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Quiz Session - Attempts With Random Questions

APICS CPIM Exam Questions

Page 1 of 80

1.

Which of the following are the two activity types of a value chain?

  • Primary and support

  • Initial and secondary

  • First and second

  • Primary and cursory

Correct answer: Primary and support

Value chains consist of primary and support activities. Primary activities create value and include purchasing, manufacturing, and distribution. Support activities enable primary activities. Secondary activities include information technology, human resources, and financials.

2.

What is the purpose of supplier metrics?

  • To increase perfect order rates and decrease manufacturing lead times

  • To reduce the total number of suppliers for a firm

  • To inhibit communication between customers and suppliers

  • To limit creative ideas between collaborative partners

Correct answer: To increase perfect order rates and decrease manufacturing lead times

At a strategic level, measuring supplier performance will tend to increase perfect order rates by ensuring suppliers are capable of delivering as committed. With a high degree of perfect orders delivered from suppliers, the organization's manufacturing lead times can be reduced from better planning. 

Reducing the total number of suppliers may make sense if there are too many, and volumes cannot be leveraged for better pricing and delivery terms. 

Seeking to inhibit communication between customer and supplier will hinder the overall relationship and supplier performance. 

Limiting creative ideas between partners may make sense when dealing with focused factory operations. Otherwise, it is detrimental.

3.

When measuring process variability and quality, how can Design of Experiments (DOE) help?

  • Ensures test input and output variables can be linked and used to improve performance

  • Ensures the customer design requirements are built into the production process

  • Defines and tracks process performance against upper and lower control limits

  • Measures acceptable variation from a standard using deviations

Correct answer: Ensures test input and output variables can be linked and used to improve performance

The ASCM Supply Chain Dictionary defines Design of Experiments (DOE) as "a quality management technique used to evaluate the effect of carefully planned and controlled changes to input process variables on the output variables. The objective is to improve production processes." DOE is broadly used in product and engineering design as well as process improvement using sophisticated mathematical techniques to identify ideal process conditions given several input variables.

Ensuring the customer design requirements are built into the production process is a form of Quality Function Deployment (QFD). 

Defining and tracking process performance against upper and lower control limits is Statistical Process Control (SPC). 

Measuring acceptable variation from a standard using deviations is related to Six Sigma.

4.

A company uses an Assemble-to-Order (ATO) manufacturing environment designing and building standard product components that, when assembled, can create a wide variety of end products. This product development system is called:

  • Configuration management

  • Participative design

  • Package-to-order

  • Product life cycle

Correct answer: Configuration management

The ASCM Supply Chain Dictionary defines a configuration management system as "formal procedures to identify and document the physical characteristics of a product or project, control changes, and support an audit to verify conformance." An example of configuration management are product specifications, where extra features can be frequently added to a product, and new specifications from these features that need to be carefully managed.

Participative design is a concept of getting multiple functions/departments within a company involved in the design process. 

Package-to-order is a manufacturing environment where product is packaged after receipt of the customer order. Different packaging could result in different products. 

Product life cycle is the progression a product goes through from market introduction to end-of-life.

5.

When using ABC inventory control, relative importance is used to categorize parts. Which of the following is NOT a criteria for determining part relative importance?

  • Variable contribution

  • Shelf life

  • Replenishment lead time

  • Inventory turns

Correct answer: Variable contribution

Variable contribution is a financial metric important to measuring profitability but is not used in ABC inventory control.

When using ABC inventory control, A items typically include parts with high annual dollar usage or parts with high relative importance. High relative importance could include parts with a short shelf life that may expire before used, parts with longer than normal replenishment lead times from suppliers, or production and parts with high turnover (high usage).

6.

Which of the following is NOT a lean continuous improvement tool?

  • DMAIC

  • Kaizen

  • Poka-yoke

  • 5S

Correct answer: DMAIC

DMAIC, or Define, Measure, Analyze, Improve, and Control, is a part of the Six Sigma improvement methodology and is not a lean continuous improvement tool.

Lean continuous improvement tools include poka-yoke, 5S, kaizen events, Hoshin planning, and value stream mapping.

7.

When a company has taken on total employee involvement, what is the supervisor's PRIMARY responsibility?

  • Coaching

  • Controlling

  • Mitigating

  • Consoling

Correct answer: Coaching

Total employee involvement focuses on employee participation in the management's decision-making process. Coaching is the primary role of supervision in this environment, as employees are encouraged to make smart business decisions without being told precisely what to do.

