FREE CSCP MCQ Questions and Answers Flashcards

A retailer notices that small fluctuations in consumer demand cause increasingly large swings in orders placed with its upstream manufacturer and raw material suppliers. What is this phenomenon called?

Answer: Bullwhip effect

The bullwhip effect describes demand variability amplifying as orders move upstream in the supply chain.

Which practice is MOST effective at reducing the bullwhip effect?

Answer: Sharing point-of-sale data with upstream partners

Sharing real end-customer demand data removes the distortion caused by each tier forecasting from its downstream orders.

In the SCOR model, which process covers ordering, receiving, verifying, and transferring materials?

Answer: Source

Source encompasses procuring goods and services to meet planned or actual demand.

A company positions its finished goods inventory close to customers so orders can be shipped immediately. Which manufacturing environment does this describe?

Answer: Make-to-stock

Make-to-stock produces finished goods ahead of demand so customer orders are filled from stock.

What is the primary purpose of sales and operations planning (S&OP)?

Answer: Balancing demand and supply at an aggregate level aligned with business plans

S&OP is a cross-functional process that aligns aggregate demand and supply plans with financial and strategic goals.

Which metric measures the time from paying suppliers for materials to collecting cash from customers?

Answer: Cash-to-cash cycle time

Cash-to-cash cycle time equals days of inventory plus days of receivables minus days of payables.

A supplier holds inventory at the buyer's site and the buyer pays only when items are consumed. What arrangement is this?

Answer: Consignment inventory

In consignment, the supplier retains ownership of the stock until the buyer uses it.