APICS CTSC Certified in Transformation for Supply Chain (CTSC) Exam Practice Test

Supply risk is the risk of not being able to source the required raw materials, components, or services from suppliers to meet customer demand1.It can be caused by various factors, such as supplier failure, quality issues, natural disasters, geopolitical events, or market fluctuations1.Supply risk can affect the cost, quality, and delivery performance of a supply chain1.

1: https://www.ascm.org/ctsc-ecm/

According to the CTSC Enterprise and Supply Chain Management (ESCM) manual, the greater value chain is the network of organizations that collaborate to create and deliver value to the end customer1.It includes not only the supply chain, but also other stakeholders such as distributors, retailers, service providers, and even competitors1.To extend the supply chain initiative to the greater value chain, the core team should first define the scope of the greater value chain, which means identifying the key players, processes, and flows that are involved in creating and delivering value1.This will help the core team to understand the current state of the greater value chain, the opportunities and challenges for improvement, and the potential impact of the initiative on the overall value creation1.

1: https://www.ascm.org/ctsc-ecm/

Nearshoring is the practice of relocating business processes or services to a nearby country, usually one that shares a border or is in the same region1. Nearshoring can help companies reduce costs, improve quality, and increase responsiveness to customer needs.Nearshoring is different from offshoring, which is moving business processes or services to a distant country, usually to take advantage of lower labor costs or favorable tax regimes2.Nearshoring is also different from insourcing, which is performing business processes or services internally within the company3. Nearshoring is also different from outsourcing, which is contracting out business processes or services to a third-party provider, regardless of the location.

Sustainability

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one of the components of the Enterprise Standards for Sustainability is ethics. Ethics refers to the principles and values that guide the behavior and decisions of an organization and its stakeholders. Ethics is important for fostering mutually beneficial relationships with stakeholders, as it involves respecting human rights, ensuring fair trade, preventing corruption, and promoting transparency and accountability. Therefore, a firm seeking to use the pillars of sustainability should consider ecology, economics, and ethics. Option A, leadership, is not a pillar of sustainability, but rather a skill or quality that can help achieve sustainability. Option C, risk, is not a pillar of sustainability, but rather a factor that can affect or be affected by sustainability. Option D, culture, is not a pillar of sustainability, but rather an aspect of social sustainability that relates to the beliefs, norms, and values of a society.

cross-selling is the practice of offering customers additional items that complement or enhance their main purchase12. In this case, the sales representative has engaged in cross-selling by offering the customer a case to protect the phone, which is a related and useful product for the customer’s main purchase of a new cell phone.Cross-selling can help to increase customer satisfaction, loyalty, and revenue12.

1:Cross-Selling vs. Upselling: Definitions and Differences | Indeed.com2:What Is Cross-Selling? - Investopedia

According to the CTSC Enterprise and Supply Chain Management (ESCM) manual, the capacity indicator is a KPI that measures the available time against total time minus dwell time1.Dwell time is the time that a process or resource is idle or waiting1.The capacity indicator shows how much of the total time is actually used for productive activities1.A higher capacity indicator means a higher utilization of the process and resources1.

1: https://www.ascm.org/ctsc-ecm/

According to the ASCM, the supply chain information system infrastructure consists of four main elements: hardware, software, data warehouse, and the internet1.These elements enable the collection, storage, processing, and transmission of data and information across the supply chain, and support the decision making and execution of supply chain activities1.The ASCM also states that the supply chain information system infrastructure is a key enabler of supply chain transformation, which is the process of changing the supply chain to achieve higher performance, efficiency, and sustainability1.By having a robust and reliable infrastructure, a company can leverage the power of data and analytics, improve the visibility and collaboration across the supply chain, and adopt new technologies and innovations that can enhance the supply chain capabilities and outcomes1. Therefore, hardware, software, data warehouse, and the internet are the infrastructure elements that have a significant impact on supply chain transformation.

According to the CTSC Learning System, one of the factors that affects the distribution costs is the cost of implementing the new materials flow network, which includes the costs of designing, building, and operating the network of warehouses, distribution centers, and transportation modes1.The cost of implementing the new materials flow network can be significant and should be included in the calculation of the total cost of ownership (TCO) of the distribution system1.The other factors listed in the question are not directly related to the distribution costs, but rather to the inventory costs, which are a separate component of the TCO1.

