Questions and Answers of Supply Chain Management A Logistics

Why can the current movement toward establishing supply chains be characterized as a revolution?
Describe "integrative management." Be specific concerning the relationship between functionality and process.
In terms of enterprise extension, describe the importance of the information sharing and process specialization paradigms.
Discuss and support the following argument: "Supply chain arrangements may reduce consumer value."
If the flow of materials is properly co-ordinated there is no need for stock and, therefore, no need for warehouses. When do you think that warehouses will disappear from the supply chain?
Warehouses used to be places where goods were stored, often for long periods, until they were needed. A more recent view has warehouses as places where loads are reorganised on their journey through
Many organisations are using specialist third party suppliers for warehousing. What are the benefits of this? What are the different types of arrangement for third party warehousing?
Why is the layout of warehouses important? Supermarkets are really one type of warehouse, so the same factors will be important in each. Is this true?
Automation is bound to give the most efficient warehouses, so everyone should move in this direction. Will all warehouses eventually be automated?
We are often told that packaging is a major problem for waste disposal. Why is there so much packaging, and how can the amount be reduced?
‘Transport is becoming increasingly less important, as e-commerce and other developments become widespread.’ Do you think that this is true?
What types of technology are used in transport? How do you expect this to change in the future?
For most organisations road transport is the only realistic mode of transport. If this is true, why do so many people disapprove of heavy lorries? Are there any noticeable trends in the choice of
One of the major trends in logistics is the move towards contract transport. Why?
An organisation with weak transport management suffers as it gives worse performance than more competent competitors and becomes uncompetitive; one with strong transport management may be diverting
There has been a huge amount of work done to develop optimal solutions to routing problems. In reality, most of this work remains theoretical and has not been implemented.Why is this?
What are the main differences between logistics within a single country and logistics that span a number of different countries? What are the specific problems of working internationally?
By their nature, all supply chains must be international. Do you think this is true?
Some regions of the world present particularly difficult problems for logistics. What regions do you think might prove difficult to work in, and why?
There is a growing number of free trade areas. Why? Do they really allow free trade between members? If free trade is such a good idea, why do countries not simply remove all their duties and tariffs
Why are companies moving towards global operations? What are the implications for logistics?
The demand for an item is constant at 200 units a year. Unit cost is £50, cost of processing an order is £20 and holding cost is £10 per unit per annum. What are the economic order quantity,
Jean Jeanie spa. work 48 weeks a year to meet demand for jeans which is more or less constant at 200 units a week. They pay £20 for each pair of jeans and aim for a return of 20% on capital
Demand for an item is steady at 40 units a week and the economic order quantity has been calculated at 150 units. What is the reorder level when the lead time is:(a) 1 week (b) 3 weeks (c) 5 weeks
Fenicci e Fantocca forecast demand for components to average 18 a day over a 200 day working year. Any shortages disrupt production and give very high costs. The holding cost for the component is
A company advertises a 95% cycle-service level for all stock items. Stock is replenished from a single supplier who guarantees a lead time of 4 weeks. What reorder level should the company adopt for
Wolfgang Heinz stocks an item with a unit cost of $80, reorder cost of $100 and holding cost of $2 a unit a week. Demand for the item has a mean of 100 a week with standard deviation 10.Lead time is
Describe a periodic review system with an interval of two weeks for the company described in Problem 10.5.Problem 10.5A company advertises a 95% cycle-service level for all stock items. Stock is
A small store has ten categories of product and the following costs and annual demands:Do an ABC analysis of these items. Product Unit Cost (Dm) Annual demand ('00s) H1 60 3 m 232 P2 A3 X1 75 382 R
What costs are incurred by holding stock? Some organisations try to reduce stocks by making to order, or guaranteeing delivery within a specified period. Do such methods really reduce inventory costs?
What factors in real inventory control are not included in the economic order quantity model? If the costs of holding stock are so difficult to find, how reliable are the results from this kind of
What should you consider when setting a service level? How can a hospital set a reasonable service level for its supplies of blood for transfusions?
