Week 12 - Review

Logistics, in its simplest form

• • is another term for transportation management

• • does not involve customer service or other related functions.

• combines inbound logistics with the outbound logistics of physical distribution.

• • is a military term, as it was developed originally to supply the battlefield.

Performance measurement is important because

• • without it, managers would not know how the global economy is doing.

• • it allows firms to rate competitors.

• • companies presently operating in the European Economic Community need to understand how its competitors are doing.

• lower-level metrics in an organization must connect directly to the high-level performance to achieve goals.

Demand management might be defined as focused efforts to estimate and manage customers' demand, with the intention of using this information to shape operating decisions.

• True

• False

The essence of demand management is to estimate and manage customer demand so that demand and supply are balanced to the point where there are zero stockouts and zero safety stocks.

• True

• False

There are four strategies that firms can use to balance supply and demand; price, lead time, inventory, and _____.

• production flexibility

• • customer service

• • warehousing

• • transportation

Firms today are beginning to use techniques such as activity-based costing to more accurately allocate costs to customers based on the specific costs of servicing a customer's orders relative to how, how much, what, and when a customer orders.

• True

• False

With the proper information on how a customer's interaction with the shipper drives the firm's costs, the firm can then segment its customers by profitability.

• True

• False

What are the steps in the CRM process?

• Segment customer base, identify service/package, then measure service, and improve

• • Segment customer base, then identify service/package

• • Segment customer base, then measure service, and improve

A reason to hold inventory arises when an organization anticipates that an unusual event might occur that will negatively impact its source of supply.

• True

• False

WIP inventories:

• • are not impacted by EOQ.

• • are the same as VMI inventories.

• • are not included on the balance sheet.

• are associated with manufacturing.