All CSCP Test Inside APICS Questions

When making a make-or-buy decision, several factors must be considered beyond costs and proprietary knowledge. The option to "make" implies manufacturing the product in-house, while "buy" means outsourcing the production. Key considerations include:

• Costs: Both fixed and variable costs associated with in-house production versus purchasing from a supplier.
• Proprietary Knowledge: The importance of keeping certain knowledge and technologies within the company for competitive advantage.
• Available Capacity: Whether the company has the necessary production capacity to manufacture the product without affecting other operations. This involves assessing current production capabilities and future scalability.
• Quality Control: The ability to maintain the desired level of quality in-house versus the quality assurance capabilities of potential suppliers.
• Flexibility and Lead Time: The ability to respond quickly to market changes and customer demands.
• Strategic Importance: How critical the component or product is to the company's core business and strategic goals.

Among the given options, "available capacity" is the most relevant factor, as it directly influences the decision of whether to allocate internal resources to production or to outsource.

References:

• Chopra, S., & Meindl, P. (2016). Supply Chain Management: Strategy, Planning, and Operation. Pearson.
• Slack, N., & Lewis, M. (2017). Operations Strategy. Pearson.

• Context: Viewing the reverse supply chain as an extension of another process influences product design considerations.
• Options Breakdown:
• Correct Answer Justification: Viewing the reverse supply chain as an extension of the forward supply chain ensures that design decisions account for the entire lifecycle, including end-of-life management.

References:

• Reverse logistics and supply chain sustainability literature
• Case studies on lifecycle management in supply chains

• Context: Long-term collaborative relationships in business require various forms of communication and mutual understanding.
• Options Breakdown:
• Correct Answer Justification: Effective long-term relationships depend on both formal (contracts, meetings) and informal (regular check-ins, casual interactions) communication, ensuring transparency, trust, and responsiveness.

References:

• Supply chain relationship management literature
• Case studies on successful long-term business partnerships

• Context: The large wholesaler owned delivery trucks but sold them and now purchases transportation services from fleet operators.
• Options Breakdown:
• Correct Answer Justification: The wholesaler is outsourcing its transportation needs to fleet operators, which is the definition of using a third-party logistics provider (3PL).

References:

• Logistics and Supply Chain Management textbooks
• Industry best practices and terminologies for third-party logistics providers (3PLs)