APICS CSCP Practice Test - Questions Answers, Page 33
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Question 321
A company wants to improve its transportation strategy to focus on its core manufacturing competence and reduce costs. Which of the following options is most likely to enable the company to achieve its objectives?
Explanation:
Improving a company's transportation strategy to focus on core manufacturing competencies and reduce costs involves leveraging specialized expertise and optimizing logistics processes. Engaging a third-party logistics (3PL) company is most likely to achieve these objectives due to the following reasons:
Specialized Expertise: 3PL providers have specialized knowledge and expertise in logistics, which can help streamline transportation processes and improve efficiency.
Cost Reduction: 3PL companies can offer economies of scale and negotiate better rates with carriers due to their larger volume of shipments, reducing transportation costs.
Focus on Core Competencies: By outsourcing logistics functions to a 3PL, the company can focus more on its core manufacturing activities, improving overall operational efficiency.
Flexibility and Scalability: 3PL providers offer flexible solutions that can scale according to the company's needs, accommodating changes in demand without requiring significant capital investment.
Council of Supply Chain Management Professionals (CSCMP)
'Logistics & Supply Chain Management' by Martin Christopher
Question 322
A company's cash-to-cash cycle time is 36 days. How many weeks of inventory are on hand if the average collection time from customers is 60 days, and the company pays its vendors in 45 days?
Explanation:
The cash-to-cash cycle time is the duration it takes for a company to convert its investments in inventory into cash flows from sales. The formula to calculate the cash-to-cash cycle time is:
Cash-to-CashCycleTime=InventoryDays+ReceivablesDaysPayablesDaysCash-to-CashCycleTime=InventoryDays+ReceivablesDaysPayablesDays
Given:
Cash-to-cash cycle time = 36 days
Receivables Days = 60 days
Payables Days = 45 days
Rearranging the formula to find the Inventory Days: InventoryDays=Cash-to-CashCycleTime+PayablesDaysReceivablesDaysInventoryDays=Cash-to-CashCycleTime+PayablesDaysReceivablesDays InventoryDays=36+4560=21daysInventoryDays=36+4560=21days
To find the number of weeks of inventory on hand: WeeksofInventory=InventoryDays7=217=3weeksWeeksofInventory=7InventoryDays=721=3weeks
APICS Dictionary
'Supply Chain Management: Strategy, Planning, and Operation' by Sunil Chopra and Peter Meindl
Question 323
Which of the following outcomes typically is the primary benefit from implementing a reverse logistics system?
Explanation:
Implementing a reverse logistics system primarily aims to manage the return of products from customers back to the company. One of the significant outcomes is extending the product life cycle by:
Refurbishment and Resale: Returned products can be refurbished and resold, extending their usability and lifecycle.
Recycling and Reuse: Components from returned products can be recycled or reused in manufacturing new products, reducing waste and conserving resources.
Cost Savings: Effective reverse logistics can reduce costs associated with waste disposal and procurement of new materials by reclaiming value from returned products.
'Reverse Logistics: Quantitative Models for Closed-Loop Supply Chains' by Rommert Dekker et al.
Council of Supply Chain Management Professionals (CSCMP)
Question 324
In an advanced planning and scheduling (APS) system, which of the following processes feeds the master schedule?
Explanation:
In an Advanced Planning and Scheduling (APS) system, the process that feeds the master schedule is fulfillment planning. This is because:
Demand Planning: Involves forecasting customer demand but does not directly feed the master schedule.
Purchasing Planning: Focuses on procuring materials and components needed for production.
Distribution Planning: Deals with the distribution of finished products to customers or other warehouses.
Fulfillment Planning: Involves coordinating the supply chain activities to fulfill customer orders efficiently and effectively, providing necessary input to create an accurate master schedule.
The master schedule requires detailed information on the availability of products and materials to meet customer orders, which is a key aspect of fulfillment planning.
'Manufacturing Planning and Control for Supply Chain Management' by F. Robert Jacobs, William L. Berry, D. Clay Whybark, and Thomas E. Vollmann
APICS Dictionary
Question 325
Bill of lading (B/L) documentation includes which of the following?
Explanation:
A Bill of Lading (B/L) is a crucial document in the shipping and logistics industry. It serves multiple key functions:
Contract for Shipping: The B/L acts as a contract between the shipper and the carrier, detailing the terms and conditions under which the goods will be transported.
Ownership of Goods: It also serves as a document of title, indicating ownership of the goods being shipped. This allows for the transfer of ownership during the shipping process if needed.
