1. When would the customer be satisfied?

Customer service is a component of customer satisfaction, which is defined as the ability of logistics management to satisfy users in term of time, dependability, communication, convenience. Further customer satisfaction compares customers actual experiences with the expected experiences and if the actual experience equals or exceeds the expected experience.

(Another possible answer: when customer expectations are fulfilled or surpassed)

3. List the four stages of the order cycle. Explain one and give an example.

• Order Transmittal
• Order Processing the time from the seller receives an order until an appropriate location (such as a warehouse) is authorized to fill the order.
• Order Picking and Assembly
• Order Delivery

4. Order picking and assembly is overlooked in practice, but they represent the best opportunity to improve the effectiveness and efficiency of an order cycle.

During the recent years the technology has made available rapid advancements in particular for this stage, greatly affecting it and improving the overall efficiency of the order cycle.

5.There are five ways to transmit orders. List them and explain at least one of them through an example.

a. In person (greatly reduces the potential for order errors, but it is not always convenient in situations where the supplier is geographically distant)

b. By e-mail (more convenient than ordering in person, but mail is relatively slow and there are occasions when the order never reaches the intended destination)

c. By telephone (fast and convenient, but order errors may not be detected until the order is delivered)

d. By fax (fast and convenient and provides a hard copy documentation of an order, but there is the potential for junk faxes and the quality of transmission may be problematic)

e. Electronically (fast, convenient and potentially very accurate; major concern is the security of the data being transmitted)

6. Explain through an example the benefits of applying CPFR.

CPFR (collaborative planning, forecasting, and replenishment) refers to supply chain partners who share planning and forecasting data to better match up supply and demand. It suggests that supply chain partners will be working from a collectively agreed-to single forecast number or opposed to each member working off its own forecast projection. Examples of successful CPFR include firms such as Wal-Mart, Tesco and Procter & Gamble.

7. List the three forecasting models. Explain one and give an example of its application.

There are three basic types of demand forecasting:

1. Judgmental forecasting - involves using judgment or intuition and is preferred in situations where there is limited or no historical data, such as with a new product introduction.

2. Time Series forecasting is that future demand is solely dependent on past demand. For example, if this years sales were 7% higher than last years sales, a time series forecast for next years sales would be this years sales plus 7 %.

3. Cause and Effect - forecasting assumes that one or more factors are related to demand and that the relationship between cause and effect can be used to estimate future demand. Examples of cause and effect forecasting include simple and multiple regression; in simple regression, demand is dependent on only one variable, whereas in multiple regression, demand is dependent on two or more variables.

8. Explain make-to-order and give an example.

Make-to-order (when finished goods are produced after receiving a customer order and the demand determines how much are you going to produce).

9. Explain make-to-stock and give an example.

Make-to-stock (when finished goods are produced prior to receiving a customer order and you keep the goods in warehouse until the customer wants it. The customer who wants a particular product, he/she does not need to wait for the product because the product is available in the warehouse).

10. Common sense is one key to being an effective logistics manager.

11.The relationship within the firm between logistics and finance.

Logistics vs. Finance There are a lot of issues where the logistics department must interface with the finance department mainly because logistical decisions are only as good as the quality of cost data which they are working.

Example: The logistics department needs forklifts and other materials to do day to day activities, so they must report to the finance department when they make the capital investments budget.

12. The relationship within the firm between logistics and marketing.

Logistics vs. Marketing Marketing places an emphasis on consumer satisfaction, and logistics strategies can facilitate customer satisfaction through reducing the cost of products, which can translate into lower process as well bringing a broader variety of choices closer to where the customer wishes to buy or use the product. Logistics can be used to differentiate the company from other companies.

Marketing Mix (4 Ps):

Place: It is very important that products are on the right place. This is important for both departments the marketing people and the logistics people. If a manufacturer is not able to provide a certain product at the right time, in the right quantities and in an undamaged condition, the channel members may end their relationship with the supplier.

Price: a firm cannot be profitable if it does not take into account its logistics costs. The price of a product must cober production, marketing, distribution, and general admin costs. Some companies decide to raise the cost of the products in order to include their higher logistics costs, but this is not very attractive. Another option to this is to decrease the quality of the product but keep price the same. Or the company can absorb these costs itself.

There are other costs associated here, like inventory costs, transportation costs etc.

Product: Here one should know that there are a lot of interfaces between the marketing and logistics ppl in terms of how many units of products they want to have in stock, how many in the inventory, etc.

Promotion: many promotional decisions require close coordination between marketing and logistics. One important situation is the availability of highly advertised products when the company has pricing campaign that lower the price of certain products. It can be very bad for a company to have a stock-out when these powerful ads are displayed everywhere about certain products.

13. The relationship within the firm between logistics and production.

Logistics vs. Production - The most common interface between production and logistic involve the length of production lines. Do you want long production runs or shorter ones? This means, do you want to have more inventory and more products in stock, or do you want to risk and produce less in the short run?