Demand Management Flashcards
7 cards from real CSCP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Demand Management flashcards as text
Which forecasting method uses a weighted average of past demand observations where more recent data receives higher weights?
Answer: Exponential smoothing
Exponential smoothing assigns exponentially decreasing weights to older observations, giving more importance to recent demand data.
What is the primary purpose of a Sales and Operations Planning (S&OP) process?
Answer: To align supply capabilities with demand requirements across functions
S&OP aligns sales, marketing, finance, and operations by balancing demand plans with supply capabilities at an aggregate level.
Mean Absolute Deviation (MAD) is used in demand management primarily to:
Answer: Measure forecast accuracy and error
MAD measures the average absolute difference between forecasted and actual demand, indicating how accurate the forecast is.
Which of the following best describes the 'bullwhip effect' in demand management?
Answer: Demand variability amplification as orders move upstream in the supply chain
The bullwhip effect occurs when small demand fluctuations at the customer level are amplified into larger swings in orders placed upstream.
In demand management, what is the difference between independent demand and dependent demand?
Answer: Independent demand is for finished goods; dependent demand is derived from the demand for finished goods
Independent demand comes directly from customer orders for finished goods, while dependent demand is calculated from the bill of materials based on production requirements.
Which technique involves sharing actual point-of-sale data between retailers and suppliers to improve demand forecasting?
Answer: Collaborative Planning, Forecasting, and Replenishment (CPFR)
CPFR is a business practice that combines information sharing and synchronized planning between trading partners to improve supply chain efficiency.
What is demand sensing in the context of modern supply chain management?
Answer: Using real-time or near-real-time data to improve short-term demand forecasting accuracy
Demand sensing leverages real-time signals such as POS data, social media, and IoT data to generate more accurate near-term forecasts.