Solution and Answer Guide: Joel Wisner, Keah-Choon Tan, G. Keong Leong, Principles of Supply Chain Management:

Solution and Answer Guide: Joel Wisner, Keah-Choon Tan, G. Keong Leong, Principles of Supply Chain Management:

A Balanced Approach, 6e,; Chapter 01: Answers to Questions/Problems

1 © 2023 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.Solution Manual Joel Wisner, Keah-Choon Tan, G. Keong Leong, Principles of Supply Chain Management: A

Balanced Approach, 6e, Chapter 01: Answers to Questions/Problems

Table of Contents Discussion Questions .................................................................................................................... 1 Cases ............................................................................................................................................... 8 Learning Objectives: .................................................................................................................................. 8 Answers to Questions ................................................................................................................................ 8 Appendix 1.1 The Beer Game ....................................................................................................... 9 Questions and Exercises ............................................................................................................................ 9 Discussion Questions 1.Define the term supply chain management in your own words and list its most important activities.

Answers:

The Supply-Chain Council’s definition of supply chain management is “managing supply and demand, sourcing raw materials and parts, manufacturing and assembly, warehousing and inventory tracking, order entry and order management, distribution across all channels, and delivery to the customer.These are also the most important activities; however, integration of key supply chain processes might also be included in there.

2.Can a small business like a local sandwich or bicycle shop benefit from practicing supply chain management? What would they most likely concentrate on?

Answers:

Yes, any organization can implement at least some of the important concepts. A good place to start is the rationalization or reduction of the supply base. Small businesses might also want to concentrate on customers as a starting point.

3.Describe and draw a supply chain for a bicycle repair shop and list the important supply chain members.

Answers:

This will vary from student to student, but should include, for instance, parts suppliers, bicycle suppliers, and other suppliers (i.e., helmet suppliers) and services (i.e., repair services) as first-tier suppliers and bicycle owners as

first-tier customers.SM Download Link At The End Of This File 1 / 4

Solution and Answer Guide: Joel Wisner, Keah-Choon Tan, G. Keong Leong, Principles of Supply Chain Management: A Balanced Approach, 6e, © 2023, 978-0-357-71560-4; Chapter 01: Answers to Questions/Problems 2 © 2023 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

• Can a bicycle repair shop have more than one supply chain? Explain.

Answers:

Yes. Every repair item the firm stocks has potentially a different supply chain associated with it.

• What is a cold chain? Why did it become so important in 2020?

Answers:

A cold chain is an alliance of companies that can monitor and protect the temperature of perishable products to maintain quality and safety from the point of origin through distribution to the final consumer. Cold chains became a popular news item in 2020 as COVID-19 vaccines began to be distributed globally by Pfizer and Moderna. The two vaccines must be stored and transported at sub-zero temperatures.

• How has the recent global pandemic impacted supply chain management?

Answers:

In general, it made things more difficult, particularly for global supply chains—companies have gone bankrupt, retailers have stopped buying regularly, ports have shut down unexpectedly, and many purchases have gone online as people stayed home. Companies have had to react quickly to the changes.

• What roles do “collaboration” and “trust” play in the practice of supply chain management?

Answers:

This is essential for process integration. Sharing information and determining joint strategies is part of the process of integration and collaboration, and to do this, trust must be present between the customer, focal firm, and supplier.

• Why don’t firms just become more vertically integrated (for example buy out suppliers and

customers), instead of trying to manage their supply chains?

Answers:

This could cause a loss of focus and keep managers and employees from doing their core competencies, resulting in loss of performance.

• What types of organizations would benefit the most from practicing supply chain

management? What sorts of improvements could be expected?

Answers:

Firms with many suppliers, many complex products, large inventories, and many customers (in other words, firms with many supply chains). Gains would be lower purchasing costs, lower carrying costs, better product quality, and better customer service.

• What are the benefits of supply chain management?

Answers:

Reduction of the bullwhip effect, better buyer/supplier relationships, better quality, lower costs, better customer service, higher demand, and more profits.

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Solution and Answer Guide: Joel Wisner, Keah-Choon Tan, G. Keong Leong, Principles of Supply Chain Management: A Balanced Approach, 6e, © 2023, 978-0-357-71560-4; Chapter 01: Answers to Questions/Problems 3 © 2023 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

• Can nonprofit, educational, or government organizations benefit from supply chain

management? How?

Answers:

Yes. All services and organizations can benefit in terms of at least better customer service, better inventory management, and cheaper purchase prices.