According to the CTSC Exam Content Manual1,design for quality is a supply chain process that focuses on ensuring that the products and services meet or exceed the customer requirements and expectations, and comply with the relevant standards and regulations. Design for quality involves applying quality management principles and tools throughout the product life cycle, from design and development to production and delivery. Automation and robotics are supply chain technologies that can help improve the quality of products and services, especially in applications that require high precision, accuracy, and consistency, such as aerospace. Automation and robotics canreduce human errors, increase efficiency and productivity, and enhance safety and reliability.

According to the ASCM CTSC Exam Content Manual, one of the first steps in developing a transformational supply chain strategy is to “determine the current and future needs and expectations of the customers, and align the supply chain strategy with the business strategy and customer value proposition” (p. 16) 1. This helps to ensure that the supply chain transformation is customer-centric and focused on delivering value to the end users. The other options are also important, but they should be done after the initial determination of the customers’ needs.

According to the CTSC Ex-am Content Manual1,the Swiss cheese model is one of the accident models that explains how accidents happen in complex systems. The model compares the system to a stack of slices of Swiss cheese, where each slice represents a layer of defense or protection against hazards. The holes in the cheese represent weaknesses or failures in each layer. Normally, the holes do not align and the system is safe. However, when the holes align, a hazard can penetrate through the layers and cause an accident. The model illustrates how multiple factors and conditions can combine to create a pathway for an accident.

1: https://www.ascm.org/ctsc-ecm/

Order fulfillment

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According to the ASCM CTSC Exam Content Manual, an order line is defined as "a commitment on a sales order that always references a product and promise delivery date.An order line may also reference a quantity, a price, and a customer location."1This definition is consistent with the concept of perfect order fulfillment, which measures how well a company delivers its orders according to the customer’s specifications and expectations.

1: ASCM CTSC Exam Content Manual, page 10.

According to the CTSC Enterprise and Supply Chain Management (ESCM) manual, effective collaborative relationships with supply chain partners are more likely to be forged when a team buys into three areas: accountability, business alignment, and vision statement1.Accountability means that each partner is responsible for delivering on their commitments and adhering to the agreed-upon rules and standards1.Business alignment means that each partner aligns their objectives, strategies, and processes with the overall goals of the supply chain network1.Vision statement means that each partner shares a common vision of the desired future state of the supply chain and how to achieve it1.

1: https://www.ascm.org/ctsc-ecm/

According to the ASCM CTSC Exam Content Manual, CPFR is a collaboration mechanism that involves the establishment of long-term relationships with partners to improve the overall efficiency and effectiveness of the supply chain.CPFR is defined as "a business practice that combines the intelligence of multiple trading partners in the planning and fulfillment of customer demand"1.CPFR enables partners to share information, align plans, and synchronize activities across the supply chain, resulting in reduced inventories, improved service levels, and increased sales23.

1: ASCM CTSC Exam Content Manual, page 8.2:Six steps to successful supply chain collaboration | McKinsey3:Supply Chain Collaboration: Meaning, Importance, Features & Impact | GEP Blog

An external motivator for executing a supply chain transformation is a factor that originates outside the organization and influences its decision to change its supply chain strategy, processes, or capabilities. Examples of external motivators include customer demands, market opportunities, competitive pressures, regulatory requirements, and environmental concerns1. In this case, the national customer’s request to sell to its international subsidiaries is an external motivator because it comes from a keystakeholder in the supply chain and requires the company to adapt to new markets, regulations, and logistics.

Porter’s Five Forces is a model that identifies and analyzes five competitive forces that shape every industry and helps determine an industry’s weaknesses and strengths1.The five forces are: competition in the industry, potential of new entrants, power of suppliers, power of customers, and threat of substitute products1. The company has used this tool to assess the attractiveness and profitability of the airline industry by evaluating the intensity of each force.

According to the CTSC exam content manual1, implementing electronic data interchange (EDI) can provide benefit in establishing business relationships with suppliers by building trust, which is one of the key elements of supplier relationship management. EDI can help to build trust by enabling faster, more accurate, and more secure data exchange, reducing errors and disputes, improving communication and collaboration, and enhancing customer satisfaction.

