Deck 2: Supply Chain Performance: Achieving Strategic Fit and Scope

Question 1

Intercompany scope is broader than intrafunctional scope.

Answer 1

TRUE

Question 2

Supply chain strategy specifies what the operations, distribution, and service functions, whether performed in-house or outsourced, should do particularly well.

Answer 2

TRUE

Question 3

The intercompany scope of strategic fit is no longer relevant today because the competitive playing field has shifted from company versus company to supply chain versus supply chain.

Answer 3

FALSE

Question 4

A company's product development strategy specifies the portfolio of new products that it will try to develop.

Question 5

Monolithic Lumber has purchased timber from Bunyan Axe, the same wholly-owned subsidiary, for the last two centuries and plans to do so for another two centuries. It is crucial that Monolithic continue to demonstrate an agile company scope.

Question 6

The value chain emphasizes the close relationship between all the functional strategies within a company.

Question 7

Over the past several decades, the supply chains of most firms have become easier to coordinate.

Question 8

Because demand and supply characteristics change, the supply chain strategy must change over the product life cycle if a company is to continue achieving strategic fit.

Question 9

To retain strategic fit, supply chain strategy must be adjusted over the life cycle of a product and as the competitive landscape changes.

Question 10

A company's product development strategy defines the set of customer needs that it seeks to satisfy through its products and services.

Question 11

A company's competitive strategy defines the set of customer needs that it seeks to satisfy through its products and services.

Question 12

The degree of supply chain responsiveness should be consistent with the implied uncertainty.

Question 13

Globalization has increased the opportunities and decreased the risks for supply chains.

Question 14

A company's supply chain strategy determines the nature of procurement and transportation of materials as well as the manufacture and distribution of the product.

Question 15

To achieve complete strategic fit, a firm must ensure that all functions in the value chain have diverse strategies that support functional goals.

Question 16

If all functional strategies are deliberately aligned with each other and with the overall competitive strategy, then the company profit will be maximized.

Question 17

The interoperation scope has each stage of the supply chain devising its strategy independently.

Question 18

Intraoperation scope resulted in minimal supply chain surplus.

Question 19

An example of intrafunctional scope is that outsourcing a key component is reasonable if the savings in staying current in technology results in improved performance in other areas of R&D that permit improved overall performance.

Question 20

Greater product variety and shorter life cycles result in shorter windows of opportunity for a supply chain to achieve fit.

Question 21

The first step in achieving strategic fit between competitive and supply chain strategies is to

A) understand the supply chain and map it on the responsiveness spectrum.
B) understand customers and supply chain uncertainty.
C) match supply chain responsiveness with the implied uncertainty of demand.
D) ensure that all functional strategies within the supply chain support the supply chain's level of responsiveness.

Question 22

A ________ strategy specifies how the market will be segmented and how the product will be positioned, priced, and promoted.

A) Product Development
B) Marketing and Sales
C) Supply Chain
D) Finance

Question 23

Which of the following customer needs will cause implied uncertainty of demand to increase?

A) Product margin
B) Lead time decreases
C) Average stockout rate
D) Average forced season end markdown

Question 24

The value that potential customers place on product cost and delivery time determines a company's

A) customer needs.
B) competitive strategy.
C) supply chain surplus.
D) product life cycle.

Question 25

The uncertainty that exists due to the portion of demand that the supply chain is required to meet is the

A) rate of strategic uncertainty.
B) demand uncertainty.
C) implied demand uncertainty.
D) average forecast error.

Question 26

Which of these services facilitates the function of the value chain but is not considered a core element of the supply chain?

A) Marketing
B) Information Technology
C) Distribution
D) Service

Question 27

A company's marketing and sales strategy

A) defines the set of customer needs that it seeks to satisfy through its products and services.
B) specifies the portfolio of new products that it will try to develop.
C) specifies how the market will be segmented and how the product will be positioned, priced, and promoted.
D) determines the nature of procurement and transportation of materials as well as manufacture and distribution of the product.

Question 28

A company's supply chain strategy

A) defines the set of customer needs that it seeks to satisfy through its products and services.
B) specifies the portfolio of new products that it will try to develop.
C) specifies how the market will be segmented and how the product will be positioned, priced, and promoted.
D) determines the nature of procurement and transportation of materials as well as manufacture and distribution of the product.

Question 29

Seven-Eleven in Japan's operations and distribution strategy focuses on

A) convenience in the form of easy access to stores.
B) constantly adding new products and services.
C) low cost for gasoline, which drives traffic to the store.
D) being responsive and having an excellent information infrastructure.

Question 30

Which of the following specifies the portfolio of new products that a company will try to develop?

A) Competitive strategy
B) Product development strategy
C) Marketing and sales strategy
D) Supply chain strategy

Question 31

A ________ strategy specifies the portfolio of new products that a company will try to develop.

A) Product Development
B) Marketing and Sales
C) Supply Chain
D) Finance

Question 32

The uncertainty of customer demand for a product is the

A) rate of strategic uncertainty.
B) demand uncertainty.
C) implied demand uncertainty.
D) average forecast error.