• What does the term, “third-tier supplier” mean? What about “third-tier customer”? What

about the “focal firm”? Provide examples.

Answers:

First-tier suppliers are the focal firm’s direct suppliers. Second-tier suppliers are the focal firm’s suppliers’ direct suppliers. Third-tier suppliers are the focal firm’s suppliers’ suppliers’ suppliers. Company A sells wood to Company B. Company B sells furniture to Company C.Company C sells the furniture to Wal-Mart. Company A is Wal-Mart’s third-tier supplier.Similarly, the focal firm’s customers’ customers’ customers are their third-tier customers. The focal firm just refers to the firm in question, or in the topic of discussion.

• What is the bullwhip effect and what causes it? How would you try to reduce the bullwhip

effect?

Answers:

The magnification of safety stock and erratic buying behavior as customers along the supply chain forecast demand and add safety stock to their forecasts and production schedules causes the bullwhip effect. As we move further back up the supply chain then, more and more of the output is in the form of safety stocks. Reducing the need to forecast (by agreeing on a future purchase quantity or using CPFR) is one way to reduce the bullwhip effect.

• When did the idea and term, supply chain management, first begin to be thought about and

discussed? Which two operations management practices became the origin of supply chain management?

Answers:

The general idea of supply chain management had been discussed for many years prior to the chain of events shown in Figure 1.1. Back in 1915, Arch W. Shaw of the Harvard Business School wrote the textbook, Some Problems in Market Distribution, considered by many to be the first on the topic of what we now refer to as supply chain management. The text included discussions of how best to purchase raw materials, transport products, locate facilities, and analyze productivity and waste. According to C. John Langley, Jr., professor of supply chain management at the Georgia Institute of Technology, “The idea that companies ought to work together, and coordinate activities has always been around, but ask people today what one of the biggest problems with supply chains are today, and they say companies don’t work very well together.” The 1980s were the breakout years for supply chain management. One of the first widely recorded uses of the term supply chain management came about in a paper published in

• Intense global competition beginning in the 1980s (and continuing today) provided an

incentive for U.S. manufacturers to offer lower-cost, higher-quality products along with higher levels of customer service. Manufacturers utilized just-in-time (JIT) and total quality 3 / 4

Solution and Answer Guide: Joel Wisner, Keah-Choon Tan, G. Keong Leong, Principles of Supply Chain Management: A Balanced Approach, 6e, © 2023, 978-0-357-71560-4; Chapter 01: Answers to Questions/Problems 4 © 2023 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.management (TQM) strategies to improve quality, manufacturing efficiency, and delivery times. In a JIT manufacturing environment with little inventory to cushion scheduling, production problems, or both firms began to realize the potential benefits and importance of strategic and cooperative supplier-buyer-customer relationships. The concept of these partnerships or alliances emerged as manufacturers experimented with JIT and TQM. These were the origins of SCM.

• Do you think supply chain management is simply the latest trend in management thinking

and will die out in a few years? Why or why not?

Answers:

This answer will vary because it was not specifically discussed. However, considering that the ideas of SCM have been around for many, many years makes one think that the practice is here to stay.

• How has technology impacted supply chain management?

Answers:

SCM software and e-commerce has aided supply chain integration and aided in the evolution and adoption of supply chain management. Sharing information with supply chain partners through the internet has enabled firms to integrate stocking, logistics, materials acquisition, shipping, and other functions to create a more proactive and effective style of business management and customer responsiveness

• What are the four foundation elements of supply chain management? Describe some

activities within each element.

Answers:

The four elements are supply (supply base reduction, supplier alliances, SRM, global sourcing, ethical and sustainable sourcing), operations (demand management, CPFR, inventory management, MRP, ERP, lean systems, Six Sigma quality), logistics (logistics management, CRM, network design, RFID, global supply chains, sustainability, service response logistics), and integration (barriers to integration, risk and security management, performance measurement, green supply chains).

• Is the use of a large number of suppliers a good idea? Why?

Answers:

This somewhat depends. Certainly, SCM suggests fewer suppliers and longer-term relationships; however, there can always be exceptions to this rule. Purchasing a widely available common product like soap or tissue paper might be better done with many suppliers competing for this business. But this works against ever creating trusting and lasting supply chain partnerships. In most cases though, use of a few key suppliers for an item is considered a good idea, since it means larger supply quantities, leading to lower prices and better service.

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