What is the Relationship Between Logistics and Supply Chain Management?


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Why is information so important in supply chains?


Chapter 1: Study Questions

1.Consumers have much more influence in the marketplace today. What factors have led to this “empowered consumer” situation? How has this factor changed supply chains in the last 10 to 15 years? Will this influence continue and what will be the impact on supply chains?


2.The influence and impact of federal, state, and local governments seem to be growing in importance for supply chains. Why? What are the most important dimensions of governmental control for supply chains for the future?


3.Supply chain managers should be concerned about four flows in their organisations. What are these four flows, and why are they important? How are they related to each other?


4.Why is information so important in supply chains? What are the challenges to the successful development and implementation of effective information? What is the role of technology and information management?


Chapter 2: Study Questions

1.Why is logistics important on a macro level, and what contributions does logistics make in the economy?


2.What is the relationship between logistics and supply chain management? In what ways they are different?


3.Compare and contrast the four major subdivisions of logistics discussed in this chapter.


4.Why do companies analyse their logistics system from perspective of nodes and links?




Indicate whether the statement is true or false.

1. The first decade of the twenty-first century was a period of rapid change for organisations, especially businesses.


2. A key element in Wal-Mart’s ability to discount brand name products was an understanding of the criticality of efficiency in its logistics and supply chain system.


 3. Outsourcing is a fairly new concept.


4. SAB should examine their off-shore purchasing policy, even though the products are sourced from the U.S.


5. It is expected that some or all of the BRIC countries (Brazil, Russia, India & china) will replace the so-called VISTA countries (Vietnam, Indonesia, S. Africa, Turkey and Argentina) as low-cost producers of various products and services.


6. The world economy still favors the United States and European countries, even though China and India can participate in the global economy much more readily.


7. It is predicted that social networks such as Facebook and Twitter will influence supply chains because of their  impact on customer demand and the speed of information transfers.


8. The U.S. transportation system was deregulated in the 1930s and 1940s in response to economic conditions and World War 2


9. Even though there are references to supply chain management in the 1980s, SCM did not capture the attention of senior-level management until the 1990s.


10. Supply chain managers no longer need to worry about suboptimization in light of today’s technology.




Indicate whether the statement is true or false.

1. The utility created through the basic marketing activities is known as place utility.


2. Transportation is the physical movement or flow of goods.


3. During the 1990s and 2000s, logistics costs as a percentage of gross national product declined.


4. An aircraft manufacturer is a good example of an organisation with a heavy inbound flow and a simple outbound flow.


5. Acme Battery distributes its batteries to warehouses, where they are stored until ordered by a retailer. The warehouses are located close by the retail markets served. This is the logistics channel approach to logistics.


6. In a logistics system, warehousing should be optimised at the expense of related logistics activities, such as transportation and procurement.


7. The mathematical calculation of the point of equality between systems under analysis is used for short-run/static analysis.


8. To hold down distribution cost, the lowest cost carrier should always be used.


9. The inverse relationship that exists between the cost of lost sales and inventory costs is the inventory effect.


Multiple Choice

Identify the choice that best completes the statement or answers the question.

10. Logistics creates which utility through production forecasting, production scheduling and inventory control?

a. form utility

b. quantity utility

c. time utility

d. possession utility


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