Supply Chain Management Risk Management 5

Question 1

What is the 'bullwhip effect' and how does it relate to supply chain risk?

Accepted Answer

Demand signal amplification upstream that causes inventory and capacity distortions

Answer

The bullwhip effect occurs when small demand changes at the retail level are magnified into large order swings upstream, creating inventory and capacity risks throughout the chain.

Question 2

A company identifies that a new trade tariff will increase import costs by 25%. Which risk response is most appropriate?

Accepted Answer

Evaluate nearshoring, tariff engineering, or alternative sourcing options

Answer

Proactively evaluating alternative sourcing, nearshoring, or supply chain redesign allows companies to mitigate the cost impact of tariffs before they fully materialize.

Question 3

Which framework is commonly used in supply chain risk management to model and analyze supply chain performance and resilience?

Accepted Answer

SCOR (Supply Chain Operations Reference) model

Answer

The SCOR model provides a standardized framework for analyzing supply chain processes, performance metrics, and risk factors across Plan, Source, Make, Deliver, and Return functions.

Question 4

What is 'lead time risk' in supply chain management?

Accepted Answer

The risk that procurement or production lead times exceed acceptable customer delivery windows

Answer

Lead time risk occurs when unexpected delays in procurement or production extend beyond the time customers are willing to wait, potentially causing lost sales or service failures.

Question 5

A supply chain manager conducts a 'tabletop exercise' for a pandemic scenario. What is the primary goal?

Accepted Answer

To walk through response procedures in a simulated disruption to identify gaps in the plan

Answer

Tabletop exercises simulate disruption scenarios in a discussion-based format to test business continuity plans and identify weaknesses before a real event occurs.

Supply Chain Management Practice Test

Supply Chain Management Practice Test

Supply Chain Management Risk Management 5