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143 Cards in this Set
- Front
- Back
an important operational decision that affects the cost of operations, customer service, and sustainability |
process design |
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the 3 major types of goods and services |
Custom or make to order (MTO), Option or assemble to order (ATO), and standard or make to stock (MTS) |
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goods and services are generally produced and delivered as one of a kind or in small quantities and are designed to meet specific customers' specifications |
make to order goods and services |
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these are configurations of standard parts, subassemblies, or services that can be selected by customers from a limited set |
assemble to order (ATO) |
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these are goods and services that are made according to a fixed design, and the customer has no options from which to choose |
make to stock (MTS) |
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strategic choice to separate "push" (forecast driven) and "pull" (demand driven) operations by utilizing an inventory buffer |
decoupling point |
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four principal types of processes that are used to produce goods and services |
projects, job shop processes, flow shop processes, continuous flow processes |
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large scale, customized initiatives that consist of many smaller tasks and activities that must be coordinated and completed to finish on time and within budget |
projects |
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organized around particular types of general purpose equipment that are flexible and capable of customizing work for individual customers |
job shop processes |
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______ produce a wide variety of goods and services, often in small quantities, customer orders are generally processed in batches, very flexible |
job shop processes |
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organized around a fixed sequence of activities and process steps, such as an assembly line, to produce a limited variety of similar goods or services, usually not flexible |
flow shop processes |
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many large volume option oriented and standard goods and services are produced in _______ ______ ___________ |
flow shop settings |
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creates highly standardized goods or services, usually around the clock in very high volumes |
continuous flow processes |
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a characterization of product growth, maturity, and decline over time |
product life cycle |
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four phases of the product life cycle |
introduction, growth, maturity, decline |
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a model that describes the alignment of process choice with the characteristics of the manufactured good |
product-process matrix |
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selectively and consciously positioning a business off the diagonal of the product process matrix, differentiating the company from competitors |
positioning strategy |
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model that suggests that the nature of the customer's desired service encounter activity sequence should lead to the most appropriate service system design and that superior performance results by generally staying along the diagonal of the matrix |
service positioning matrix |
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a unique route through a service system |
pathway |
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consists of all the process steps and associated service encounters necessary to complete a service transaction and fulfill customer's wants and needs |
service encounter activity sequence |
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those that offer customers broad freedom to select the pathways that are best suited for their immediate needs and wants from many possible pathways through the service delivery system |
customer-routed services |
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constrain customers to follow a very small number of possible and predefined pathways through the service system |
provider routed services |
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focus on the service encounter level and helps management design a service system that best meets the technical and behavioral needs of customers |
service positioning matrix |
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the service encounter activity sequence consists of two things: |
1. degree of customer discretion, freedom, and decision making power 2. degree of repeatability |
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four levels of work |
task, activity, process, and value chain |
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a specific unit go work required to create an output |
task |
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a group of tasks needed to create and deliver an intermediate or final output |
activity |
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a group of activities |
process |
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a network of processes |
value chain |
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describes the sequence of all process activities and tasks necessary to create and deliver output or outcome |
process map (flowchart) |
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the beginning or end of a process |
process boundary |
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refers to all value added activities involved in designing, producing, and delivering goods and services to customers |
value stream |
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shows the process flows in a manner similar to an ordinary process map; the difference lies in that this one highlights value added vs non value added activities and includes cost associated with work activities for both value and non value added activities |
value stream map |
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examples of non value added activities |
overproducing, waiting for service or to do work, not doing work correctly the first time, transferring materials between 2 nonadjacent workstations |
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the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed |
reengineering |
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the two basic questions for reengineering |
1. why do we do it? 2. why is it done this way? |
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the fraction of time a workstation or individual is busy over the long run |
utilization |
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the average number of entities completed per unit time from a process is called ______ |
throughput |
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the work activity that effectively limits throughput of the entire process |
bottleneck |
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the average time it takes to complete one cycle of a process |
flow time/cycle time |
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a simple formula that explains the relationship among flow time (T) throughput ® and work in process (WIP) |
Littles Law |
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T or F? in service operations, significant volume increases can and frequently are made without changes in the service process, as would be expected in manufacturing |
TRUE |
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a manufacturing firm that produces a standardized product, not made of discrete parts, with little to no customization, with high demand is most likely to use this type of process |
flow shop |
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during which phase of a product's life cycle does low unit cost become a top competitive priority |
maturity |
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which of the following is not a major activity in designing a goods producing or service producing process? |
utilize reengineering |
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_______ can be one of the most expensive assets of an organization |
inventory |
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inventory management models can be classified as these 2 groups |
dependent demand and independent demand |
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describes the internal demand for parts based on the demand of the final product in which the parts are used |
dependent demand |
