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Question 330 - CSCP discussion

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A quick-response program (QRP) will add value to the supply chain by:

A.
accelerating new product introduction
Answers
A.
accelerating new product introduction
B.
lowering the total cost of ownership (TCO)
Answers
B.
lowering the total cost of ownership (TCO)
C.
linking sales with production
Answers
C.
linking sales with production
D.
improving overall cash velocity
Answers
D.
improving overall cash velocity
Suggested answer: C

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.

asked 16/09/2024
Marie Joyce Candice Dancel
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