DSCM404 SUPPLY CHAIN COST MANAGEMENT

Description

SESSION	JUL – AUG 2025
PROGRAM	MASTER OF BUSINESS ADMINISTRATION (MBA)
SEMESTER	4
COURSE CODE & NAME	DSCM404 SUPPLY CHAIN COST MANAGEMENT

 

 

Assignment Set – 1

 

 

1. What is Cash to Cash Cycle and why is it important? Discuss the various challenges faced in managing cash to cash cycle and what are the strategies to control it. 6+4

Ans 1.

Concept of Cash-to-Cash Cycle

The Cash-to-Cash (C2C) cycle, also known as the cash conversion cycle, measures the time taken by a company to convert its investments in inventory and other resources into cash flows from sales. It reflects the operational efficiency of a business by showing how quickly capital invested in raw materials, production, and sales is recovered. The cycle consists of three key components—Days Inventory Outstanding (DIO), Days Sales Outstanding (DSO), and Days Payable Outstanding (DPO).

The formula used is:

 

 

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2. What is the significance of Non-financial performance measurement and what are the key dimensions of Non-Financial performance measurement? List some of the challenges in Non-Financial performance management. 7+3

Ans 2.

Significance of Non-Financial Performance Measurement

Non-financial performance measurement focuses on assessing organizational success beyond monetary outcomes. It includes qualitative and operational indicators that provide insights into efficiency, customer satisfaction, innovation, and sustainability. In supply chain management, financial data alone cannot reveal the entire picture; non-financial metrics are essential to evaluate long-term value creation and strategic alignment.

The significance of non-

 

3. Discuss the Critical Costs that need to be managed to make the supply chain more cost effective. 10

Ans 3.

Critical Costs to be Managed for a Cost-Effective Supply Chain

A cost-effective supply chain focuses on delivering maximum customer value at the lowest possible operational cost. Managing critical costs effectively ensures competitiveness, profitability, and efficiency. Supply chain cost management encompasses all expenses incurred from sourcing raw materials to delivering finished goods to customers. Understanding and controlling these costs enables organizations to enhance productivity, improve margins, and

 

Assignment Set – 2

 

4. Discuss the different types of Primary, Secondary and tertiary costs of any supply chain. What are the key challenges and considerations in implementing allocation-based systems for cost measurement within the supply chain? 7+3

Ans 4.

Types of Supply Chain Costs

Supply chain costs can be broadly categorized into primary, secondary, and tertiary costs. These classifications help organizations trace expenditures throughout the supply chain and identify areas for improvement or optimization. Understanding the hierarchy of these costs allows companies to align strategic, operational, and financial objectives effectively.

Primary Costs

Primary costs are the direct expenses associated with the production and movement of goods. These include procurement costs, raw material acquisition, manufacturing expenses, and direct labor. They represent the foundation of the supply chain cost structure. Procurement and production decisions directly influence primary costs, making them essential in determining pricing and profitability. For example, sourcing from global suppliers may reduce unit costs but

 

5. How can organisations effectively select key cost drivers within their supply chain and manage their overall cost structure 10

Ans 5.

Selecting Key Cost Drivers

Cost drivers are the underlying factors that influence the total cost of supply chain operations. Identifying and managing them effectively is vital for maintaining profitability and operational control. Cost drivers vary by industry, process complexity, and organizational priorities but generally include procurement, production, logistics, and inventory management.

Organizations begin by conducting cost mapping to understand where resources are consumed across the value chain. This involves categorizing costs into fixed, variable, and semi-variable components and analyzing their correlation with operational activities. Advanced analytics and enterprise resource planning (ERP) systems play a key role in identifying cost drivers such

6. What are the key elements of corrugated box cost calculations? 10

Ans 6.

Key Elements of Corrugated Box Cost Calculations

Corrugated boxes are an integral component of packaging in supply chain logistics, providing protection, branding, and transportation efficiency. Understanding the cost structure behind corrugated boxes is essential for managing packaging budgets, optimizing design, and maintaining profitability. The cost calculation involves assessing material, manufacturing, logistics, and overhead factors that together determine the final price of each unit.

Elements of