CPIM Strategic Management of Resources 3 — Questions and Answers
Question 1: What is the primary benefit of 'concurrent engineering' (simultaneous engineering)?
- Reducing the number of engineers needed on a project
- Shortening product development cycle time by overlapping design and manufacturing process development activities (Correct answer)
- Standardizing engineering drawings across product lines
- Eliminating prototype builds during product development
Correct answer: Shortening product development cycle time by overlapping design and manufacturing process development activities
Concurrent engineering involves cross-functional teams working on product design and process design simultaneously rather than sequentially, significantly reducing time to market.
Question 2: In supply chain strategy, 'supply chain agility' is best defined as:
- The ability to operate at the lowest possible cost
- The ability to respond rapidly and cost-effectively to unpredictable changes in demand or supply (Correct answer)
- The speed at which goods move through a distribution center
- The use of automation to replace manual labor
Correct answer: The ability to respond rapidly and cost-effectively to unpredictable changes in demand or supply
Supply chain agility is the capability to quickly reconfigure supply chain resources and processes in response to unexpected disruptions or market opportunities.
Question 3: The 'strategic profit model' (DuPont model) in CPIM links inventory management decisions to:
- Customer satisfaction scores
- Return on assets and overall financial performance (Correct answer)
- Employee productivity measures
- Supplier delivery performance
Correct answer: Return on assets and overall financial performance
The strategic profit model shows how inventory decisions affect asset turnover and profit margins, ultimately driving return on assets (ROA) and return on investment (ROI).
Question 4: What does 'flexible manufacturing system' (FMS) enable that traditional dedicated lines cannot?
- Higher volume production at lower unit cost than any other system
- Rapid changeover between different products with minimal manual intervention (Correct answer)
- Complete elimination of setup time on all operations
- Fully automated quality inspection without human oversight
Correct answer: Rapid changeover between different products with minimal manual intervention
An FMS is a group of computer-controlled machines and material handling equipment that can automatically switch between different parts or products with little or no changeover time.
Question 5: In CPIM, 'enterprise resource planning' (ERP) is best described as:
- A specialized module for production scheduling only
- An integrated information system that supports cross-functional business processes with a shared database (Correct answer)
- A financial reporting system for manufacturing cost accounting
- A supplier portal for electronic purchase orders
Correct answer: An integrated information system that supports cross-functional business processes with a shared database
ERP integrates all major business functions — manufacturing, finance, HR, procurement, sales — into one system with a common database, enabling real-time data visibility across the enterprise.
Question 6: A 'focused factory' strategy, as described by Wickham Skinner, recommends:
- Consolidating all products into one large plant to achieve economies of scale
- Dedicating each plant to a narrow product range or market segment to achieve excellence in a limited set of tasks (Correct answer)
- Outsourcing all manufacturing to specialized contract manufacturers
- Automating all processes to reduce dependence on labor
Correct answer: Dedicating each plant to a narrow product range or market segment to achieve excellence in a limited set of tasks
Skinner's focused factory concept argues that a plant performing a limited, focused set of tasks will outperform a complex plant trying to do everything for everyone.
CPIM Strategic Management of Resources 3
What is the primary benefit of 'concurrent engineering' (simultaneous engineering)?