Manuel has created an Efficient Frontier diagram mapping six options his organisation can take. Is it possible for there to be two curves on this diagram?
Answer(s): A
An Efficient Frontier diagram can have multiple curves. The first curve shows potential return on investment under current conditions, while the second curve models improvements if the organisation engages in continuous improvement. A third curve may represent a long-term vision, but this is less common. (See p.136)
Which of the following can be used to pre-assess the consequences of a network member not meeting the control requirements set by the organisation?
The key term in this question is "pre-assess." An escalation strategy identifies risks in the supply network and outlines how to manage disruptions before they escalate. It ensures control issues are handled efficiently by escalating them to senior management when necessary. (See p.194)
What does a forcefield diagram show?
Answer(s): D
A forcefield diagram identifies forces (e.g., people or factors) that support or oppose change. This model, developed by Kurt Lewin, helps organisations assess and manage resistance to change. (See p.196)
Andrea is the Chief Financial Officer at Big Corporation and is completing a Variance Analysis. She has reviewed the production costs of creating item B, and this month's costs show a variance to budget of £-200. What does this mean?
Answer(s): B
A negative variance to budget means that the company spent £200 less than expected, which is a positive outcome. While it may seem counterintuitive, a negative variance in this context indicates cost savings rather than overspending. Option D is incorrect because the organisation has saved £200, not gained it. (See p.198)
Which of the following appear in the concept of Theory of Constraints? Select ALL that apply.
Answer(s): B,C,D
The Theory of Constraints (TOC) includes the Drum, Buffer, and Rope approach. This method helps manage constraints in production by synchronising workflow. The Drum sets the pace, the Buffer protects against variability, and the Rope ensures efficient scheduling. Boat and safe harbour are not part of TOC. (See p.204)For further reading on Drum-Buffer-Rope, refer to this resource:Theory of Constraints - Fortelabs
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