Question 33

Which element in the value chain is responsible for transforming inputs into outputs?

A) Operations
B) Marketing
C) Distribution
D) All elements of the value chain do this.

Question 34

Which of the following determines the nature of procurement of raw materials, transportation of materials to and from the company, manufacture of the product or operation to provide the service, and distribution of the product to the customer along with follow-up service?

A) Competitive strategy
B) Product development strategy
C) Marketing and sales strategy
D) Supply chain strategy

Question 35

A company's competitive strategy

A) defines the set of customer needs that it seeks to satisfy through its products and services.
B) specifies the portfolio of new products that it will try to develop.
C) specifies how the market will be segmented and how the product will be positioned, priced, and promoted.
D) determines the nature of procurement and transportation of materials as well as manufacture and distribution of the product.

Question 36

A supply chain strategy involves decisions regarding all of the following except

A) inventory.
B) transportation.
C) new product development.
D) operating facilities.

Question 37

Which of the following defines the set of customer needs that a company seeks to satisfy through its products and services?

A) Competitive strategy
B) Product development strategy
C) Marketing and sales strategy
D) Supply chain strategy

Question 38

A company's product development strategy

A) defines the set of customer needs that it seeks to satisfy through its products and services.
B) specifies the portfolio of new products that it will try to develop.
C) specifies how the market will be segmented and how the product will be positioned, priced, and promoted.
D) determines the nature of procurement and transportation of materials as well as manufacture and distribution of the product.

Question 39

The value chain in a company begins with

A) the customer.
B) marketing and sales.
C) new product development.
D) operations.

Question 40

The value chain consists of direct and indirect activities. Which of the following is an indirect activity for an enterprise?

A) Marketing
B) Distribution
C) Human Resources
D) Service

Question 41

Supply chain responsiveness includes the ability to do which of the following?

A) Understand customers and supply chain
B) Meet a very high service level
C) Match supply chain responsiveness with the implied uncertainty of demand
D) Ensure that all functional strategies within the supply chain support the supply chain's level of responsiveness

Question 42

Which of these has the broader range?

A) Intrafunctional scope
B) Intercompany scope
C) Interfunctional scope
D) Intraoperational scope

Question 43

The second step in achieving strategic fit between competitive and supply chain strategies is to

A) understand the supply chain and map it on the responsiveness spectrum.
B) understand customers and supply chain uncertainty.
C) match supply chain responsiveness with the implied uncertainty of demand.
D) ensure that all functional strategies within the supply chain support the supply chain's level of responsiveness.

Question 44

The curve that shows the lowest possible cost for a given level of responsiveness is referred to as the

A) supply chain responsiveness curve.
B) supply chain efficiency curve.
C) cost-responsiveness efficient frontier.
D) responsiveness spectrum.

Question 45

The relationship where increasing implied uncertainty from customers and supply sources is best served by increasing responsiveness from the supply chain is known as the

A) implied uncertainty spectrum.
B) responsiveness spectrum.
C) uncertainty/responsiveness map.
D) zone of strategic fit.

Question 46

Efficient supply chains

A) respond quickly to demand.
B) have higher margins because price is not a prime customer driver.
C) maintain buffer inventory to deal with demand/supply uncertainty.
D) maximize performance at a minimum cost.

Question 47

With the ________ view, firms attempt to align all operations within a function. In this view, all supply chain functions including sourcing, manufacturing, warehousing, and transportation must align their strategy to minimize total functional cost.

A) Intrafunctional scope
B) Intraoperation scope
C) Interfunctional scope
D) Intercompany scope

Question 48

A firm that is not on the cost-responsiveness efficient frontier can improve

A) both responsiveness and cost performance.
B) only responsiveness.
C) only cost performance.
D) responsiveness, but not cost performance.

Question 49

The functions and stages that devise an integrated strategy with a shared objective are referred to as

A) competitive strategy.
B) supply chain strategy.
C) scope of strategic fit.
D) scope of marketing strategy.

Question 50

The final step in achieving strategic fit between competitive and supply chain strategies is to

A) understand the supply chain and map it on the responsiveness spectrum.
B) understand customers and supply chain uncertainty.
C) match supply chain responsiveness with the implied uncertainty of demand.
D) combine customer and supply chain uncertainty and map it on the implied uncertainty spectrum.

Question 51

Supply chain responsiveness includes the ability to do which of the following?

A) Handle supply uncertainty
B) Understand customers and supply chain uncertainty
C) Match supply chain responsiveness with the implied uncertainty of demand
D) Ensure that all functional strategies within the supply chain support the supply chain's level of responsiveness

Question 52

Which of the following would be a demand and supply characteristic toward the beginning stages of a product's life cycle?

A) Demand has become more certain and supply is predictable.
B) Margins are lower due to an increase in competitive pressure.
C) Product availability is crucial to capturing the market.
D) Price becomes a significant factor in customer choice.

Question 53

The cost of making and delivering a product to the customer is referred to as

A) supply chain responsiveness.
B) supply chain efficiency.
C) cost-responsiveness efficient frontier.
D) implied uncertainty.