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the demand for final products and has a demand pattern affected by trends, seasonal patterns, and general market conditions |
independent demand |
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the primary functions of inventory are to: |
buffer from uncertainty in the marketplace and decouple dependencies in the supply chain (safety stock) |
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the 4 broad categories of inventories |
raw materials, work in process, finished goods, maintenance, repair and operating |
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unprocessed purchase inputs |
raw materials |
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partially processed materials not yet ready for sales |
work in process |
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products ready for shipment |
finished goods |
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materials used in production |
maintenance, repair, and operating |
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directly traceable to unit produced |
direct costs |
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cannot be traced directly to the unit produced |
indirect costs |
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independent of the output quantity |
fixed costs |
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vary with output level |
variable costs |
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direct variable costs for making an order, in manufacturing setup costs are related to machine set ups |
order costs |
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incurred for holding inventory in storage |
holding or carrying costs |
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4 types of inventory carrying costs |
capital, storage space, inventory service, inventory risk |
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opportunity cost associated with investing in inventory, or any asset, over other investment choices, generally the largest component of ICC |
capital |
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minimum rate of return for any investment |
hurdle rate |
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variable costs of moving product in and out of storage |
storage space |
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public space is mostly what kind of cost? |
variable |
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private space is primarily what kind of cost? |
fixed |
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insurance and taxes on stored goods, varies according to the value of goods |
inventory service |
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factors beyond the control of the firm |
inventory risk
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types of inventory risk |
obsolescence, damage, theft, employee pilferage |
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determines which inventories should be counted and managed more closely than others |
ABC inventory control system |
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ABC Classes |
revenue, profit, and volume |
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used to reduce inventory at multiple locations, states that total safety stock can be approximated by multiplying the total inventory by the square root of the number of future facilities divided by the current number of facilities |
square root law |
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successor to the bar code for tracking individual unit of goods, does not require direct line of sight to read a tag and information on the tag is updateable |
radio frequency identification (RFID) |
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to design an inventory control system you need to know 2 things: |
how much to order (EOQ) and when to order (ROP) |
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relaxes the constant price assumption by allowing purchase quantity discounts |
quantity discount model |
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considers the tradeoff between purchasing in large quantity to take advantage of the price discount and issuing fewer orders, against holding higher inventory |
quantity discount model or price break model |
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the lowest inventory level at which a new order must be placed to avoid a stockout, demand and delivery lead time are never certain and require safety stock |
statistical reorder point (ROP) |
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necessary to cover variations in demand or supply |
safety stock |
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the average daily demand during lead time plus the safety stock |
reorder point |
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involves ordering at fixed intervals and varying Q depending upon the remaining stock at the time the order is placed |
fixed order interval approach/ Periodic review |
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refers to the assignment of start and completion times to particular jobs, people, or equipment |
scheduling |
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refers to determining the order in which jobs or tasks are processed |
sequencing |
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attempts to match available personnel with the needs of the organization |
staff scheduling |
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4 decisions for appointment systems |
1. determine the appointment time interval 2. determine the length of each workday and time off duty 3. decide how to handle overbooking 4. develop customer appointment rules that maximize customer satisfaction |
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sequencing criteria (3) |
process-focued performance criteria, customer focused due date criteria, cost based criteria |
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the amount of time a job spent in the shop or factory |
flow time |
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the time needed to process a given set of jobs |
makespan |
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the difference between the completion time and the due date |
lateness |
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the amount of time which the completion time exceeds the due date |
tardiness |
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maximizes resource utilization and minimizes average flow time and work in process inventory |
shortest processing time (SPT) |
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minimizes the maximum job tardiness and lateness |
earliest due date (EDD) |
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FCFS |
first come first serve |
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FNO |
fewest number of operations remaining |
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LWR |
least work remaining- the sum of all processing times for operations not yet performed |
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LWNQ |
least amount of work at the next process queue- amount of work awaiting the next process in a job's sequence |
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useful tools for monitoring schedules, helps track jobs that are behind, on, or ahead of schedulel |
gantt charts |
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decisions regarding the types of parts purchased, suppliers used, and the manufacturing process employed, should be decided in which phase of the supply chain integration model? |
review and establish supply chain strategies |
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a primary goal in supply chain management is to create value for end customers and Tier 1 suppliers. creating value for these members of a supply chain will in turn benefit the partners in between such as manufacturers and distributors that rely heavily on end customers and Tier 1 suppliers to be successful T to F? |
FALSE |
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the phase of the supply chain integration model concerned with identifying the important processes linking each of the supply chain partners is |
align supply chain strategies with key supply chain process objectives |
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which of the following is considered an obstacle to supply chain integration? |
price and discounting which can create a bullwhip effect and lack of supply chain visibility |
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which of the following is a vital element in developing a strong supply chain through the practice of process integration? |
a. partner collaborations that share knowledge management solutions b. developing and implementing a stung information technology system that allows for fast and easy information exchanges c. partnerships that are built on trust d. all the above ITS D!!!!!!!!!!!!
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the ultimate goal of supply chain management is to |
create value for end customers and firms in the supply chain |
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process integration requires: |
training, willing and competent partners, trust, organizational culture change |
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8 key SC processes |
1.customer relationship management 2. customer service management 3. demand management 4. order fulfillment 5. manufacturing and flow management 6. supplier relationship management 7. product development and commercialization 8. returns management
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"i win you lose", using the cheapest suppliers, ignoring customers, assigning few resources to new product and service design |
the silo mentality |
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forecasts and their corresponding orders along the supply chain can become amplified and accumulate, causing: |
the bullwhip effect |
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when demand exceeds availability, supplier provides partial supply to customers who also tend to inflate orders |
rationing |
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when production capacity equals demand, demand then drops, as the buyers try to unload excess inventories |
shortage gaming |
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created this to align an organization's performance measures with its strategic plan and goals |
balanced scorecard |
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BSC consists of 4 perspectives |
financial, internal business process, customer, learning and growth |
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supply chains that are flexible enough to quickly respond to changes in the marketplace are called demand driven supply networks T or F? |
TRUE |
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traditional performance measures include |
cost and revenue |
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supply chain cash to cash cycle time is a performance measure that provides the average number of days between selling the end product to the customer and receiving full payment for the goods. T or F? |
FALSE |
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which of the following supply chain performance metrics measures the average percentage of orders that arrive on time, complete, and damage free? |
perfect order fulfillment |
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the initial step in creating an effective performance measurement system is |
establishing objectives |
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provide managers a way to see real time progress toward organizational milestones and help to ensure that decisions remain in sync with the firms overall strategies |
dashboards |
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what you want, what external people asses you on |
output |
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key internal measures required to deliver output |
in process |
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separates supply chain operations into 5 process categories |
SCOR model |
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5 process categories of the SCOR model |
plan, source, make, deliver, return |
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defines the customer part of the SC as the integration of plan, relate, sell, contract, service, and enable processes |
customer chain operations reference model |
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defines the design portion of the SC as the integration of plan, research, design, integrate, amend, and enable processes |
design chain operations reference model |
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why are supply chains more global than ever? |
competitive advantage |
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two components of risk: |
1. potential losses 2. probability or likelihood of an event leading to those losses |
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the expected outcome of an uncertain event |
risk |
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risk = |
probability X consequences |
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supplier failure, inbound product quality, transit time variability, supplier opportunism |
supply risk |
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demand variability, forecast errors, competitor moves |
demand risk |
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inventory ownership, asset and tools ownership, product quality and safety |
operational risk |
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currency, sercurity |
other risk |
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most significant SC Risk |
1. quality problems 2. long supply chain- increased inventory 3. natural disasters
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SC risk of least concern |
1. terrorism and piracy 2. customs delays |
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top SC risk mitigation strategies |
1. world class supplier capability 2. working to reduce SC time (cycle time) 3. visibility tools |
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the most popular technique for SC risk mitigation is |
failure mode and effect analysis (FMEA) |
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looks at seriousness, probability of occurrence, and probability to detect defect |
FMEA |
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supply chains are _____________ _______________ to disruption due to macro trends and supply chain design |
increasingly vulnerable |
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the costs of disruption are |
significant and long term |
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supply chain risk management can be used to |
identify sources of risk, prioritize identified risks, develop mitigation strategies to reduce, transfer, and or avoid risk |
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this is a core element of supply chain risk mitigation |
visibility |
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these are the key to early discovery |
predictive measures |
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this is needed but difficult to perform |
SC risk management |
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you are done |
:) |