According to the CTSC Exam Content Manual1, one of the characteristics of digital supply chain integration is that it “enables end-to-end visibility, collaboration, and optimization across the supply chain network”. This means that digital supply chain integration aims to achieve efficiency and effectiveness across all the processes involved in planning, sourcing, transforming, and fulfilling products, rather than focusing on each process in isolation. Therefore, the best approach to support a digital supply chain for an apparel company is to emphasize integrated efficiency goals across all four processes, as this would enable the company to optimize its resources, reduce costs, improve quality, and meet customer expectations. Option A, C and D are examples of approaches that do not support digital supply chain integration, as they either focus on standalone goals for each process or prioritize revenue over efficiency.

According to the CTSC Exam Content Manual, process harmonization is the degree to which an organization’s processes are standardized and aligned across its business units1.Documenting supply chain processes and maintaining updated documentation are used to achieve process harmonization, as they help to ensure consistency, transparency, and compliance of the processes across the organization2.Documenting supply chainprocesses also facilitates the identification of best practices, gaps, and improvement opportunities for the processes2.

According to the ASCM CTSC Exam Content Manual, ecological, ethical, and economic are the three major categories of practices that an organization should evaluate as it transforms its processes to be more sustainable.These categories are also known as the triple bottom line of sustainability, which measures the social, environmental, and financial impacts of an organization’s activities1.Ecological practices refer to the environmental aspects of sustainability, such as reducing greenhouse gas emissions, waste, and resource consumption, and enhancing biodiversity and ecosystem services12.Ethical practices refer to the social aspects of sustainability, such as respecting human rights, labor standards, and diversity, and promoting health, safety, and well-being of employees and communities13.Economic practices refer to the financial aspects of sustainability, such as creating value for stakeholders, ensuring fair and transparent transactions, and investing in innovation and development14.

1: ASCM CTSC Exam Content Manual, page 9.2:Environmental Sustainability: Definition and Importance - Investopedia3:Social Sustainability: Definition, Importance, and Examples - Investopedia4:Economic Sustainability: Definition, Importance, and Examples - Investopedia

Ac-cording to the CTSC Exam Content Manual1, one of the required key management capabilities for implementing new supply chain capabilities is inspiring and influential leadership. This means having the ability to communicate the vision and goals of the transformation, motivate and empower the team, and foster a culture of innovation and collaboration.

Process mapping is the term used to describe the creation of a diagram of the workflow of a production or service that includes standardized symbols, inputs, and outputs.Process mapping is a tool of management that visually depicts the flow of work and the steps and people involved in a business process3.Process mapping can help communicate how a process works in a concise and straightforward way, identify inefficiencies or areas of improvement, and document or train the process12.Process mapping uses visual representations, such as basic symbols, to describe each element in the process, such as rectangles for activities, arrows for direction of flow, diamonds for decisions, and ovals for start and end points24.

According to the CTSC Exam Content Manual, an agile chain is a supply chain model that can handle high demand during peak season and quickly adjust to a lean period with low demand1.An agile chain is characterized by high responsiveness, flexibility, and adaptability to changing customer needs and market conditions1.An agile chain can also cope with high levels of uncertainty and variability in demand and supply1. The other options are not the best supply chain model for this scenario, as they have different characteristics and trade-offs.A custom-configured chain is a supply chain model that delivers customized products or services to customers through modularization and postponement strategies1.A custom-configured chain is suitable for high variety and low volume markets, but it may not be able to handle high demand peaks efficiently2.An efficient chain is a supply chain model that focuses on minimizing costs and maximizing asset utilization through economies of scale and scope1.An efficient chain is suitable for low variety and high volume markets, but it may not be able to adjust quickly to demand fluctuations or customer preferences2.A flexible chain is a supply chain model that can handle moderate changes in demand and supply by adjusting production capacity and inventory levels1.A flexible chain is suitable for medium variety and medium volume markets, but it may not be able to handle extreme demand peaks or lean periods without compromising service levels or costs2.

