network.d. how to implement model changes.e. all of the aboveAnswer: cDifficulty: HardEssay/Problems1. Explain the 3 decision phases (categories) that must be made in asuccessful supply chain.Answer: The 3 decision phases that occur within a supply chain aresupply chain strategy (or design), supply chain planning and supplychain operation. Decisions relate to the flow of information, productand funds. The difference between categories depends upon the frequency of each decision and the time frame over which it has an impact. During the supply chain strategy phase, a company determines what the chain’s configurations will be, how resources will be allocated, and whatprocesses each stage will perform. This will establish the structure of the supply chain for several years. Supply chain planning deals withdecisions with a time frame from 3 months up to a year. The planning。
Chapter 11Managing Uncertainty in the Supply Chain: Safety InventoryTrue/False1. Safety inventory is inventory carried for the purpose of satisfying demand thatexceeds the amount forecasted for a given period.Answer: TrueDifficulty: Moderate2. Safety inventory is carried because demand forecasts are accurate and aproduct shortage may result if the forecast demand exceeds the actual demand.Answer: FalseDifficulty: Moderate3. Raising the level of safety inventory increases product availability and thus themargin captured from customer purchases.Answer: TrueDifficulty: Moderate4. Raising the level of safety inventory increases inventory holding c osts.Answer: TrueDifficulty: Easy5. Carrying excessive inventory can help counter demand volatility when newproducts come on the market.Answer: FalseDifficulty: Moderate6. The appropriate level of safety inventory is determined by the uncertainty of bothdemand and supply and the desired level of cycle inventory.Answer: FalseDifficulty: Moderate7. As the uncertainty of supply or demand grows, the required level of safetyinventories increases.Answer: TrueDifficulty: Moderate8. As the desired level of product availability increases, the required level of s afetyinventory decreases.Answer: FalseDifficulty: Easy9. Lead time is the gap between when an order is placed and when it is r eceived.Answer: TrueDifficulty: Easy10. The coefficient of variation measures the size of the relative certainty of cycleinventory.Answer: FalseDifficulty: Easy11. Product availability reflects a firm’s ability to fill a customer order out of availableinventory.Answer: TrueDifficulty: Moderate12. Order fill rate is the fraction of product demand that is satisfied from product ininventory.Answer: FalseDifficulty: Moderate13. Product fill rate is the fraction of product demand that is satisfied from product ininventory.Answer: TrueDifficulty: Moderate14. The distinction between product fill rate and order fill rate is significant in a singleproduct situation.Answer: FalseDifficulty: Hard15. Tracking order fill rates is important when customers place a high value on theentire order being filled simultaneously.Answer: TrueDifficulty: Easy16. With continuous review, inventory is continuously tracked and an order for a lotsize Q is placed at regular intervals of time.Answer: FalseDifficulty: Hard17. With periodic review, inventory status is checked at regular intervals and an orderis placed to raise the inventory level to a specified threshold.Answer: TrueDifficulty: Hard18. The expected shortage per replenishment cycle (ESC) is the average units ofdemand that are satisfied from inventory in stock per replenishment cycle.Answer: FalseDifficulty: Hard19. A shortage occurs in a replenishment cycle only if the demand during the leadtime exceeds the ROP.Answer: TrueDifficulty: Moderate20. The fill rate increases and the cycle service level decreases as the safetyinventory is increased.Answer: FalseDifficulty: Moderate21. For the same safety inventory, an increase in lot size increases the fill rate butnot the cycle service level.Answer: TrueDifficulty: Hard22. The required safety inventory grows rapidly with a decrease in the desiredproduct availability.Answer: FalseDifficulty: Easy23. The required safety inventory increases with an increase in the lead time and thestandard deviation of periodic demand.Answer: TrueDifficulty: Easy24. A goal of any supply chain manager is to reduce the level of safety inventoryrequired regardless of the affect product availability.Answer: FalseDifficulty: Easy25. In most supply chains, the key to reducing the underlying forecast uncertainty isto link all forecasts throughout the supply chain to customer demand data.Answer: TrueDifficulty: Moderate26. A reduction in supply can help dramatically reduce safety inventory requiredwithout hurting product availability.Answer: FalseDifficulty: Moderate27. Aggregation reduces the standard deviation of demand only if demand acrossthe regions being aggregated is not perfectly positively correlated.Answer: TrueDifficulty: Moderate28. In case demand in different geographical regions is about the same size andindependent, aggregation increases safety inventory by the square root of thenumber of areas aggregated.Answer: FalseDifficulty: Moderate29. If aggregation reduces the required safety inventory for a product by a smallamount, it