Question 54

For a company to achieve strategic fit, it must accomplish the following keys:

A) All functional strategies must fit together to form a coordinated overall strategy.
B) The different functions in a company must appropriately structure their processes and resources to be able to execute these strategies successfully
C) The overall supply chain must operate at the lowest cost possible to achieve success.
D) The design of the overall supply chain and the role of each stage must be aligned to support the supply chain strategy.

Question 55

The preferable supply chain strategy for a firm that sells multiple products and serves customer segments with very different needs is to

A) set up independent supply chains for each different product or customer segment.
B) set up a supply chain that meets the needs of the highest volume product or customer segment.
C) tailor the supply chain to best meet the needs of each product's demand.
D) set up a supply chain that meets the needs of the customer segment with the highest implied uncertainty.

Question 56

The drive for strategic fit should come from

A) the supply chain manager.
B) the strategic planning department.
C) the highest levels of the organization, such as the CEO.
D) middle management.

Question 57

A graph with two axes with implied uncertainty along the horizontal axis and responsiveness along the vertical axis is referred to as the

A) implied uncertainty spectrum.
B) responsiveness spectrum.
C) uncertainty/responsiveness map.
D) zone of strategic fit.

Question 58

The key weakness of the ________ view is that different functions within a firm may have conflicting objectives.

A) Intrafunctional scope
B) Intraoperation scope
C) Interfunctional scope
D) Intercompany scope

Question 59

Between 1993 and 2006, Dell's competitive strategy was to provide a large variety of customizable products at a reasonable price. Given the focus on customization, Dell's supply chain was designed to

A) be responsive.
B) provide a different product.
C) operate on a low-cost basis.
D) provide sustainable products.

Question 60

Supply chain responsiveness includes the ability to do which of the following?

A) Understand customers and supply chain
B) Match supply chain responsiveness with the implied uncertainty of demand
C) Meet short lead times
D) Ensure that all functional strategies within the supply chain support the supply chain's level of responsiveness

Question 61

A company's partners in the supply chain determine

A) the company's success.
B) the scope of strategic fit.
C) the relevance of sustainability initiatives.
D) the need for customers.

Question 62

List and explain the three basic steps to achieving strategic fit.

Question 63

Over the past several decades

A) the life cycle of products has increased.
B) most firms have become more vertically integrated.
C) the number of owners per supply chain has increased.
D) product variety has decreased.

Question 64

Explain scope of strategic fit.

Question 65

Sketch the generic value chain for a company and briefly describe the contributions of each of its elements.

Question 66

Discuss the two keys to the success or failure of a company.

Question 67

Which of these examples ripped from the headlines of business periodicals is most accurate?

A) Netflix has two content delivery systems that are inexpensive to operate.
B) Blockbuster's reliance on streaming services was overwhelmed by a lack of bandwidth at the dawn of the 21st century.
C) Once an increase in demanded customization seized the market, Dell was unable to rely on its retail store strategy.
D) Redbox's reliance on streaming services ended Dell's run as a leader in the industry.

Question 68

Increased product variety and shrinking product life cycles usually result in

A) the deliberate phase-out of older products.
B) a decrease in overall uncertainty for the supply chain.
C) an increase in the time allowed for a supply chain to develop specific competencies.
D) a deliberate proliferation in the variety of components used for all products produced.

Question 69

Discuss the impact of the product life cycle on strategic fit between implied demand uncertainty and supply chain responsiveness.

Question 70

Concerns related to the environment and sustainability

A) are becoming less important to the consuming public.
B) are sometimes dictated by regulations and sometimes by perception.
C) result in increased cost for the supply chain.
D) are relevant to only the retail member of each supply chain.

Question 71

Company A and Company B of the same supply chain rely on market responsiveness to attract customers. Each company has access to the other company's designs, production schedules, and goals, and if Company A needs product overnight, Company B gladly ships it, knowing that in the long run it works to the benefit of both. Such an arrangement is an example of

A) intrafunctional scope.
B) intraoperation scope.
C) interfunctional scope.
D) intercompany scope.

Question 72

One motivation for companies to shed noncore functions to their supply chains has been to

A) increase supply chain membership and participation.
B) increase supply chain complexity to ease supply chain alignment.
C) maximize focus on local objectives.
D) take advantage of supplier and customer competencies that they did not possess.

Question 73

Scope of strategic fit refers to both the

A) function within the firm and the satisfaction of the customer.
B) satisfaction of the customer and the profits returned to the shareholders.
C) function within the firm and stages across the supply chain.
D) profits returned to the shareholders and the stages across the supply chain.

Question 74

Risks and opportunities have increased for supply chains due to

A) the decreasing value of the U.S. dollar.
B) increasing globalization.
C) the increasing population.
D) a decline in energy prices.

Question 75

The authors cite IKEA as achieving an intercompany scope of strategic fit which serves to

A) minimize IKEA's costs.
B) align the strategic fit with the consumer surplus.
C) minimize the costs of all supply chain elements.
D) increase the supply chain surplus.