APICS Updated CSCP Exam Questions and Answers by nour

When supply continuity is threatened due to heavy dependence on international suppliers, the most appropriate action is to conduct a risk assessment. This involves systematically identifying potential risks, evaluating their impact, and developing strategies to mitigate them. The risk assessment provides a comprehensive understanding of vulnerabilities and helps in making informed decisions on sourcing strategies, inventory management, and logistics.

• Sourcing from domestic suppliers may reduce some risks but might not be feasible or cost-effective without a thorough assessment.
• Carrying additional safety stock is a mitigation strategy but does not address the root cause of supply risk.
• Spreading logistics across multiple carriers can help manage transportation risks but does not cover the broader supply chain risks.

References:

• Christopher, M. (2011). "Logistics & Supply Chain Management."
• Waters, D. (2011). "Supply Chain Risk Management: Vulnerability and Resilience in Logistics."

• Demand Forecasting: This involves predicting future customer demand using historical data and market analysis.
• Impact of Promotions: Understanding how promotional activities like discounts and rebates affect demand is crucial for accurate forecasting.
• Demand Shaping: The process of adjusting and influencing customer demand through strategies such as promotions, discounts, and rebates is known as demand shaping. It involves proactively managing demand to align with supply chain capabilities and strategic goals.
• Purpose of Demand Shaping: This helps companies manage inventory, optimize production schedules, and improve customer satisfaction by aligning supply with anticipated demand.

References:

• Chopra, S., & Meindl, P. (2016). Supply Chain Management: Strategy, Planning, and Operation. Pearson.
• Fisher, M., & Raman, A. (1996). Reducing the Cost of Demand Uncertainty through Accurate Response to Early Sales. Operations Research, 44(1), 87-99.

When the number of warehouses increases, transportation costs between manufacturing facilities and warehouses are likely to increase. This is because each additional warehouse introduces new destinations for shipments, leading to more frequent and smaller shipments from manufacturing facilities to each warehouse. This fragmentation of shipments generally increases the total transportation costs, as larger shipments are typically more cost-effective due to economies of scale. Additionally, managing a larger number of shipping routes can add complexity and logistical costs.References:

• "Logistics and Supply Chain Management" by Martin Christopher
• "Designing and Managing the Supply Chain" by David Simchi-Levi, Philip Kaminsky, and Edith Simchi-Levi

• Supply Chain Risk: The total supply chain risk refers to the likelihood of disruptions and the potential impact those disruptions can have on the supply chain's ability to function effectively.
• Reducing Supplier Base: When a company reduces the number of suppliers for commodity-type components, it becomes more dependent on a few suppliers. This increases vulnerability because any disruption at one of these suppliers (e.g., financial instability, natural disasters, or quality issues) can have a significant impact on the company's operations.
• Comparative Analysis:
• Conclusion: Reducing the supplier base for commodities is most likely to increase total supply chain risk due to increased dependence on fewer suppliers, leading to higher exposure to supply disruptions.

References:

• Chopra, S., & Sodhi, M. S. (2004). Managing Risk to Avoid Supply-Chain Breakdown. MIT Sloan Management Review, 46(1), 53-61.
• Monczka, R. M., Handfield, R. B., Giunipero, L. C., & Patterson, J. L. (2016). Purchasing and Supply Chain Management. Cengage Learning.