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Supply Chain Strategy Flashcards

7 cards from real CPIM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Supply Chain Strategy flashcards as text

  1. In supply chain strategy, a 'decoupling point' separates:

    Answer: Forecast-driven upstream activities from demand-driven downstream activities

    The decoupling point is where inventory buffers demand uncertainty, with upstream operations driven by forecasts and downstream by actual orders.

  2. A company adopts a hub-and-spoke distribution network. What is the primary advantage of this design?

    Answer: Consolidation of freight to reduce transportation costs

    Hub-and-spoke networks consolidate shipments through central hubs, enabling full truckload shipments that reduce per-unit transportation costs.

  3. Which supply chain risk management strategy involves holding duplicate inventory at multiple locations?

    Answer: Risk hedging

    Risk hedging uses redundant inventory or capacity buffers across multiple locations to absorb supply or demand shocks.

  4. Strategic sourcing differs from traditional purchasing primarily in that it:

    Answer: Takes a long-term, holistic view of supplier relationships and total value

    Strategic sourcing evaluates suppliers on total value—quality, innovation, reliability, and cost—and builds collaborative long-term relationships.

  5. The primary purpose of Sales and Operations Planning (S&OP) in supply chain strategy is to:

    Answer: Align supply capacity plans with demand plans across functional teams

    S&OP aligns sales, operations, finance, and supply chain into a single integrated plan to balance supply and demand at the aggregate level.

  6. Which of the following best describes 'supply chain resilience'?

    Answer: The capacity to anticipate, absorb, and recover from supply chain disruptions

    Resilience encompasses proactive preparedness, the ability to withstand disruptions, and the speed of recovery to normal operations.

  7. A firm uses a 'postponement' strategy by shipping unfinished products to regional distribution centers for final assembly. This is called:

    Answer: Form postponement

    Form postponement delays the physical transformation (assembly, configuration) of products until demand signals are clearer, reducing premature differentiation.