Controlling, mitigating, and consoling are not actions requested of managers in a total employee involvement company.

8.

The material in queue for a bottleneck operation to keep a constraint from being starved is known as which of the following?

  • Buffer

  • Rope

  • Drum

  • Work-in-process

Correct answer: Buffer

In Theory of Constraints (TOC), a buffer is the name for the material kept in front of a bottleneck to ensure it never stops. One challenge is to manage the size of the buffer to prevent starving the bottleneck while minimizing the WIP investment.

Rope in TOC is the pull-based scheduling at non-bottleneck centers. Drum in TOC is the bottleneck work center. Work-in-process is semi-finished inventory awaiting further processing.

9.

Which of the following is a desirable outcome of continuous improvement in the supply chain?

  • Sustainability

  • One-time events

  • Short-term financial gain

  • Immediate results

Correct answer: Sustainability

Continuous improvement is more of a culture than a project. Continuous improvement is focused on small initiatives with long-term benefits that tend to occur routinely and promote a supply chain transformation plan to ensure sustainable operations. While there might be one-time events with short-term financial gain, the idea is to make continuous improvement a part of everyday work.

10.

Which selection is NOT seen as a benefit of the internet for vendor scheduling?

  • Rapid adjustments in customer schedules

  • Quick access to engineering and product information

  • Quick sharing of vendor report cards

  • Reduction in manual transactions

Correct answer: Rapid adjustments in customer schedules

To avoid cost impacts to vendors akin to the bullwhip effect, customers who rapidly adjust their planning schedules must understand there's a limit to vendor flexibility and adaptability. Contracts are usually the mechanism by which vendors institute their own demand fence with customers. There can be severe surcharges for breaking inside a vendor demand fence.

Aside from technology having now outstripped the ability of companies to make sudden, unexpected changes in their supply plans, at least for now, the benefits of the internet are numerous and include quick access to important information such as engineering and vendor performance data. As a result, partly because time = money, transactional cost has been driven out of many vendor/customer relationships. 

11.

Which type of manufacturing focuses on producing products that vary in design, process, and order quantities?

  • Intermittent manufacturing

  • Flow manufacturing

  • Project manufacturing

  • Standard manufacturing

Correct answer: Intermittent manufacturing

Intermittent manufacturing, or jobbing, focuses on producing products that vary in design, process, and order quantities. Any machine parts production facility is a perfect example of intermittent manufacturing.

Flow manufacturing focuses on producing high-volume standard products. Project manufacturing focuses on producing one complex unit, such as a ship or a building. Standard manufacturing is not a type of manufacturing used during production activity control.

12.

What are the three common capacity strategies?

  • Lead, lag, tracking

  • Level, chase, hybrid

  • Leading, lagging, diagnostic

  • Level, lagging, diagnostic

Correct answer: Lead, lag, tracking

The ASCM Supply Chain Dictionary defines capacity strategy as "one of the strategic choices a firm must make as part of its manufacturing strategy. There are three commonly recognized capacity strategies: lead, lag, and tracking." These strategies are used to help optimize capacity utilization given certain manufacturing, product cycle, and business strategy considerations. 

Level, chase, and hybrid are production strategies. Leading, lagging, and diagnostic are associated with key performance indicators.

13.

Which of the following is a POSITIVE aspect of the chase strategy in production planning?

  • Inventory will remain stable

  • Production levels will fluctuate with sales

  • Labor needs will remain stable

  • Capacity utilization will fluctuate

Correct answer: Inventory will remain stable

The chase strategy is in effect when production levels are adjusted to meet demand. The positive aspect of the chase strategy is that inventory will remain the same and, typically, the lowest cost.

On the negative side, the chase strategy causes production levels, labor, capacity usage, and equipment usage to fluctuate.

14.

Regarding manufacturing lead time, which of the following elements is usually the longest?

  • Queue time

  • Run time

  • Setup time

  • Move time

Correct answer: Queue time

On average, only 10 to 20 percent of manufacturing lead time is actual operation time (setup plus run time). The remaining time is mostly attributed to queue time, or the time that the part sits before being worked.

Manufacturing lead time is the total time required to manufacture an item. Elements of manufacturing lead time are as follows:

  • Queue time
  • Setup time
  • Run time
  • Wait time
  • Move time

15.