According to the CTSC Exam Content Manual, one of the steps that should be completed before determining training needs is to assess key performance indicators (KPIs)1.KPIs are the metrics that measure the performance and progress of the supply chain transformation objectives and outcomes1.Assessing KPIs can help to identify the gaps and opportunities for improvement in the supply chain processes, functions, and roles, and to determine the training needs and priorities for the workforce2. The other options are not the steps that should be completed before determining training needs, as they are more related to the implementation and evaluation of the training plan.Developing an action plan is a step that follows the determination of training needs, as it outlines the specific actions, resources, and timelines for delivering the training3. Developing a training plan is a step that involves designing the training content, methods, and materials based on the training needs and objectives. Assessing performance management is a step that involves monitoring and reviewing the performance of the trainees and the training program, and providing feedback and recognition.

the SCOR level 1 metrics for the performance attribute of Cost are total supply chain management and cost of goods sold (COGS).Cost is defined as "the costs associated with operating the supply chain, including labor, material, and transportation"2.Total supply chain management cost (TSCM/CO.1.1) is "the sum of the costs associated with the SCOR Level 2 processes to Plan, Source, Deliver, and Return"2.Cost of goods sold (COGS/CO.1.2) is "the direct costs attributable to the production of the goods sold by a company"3.These metrics measure the financial efficiency and effectiveness of the supply chain processes and activities14.

1:Supply Chain Operations Reference Model Revision 114:SCOR Metrics - scpiteam.com2:CLL037 DoD Supply Chain Fundamentals - Defense Acquisition University3:Cost of Goods Sold – COGS Definition - Investopedia

a differentiation strategy is the approach businesses use to attract and keep customers by giving them a unique product or service123.The main goal of this strategy is to attain a competitive advantage by offering something that is different and distinct from the competitors in the same market123.A differentiation strategy can help a company to reduce price competition, increase customer loyalty, and improve profit margins1.Some examples of companies that use a differentiation strategy are Apple, Starbucks, and Tesla23. Therefore, a differentiation strategy would help the company to stand out in the market by offering unique products or services.

According to the CTSC Enterprise and Supply Chain Management (ESCM) manual, the next step after setting improvement priorities on the basis of strategic objectives is to design the transformation road map1.The transformation road map is a document that outlines the vision, goals, scope, timeline, milestones, deliverables, resources, risks, and dependencies of the supply chain transformation project1.It also defines the roles and responsibilities of the project team and the stakeholders, and the communication and governance mechanisms1.The transformation road map helps to guide the execution of theproject, monitor the progress and performance, and ensure alignment and collaboration among the project participants1.

1: https://www.ascm.org/ctsc-ecm/

According to the ASCM CTSC Exam Content Manual, one of the benefits of a mature S&OP process is to enable the alignment of supply and demand plans with the strategic objectives of the organization1.This can help to optimize the use of resources, reduce costs, improve customer service, and increase profitability. Therefore, evaluating the current S&OP process can help an organization to identify the gaps and opportunities for improvement in a supply chain transformation initiative.

1: ASCM CTSC Exam Content Manual, page 14.

According to the ASCM, the balanced scorecard in the supply chain measures the performance of the supply chain against eight attributes: reliability, responsiveness, agility, cost, profit, assets, environmental, and social.These attributes reflect the efficiency, effectiveness, and sustainability of the supply chain, as well as its alignment with the customer and stakeholder expectations1.

According to the CTSC exam content manual1, the last phase of the transformation project is to analyze performance, which involves measuring and evaluating the outcomes of the transformation, identifying gaps and opportunities for improvement, and communicating the results and lessons learned to stakeholders.

According to the CTSC Exam Content Manual, one of the ways to reduce the costs of poor quality in the supply base is to establish education and quality training for the suppliers, as this can help them improve their quality performance, reduce defects, and prevent problems1.Education and quality training can also enhance the collaboration and communication between the buyers and the suppliers, and foster a culture of continuous improvement2. The other options are not the best approach to reduce the costs of poor quality in the supply base, as they are more reactive than proactive, and they do not address the root causes of the poor quality.Conducting supplier appraisals, tracking costs of returns, and inspecting all received products are examples of appraisal costs, which are part of the costs of poor quality, not the solution3.

Before the firm can negotiate or discuss data exchanges with the retailers, it should first review its own data needs and potential trading options. This means that the firm should identify what kind of retail sales data it requires, how frequently, and for what purpose. It should also assess the value and quality of the data, and the costs and benefits of obtaining it. Moreover, the firm should explore what kind of data it can offer in return to the retailers, and how it can create a mutually beneficial data exchange relationship. By reviewing its data needs and potential trading options, the firm can prepare a clear and realistic data exchange proposal that can facilitate the subsequent negotiation or discussion process.

