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Chapter17InformationTechnologyandtheSupplyChainTrue/FalseInformationiscrucialtotheperformanceofasupplychainbecauseitprovidesthebasisuponwhichsupplychainmanagersmakedecisions.Answer:TrueDifficulty:EasyInformationisthesupplychaindriverthatservesastheglueallowingtheotherthreedriverstoworktogethertocreateanintegrated,coordinatedsupplychain.Answer:TrueDifficulty:ModerateInformationmakesthesupplychainvisibletoamanagersothathecanmakedecisionstoimprovethesupplychain’sperformance.Answer:TrueDifficulty:ModerateInformationisnotnecessaryformanagementtomakedecisionsoverabroadscopethatcrossesbothfunctionsandcompanies.Answer:TrueDifficulty:EasyInformationmustbe100percentcorrectinordertomakegooddecisions.Answer:FalseDifficulty:ModerateTomakegooddecisions,amanagerneedstohaveaccurateinformationregardlessofhowlongittakestoacquireit.Answer:FalseDifficulty:HardOftencompanieswillhavelargeamountsofdatathatarenothelpfulwithdecisionmaking.Answer:TrueDifficulty:ModerateInformationisonlyakeyingredientateachstageofthesupplychain,notwithineachphaseofsupplychaindecisionmaking.Answer:FalseDifficulty:ModerateThedriverofITinthesupplychainhasincreasinglybeentheenterprisesoftwaredevelopedtoenableprocessesbothwithinandacrosscompanies.Answer:TrueDifficulty:ModerateTheunsuccessfulcategoriesofsoftwarewillbethosefocusedonthesupplychainmacroprocesses.Answer:FalseDifficulty:EasyThisbroadeningofscopeacrosswhichcompaniesmakedecisionsemphasizestheimportanceofincludingprocessesallalongthesupplychainwhenmakingdecisions.Answer:TrueDifficulty:ModerateToincreasethesupplychainsurplus(andthereforetheirfirm’sownprofitability)mosteffectively,firmsmustfocusprimarilyonimprovinginternalprocesses.Answer:FalseDifficulty:ModerateFunctionalperformanceisimportanttocustomersbecauseitprovidesthemwithcapabilitiestocreateacompetitiveadvantage.Answer:TrueDifficulty:ModerateTheabilitytointegrateisimportanttoacustomerbecauseapplicationsthatareeasytointegratearegenerallyhardertogetimplementedandproducingvalue.Answer:FalseDifficulty:ModerateFirmsthatworkwellwithimplementationpartnersandbuilduplargegroupsofcustomerstrainedontheirsolutionshavebuiltahighlydefensibleposition.Answer:TrueDifficulty:ModerateThegoaloftheCRMmacroprocessistonegotiateaneffectivecontractthatestablishesparametersforasupplierinawaythatbestmeetsenterpriseneeds.Answer:FalseDifficulty:HardWeaknessintheCRMprocessresultsindemandbeinglostandapoorcustomerexperiencebecauseordersarenotprocessedandexecutedeffectively.Answer:TrueDifficulty:EasyCRMprocessesarecrucialtothesupplychainbecauseofthelackofinteractionbetweenanenterpriseanditscustomers.Answer:FalseDifficulty:ModerateThecustomermustbethestartingpointwhentryingtoincreasethesupplychainsurplusbecausealldemand,andthereforerevenue,ultimatelyarisesfromthem.Answer:TrueDifficulty:ModerateWhenforecastingdemand,ISCMinteractionwithSRMisessentialastheSRMapplicationshavethemostdataandinsightoncustomerbehavior.Answer:FalseDifficulty:EasyTheISCMprocessesshouldhavestrongintegrationwiththeSRMmacroprocess,becausesupplyplanning,fulfillment,andfieldservicearealldependentonsuppliersandthereforetheSRMprocesses.Answer:TrueDifficulty:ModerateEveryindustryhasthesamekeysuccessfactors.Answer:FalseDifficulty:EasySomeoftheworstITdisastersareduetothefactthatcompaniestrytoimplementITsystemsinawidevarietyofprocessesatthesametime.Answer:TrueDifficulty:EasyCompaniesshoulduseITsystemstomakedecisions,becausethesoftwareavailabletodaycanmakemanysupplychaindecisionsformanagement.Answer:FalseDifficulty:EasyMultipleChoiceInformationtechnology(IT)consistsofthetoolsusedtogainawarenessofinformation.toanalyzeinformation.toactoninformationtoimprovetheperformanceofthesupplychain.alloftheabovebandconlyAnswer:eDifficulty:EasyInformationisthesupplychaindriverthatservesastheglueallowingtheotherthreedriverstoworktogethertocreateanintegrated,coordinatedsupplychain.crucialtosupplychainperformance.thekeytothesuccessofasupplychain.alloftheaboveaandconlyAnswer:dDifficulty:EasyInformationprovidesthefoundationonwhichsupplychainprocessesexecutetransactionsandmanagersmakedecisions.makesthesupplychainvisibletoamanager.enablesmanagementtomakedecisionsoverabroadscopethatcrossesbothfunctionsandcompanies.alloftheabovebandconlyAnswer:dDifficulty:ModerateInformationTechnology(IT)consistsofthehardwareandsoftwarethroughoutasupplychainthatgather,analyze,andactoninformation.servesastheeyesandears(andsometimesaportionofthebrain)ofmanagementinasupplychain.canhaveasignificantimpactonafirm’sperformance.alloftheaboveaandbonlyAnswer:dDifficulty:ModerateWhichofthefollowingisnotacharacteristicinformationmusthavetobeusefulwhenmakingsupplychaindecisions?Informationmustbeaccurate.Informationmustbeaccessibleinatimelymanner.Informationmustbeinteresting.Informationmustbeoftherightkind.Alloftheaboveareusefulcharacteristics.Answer:cDifficulty:ModerateTobeaccurate,informationmustgivethetruepictureofthestateofthesupplychain.be100percentcorrect.paintapictureofrealitythatisatleastdirectionallycorrect.alloftheaboveaandconlyAnswer:eDifficulty:ModerateTobeaccessibleinatimelymanner,informationmustbeoutofdate.current.easilyaccessible.alloftheabovebandconlyAnswer:eDifficulty:ModerateTobeoftherightkind,informationneedstobeuseful.irrelevant.meaningless.alloftheabovebandconlyAnswer:aDifficulty:ModerateInformationisakeyingredientateachstageofthesupplychain.withineachphaseofsupplychaindecisionmaking.onlyateachstageofthesupplychain.noneoftheaboveaandbonlyAnswer:eDifficulty:ModerateEnterprisesoftwarecollectstransactiondata.analyzestransactiondatatomakedecisions.executesdecisionsbothwithinanenterpriseandacrossitssupplychain.alloftheaboveaandbonlyAnswer:bDifficulty:ModerateThesuccessfulcategoriesofsoftwareintheevolutiontakingplaceinenterprisesoftwarewillbethosefocusedonthesupplychainmacroprocesses.thosenotfocusedonthesupplychainmacroprocesses.thosefocusedonbasicfunctions.noneoftheabovebothaandcAnswer:bDifficulty:ModerateTheemergenceofsupplychainmanagementhasbroadenedthescopeacrosswhichcompaniesmakedecisionstothesupplier.theenterprise.theentiresupplychain.thecustomer.noneoftheaboveAnswer:cDifficulty:EasyWhichofthefollowingisnotoneofthesupplychainmacroprocesses?CustomerRelationshipManagement(CRM)InternalSupplyChainManagement(ISCM)SupplierRelationshipManagement(SRM)TransactionManagementFoundation(TMF)Alloftheabovearesupplychainmacroprocesses.Answer:cDifficulty:EasyProcessesthatfocusondownstreaminteractionsbetweentheenterpriseanditscustomersareincludedinCustomerRelationshipManagement(CRM).InternalSupplyChainManagement(ISCM).SupplierRelationshipManagement(SRM).TransactionManagementFoundation(TMF).noneoftheaboveAnswer:aDifficulty:EasyProcessesthatfocusoninternaloperationswithintheenterpriseareconsideredCustomerRelationshipManagement(CRM).InternalSupplyChainManagement(ISCM).SupplierRelationshipManagement(SRM).TransactionManagementFoundation(TMF).noneoftheaboveAnswer:bDifficulty:EasyProcessesthatfocusonupstreaminteractionsbetweentheenterpriseanditssuppliersarepartofCustomerRelationshipManagement(CRM).InternalSupplyChainManagement(ISCM).SupplierRelationshipManagement(SRM).TransactionManagementFoundation(TMF).noneoftheaboveAnswer:cDifficulty:EasySoftwarethatprovidesthefoundationuponwhichthemacroprocessesrestthroughbasicERPsystems,infrastructuresoftware,andintegrationsoftwareisCustomerRelationshipManagement(CRM).InternalSupplyChainManagement(ISCM).SupplierRelationshipManagement(SRM).TransactionManagementFoundation(TMF).noneoftheaboveAnswer:dDifficulty:EasyToincreasethesupplychainsurplus(andthereforetheirfirm’sownprofitability)mosteffectively,firmsmustexpandtheirscopebeyondtheirenterprise.focusprimarilyonimprovinginternalprocesses.thinkintermsofallthreesupplychainmacroprocesses.alloftheaboveaandconlyAnswer:dDifficulty:ModerateWhichofthefollowingisnotafactordeterminingthesuccessofsoftwarefirmsfocusedonamacroprocess?functionalperformancecolorandimagesonworkingscreensintegrationwithothermacroprocessesstrengthofthesoftwarefirm’secosystemnoneoftheaboveAnswer:bDifficulty:ModerateFunctionalperformanceisimportanttocustomersbecauseadvancedfunctionalityisrarelyutilized.itprovidesthemwithcapabilitiestocreateacompetitiveadvantage.theeaseofuseiscrucialtosuccessfuluse.alloftheabovebandconlyAnswer:eDifficulty:ModerateTheabilitytointegrateisimportanttoacustomerbecauseapplicationsthatareeasytointegratearegenerallyeasiertogetimplementedandproducingvalue.applicationsthatintegrateacrossmacroprocesseswillbeabletoprovidethebenefitsofmakingdecisionsfortheextendedsupplychain.firmsthatdonothaveintegratedsolutionsinallthreemacroprocesseshaveacompetitiveadvantage.bothaandbbothaandcAnswer:dDifficulty:ModerateAfirm’secosystemisthenetworkofsoftwarepartnersand,moreimportantly,systemsintegratorsandinstalledvidesassistanceinsellingandimplementingsoftware.willdeterminehowstrongthenetworkwillbethatprovidessupporttoacustomerbothduringimplementationanddowntheroad.alloftheaboveaandconly Answer:dDifficulty:ModerateThegoaloftheCRMmacroprocessistonegotiateaneffectivecontractthatbestmeetsenterpriseneeds.improvethedesignofproducts.fulfilldemandgeneratedbyISCMprocesses.generatecustomerdemandandfacilitatetransmissionandtrackingoforders.noneoftheaboveAnswer:dDifficulty:ModerateWeaknessintheCRMprocessresultsinordersthatarenotprocessedandexecutedeffectively.demandbeinglost.apoorcustomerexperience.alloftheaboveaandbonlyAnswer:dDifficulty:EasyWhichofthefollowingisakeyprocessunderCRM?StrategicPlanningFulfillmentFieldServiceDemandPlanningOrderManagementAnswer:eDifficulty:ModerateWhichofthefollowingisnotakeyprocessunderCRM?MarketDemandPlanningOrderManagementSellCallAnswer:bDifficulty:HardTheCRMprocessesarecrucialtothesupplychainbecausealldemand,andthereforerevenue,ultimatelyarisesfromthecustomer.CRMprocesses(andalsoCRMsoftware)mustbeintegratedwithinternaloperationstooptimizeperformance.customer-focusedunitsshouldbeworkingindependentlyfrominternaloperations.alloftheaboveaandbonlyAnswer:cDifficulty:ModerateThecustomermustbethestartingpointwhentryingtoincreasethesupplychainsurplusbecausecustomer-focusedunitsaremoreeffectivewhenworkingindependently.alldemand,andthereforerevenue,ultimatelyarisesfromernaloperationscannotoptimizeperformance.alloftheaboveaandconlyAnswer:bDifficulty:HardWhichofthefollowingisakeyprocessunderISCM?DesignCollaborationNegotiateSupplyCollaborationSupplyPlanningOrderManagementAnswer:dDifficulty:ModerateWhichofthefollowingisnotakeyprocessunderISCM?StrategicPlanningFulfillmentSupplyCollaborationDemandPlanningFieldServiceAnswer:cDifficulty:ModerateThereneedstobestrongintegrationbetweentheISCMandCRMmacroprocessesbecausetheISCMmacroprocessaimstofulfilldemandthatisgeneratedbyCRMprocesses.CRMapplicationshavethemostdataandinsightoncustomerbehaviortobeusedinforecasting.fulfillmentandfieldservicearealldependentonsuppliers.alloftheaboveaandbonlyAnswer:eDifficulty:ModerateTheISCMprocessesshouldhavestrongintegrationwiththeSRMmacroprocessbecauseSRMapplicationshavethemostdataandinsightoncustomerbehaviortobeusedinforecasting.supplyplanning,fulfillment,andfieldservicearealldependentonsuppliers.ordermanagementmustintegratecloselywithfulfillmentandbeaninputforeffectivedemandplanning.alloftheaboveaandbonlyAnswer:bDifficulty:ModerateWhichofthefollowingisamajorSRMprocess?StrategicPlanningOrderManagementDesignCollaborationSupplyPlanningFulfillmentAnswer:cDifficulty:ModerateWhichofthefollowingisnotamajorSRMprocess?SupplyPlanningBuyDesignCollaborationSourceNegotiateAnswer:aDifficulty:HardERPsystemswerefocusedonbuildingtransactionmanagementandprocessautomationvedtobethefoundationforfuturedecisionsupportapplications.excelledattheautomationofsimpletransactionsandprocessesaswellasthecreationofanintegratedwaytostoreandview.alloftheabovebandconlyAnswer:dDifficulty:ModerateSelectanITsystemthataddressesthecompany’skeysuccessfactorsbecauseeveryindustryhasthesamekeysuccessfactors.ITsystemsneedtogiveacompanyanadvantageintheareasmostcrucialtothesuccessofthebusiness.theseelementsdonotdeterminewhetherornotacompanyisgoingtobesuccessful.alloftheaboveaandbonlyAnswer:bDifficulty:ModerateTakeincrementalstepsandmeasurevaluebecausesomeoftheworstITdisastersareduetothefactthatcompaniestrytoimplementITsystemsinawidevarietyofprocessesatthesamepaniesshouldnottakeabigpictureperspective.thebigpictureperspectiveshouldbeimplementedindigestiblepieces.alloftheaboveaandconlyAnswer:eDifficulty:ModerateAlignthelevelofsophisticationwiththeneedforsophisticationbecausethereisatrade-offbetweentheeaseofimplementingasystemandthesystem’slevelofcomplexity.erringonthelesssophisticatedsideleavesthefirmwithacompetitiveweakness.tryingtobetoosophisticatedleadstoahigherpossibilityoftheentiresystemfailing.alloftheaboveaandbonlyAnswer:dDifficulty:ModerateUseITsystemstosupportdecisionmaking,nottomakedecisionsbecausethesoftwareavailabletodaycanmakemanysupplychaindecisionsforpaniesneedtomaintaintheamountofmanagerialefforttheyspendonsupplychainissues.managementneedstobeabletomakeadjustmentsinthesupplychainbecausethecompetitiveandcustomerlandscapechanges.alloftheabovebandconlyAnswer:cDifficulty:ModerateCompaniesneedtothinkaboutthefuturebecausetrendsinacompany’sindustryregardinginsignificantcharacteristicscouldbecomecrucialinthefuture.managersneedtoexplorehowflexiblethesystemswillbewhenchangesarerequiredinthefuture.ITsystemsoftenlastformanymoreyearsthanoriginallyplanned.alloftheabovebandconlyAnswer:dDifficulty:ModerateEssay/ProblemsExplaintheroleofinformationinthesupplychain.Answer:Informationiscrucialtotheperformanceofasupplychainbecauseitprovidesthebasisuponwhichsupplychainmanagersmakedecisions.Informationisthesupplychaindriverthatservesastheglueallowingtheotherthreedriverstoworktogethertocreateanintegrated,coordinatedsupplychain.Informationiscrucialtosupplychainperformancebecauseitprovidesthefoundationonwhichsupplychainprocessesexecutetransactionsandmanagersmakedecisions.Therefore,informationmakesthesupplychainvisibletoamanager.Withthisvisibility,amanagercanmakedecisionstoimprovethesupplychain’sperformance.Inmanyways,informationisthemostimportantofthefoursupplychaindriversbecausewithoutit,noneoftheotherdriverscanbeusedtodeliverahighlevelofperformance.Informationisthekeytothesuccessofasupplychainbecauseitenablesmanagementtomakedecisionsoverabroadscopethatcrossesbothfunctionsandcompanies.Successfulsupplychainstrategyresultsfromviewingthesupplychainasawhole,ratherthanlookingonlyattheindividualstages.Bytakingaglobalscopeacrosstheentiresupplychain,amanagerisabletocraftstrategiesthattakeintoaccountallfactorsthataffectthesupplychain,ratherthanjustthosefactorsaffectingaparticularstageorfunctionwithinthesupplychain.Takingtheentirechainintoaccountmaximizestheprofitofthetotalsupplychain,whichthenleadstohigherprofitsforeachindividualcompanywithinthesupplychain.Difficulty:HardExplaintheroleofinformationtechnologyinthesupplychain.Answer:Informationiscrucialtotheperformanceofasupplychainbecauseitprovidesthebasisuponwhichsupplychainmanagersmakedecisions.Informationtechnology(IT)consistsofthetoolsusedtogainawarenessofinformation,analyzethisinformation,andactonittoimprovetheperformanceofthesupplychain.Informationiscrucialtosupplychainperformancebecauseitprovidesthefoundationonwhichsupplychainprocessesexecutetransactionsandmanagersmakedecisions.Giventheroleofinformationinasupplychain’ssuccess,managersmustunderstandhowinformationisgatheredandanalyzed.ThisiswhereITcomesintoplay.ITconsistsofthehardwareandsoftwarethroughoutasupplychainthatgather,analyze,andactoninformation.ITservesastheeyesandears(andsometimesaportionofthebrain)ofmanagementinasupplychain,capturingandanalyzingtheinformationnecessarytomakeagooddecision.UsingITsystemstocaptureandanalyzeinformationcanhaveasignificantimpactonafirm’sperformance.Difficulty:ModerateExplainthecharacteristicsinformationmusthavetobeusefulfordecisionmakinginasupplychain.Answer:Informationmusthavethefollowingcharacteristicstobeusefulwhenmakingsupplychaindecisions:1.Informationmustbeaccurate.Withoutinformationthatgivesthetruepictureofthestateofthesupplychain,itisverydifficulttomakegooddecisions.Thatisnottosayallinformationmustbe100percentcorrectbutratherthatthedataavailablepaintapictureofrealitythatisatleastdirectionallycorrect.2.Informationmustbeaccessibleinatimelymanner.Oftenaccurateinformationexists,butbythetimeitisavailable,itiseitheroutofdateorifitiscurrent,itisnotinanaccessibleform.Tomakegooddecisions,amanagerneedstohaveup-to-dateinformationthatiseasilyaccessible.3.Informationmustbeoftherightkind.Decisionmakersneedinformationthattheycanuse.Oftencompanieswillhavelargeamountsofdatathatarenothelpfulwithdecisionmaking.Companiesmustthinkaboutwhatinformationshouldberecordedsothatvaluableresourcesarenotwastedcollectingmeaninglessdatawhileimportantdatagoesunrecorded.Whenmanagershavegoodinformation,theyhavesupplychainvisibility,enablingthemtotakeaglobalscope.Withthisglobalscope,theyareabletomakethebestdecisionsforthesupplychain.Therefore,informationisakeytosupplychainsuccess.Difficulty:ModerateDescribethefactorsthatdeterminethesuccessoffirmsinvolvedinthesoftwareindustry.Answer:Amongsoftwarefirmsfocusedonamacroprocess,thefollowingthreefactorsdeterminetheirsuccess:1.Functionalperformance2.Integrationwithothermacroprocesses3.Strengthofthesoftwarefirm’secosystemFunctionalperformanceisimportanttocustomersbecauseitprovidesthemwithcapabilitiestocreateacompetitiveadvantage.Inadditiontorawfunctionalperformance(qualitiessuchastheabilitytooptimizebothpriceandsupplyinanintegratedfashion),theeaseofuseiscrucialtosuccessinthiscategory.Somesoftwarehasveryadvancedfunctionalitybutisverydifficulttouse.Asaresult,theadvancedfunctionalityisrarelyutilized.Softwarefirmswithlowerlevelsoffunctionalitybutwithhigheaseofusecan,inessence,providemore“usable”functionalitytotheircustomersandthereforegainanedge.Theabilitytointegrateisimportanttoacustomerforavarietyofreasons.Applicationsthatareeasytointegratearegenerallyeasiertogetimplementedandproducingvalue.Integrationisalsocrucialacrossdifferentmacroprocesses.Applicationsthatintegrateacrossmacroprocesseswillbeabletoprovidethebenefitsofmakingdecisionsfortheextendedsupplychain.Thisgivesanedgetofirmsthatofferafulllineofintegratedsolutionsinallthreemacroprocesses.Finally,afirm’secosystem-thenetworkofsoftwarepartnersand,moreimportantly,systemsintegratorsandinstalledbase-providesassistanceinsellingandimplementingsoftware.Firmsthatworkwellwithimplementationpartnersandbuilduplargegroupsofcustomerstrainedontheirsolutionshavebuiltahighlydefensibleposition.Foranotherfirmtocapturethisbusinessrequiresthattheybesofarsuperiorthatitisworththeretrainingandreintegrationeffort,whichisoftenquitesignificant.Foracustomer,astrongecosystemmeansastrongnetworktoprovidesupportbothduringimplementationanddowntheroad.Thesecriteriaarealsoimportantforcustomersofsupplychainsoftware.Thesecriteriaarethekeytosuccessforsoftwarecompaniespreciselybecausetheyimprovesupplychainperformanceforfirms.Thus,companiesshouldevaluatesoftwareprovidersalongtheselinestodeterminetheirchoiceofsoftwarevendor.Difficulty:ModerateDiscusshowthethreesupplychainmacroprocessesinterfaceinordertobesuccessful.Answer:ThegoaloftheCRMmacroprocessistogeneratecustomerdemandandfacilitatetransmissionandtrackingoforders.Weaknessinthisprocessresultsindemandbeinglostandapoorcustomerexperiencebec

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