True or False #3 Flashcards
The major drivers of supply chain performance are customers, facilities, inventory, transportation, and information.
False
The two major types of facilities are production sites and storage sites.
True
Inventory is an important supply chain driver because changing inventory policies can dramatically alter the supply chain’s efficiency and responsiveness.
True
Information is potentially the biggest driver of performance in the supply chain as it directly affects each of the other drivers.
True
A facility with little excess capacity will likely be no more or less efficient per unit of product it produces than one with a lot of unused capacity.
False
The high utilization facility will have difficulty responding to demand fluctuations.
True
Stock keeping unit (SKU) storage is the warehousing methodology that uses a traditional warehouse to store all of one type of product together.
True
Warehouse unit storage is the warehousing methodology that uses a traditional warehouse to store all of one type of product together.
False
The components of inventory decisions include capacity, cycle inventory, safety inventory, seasonal inventory, and sourcing.
False
Cycle inventory is inventory that is built up to counter predictable variability in demand.
False
Seasonal inventory is inventory that is built up to counter predictable variability in demand.
True
Companies using seasonal inventory will build up inventory in periods of low demand and store it for periods of high demand when they will not have the capacity to produce all that is demanded.
True
Companies using seasonal inventory will maintain a level inventory increase rate of production for periods of high demand.
False
A company’s ability to find a balance between responsiveness and efficiency that best matches the needs of the customer it is targeting is the key to achieving strategic fit.
True
