CPIM Strategic Management and Performance Metrics 2

Question 1

Which performance metric measures the percentage of customer orders shipped complete and on time?

Accepted Answer

Perfect order fulfillment rate

Answer

Perfect order fulfillment rate measures the percentage of orders delivered complete, on time, undamaged, and with accurate documentation.

Question 2

In CPIM, what does 'inventory turnover' measure?

Accepted Answer

The number of times inventory is replenished per year relative to average inventory value

Answer

Inventory turnover = Cost of Goods Sold / Average Inventory Value, indicating how many times inventory is cycled through per period.

Question 3

What is 'days of supply' (DOS) as a supply chain metric?

Accepted Answer

The number of days the current inventory can cover future demand at the average daily usage rate

Answer

Days of supply = (Inventory on Hand) / (Average Daily Usage), showing how long current stock will last before a stockout occurs.

Question 4

Which CPIM concept measures the actual output of a process compared to the planned or theoretical output?

Accepted Answer

Efficiency

Answer

Efficiency = (Actual Output / Standard Output) × 100, comparing actual performance to the engineered standard.

Question 5

A company achieves a 95% on-time delivery rate but ships incomplete orders 10% of the time. What is the approximate perfect order rate?

Accepted Answer

85.5%

Answer

Perfect order rate ≈ 0.95 × 0.90 = 0.855 or 85.5%, since each dimension must be multiplied together (assuming independence).

(CPIM) Certified in Planning and Inventory Management Practice Test