APICS Supply Planning 3 — Questions and Answers
Question 1: Which supply planning concept involves grouping individual items with similar supply characteristics to simplify planning and reduce system complexity?
- ABC classification
- Product family aggregation (Correct answer)
- Kanban grouping
- Hedge inventory pooling
Correct answer: Product family aggregation
Product family aggregation combines items with similar production processes, lead times, or supply sources so they can be planned together at a higher level.
Question 2: A planner is evaluating two supply options: Option A has lower unit cost but 12-week lead time; Option B has higher unit cost but 2-week lead time. The primary supply planning trade-off being evaluated is:
- Quality versus delivery reliability
- Total cost of ownership versus supply chain agility (Correct answer)
- Supplier capacity versus demand variability
- Batch size versus setup frequency
Correct answer: Total cost of ownership versus supply chain agility
This decision balances total cost (unit price plus inventory carrying cost from longer lead time) against supply chain responsiveness and flexibility.
Question 3: In a make-to-stock environment, what is the primary purpose of the production plan at the aggregate level?
- To schedule individual work center loading
- To set overall output rates that balance workforce and inventory levels against anticipated demand (Correct answer)
- To calculate material requirements for purchased components
- To determine customer delivery dates
Correct answer: To set overall output rates that balance workforce and inventory levels against anticipated demand
Aggregate production planning establishes resource output rates in families or groups to balance supply capacity against aggregate demand while managing inventory and workforce.
Question 4: Which MRP input file contains information about the quantity of each component required to build one unit of a parent item?
- Item master file
- Bill of materials (BOM) (Correct answer)
- Inventory status record
- Routing file
Correct answer: Bill of materials (BOM)
The bill of materials defines the parent-component relationships and the quantity per (QPA) of each component needed to produce one unit of the parent.
Question 5: A supply planner is concerned about single-source dependency for a critical component. Which risk mitigation strategy would be most appropriate?
- Increasing safety stock for that component only
- Qualifying an alternate supplier and dual-sourcing the component (Correct answer)
- Switching to a make-to-order strategy for the finished good
- Reducing the product's BOM complexity
Correct answer: Qualifying an alternate supplier and dual-sourcing the component
Dual-sourcing by qualifying an alternate supplier directly eliminates the single-source dependency and reduces supply disruption risk.
Question 6: In supply planning, 'cumulative lead time' refers to:
- The total time for a supplier to deliver an order after receipt of a purchase order
- The longest total elapsed time from raw material procurement through finished goods completion (Correct answer)
- The average lead time across all components in a bill of materials
- The time between placing and receiving a replenishment order
Correct answer: The longest total elapsed time from raw material procurement through finished goods completion
Cumulative lead time is the critical path through the entire supply chain from the earliest raw material purchase to the finished product, defining the minimum planning horizon.
Question 7: Which of the following best describes the role of safety lead time in an MRP system?
- It extends supplier payment terms to allow buffer time
- It artificially inflates lead time to trigger planned orders earlier, providing a time buffer against late deliveries (Correct answer)
- It reduces the planning horizon to simplify calculations
- It pads demand forecasts to ensure adequate supply
Correct answer: It artificially inflates lead time to trigger planned orders earlier, providing a time buffer against late deliveries
Safety lead time adds extra days to a component's lead time so MRP generates purchase orders earlier, building in a buffer against supplier lateness.
APICS Supply Planning 3
Which supply planning concept involves grouping individual items with similar supply characteristics to simplify planning and reduce system complexity?