An organization's balance sheet shows the following:

Cash - $10,000,000

Inventories - $23,000,000

Insurance - $1,200,000

Patents - $10,000,000

Loans - $15,000,000

Mortgages - $2,000,000

Goodwill - $1,000,000

What are the net assets of this company?

  • $25,800,000

  • $24,800,000

  • $15,800,000

  • $27,000,000

Correct answer: $25,800,000

The ASCM Supply Chain Dictionary defines net assets as "an accounting/financial term (balance sheet classification of accounts) representing the resources owned by a company, whether tangible (cash, inventories) or intangible (patent, goodwill)." Using this same reference, net assets are "total assets minus total liabilities."

From the balance sheet, assets include cash, inventories, patents, and goodwill, which sum to $44,000,000. Liabilities include loans, mortgages, and insurance, which sum to $18,200,000. Subtracting these liabilities from total assets yields $25,800,000.

16.

With Lean implementation, which of the following would no longer be a required process?

  • Capacity requirements planning (CRP)

  • Rough cut capacity planning (RCCP)

  • Demand planning

  • Production planning

Correct answer: Capacity requirements planning (CRP)

Capacity Requirements Planning (CRP) is not necessary after Lean implementation. In a lean environment, rate-based planning takes precedence and demand will be planned using line balancing and takt time. 

Rough Cut Capacity Planning (RCCP) and production planning occur prior to CRP in the Manufacturing Planning and Control (MPC) process and help determine what gets made. 

Demand planning is executed as a component of demand management and helps inform timing and quantity of production.

17.

Which of the following systems is unique in its focus on the reduction of defects by reducing variation?

  • Six Sigma

  • Lean

  • Theory of constraints

  • Just-in-time

Correct answer: Six Sigma

The Six Sigma methodology was developed in the 1980s at Motorola Corporation. Six Sigma focuses on the reduction of defects to no more than a statistical sigma level (3.4 defects per million opportunities). Like lean, Six Sigma needs to be initiated at the top levels of management, and it requires employee involvement and empowerment at all levels. Six Sigma is evidence-based, which means organizations must develop more precise ways of measurement to align with their much higher goals for process improvement.

Theory of constraints focuses on identifying and removing constraints that limit a system's ability to meet its goals. 

Lean focuses on eliminating wasteful activities, creating flow and continuous improvement. 

Just-in-time employs lean principles in production to eliminate wastes, reduce work in process, and empower front-line workers to ensure quality.

18.

Implementing Lean and Six Sigma will help a company by:

  • Focusing on both solving problems and improving processes

  • Reducing the total amount of time to implement the projects separately

  • Reducing the amount of waste in a process

  • Reducing the amount of variance in a process

Correct answer: Focusing on both solving problems and improving processes

Implementing Lean and Six Sigma will help a company by focusing on both solving problems and improving processes. Both processes help evolve a company's culture to one of individual ownership over quality, cost, and customer service, where each employee has a stake in the company's success. Additionally, these processes bring an organization and discipline to execution that is not generally achieved otherwise.

Reducing implementation time is not a key benefit to the company. Reducing the amount of waste in a process is the focus of Lean. Reducing the amount of variance in a process is the focus of Six Sigma.

19.

Which type of distribution intermediaries handle and sell the product?

  • Selective distribution

  • Intensive distribution

  • Exclusive distribution

  • Resistive distribution

Correct answer: Selective distribution

In selective distribution, organizations have intermediaries handle and sell the product. This strategy allows a company to provide focused service into specific customer segments.

Intensive distribution has the broadest network and maximum exposure possible. 

Organizations using exclusive distribution are attempting to limit the number of intermediaries through exclusive distribution rights. 

Resistive distribution is not a type of distribution intensity.

20.

During which phase of the product lifecycle is the market saturated with a product, and price competition is at its highest?

  • Maturity phase

  • Introduction phase

  • Growth phase

  • Decline phase

Correct answer: Maturity phase

The maturity phase occurs when the market is saturated with a product, and its price competition is at the highest. This is the phase where the product’s sales begin to level off because the consumers who want the product have already purchased it.

Introduction phase is incorrect because it is the phase in which the product is just being introduced. 

Growth phase is incorrect because it is the phase in which competitors start entering the market and sales are rapidly growing. 

Decline phase is incorrect because it is the phase in which consumers begin to lose interest in the product.

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