Written examination MTT 240 – Supply chain management

Time: Wednesday June 1st 2016, 14.00 – 19.00

Instructions:

· The examination has 6 questions – but you should only solve 5. Select 5 of the questions and
answer these – only 5 questions will be corrected.
If you answer more than 5 questions, only the first 5 (questions 1-5) will be corrected.
Maximal result is 50 points.

· Start every new question on a new sheet of paper.

· Answer the questions as informative, explicit, and well structured as you can (e.g. clear points
with explanations/discussions). Show the examiner that you have understood the content, not
only specific bullet points.

· If possible, illustrate your discussions with models, frameworks and figures.

· Write as clearly as possible.

· English dictionary is allowed.

· Write your anonymous code, personal identifier and page number on each page.

Good luck!
Andreas Norrman
Course responsible

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Question 1:
The course has been focusing on different Supply chain interface variables and their antidotes,
according to the model by Simatupang and Sridharan (2005).
a) Describe this model, and elaborate on the different antidotes. Give short examples
explaining the discontents that the models addresses. (7 points)
b) The lecture by Relex (Janne Nissi) (as well as the paper by Alftan et al (2014)) discussed
especially two of the antidotes. Which two? (2 points)
c) What classical “Supply chain phenomenon” (that you did meet in the course) could be
decreased by the type of tool that Relex provides? (1 points)
(Totally 10 points)

Question 2:
Fisher (1997) discusses in his article “What Is the Right Supply Chain for your Product”(that
also was part of Chopra & Meindl’s chapter) the importance of alignment of the SC
configuration with the SC strategy by exemplifying two different product types and supply
chains.

a) Describe Fisher’s model, discuss characteristics for the two different product types, and
elaborate more specifically on how those two types of supply chains differ on lower
configuration levels. (8 points)
b) Order Winners and Order Qualifiers are important to understand when developing the SC
strategy. Illustrate the difference between OW and OQ by comparing them in a graph. (2
points)
(Totally 10 points)

Question 3:
Strategic supply chain mapping is important (according to i.e. Gardner and Cooper (2003)).

a) State at least 4 reasons to why a firm should create a strategic supply chain map. (2
points)

b) Based on your experience from playing “Fresh Connection” (or from industry), draw an
example of an SC map (that uses normal SC-symbols from any of the examples in e.g.
Gardner and Cooper (2003) or other source in the course). Fill your map with relevant
data useful for someone that should analyze and improve the supply chain. (If you are
using an industry example, state what type of company/product you are thinking of). (4
points)

c) Persson (1995) provides a framework pointing at three major elements (operational

characteristics, structural context, and managerial context) that are important to
understand when configuring/designing the supply chain. Describe 2 sub-items for each of
operational characteristics and structural contexts, and elaborate on how and where the
reader can find information about each of these 4 sub-items in your supply chain map. (4
points) (Totally 10 points)

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Question 4:
Most literature on Supply chain risk management proposes a three-step overriding process (that is
based on the general risk management process).
a) Explain these three key steps. (5 points)

b) After the “Albuquerque incident” Ericsson radically improved their SCRM work. Give for
each of the three steps above examples of what Ericsson did in their new approach. (If you
do not remember what Ericsson did, you can also propose what companies should do
according to your view). Do not forget to make the “supply chain-view” explicit! (5
points)
(Totally 10 points)

Question 5:
Differentiation (or segregating/splintering) based on segmentation is an important principle within
SCM, and can be used on suppliers, customers, products etc.

a) You have been asked to (starting with the data below) segment the products into different
categories. Illustrate your segmentation in an illustrative matrix (that you have seen in
articles and lecture). Then propose, and motivate, how the different categories could be
configured regarding inventory/stocking and manufacturing tactics. (7 points)

Average weekly Standard

Item demand deviation
1 10 100
2 5000 25000
3 4000 2400
4 2000 2200
5 4000 24000
6 7000 2800
7 200 1600
8 10000 3000

b) A products position in the product life cycle is another framework that could give insights
for differentiation, e.g. how to handle collaboration and information sharing. (Småros
(2003) discusses this). What kind of information (forecast/data/plans) is best shared for
different phases of a products life cycle? (3 points)
(Totally 10 points)

3
Question 6:
There are different ways to create incentives in supply chain, both by contract and other ways.
a) How would you, with a mathematical formula, define the following types of contracts:
– Wholesale price
– Franchise fee/2-part tariff
– Revenue sharing contract
Describe shortly an example, related to practice, for each of the contract types (4,5 p)

b) What kind of principal/agency problem can “social control”/”group incentives” help you to
handle, and in what situation do this kind of incentives work especially good?
Exemplify with a “supply chain” example! (3,5 p)

c) Barilla tried to implement VMI (JIT distribution) with its independent distributors, but to
be able to implement VMI Barilla had to change the incentives in the interface to
distributors. Why, and in what way (roughly) had the incentives to change? (2 p)
(Totally 10 points)