Question Paper SCM PGDIE II Module Priyanka Verma
Question Paper SCM PGDIE II Module Priyanka Verma
Question Paper SCM PGDIE II Module Priyanka Verma
PART I:
Explain in detail the role of emerging technologies in supply chain with reference to Artificial
Intelligence, Internet of Things, Blockchain and Machine Learning with examples.
[5 Marks]
PART II:
What are the different Collaborative planning, Forecasting and Replenishment (CPFR)
scenarios and how do they benefit supply chain partners with examples.
[5 Marks]
QUESTION 2: ANSWER BOTH THE PARTS (10 Marks)
PART I:
Prepare design for Distribution Network considering Manufacturer or Distributor storage with
customer pick up. What will be the impact on various cost and service factors?
[3 Marks]
PART II:
Cooling Agents, Inc., is a manufacturer of air conditioners that has seen its demand grow
significantly. The company anticipates nationwide demand for the next year to be 180,000 units
in the South; 120,000 units in the Midwest; 110,000 units in the East; and 100,000 units in the
West. Managers at Cooling Agents are designing the manufacturing network and have selected
four potential sites - New York, Atlanta, Chicago and San Diego. Plants could have a capacity
of either 200,000 or 400,000 units. The annual fixed costs at the four locations are shown in
the table below, along with the cost of producing and shipping an air conditioner to each of the
four markets.
Where should Cooling Agents, Inc. build its factories and how large should they be?
[7 Marks]
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PART I:
Explain various Supply Chain risks to be considered for network design for Global supply
chain. Describe risk mitigation strategies to be followed for network design.
[3 Marks]
PART II:
A European apparel manufacturer has production facilities in Italy and China to serve its
European market, where annual demand is for 1.9 million units. Demand is expected to stay at
the same level over the foreseeable future. Each facility has a capacity of 1 million units per
year. With the current exchange rates, the production and distribution cost from Italy is 10 euro
per unit, whereas the production and distribution cost from China is 7 euro. Over each of the
next three years, the Chinese currency could rise relative to the euro by 15 percent with a
probability of 0.5 or drop by 5 percent with a probability of 0.5. An option being considered is
to shut down 0.5 million units of capacity in Italy and move it to China at a one-time cost of 2
million euro. Assume a discount factor of 10 percent over the three years. Do you recommend
this option? [Hint: Use NPV]
[7 Marks]
[10 Marks]
As an supply chain expert, you first decide to coordinate with the marketing team to look at the
demand forecasts. By engaging with the retailers through a collaborative process, the marketing
team has built a six month forecast from January to June. The demand is highly seasonal, and
there is no demand for the product during the other six months i.e. July to December. The
forecasts are given in the following table.
Further, you examine several costs related to manufacture available from the company records.
The costs are as follows.
Item Cost
Material cost 10
Inventory holding cost 2 / unit / month
Marginal cost of backlog 5 / unit / month
Hiring and training costs 300 / worker
Layoff costs 500 / worker
Regular time costs 4 / hour
Overtime costs 6 / hour
Subcontracting costs 30 / unit
Also, you find from the industrial engineering department that the labor hours required are 4
hours per unit and each worker is expected to work for 8 hours a day. Further there are 20 days
of production scheduled per month and the production capacity is primarily determined by the
total labor hours worked. The HR department reports to you that at the beginning of January
month, the existing number of workers are 80, and maximum number of overtime hours cannot
be more than 10 hours per month due to regulations.
You take a stock of inventory of finished product at the beginning of January and find that you
have 1000 units in stock. Also, the materials department informs you that at the end of June, a
minimum of 500 units must be in stock to handle a small volume of off-season demand.
You are required to prepare an aggregate production plan over the next 6 months which results
into maximizing the overall profit for the company.
[10 Marks]
QUESTION 6: (10 Marks)
The management of the Red Tomato company has further requested you look into their demand
planning process. After discussion with the marketing team, you find that the company is
planning to offer price discount ($39 instead of $40) as a promotion either at the beginning of
the season (January) or during the peak season (April). Also, it is estimated that the price
discount increases the consumption by 10% of the demand in the same month and shifts
forward the demand of the next two months by 20%.
You are required to obtain the optimal aggregate plan for both the options i.e. promotion in
January or promotion in April and suggest the best alternative. Also comment on how the
profitability will be affected if (i) there is a higher amount of forward buying and (ii) there is a
greater increase in the consumption.
[10 Marks]
In writing the answers to this question, select one industry of your choice (e.g. FMCG,
Automobile, etc.) and write the answers with respect to that industry.
PART I:
(i) What is the effect of lack of coordination on the performance of the supply chain?
(ii) What are the obstacles to coordination in supply chain?
[5 Marks]
PART II:
(i) What are the managerial levers to achieve the coordination in supply chain?
(ii) In your selected industry, which of the CPFR scenario would you implement to
achieve coordination and why?
[5 Marks]