may be best to carry the product in multiple decentralized locations t o reduce response time and transportation cost.Answer: TrueDifficulty: Moderate30. The lower the coefficient of variation of an item, the greater the reduction insafety inventories as a result of centralization.Answer: FalseDifficulty: Hard31. Manufacturer-driven substitution increases overall profitability for themanufacturer by allowing some aggregation of demand, which reduces theinventory requirements for the same level of availability.Answer: TrueDifficulty: Moderate32. Postponement allows the supply chain to delay product differentiation, whichresults in disaggregating most of the inventories in the supply chain. Answer:FalseDifficulty: Moderate33. Periodic review policies require more safety inventory than continuous reviewpolicies for the same level of product availability.Answer: TrueDifficulty: Easy34. When using a continuous review policy, a manager has to account for theuncertainty of demand during the lead time and the review interval.Answer: FalseDifficulty: EasyMultiple Choice1. Inventory carried for the purpose of satisfying demand that exceeds the amountforecasted for a given period isa. cycle inventory.b. demand inventory.c. safety inventory.d. security inventory.e. all of the aboveAnswer: cDifficulty: Easy2. Safety inventory is carried becausea. demand forecasts are accurate.b. demand forecasts are uncertain.c. adequate supplies are available.d. excess product was manufactured.e. forecast demand exceeds the actual demand.Answer: b Difficulty:Moderate3. The trade-off that a supply chain manager must consider when planning safetyinventory isa. increasing product availability versus increasing inventory holding costs.b. decreasing product availability versus decreasing inventory holding costs.c. increasing product availability versus raising the level of safety inventory.d. decreasing product availability versus decreasing the level of safetyinventory.e. none of the aboveAnswer: aDifficulty: Moderate4. The issue of product availability and the level of safety inventory is particularlysignificant in industries wherea. product life cycles are short and demand is stable.b. product life cycles are short and demand is very volatile.c. product life cycles are long and demand is stable.d. product life cycles are long and demand is very volatile.e. a and b onlyAnswer: b Difficulty:Moderate5. A key to success at which company has been its ability to provide a high level ofproduct availability to customers while carrying very low levels of safety inventory in its supply chain?a. Compaqb. Hewlett-Packardc. Delld. Packard-Belle. all of the aboveAnswer: cDifficulty: Moderate6. What key question(s) need(s) to be considered when planning safety inventoryfor any supply chain?a. What is the appropriate lead time to establish?b. What is the appropriate level of safety inventory to carry?c. What actions can be taken to improve product availability while reducingsafety inventory?d. a and b onlye. b and c onlyAnswer: e Difficulty:Moderate7. The appropriate level of safety inventory is determined bya. the uncertainty of both demand and supply.b. the desired level of product availability.c. the desired level of cycle inventory.d. the processes in a supply chain are divided into 2 categories dependingall of the abovee. a and b onlyAnswer: e Difficulty:Moderate8. As the uncertainty of supply or demand grows, the required level of safetyinventoriesa. decreases.b. increases.c. remains stable.d. both a and be. none of the aboveAnswer: bDifficulty: Moderate9. As the desired level of product availability increases, the required level of s afetyinventorya. decreases.b. increases.c. remains stable.d. both a and be. none of the aboveAnswer: eDifficulty: Moderate10. Lead time is the gap betweena. when an order is placed and when it is received.b. when an order is received and when it is put away.c. when an order is received and when it is used.d. when an order is acknowledged and when it is received.e. none of the aboveAnswer: aDifficulty: Easy11. The coefficient of variation measuresa. the accuracy of the demand forecast.b. the size of the uncertainty relative to demand.c. the relevance of cycle inventory to demand.d. the relative certainty of the forecast.e. none of the aboveAnswer: bDifficulty: Moderate12. Which of the following is not a measure of product availability?a. customer fill rateb. product fill ratec. order fill rated. cycle service level (CSL)e. none of the aboveAnswer: aDifficulty: Moderate13. The fraction of orders that are filled from available inventory is thea. customer fill rate.b. product fill rate.c. order fill rate.d. cycle service level (CSL).e. none of the aboveAnswer: cDifficulty: Easy14. The fraction of product demand that is satisfied from product in inventory is thea. customer fill rate.b. product fill rate.c. order fill rate.d. cycle service level (CSL).e. none of the aboveAnswer: bDifficulty: Easy15. The fraction of replenishment cycles that end with all the customer demand beingmet is thea. customer fill rate.b. product fill rate.c. order fill rate.d. cycle service level (CSL).e. none of the aboveAnswer: dDifficulty: Easy16. If a customer order arrives when product is not