Free Practice Questions for APICS CPIM-8.0 Exam

Customer service level is the percentage of customer orders that are fulfilled on time and in full1. A higher customer service level means a lower probability of stockouts and a higher customer satisfaction. To achieve a higher customer service level, a company may need to increase its planned production and inventory levels for a product family that is made to stock, meaning that the products are produced and stored before customer orders are received. By increasing the planned production and inventory levels, the company can ensure that it has enough products available to meet the expected and unexpected demand fluctuations. Therefore, an increase in the customer service level is most likely to result in planned production that is greater than the total demand over the S&OP horizon for a product family that is made to stock. Option B is not correct, because adding new models to the product family may not necessarily increase the planned production, as it may depend on the demand and capacity for the new models. Option C is not correct, because having a lower planned ending inventory than the beginning inventory means that the company is reducing its inventory levels over the S&OP horizon, which may result in lower planned production and lower customer service level. Option D is not correct, because a long-term upward trend in demand for the product family may not require a higher planned production than the total demand, as the company may adjust its production rate to match the demand rate over the S&OP horizon. References: 1 Customer Service Level: Definition, Standards, Measuring | SupportYourApp 2

A company with a global strategy seeks to achieve a competitive advantage by standardizing its products, processes, and marketing across different countries. It leverages economies of scale and scope, as well as global brand recognition, to gain market share and profitability. It does not adapt to local preferences or conditions, but rather imposes a uniform approach to all markets. References: EXAM CONTENT MANUAL PREVIEW, page 6, section 1.1.2. Strategic Supply Chain Management: The Five Core Disciplines for Top Performance, Second Edition, page 19, section 1.2.

Enterprise resource planning (ERP) systems are software platforms that help organizations manage and integrate the essential parts of their businesses, such as finance, supply chain, operations, human resources, and more. ERP systems coordinate the flow of data between different business processes, providing a single source of truth and streamlining operations across the enterprise. ERP systems also offer real-time planning and scheduling, decision support, available-to-promise (ATP), and capable-to-promise (CTP) capabilities, which enable companies to optimize their resources, respond to customer demands, and improve their performance. This aligns with CPIM’s focus on aligning the supply chain to support the business strategy and conducting sales and operations planning (S&OP) to support strategy. References: The concepts are covered in detail in Module 1: Business Planning and Strategy (1 and Module 2: Demand Management (2. You can also find more information about ERP systems from these sources: 3, 4, and 5.

In MTO environments, production starts only after an order is received. There is no finished goods inventory to buffer demand fluctuations. Instead, customer order backlog expands or contracts with changing sales volumes.

“MTO environments manage demand fluctuations through the customer order backlog rather than inventory.”

— APICS CPIM ECO and SMR Modules – MTO Production Strategy Section

 The shortest processing time rule is a prioritization rule that assigns the highest priority to the job that requires the least amount of processing time. This rule minimizes the average flow time of jobs and reduces the number of jobs in queue. The critical ratio rule assigns priority based on the ratio of time remaining until the due date to the remaining processing time. The fewest operations remaining rule assigns priority based on the number of remaining operations for each job. The first come, first served rule assigns priority based on the arrival time of the jobs. References: Managing Supply Chain Operations, Chapter 9: Scheduling and Sequencing, page 237. Manufacturing Planning and Control for Supply Chain Management: The CPIM Reference, Second Edition, Chapter 13: Scheduling and Execution, page 419.