Supply Chain Management ExerciseTrue or False1. A supply chain includes only the organizations directly involved in supplying 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 or supply web.Answer: TrueDifficulty: Moderate4. The objective of every supply chain is to maximize the overall value generated.Answer: TrueDifficulty: Easy5. The objective of every supply chain is to maximize the value generated for the manufacturing component of the supply chain.Answer: FalseDifficulty: Moderate6. All supply chain activities within a firm belong to one of three macro processes CRM, ISCM and SRM.Answer: TrueDifficulty: Easy7. There is a close connection between the design and management of supply chain flows and the success of a supply chain.Answer: TrueDifficulty: Easy8. A companys competitive strategy defines the set of customer needs that it seeks to satisfy through its products and services.Answer: TrueDifficulty: Easy9. The value chain emphasizes the close relationship between all the functional strategies within a company.Answer: TrueDifficulty: Moderate10. A companys product development strategy defines the set of customer needs that it seeks to satisfy through its products and services.Answer: FalseDifficulty: Moderate11. A companys product development strategy specifies the portfolio of new products that it will try to develop.Answer: TrueDifficulty: Easy12. A companys supply chain strategy specifies how the market will be segmented and how the product will be positioned, priced, and promoted.Answer: FalseDifficulty: Easy13. A companys supply chain strategy determines the nature of procurement and transportation of materials as well as the manufacture and distribution of the product.Answer: TrueDifficulty: Easy14. The degree of supply chain responsiveness should be consistent with the implied uncertainty.Answer: TrueDifficulty: Easy15. The degree of supply chain responsiveness does not need to be consistent with the implied uncertainty.Answer: FalseDifficulty: Moderate16. The two major types of facilities are distribution sites and storage sites.Answer: FalseDifficulty: Moderate17. Inventory is an important supply chain driver because changing inventory policies can dramatically alter the supply chains efficiency and responsiveness.Answer: TrueDifficulty: Moderate18. Information is potentially the biggest driver of performance in the supply chain as it directly affects each of the other drivers.Answer: TrueDifficulty: Easy19. The high utilization facility will have no more difficulty responding to demand fluctuations than one with a lot of unused capacity.Answer: False Difficulty: Easy20. Stock keeping unit (SKU) storage is the warehousing methodology that uses a traditional warehouse to store all of one type of product together.Answer: TrueDifficulty: Moderate21. Warehouse unit storage is the warehousing methodology that uses a traditional warehouse to store all of one type of product together.Answer: FalseDifficulty: Moderate22. Distribution occurs between every pair of stages in the supply chain.Answer: TrueDifficulty: Moderate23. Distribution only occurs between manufacturing and consumers in the supply chain.Answer: FalseDifficulty: Moderate24. Companies in the same industry often select very different distribution networks, because the choice of the distribution network can be used to achieve a variety of supply chain objectives ranging from low cost to high responsiveness.Answer: TrueDifficulty: Moderate25. The main advantage of a distribution network with local storage is that it can lower the delivery cost and provide a faster response than other networks.Answer: TrueDifficulty: Moderate26. When designing supply chain networks, companies must build appropriate flexibility to help counter fluctuations in exchange rates and demand across different countries.Answer: TrueDifficulty: Moderate27. Inventory and facility costs increase as the number of facilities in a supply chain increase. Answer: TrueDifficulty: Moderate28. Transportation costs increase as the number of facilities is increased.Answer: FalseDifficulty: Moderate29. When faced with a network design decision, the goal of a manager is to design a network that minimizes the firms costs while satisfying customer needs in terms of demand and responsiveness.Answer: FalseDifficulty: Hard30. The supply chain network is designed to maximize total profits, taking into account the expected margin and demand in each market, various logistics and facility costs, and the taxes and tar