Supply Chain Management Risk Management 2

Question 1

Which risk management strategy involves transferring supply chain risk to a third party through contracts or insurance?

Accepted Answer

Risk transfer

Answer

Risk transfer shifts financial responsibility for a risk to another party, such as through insurance policies or supplier contracts with penalty clauses.

Question 2

A company sources a critical component from a single supplier in a politically unstable region. This represents which type of supply chain risk?

Accepted Answer

Geopolitical risk

Answer

Geopolitical risk arises from political instability, trade restrictions, or conflicts in supplier regions that can disrupt supply chains.

Question 3

What is the purpose of a Supply Chain Risk Management (SCRM) plan?

Accepted Answer

To identify, assess, and mitigate risks across the supply chain

Answer

A SCRM plan provides a structured framework to proactively identify, evaluate, and respond to risks before they cause significant disruption.

Question 4

Which metric best measures a supply chain's ability to recover from a disruption?

Accepted Answer

Time to recover (TTR)

Answer

Time to recover (TTR) measures how long it takes a supply chain to restore normal operations after a disruption occurs.

Question 5

A manufacturer holds 30 days of safety stock for a key raw material. This is primarily an example of:

Accepted Answer

Risk mitigation through redundancy

Answer

Holding safety stock creates a buffer inventory that mitigates the impact of supply disruptions by providing redundant supply capacity.

Supply Chain Management Practice Test

Supply Chain Management Practice Test

Supply Chain Management Risk Management 2