CSCP Global Supply Chain Networks 5 — Questions and Answers
Question 1: A global company is shifting from a 'just-in-time' (JIT) to a 'just-in-case' (JIC) inventory strategy following supply chain disruptions. What is the PRIMARY trade-off of this shift?
- Improved supplier relationships at the cost of reduced product variety
- Higher inventory carrying costs in exchange for greater supply chain resilience (Correct answer)
- Faster delivery times at the cost of increased transportation expenses
- Reduced demand forecasting accuracy in exchange for higher service levels
Correct answer: Higher inventory carrying costs in exchange for greater supply chain resilience
JIC requires holding more safety stock which increases carrying costs (capital, storage, obsolescence risk), but provides a buffer against supply disruptions and demand spikes.
Question 2: The US Customs and Border Protection (CBP) Customs-Trade Partnership Against Terrorism (C-TPAT) program is designed to:
- Eliminate all import duties for compliant importers
- Strengthen international supply chain security through partnership between government and trade (Correct answer)
- Automate customs clearance for all commercial shipments
- Certify foreign manufacturers for product safety compliance
Correct answer: Strengthen international supply chain security through partnership between government and trade
C-TPAT is a voluntary public-private partnership where companies implement supply chain security measures in exchange for expedited border processing and reduced inspection rates.
Question 3: A supply chain network analyst uses 'scenario planning' during network design. This technique is BEST described as:
- Creating a single optimal network design based on current conditions
- Developing multiple future-state models based on different assumptions about uncertain variables (Correct answer)
- Scheduling production based on seasonal demand forecasts
- Mapping current-state supply chain processes to identify inefficiencies
Correct answer: Developing multiple future-state models based on different assumptions about uncertain variables
Scenario planning builds and tests multiple network configurations under different assumptions (e.g., demand growth, tariff changes, fuel costs) to find robust designs that perform well across scenarios.
Question 4: Which practice BEST describes 'supply chain segmentation' in a global context?
- Dividing the supply chain into geographic regions for administrative purposes
- Tailoring supply chain strategies and capabilities to serve distinct customer or product groups differently (Correct answer)
- Separating domestic and international supply chains into independent organizations
- Splitting procurement and logistics responsibilities into separate departments
Correct answer: Tailoring supply chain strategies and capabilities to serve distinct customer or product groups differently
Supply chain segmentation recognizes that different customer segments or product lines have different service, cost, and flexibility requirements, warranting distinct supply chain configurations.
Question 5: A multinational company discovers that a tier-2 supplier is violating labor laws in its country of operation. Under responsible supply chain management principles, the BEST initial response is to:
- Immediately terminate all business with the tier-1 supplier who sources from them
- Engage the tier-1 supplier to investigate and develop a corrective action plan with the tier-2 supplier (Correct answer)
- Issue a public statement distancing the company from the violation
- Transfer all orders to domestic suppliers to avoid international complexity
Correct answer: Engage the tier-1 supplier to investigate and develop a corrective action plan with the tier-2 supplier
Responsible supply chain management favors engagement and remediation over immediate termination, working through tier-1 suppliers to correct violations while maintaining supply continuity.
Question 6: Which technology enables real-time tracking of goods across a global supply chain by embedding unique identifiers that can be scanned at every handoff point?
- Enterprise Resource Planning (ERP) systems
- Radio Frequency Identification (RFID) technology (Correct answer)
- Electronic Data Interchange (EDI) messaging
- Warehouse Management Systems (WMS)
Correct answer: Radio Frequency Identification (RFID) technology
RFID tags broadcast unique item identifiers to readers at each transfer point, enabling automatic, real-time location and status tracking throughout the global supply chain without manual scanning.
Question 7: The 'reshoring' trend in global supply chains PRIMARILY refers to:
- Moving offshore manufacturing operations to a third country with lower labor costs
- Returning previously offshored production back to the company's home country (Correct answer)
- Transferring supply chain management responsibilities to a third-party logistics provider
- Relocating distribution centers from inland locations to coastal ports
Correct answer: Returning previously offshored production back to the company's home country
Reshoring is the practice of bringing manufacturing or services back to the home country, driven by factors like rising offshore labor costs, supply chain resilience goals, and total cost reconsideration.
CSCP Global Supply Chain Networks 5
A global company is shifting from a 'just-in-time' (JIT) to a 'just-in-case' (JIC) inventory strategy following supply chain disruptions.
What is the PRIMARY trade-off of this shift?