availablea. a sale results.b. the retailer allocates product to the customer.c. a stockout results.d. the order is filled from safety inventory.e. none of the aboveAnswer: cDifficulty: Moderate17. The distinction between product fill rate and order fill rate isa. not significant in a single product situation.b. significant in a single product situation.c. not significant when a firm is selling multiple products.d. significant when a firm is selling multiple products.e. both a and dAnswer: aDifficulty: Moderate18. A replenishment policya. consists of decisions regarding when to reorder and how much to reorder.b. determines the cycle and safety inventories along with the fr and the CSL.c. may take several forms.d. All of the above are true.e. None of the above are true.Answer: dDifficulty: Moderate19. A company that tracks inventory and places an order for a lot size Q when theinventory declines to the reorder point (ROP) is usinga. continuous review.b. daily review.c. occasional review.d. periodic review.e. none of the aboveAnswer: aDifficulty: Easy20. A company that checks inventory status at regular periodic intervals and placesan order to raise the inventory level to a specified threshold is usinga. continuous review.b. daily review.c. occasional review.d. periodic review.e. none of the aboveAnswer: dDifficulty: Moderate21. Which of the following is correct?a. Average inventory = cycle inventory + safety inventoryb. Average inventory = cycle inventory - safety inventoryc. Average inventory = cycle inventory x safety inventoryd. Average inventory = cycle inventory / safety inventorye. none of the aboveAnswer: aDifficulty: Easy22. The expected shortage per replenishment cycle (ESC) isa. the units of demand that are not satisfied from inventory in stock in agiven replenishment cycle.b. the units of demand that are satisfied from inventory in stock in a givenreplenishment cycle.c. the average units of demand that are not satisfied from inventory in stockper replenishment cycle.d. the average units of demand that are satisfied from inventory in stock perreplenishment cycle.e. none of the aboveAnswer: cDifficulty: Moderate23. The product fill rate (fr) is thus given bya. fr = 1 –ESC/Q + (Q – ES C)/Q.b. fr = 1 –ESC/Q – (Q – ES C)/Q.c. fr = 1 + ESC/Q = (Q + ES C)/Q.d. fr = 1 –ESC/Q = (Q – ES C)/Q.e. none of the aboveAnswer: dDifficulty: Hard24. Given a lot size of Q (which is also the average demand in a replenishmentcycle)a. the fraction of demand lost is thus ESC + Q.b. the fraction of demand lost is thus ESC –Q.c. the fraction of demand lost is thus ESC/Q.d. the fraction of demand lost is thus ESC x Q.e. none of the aboveAnswer: cDifficulty: Hard25. A shortage occurs in a replenishment cyclea. only if the demand during the lead time exceeds the ROP.b. only if the demand during the lead time is less than the ROP.c. only if the demand during the lead time exceeds the average demand.d. only if the demand during the lead time is less than the average demand.e. none of the aboveAnswer: aDifficulty: Moderate26. As the safety inventory is increaseda. fill rate increases and cycle service level decreases.b. fill rate decreases and cycle service level increases.c. both fill rate and cycle service level increase.d. both fill rate and cycle service level decrease.e. none of the aboveAnswer: cDifficulty: Moderate27. For the same safety inventory, an increase in lot sizea. decreases the fill rate but not the cycle service level.b. increases the fill rate but not the cycle service level.c. decreases both the fill rate and the cycle service level.d. increases both the fill rate and the cycle service level.e. none of the aboveAnswer: cDifficulty: Hard28. The expected shortage per replenishment cycle is shown asa. ESC = (1 + fr)Q.b. ESC = (1 –fr)Q.c. ESC = (1 + fr)/Q.d. ESC = (1 –fr)/Q.e. none of the aboveAnswer: bDifficulty: Hard29. The required safety inventorya. grows rapidly with a decrease in the desired product a vailability.b. grows rapidly with an increase in the desired product availability.c. decreases with an increase in the desired product a vailability.d. remains stable with an increase in the desired product availability.e. none of the aboveAnswer: bDifficulty: Moderate30. The required safety inventorya. increases with an increase in the lead time and the standard deviation ofperiodic demand.b. decreases with an increase in the lead time and the standard deviation ofperiodic demand.c. remains stable with an increase in the lead time and the standarddeviation of periodic demand.d. increases with a decrease in the lead time and the standard deviation ofperiodic demand.e. none of the aboveAnswer: dDifficulty: Moderate31. A goal of any supply chain manager is toa. increase the level of safety inventory required in a way that does notadversely affect product availability.b. increase the level of safety inventory required regardless of the effect onproduct availability.c. reduce the level of safety inventory required regardless of the effect onproduct availability.d. reduce the level of safety inventory required in a way that does notadversely affect product availability.e. none of the aboveAnswer: dDifficulty: Moderate32. Which of the following is not an approach to reduce the level of