1:Data Processing Agreements: Coordination, Drafting, and Negotiation

According to the ASCM, a comprehensive supply chain transformation action plan is a roadmap that guides the organization to align its supply chain strategy with its business strategy, and to achieve higher performance, efficiency, and sustainability in its supply chain operations1.The main outcome of such a plan is to enable the organization to deliver better value to its customers and stakeholders, and to improve its top and bottom line results1. Some of the steps involved in creating a supply chain transformation action plan are:

• Assessing the current state of the supply chain and identifying the gaps and opportunities for improvement
• Defining the future state of the supply chain and setting the vision, goals, and objectives
• Developing the business case for change and securing the buy-in and support from the senior management and cross-functional teams
• Selecting the best practices, methodologies, and technologies to implement the change and optimize the supply chain processes
• Executing the change and monitoring the progress and results1

The other options are not the main focus of a comprehensive supply chain transformation action plan, but rather some of the aspects or outcomes of the plan.For example, traditional metrics around supply chain performance are important to measure the current state and the improvement potential, but they may not capture the strategic value and impact of the supply chain transformation2.Perfect order targets and inventory levels are some of the operational goals that the plan may aim to achieve, but they are not the ultimate outcome of the plan3.Best practices around Plan, Source, Transform, and Fulfill processes are some of the tools and methods that the plan may use to optimize the supply chain operations, but they are not the purpose of the plan4. Therefore, the most accurate answer is A.

According to the ASCM CTSC Exam Content Manual, developing an organizational mapping is one of the steps in transforming management.An organizational mapping is defined as "a tool that helps to identify the current and future state of the organization’s structure, roles, responsibilities, and reporting relationships"1. An organizationalmapping can help to ensure alignment and consistency across different regions, functions, and processes, and to identify and resolve any gaps or conflicts that may arise during the transformation. By omitting this step, the company failed to recognize and address the difference in the product hierarchy among the regions, which could lead to problems in data integration, reporting, and analysis in the new ERP system.

According to the CTSC Exam Content Manual, one of the steps in the digital supply chain transformation process is to identify and prioritize the strategic assets of the organization, which are the resources and capabilities that provide a competitive advantage and enable value creation1.One of the strategic assets that leadership should have its team of stakeholders prioritize is the internal and external data sources making up the supply chain, as data is the foundation of digital transformation and the key to unlocking insights, innovation, and efficiency2.Data sources can include operational data, customer data, supplier data, market data, and environmental data, among others2. The other options are not necessarily strategic assets, as they may not provide a distinctive edge or value proposition for the organization.Hardware and machinery, truck fleet and warehouses, and free cash flow are examples of tangible assets that can be easily replicated or substituted by competitors3.

According to the CTSC Exam Content Manual, metrics decomposition is the analysis of indicators of supply chain performance from level 1 through 3 in the SCOR model1.Metrics decomposition helps to identify the root causes of performance gaps, prioritize improvement opportunities, and align metrics across different levels and processes1.The SCOR model defines four levels of metrics: level 1 metrics are strategic, cross-functional, and end-to-end; level 2 metrics are tactical and process-specific; level 3 metrics are operational and sub-process-specific; and level 4 metrics are transactional and implementation-specific2.Metrics decomposition is different from metrics attribution, which is the assignment of metrics to the responsible parties or processes1.Metrics decomposition is also different from performance cascading, which is the translation of strategic objectives into operational goals and metrics1. Performance classification is not a term used in the SCOR model.

According to the ASCM, the Connected Customer Capability allows companies to augment traditional transactional interactions to achieve effective and integrated customer engagement throughout the customer, product and service life cycles, from acquisition to service1.One of the benefits of this capability is to increase the awareness of the customers about the company’s products, services, and value proposition, as well as to generate more leads and referrals1.Awareness is the first stage of the customer journey, where the customer becomes aware of the company and its offerings, and decides whether to engage with the company or not1.By improving the connected customer capability, a company can use various channels and technologies to reach out to potential customers, provide relevant and personalized information, and create a positive impression that attracts and retains customers1. Therefore, awareness is the most likely outcome of enhancing the connected customer capability.