We have now seen how stocks can be controlled by MRP, JIT and independent demand systems. When would you use each of these? Are there any other methods?
What features would you expect to see in an automated inventory control system? Look at some commercial packages and compare the features they offer.
Stocks are an inevitable. Methods like JIT only transfer stocks from one part of the supply chain to another. To what extent do you think this is true?
Some people say that you should always look for quotations, even for repeat orders, as this encourages competition and keeps prices low. Other people say that you should form an alliance with one
Everyone is talking about the benefits of purchasing through the Internet. What are these? How will e-procurement affect wider operations? What other changes will there be in the future?
What features would make an ideal supplier?
Forward purchasing has many advantages – as demonstrated by the huge market in financial futures. What are these benefits? If these are so obvious, why are many organisations ignoring them and
Do you think an organisation should always negotiate hard with suppliers to get the cheapest prices and best conditions it can?
In October 2000 The Trading and Standards Institute in London made test purchases in 102 retail websites. There were problems with 37% of these, 38% arrived later than promised and 17% did not arrive
‘What you can’t measure you can’t manage.’ To what extent do you think this is true?
Managers can be tempted to use the easiest measures of performance, or those that show themselves in the best light. What are the consequences of this? Can you give examples of problems this creates?
What are the most appropriate measures of performance for a supply chain?
Performance measures can give conflicting views – changes that improve some measures, make others worse. How can you decide whether the overall effect is beneficial or not?
It is easy to find improvements in any supply chain. So why have the managers not already made them?
Continuous improvement is not really useful as it just tinkers with existing operations and does not look for significant gains. To what extent do you think this is true?
To what extent is logistics a strategic function? Does it really have a long-term effect on an organisation? Is it possible to be ‘essential’ but not ‘strategic’?
When customers judge products, they include factors like availability, lead time and aftersales service – and these are part of logistics. Is it reasonable to say, therefore, that logistics plays a
What are the main options for a logistics strategy?
What factors affect the choice of logistics strategy? Take an organisation that you are familiar with, and say exactly how you would set about designing a logistics strategy.
There is only one ‘best’ logistics strategy in any circumstances, and managers should look for this. Do you think this is true?
What exactly is meant by ‘implementing the logistics strategy’?
We suggested a difference between strategic decisions that set the principles for logistics, and those concerned with the practicalities of implementation. Do you think that this is a real
It is often more difficult to implement a logistics strategy than to design one. This is why most logistics plans fail in the practice rather than the theory. Do you think that this is necessarily
What are the main areas for strategic decisions in logistics?
Supply chains are not usually designed from scratch, but evolve over time. What problems does this create? Can you suggest a better approach?
Can you find any examples of good logistics strategies that have given poor results because of poor implementation? What could have been done better?
If a company chooses a poor site it can always move to a better one. Such change is an unavoidable part of business. Do you think this is true?
Which areas of the world do you think will have the fastest economic development over the next twenty years? How will this affect location decisions?
What costs should be considered in a location decision? Is cost always an important factor? What other factors should be considered? What effect do government grants have?
Mathematical models for location take a simplified view and they only include the few factors that can most easily be quantified. So how useful are they for real decisions?
What features would you expect to see in computer software that helps with location decisions? Do a survey of relevant packages. How do they work, and what analyses do they do?
Different cultures are the main problem of locating facilities in different countries. They make it impossible to standardise procedures, have consistent operations, compare performance, or anything
Capacity is the most important decision in the design of a supply chain, as it affects the amount of materials that can be moved. Do you find this argument convincing?
Tactical plans – such as aggregate plans and master schedules – are useful for manufacturing, but they are not so relevant for logistics. Do you think that this is true? What happens if there is
What decisions are involved in tactical planning for logistics?
