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| Section | Objectives |
|---|---|
| Demand Planning and Scheduling | - Production and Supply Scheduling - Demand and Supply Alignment - Demand Planning |
| Supply Chain Management Fundamentals | - Logistics and Supply Chain Management - Supply Chain Management Concepts and Principles - Supply Chain and Organizational Competitiveness - Integrated Supply Chain Processes |
| Supply Chain Analytics and Artificial Intelligence | - Automation and Optimization - Supply Chain Risk Management - Predictive Analytics - Real-Time Monitoring |
| Manufacturing and Operations Management | - Supply and Production Coordination - Operations Management - Manufacturing Processes |
| Procurement | - Procurement Processes - Procurement Strategies - Supplier and Sourcing Management |
| Inventory and Warehousing | - Inventory Cost and Availability - Inventory Management - Warehousing |
| Transportation and Logistics | - Logistics Operations - Transportation Management - Delivery and Distribution |
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NEW QUESTION # 70
Situations in which the pricing policies for a product lead to an increase in variability of orders placed are referred to as
Answer: A
Explanation:
Pricing obstacles occur when pricing mechanisms cause customers or downstream supply-chain stages to place orders that are substantially more variable than actual consumer demand. The distortion typically arises from quantity discounts, trade promotions, temporary price reductions, and other pricing arrangements that encourage buyers to change the timing or size of purchases.
For example, a temporary supplier discount can encourage a retailer to engage in forward buying-purchasing several periods of anticipated requirements while the price is temporarily low. Orders become exceptionally large during the promotional period and very small afterward. Consumer demand may remain comparatively stable, yet the manufacturer's observed order stream becomes highly volatile.
Lot-size-based quantity discounts can produce a similar effect by encouraging buyers to place fewer but much larger orders. The resulting batching amplifies order variability upstream and increases the bullwhip effect.
This definition distinguishes pricing obstacles from operational obstacles involving lot sizing, lead times, or rationing; information-processing obstacles involving distorted demand signals; and incentive obstacles involving conflicting performance objectives.
Supply-chain coordination literature explicitly defines pricing obstacles as pricing policies that increase variability in orders placed.
Reference Topic: Inventory, Forecasting and Demand Planning - Pricing Obstacles, Forward Buying, and Bullwhip Effect.
NEW QUESTION # 71
Managers can improve coordination within the supply chain by
Answer: D
Explanation:
Managers improve supply-chain coordination by aligning goals and incentives so that participants are rewarded for actions that improve overall supply-chain performance rather than isolated functional results.
Misaligned incentives frequently cause otherwise rational managers to make decisions that reduce total supply-chain profitability.
For example, rewarding a purchasing manager exclusively for low unit acquisition cost can encourage excessive order quantities. Rewarding transportation management solely for low freight cost per unit can encourage larger, less frequent shipments that increase inventory and reduce responsiveness. Similarly, sales incentives based on sell-in rather than final customer sell-through can create artificial order spikes.
Proper goal alignment establishes shared measures involving customer service, inventory, total landed cost, responsiveness, and overall profitability. Contracts, performance metrics, and incentive plans should therefore encourage behaviors that increase total network value.
The other alternatives undermine coordination. Keeping real inventory outside official records corrupts information accuracy; recording nonexistent inventory creates false availability; and reducing visibility makes synchronized planning more difficult.
Supply-chain coordination frameworks specifically identify aligning goals and incentives as a principal managerial lever for improving coordination.
Reference Topic: Leadership and Organizational Change - Goal Alignment, Incentive Design, and Cross- Functional Coordination.
NEW QUESTION # 72
When demand is steady, cycle inventory and lot size are related as