Options A (Country where goods were produced), C (Description and terms of sale of goods), and D (Means of payment for import/export of goods) are not primary functions of the Bill of Lading.
'The Transportation and Logistics Industry: A Complete Guide' by William T. Walker
Council of Supply Chain Management Professionals (CSCMP)
Question 326
Which of the following activities is most appropriate in the implementation of a lean production strategy?
Explanation:
Lean production strategy aims to minimize waste and maximize efficiency. The most appropriate activity in this context is implementing manufacturing cells:
Manufacturing Cells: This involves organizing production processes into small, flexible cells that can produce a variety of products efficiently. It reduces waste, improves workflow, and enhances flexibility.
Push vs. Pull: Lean strategies typically involve a pull strategy rather than a push strategy.
Inventory Levels: Lean production focuses on reducing excess inventory, contrary to increasing service through inventory.
Batch Type Operations: These can lead to higher inventory levels and are generally not aligned with lean principles.
'Lean Thinking: Banish Waste and Create Wealth in Your Corporation' by James P. Womack and Daniel T. Jones
APICS Dictionary
Question 327
Which of the following tools is most appropriate for understanding why products fail?
Explanation:
Understanding why products fail requires identifying the root causes of the failure. The most appropriate tool for this is Root Cause Analysis (RCA):
Root Cause Analysis (RCA): RCA is a systematic process for identifying the fundamental causes of problems or failures. It helps to determine what happened, why it happened, and how to prevent it from happening again.
Run Chart and Control Chart: These are used for monitoring process performance over time but do not specifically identify causes of failure.
Pareto Analysis: This helps prioritize issues based on their frequency or impact but does not identify the underlying causes.
'Root Cause Analysis: Improving Performance for Bottom-Line Results' by Robert J. Latino, Kenneth C. Latino, and Mark A. Latino
ASQ (American Society for Quality) Resources
Question 328
Implementing a balanced scorecard for a supply chain typically would include which of the following actions?
Explanation:
Implementing a balanced scorecard for a supply chain involves multiple strategic actions, with one of the primary actions being communicating the strategic purpose to partner organizations:
Strategic Communication: Ensuring that all partner organizations understand the strategic goals and objectives is critical for alignment and successful implementation.
Responding to Resistance: This is a part of change management but not a primary action for implementing a balanced scorecard.
Calculating Partner Performance: This is an analytical activity but not directly tied to the implementation phase.
Aligning Partner Performance: While important, it follows from effectively communicating the strategic purpose.
'The Balanced Scorecard: Translating Strategy into Action' by Robert S. Kaplan and David P. Norton
Supply Chain Council (SCC) Guidelines
Question 329
Customer relationship management (CRM) provides the sales and customer service functions with:
Explanation:
Customer Relationship Management (CRM) systems provide sales and customer service functions with vital information to enhance customer interactions and support:
Shipment History: Access to past shipment data helps in understanding delivery patterns and addressing customer inquiries.
Promotional Programs: Information on promotions aids in upselling and cross-selling efforts.
Order Status: Real-time order status updates help in providing accurate information to customers about their purchases.
Options A (on-hand inventory balance), C (master production schedule details), and D (customer and market segments) are more relevant to inventory management and logistics planning rather than the primary focus of CRM.
'Customer Relationship Management: Concept, Strategy, and Tools' by V. Kumar and Werner Reinartz
Gartner CRM Reports
Question 330
A quick-response program (QRP) will add value to the supply chain by:
Explanation:
A Quick-Response Program (QRP) is designed to enhance the responsiveness of a supply chain to actual demand signals. The primary value addition by a QRP in the supply chain is achieved through linking sales data directly with production schedules. This synchronization ensures that production processes are closely aligned with real-time sales, minimizing inventory levels and reducing lead times. By doing so, it helps in:
Reducing Inventory Costs: By producing only what is needed, companies can minimize excess inventory, which ties up capital and incurs holding costs.
Improving Customer Satisfaction: Faster response times to actual customer demand improve service levels, leading to higher customer satisfaction.
Enhancing Agility: The ability to quickly adjust production schedules based on real-time sales data makes the supply chain more agile and capable of responding to market changes swiftly.
Reducing Stockouts and Overproduction: Accurate alignment of production with sales reduces the risks of stockouts and overproduction, ensuring that inventory levels are optimal.
Chopra, S., & Meindl, P. (2016). Supply Chain Management: Strategy, Planning, and Operation. Pearson.
Fisher, M. L. (1997). What is the right supply chain for your product? Harvard Business Review.
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