Logistics Questions & Answers

This week’s questions are:

1. How does lowest TCO differ from lowest purchase price? Can you think of an example where a manager may choose to buy based on lowest purchase price instead of lowest TCO? Explain.

2. Explain how logistics performance is crucial to JIT. What supply chain and logistics factors would you consider before deciding whether to implement JIT?

3. Why would a company’s cost of manufacturing and procurement tend to increase as the firm changes from an MTP to an MTO strategy? Why would inventory costs tend to decrease?

4. Many people think of lean systems as being incompatible with mass customization and flexible manufacturing. Why does the textbook say this is incorrect? Do you agree or disagree? Explain.

5. You read in Chapter 5 about the Levi Strauss decision to drop its program for mass customization. You also read about mass customization strategies at M&M, BMW, and Reebok. Why do you think Levi Strauss eventually dropped their program? What are the key success factors for the firms that are still pursuing mass customization?

6.Describe the S&OP process. What are the major trade-offs that must be considered?

7. Describe the major components of an advanced planning and scheduling system. What are the major challenges in implementing such a system?

8. Read the attached (see above) brief article, “The Achilles’ Heel of Supply Chain Management”. Does the textbook address this issue when describing integrated operations planning (IOP)? Does the article cause you to think differently about IOP? Explain.