Supply Planning and Management Flashcards
7 cards from real CPIM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Supply Planning and Management flashcards as text
When a manufacturer uses a 'chase' production strategy, which outcome is most likely compared to a 'level' strategy?
Answer: Lower inventory levels and higher workforce variability costs
Chase strategy matches production to demand each period, resulting in low inventory but frequent workforce adjustments and associated costs.
In MRP, what is the significance of the 'planning time fence'?
Answer: It defines the period within which no changes are allowed to the MPS
Within the planning time fence, the MPS is frozen or requires management approval to change, protecting shop floor execution stability.
A firm's planned production exceeds demonstrated capacity consistently. Which action is LEAST appropriate?
Answer: Reducing the safety stock policy
Reducing safety stock addresses inventory policy, not the capacity shortfall, and would likely worsen service levels.
Which term describes the practice of grouping similar items together in a production run to reduce setup time and cost?
Answer: Family scheduling
Family scheduling groups products with similar setups into sequential runs, reducing the total number of major changeovers.
Under a 'fixed-period' replenishment system, what triggers a replenishment order?
Answer: The passage of a fixed time interval
In a fixed-period (or periodic review) system, orders are placed at regular predetermined intervals regardless of current inventory level.
What does the 'bullwhip effect' specifically describe in supply chain management?
Answer: Amplification of demand variability as orders move upstream in the supply chain
The bullwhip effect describes how small fluctuations in end-customer demand become amplified into large order swings as they move upstream to manufacturers and suppliers.
A company wants to reduce its total supply chain inventory while maintaining service levels. Which strategy would be MOST effective?
Answer: Centralize inventory at a single distribution center
Centralizing inventory exploits the 'risk pooling' effect, where combined variability is lower than the sum of individual location variabilities, reducing total safety stock needs.