safety inventoryrequired in a way that does not adversely affect product availability?a. Reduce the supplier lead time.b. Reduce the underlying uncertainty of demand.c. Reduce the cost of material coming from suppliers.d. All of the above are approaches.e. None of the above are approaches.Answer: cDifficulty: Hard33. Often, safety inventory calculations in practicea. do not include any measure of supply uncertainty, resulting in levels thatmay be higher than required.b. do not include any measure of supply uncertainty, resulting in levels thatmay be lower than required.c. include measures of supply uncertainty, resulting in levels that may behigher than required.d. include any measures of supply uncertainty, resulting in levels that maybe lower than required.e. None of the above are accurate.Answer: bDifficulty: Hard34. Aggregation reduces the standard deviation of demanda. only if demand across the regions being aggregated is perfectly positivelycorrelated.b. only if demand across the regions being aggregated is not p erfectlypositively correlated.c. even if demand across the regions being aggregated is not p erfectlypositively correlated.d. whenever demand across the regions being aggregated is not perfectlypositively correlated.e. All of the above are accurate.Answer: bDifficulty: Hard35. If the number of independent stocking locations decreases by a factor of n, theaverage safety inventory is expected toa. decrease by a factor of √n.b. decrease by a factor of n.c. increase by a factor of √n.d. increase by a factor of n.e. None of the above are accurate.Answer: aDifficulty: Moderate36. Which of the following is not a major disadvantage of aggregating all inventory inone location?a. Increase in forecast accuracy of customer demand.b. Increase in response time to customer order.c. Increase in transportation cost to customer.d. All of the above are disadvantages.e. All of the above are advantages.Answer: aDifficulty: Easy37. Which of the following is not a method by which a supply chain can extract thebenefits of aggregation without having to physically centralize all inventories inone location?a. information centralizationb. specializationc. product substitutiond. component differentiatione. postponementAnswer: dDifficulty: Moderation38. Which approach to aggregation requires an information system that allowsaccess to current inventory records from each location?a. information centralizationb. specializationc. product substitutiond. component commonalitye. postponementAnswer: aDifficulty: Easy39. Which approach to aggregation would stock the fast-moving items atdecentralized locations close to the customer and slow-moving items at acentralized location?a. information centralizationb. specializationc. product substitutiond. component commonalitye. postponementAnswer: b Difficulty:Moderate40. The use of one product to satisfy demand for a different product isa. information centralization.b. specialization.c. product substitution.d. component commonality.e. postponement.Answer: cDifficulty: Easy41. Which use of common components in a variety of products has been a veryeffective supply chain strategy to exploit aggregation and reduce componentinventories?a. information centralizationb. specializationc. product substitutiond. component commonalitye. postponementAnswer: aDifficulty: Easy42. The ability of a supply chain to delay product differentiation or customization u ntilcloser to the time the product is sold isa. information centralization.b. specialization.c. product substitution.d. component commonality.e. postponement.Answer: e Difficulty:Moderate43. Which approach to aggregation has the goal of moving product differentiation asclose to the pull phase of the supply chain as possible?a. information centralizationb. specializationc. product substitutiond. component commonalitye. postponementAnswer: e Difficulty:Moderate44. Periodic review policies for inventory replenishment require safety inventory tocover demand duringa. lead time only.b. the review interval only.c. both lead time and the review interval.d. neither lead time or the review interval.e. lead time when it exceeds the review interval.Answer: cDifficulty: Moderate45. Continuous review policies for inventory replenishment require safety inventory tocover demand duringa. lead time only.b. the review interval only.c. both lead time and the review interval.d. neither lead time or the review interval.e. lead time when it exceeds the review interval.Answer: aDifficulty: Moderate46. Periodic review policies requirea. more safety inventory than continuous review policies for the same levelof product availability.b. less safety inventory than continuous review policies for the same level ofproduct availability.c. the same safety inventory as continuous review policies for the samelevel of product availability.d. no more safety inventory than continuous review policies for the samelevel of product availability.e. none of the aboveAnswer: aDifficulty: Moderate47. All inventory between a given stage in the supply chain and the final customer iscalled thea. cycle inventory.b. demand inventory.c. echelon inventory.d. safety inventory.e. none of the aboveAnswer: cDifficulty: Hard48. A distributor should decide his safety