CBS Supply Chain & Operations Strategy Flashcards

Which supply chain strategy prioritizes cost efficiency by producing goods based on forecasted demand?

Answer: Push strategy

A push strategy produces inventory based on demand forecasts, optimizing cost efficiency by manufacturing in advance of actual orders.

Just-in-Time (JIT) inventory management aims to:

Answer: Receive goods only as they are needed in production

JIT minimizes inventory holding costs by scheduling deliveries to arrive precisely when needed in the production process.

Vertical integration in operations strategy refers to:

Answer: A company owning multiple stages of its supply chain

Vertical integration occurs when a company controls multiple stages of its supply chain, from raw materials to distribution, reducing dependence on external suppliers.

A key performance indicator (KPI) commonly used to measure supply chain efficiency is:

Answer: Perfect Order Rate

Perfect Order Rate measures the percentage of orders delivered on time, complete, undamaged, and with accurate documentation — a holistic supply chain efficiency metric.

Which risk mitigation strategy involves sourcing the same component from multiple suppliers?

Answer: Multi-sourcing

Multi-sourcing distributes procurement across multiple suppliers to reduce the risk of supply disruption from any single source.

Total Cost of Ownership (TCO) in supply chain decisions includes:

Answer: All costs related to acquiring, using, and disposing of a product or service

TCO captures all costs across the full lifecycle including purchase price, transportation, holding, maintenance, and disposal costs.