Mathematical models can find optimal solutions for planning and scheduling problems.By definition, these solutions are the best. If an organisation uses any other methods, it is accepting poor
MRP was developed to plan the supply of parts at manufacturers, so it cannot really be used in other types of organisation. Do you think this is true?
MRP II seems a good idea in theory, but it would be difficult to plan logistics, let alone finance and marketing, from a master schedule. The systems would also be so unwieldy that they could never
What are the main difficulties of using ERP?
If you were in hospital and needing a blood transfusion, would you rather the transfusion service used a traditional system of holding stocks of blood, or a just-in-time system?What does your answer
What are the most significant changes that JIT brings to the planning of logistics in an organisation? What happens if an organisation wants to introduce JIT, but finds that its suppliers cannot cope
Is it true that every organisation has to move materials to support its operations? What do service companies like Internet service providers move? Give some examples from different types of
How important is logistics to the national economy? What proportion of employment and gross domestic product is due to logistics? How has this proportion changed over time?
The supply chain is a convenient notion, but organisations are only really interested in making products that they can sell to customers. Provided they have reliable supplies of materials, and
Very few organisations deal with the final customer for a product. Most operations work upstream and form one step of the supply chain, often passing materials to internal customers within the same
The cost of logistics varies widely from organisation to organisation. What factors affect these costs? Are the costs fixed or can they be controlled?
How could you find the best balance between service level and costs?
Of the game-changing technologies discussed in this chapter, which do you feel will be among the most impactful for supply chains in the future?
What do you think would be some of the challenges with transforming supply chain processes within an organization? Across a number of organizations that may comprise a supply chain?
1. After looking over the similarities and differences between Amazon and Alibaba in the above table, which do you feel will become significant drivers of future success in the e-Commerce sector?2.
1. What are the relevant demographic changes that Jordano and SAB have to address in the 21st century? Why are they important for the success of both organizations? Provide some recommendations
Compare and contrast the four major subdivisions of logistics discussed in this chapter.
Discuss the relationship between manufacturing and logistics. What are the tradeoffs between the two areas? Has the relationship become more or less important in the 21st century?
1. From a global perspective, what are some of the factors that will impact the extent to which Nike’s strategies will be successful?2. What will be some of the challenges to be expected by Nike
What is meant by the current description of the global economy that “time anddistance have been compressed”? Do you agree? What has been the impact of this compression?
Physical distribution has a special relationship to marketing. What is the nature of the relationship between logistics and marketing, and why is it growing in importance?
Logistics encompasses a relatively large number of managerial activities. Discuss five of these activities and why they are important to logistics systems. Are some of these activities increasing in
Why do companies analyze their logistics systems from perspective of nodes and links? What additional or special insights do they gain by this analysis?
What product characteristics affect logistics costs? Discuss the effects of these characteristics on logistics costs. Are some characteristics increasing in importance in the 21st century? Why?
1. What are the key strategic and operational benefits of The Home Depot’s RDC and omni-channel supply chain strategies?2. What are some of the challenges that you feel may need to be addressed as
Using the company Web sites, evaluate the supply chain and contract manufacturing services provided by the following organizations:a. Refresco (https://www.refresco.com/en)b. Li & Fung
Identify and discuss the most appropriate assembly process and facility layout for each of the following products:a. Keystone Light beerb. IKEA furniturec. Kia vehicles
Discuss the role of technology in creating a smart factory.
Calculate a forecast using a simple three-month moving average.Calculate a forecast using a three-period weighted moving average. Use weights of 0.60, 0.30, and 0.10 for the most recent period, the
1. What is the economic order quantity for BBE in units? In pounds?2. What is the total cost (not considering transportation-related costs) of the EOQ?3. What is the total cost for using motor
1. If you were employed by the consulting firm, how would you construct your method of analysis?2. What criteria would you use?3. What would the cutoff levels be? Be sure to provide explanations of
What are the basic types of forecasts? What are their strengths and weaknesses?
Why are companies like Amazon and The Home Depot making significant investments in distribution network expansion?

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