chapter 5 answers to study questions

chapter 5 answers to study questions - chapter 5 answers to...

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chapter 5 answers to study questions ANSWERS TO STUDY QUESTIONS 1. “Performance measurement for logistics managers is relatively recent. Their focus was previously directed toward other managerial activities.” Do you agree or disagree with these statements? Explain your position. Answer: A question might be raised as to whether or not the focus on performance measurement is a recent event in industry. The answer to that question is a definite “no.” Recall from Chapter 2 that the development of the physical distribution and logistics concepts was based upon systems theory with the specific application focused upon least total cost analysis. Total cost is a measure of efficiency and was the rationale supporting physical distribution management. Least total cost was later used to support the logistics management approach. The focus upon a least total cost system required measuring the tradeoff costs when a suggested change was made in one of the components or elements of the system. For example, this could include switching from rail to motor transportation or adding a distribution center to the distribution network. Cost has long been recognized as an important metric for determining efficiency. This is still true today. However, we have evolved from measuring functional cost to supply chain cost. This means the relevant point of measurement has changed from totally internal to a firm to the collective costs of many firms involved in the supply chain. (Page 150) The second part of the question is subjective and must be evaluated in that light 2. What role should employees, in general, play in the development of performance metrics? Why is this role important? Answer: First, the development of a metrics program should be the result of a team effort. Successful metrics implementations involve development teams comprised of individuals representing functional areas within the firm that will be impacted by the metrics. Because this phase of development requires metric identification and definition, it is critical that all impacted areas agree on the appropriate metrics and their definitions. This agreement will lead to a more successful implementation and use of the metrics to manage the business. Identify metric “owners” and tie metric goal achievement to an individual’s or division’s performance evaluation. This provides the motivation to achieve metric goals and use metrics to manage the business. (Page 151) 3. “Metrics must focus upon customer needs and expectations.” Explain the meaning of this statement. Why have customers become more important for performance measurement? What role, if any, should customers play in developing supply chain metrics? Answer: Involve customers and suppliers, where appropriate, in the metrics development
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This note was uploaded on 07/28/2011 for the course MKTG 4354 taught by Professor Nancyevans during the Summer '11 term at Virginia Tech.

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chapter 5 answers to study questions - chapter 5 answers to...

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