inventory levels based ona. the level of safety inventory carried by all retailers supplied by him.b. the level of safety inventory carried by other distributors.c. the level of safety inventory carried by manufacturers supplying him.d. the level of cycle inventory carried by all retailers supplied by him.e. the level of cycle inventory carried by other distributors.Answer: aDifficulty: Hard49. As retailers decrease the level of safety inventory they carry, the distributor willhave toa. decrease his or her safety inventory.b. increase his or her safety inventory.c. keep his or her safety inventory at the same level.d. increase his or her cycle inventory.e. decrease his or her cycle inventory.Answer: bDifficulty: HardEssay/Problems1. Discuss the role of safety inventory in the supply chain and the trade-offsinvolved.Answer: The primary role of safety inventory is providing product availability forcustomers when demand and supply are uncertain. The trade-off that a supplychain manager must consider when planning safety inventory involve productavailability and inventory holding costs. On one hand, raising the level of safetyinventory increases product availability and thus the margin captured fromcustomer purchases. On the other hand, raising the level of safety inventoryincreases inventory holding costs. This issue is particularly significant inindustries where product life cycles are short and demand is very volatile.Carrying excessive inventory can help counter demand volatility but can reallyhurt if new products come on the market and demand for the product in inventory dries up. The inventory on hand then becomes worthless.In today’s business environment, firms experience great pressure to improveproduct availability while increasing product variety through customization. As aresult, markets have become increasingly heterogeneous and demand forindividual products is very unstable and difficult to forecast. Both the increasedvariety and the increased pressure for availability push firms to increase the level of safety inventory they hold.At the same time, product life cycles have shrunk. This increases the risk to firms of carrying too much inventory. Thus, a key to the success of any supply chain is to figure out ways to decrease the level of safety inventory carried without hurting the level of product availability.Difficulty: Hard2. Discuss the various measures of product availability.Answer: Product availability reflects a firm’s ability to fill a customer order out ofavailable inventory. A stockout results if a customer order arrives when product is not available. There are several ways to measure product availability. Allavailability measures are defined on average over a given time frame, which can range from hours to a year.Product fill rate (fr) is the fraction of product demand that is satisfied from product in inventory. It is equivalent to the probability that product demand is suppliedfrom available inventory.Order fill rate is the fraction of orders that are filled from available inventory. In a multi-product scenario, an order is filled from inventory only if all products in theorder can be supplied from the available inventory. Order fill rates tend to belower than product fill rates because all products must be in stock for an order to be filled.Cycle service level (CSL) is the fraction of replenishment cycles that end with all the customer demand being met. A replenishment cycle is the interval betweentwo successive replenishment deliveries. The CSL is equal to the probability ofnot having a stockout in a replenishment cycle. Observe that a CSL of 60 percent will typically result in a much higher fill rate.The distinction between product fill rate and order fill rate is not significant in asingle product situation. When a firm is selling multiple products, however, thisdifference may be significant. For example, if most orders include 10 or moredifferent products that are to be shipped, an out-of-stock situation of one product results in the order not being filled from stock. The firm in this case may have apoor order fill rate even though it has good product fill rates. Tracking order fillrates is important when customers place a high value on the entire order beingfilled simultaneously.Difficulty: Moderate3. Describe the two types of ordering policies and the impact each has on safetyinventory.Answer: A replenishment policy consists of decisions regarding when to reorderand how much to reorder. These decisions determine the cycle and safetyinventories along with the fr and the CSL. There are several forms thatreplenishment policies may take. We restrict attention to two instances:1. Continuous review: Inventory is continuously tracked and an order for a lotsize Q is placed when the inventory declines to the reorder point (ROP). The time between orders may fluctuate given variable demand. When using a continuousreview policy, a manager has to account only for the uncertainty of demandduring the lead time (L).2. Periodic review: Inventory status is checked at regular periodic intervals andan order is placed to raise the inventory level to a specified threshold. In thiscase, the time between orders is fixed. The size of each order, however, can。
