CLT CLT Supply Chain Management 2 — Questions and Answers
Question 1: What is 'lead time' in supply chain management?
- The time a manager spends overseeing operations
- The total time from order placement to order receipt (Correct answer)
- The time spent loading a truck
- The number of days before a product expires
Correct answer: The total time from order placement to order receipt
Lead time is the total elapsed time between placing an order with a supplier and receiving that order at the destination.
Question 2: Which supply chain strategy has the supplier monitor and replenish inventory at the customer's location using shared data?
- Cross-docking
- Drop shipping
- Vendor Managed Inventory (VMI) (Correct answer)
- Consignment
Correct answer: Vendor Managed Inventory (VMI)
Vendor Managed Inventory (VMI) shifts replenishment responsibility to the supplier, who monitors stock levels and replenishes based on real-time shared data.
Question 3: What is the purpose of safety stock in inventory management?
- To reduce warehouse costs
- To buffer against demand variability and supply uncertainty (Correct answer)
- To eliminate the need for reordering
- To reduce the number of SKUs managed
Correct answer: To buffer against demand variability and supply uncertainty
Safety stock is extra inventory held beyond expected demand to prevent stockouts caused by unpredictable demand fluctuations or supply delays.
Question 4: Which technology uses radio waves to automatically identify and track tags attached to objects, enabling real-time inventory visibility?
- Barcode scanning
- GPS tracking
- RFID (Radio Frequency Identification) (Correct answer)
- EDI (Electronic Data Interchange)
Correct answer: RFID (Radio Frequency Identification)
RFID technology uses electromagnetic fields to automatically identify and track tagged items, and can read multiple items simultaneously without requiring line-of-sight.
Question 5: What does '3PL' stand for in logistics?
- Three-part logistics
- Third-party logistics (Correct answer)
- Three-point loading
- Triple-phase logistics
Correct answer: Third-party logistics
Third-party logistics (3PL) refers to outsourcing logistics operations such as warehousing, transportation, and fulfillment to a specialized external provider.
Question 6: Which concept in supply chain management refers to a company acquiring businesses at the same level of the supply chain?
- Vertical integration
- Horizontal integration (Correct answer)
- Backward integration
- Forward integration
Correct answer: Horizontal integration
Horizontal integration occurs when a company acquires or merges with competitors or businesses at the same supply chain level to increase market share or capacity.
CLT CLT Supply Chain Management 2
What is 'lead time' in supply chain management?