Certified Supply Chain Professional (CSCP) Practice Exam

What is one of the significant drawbacks of a pull system?

1. Excess inventory is maintained at production sites

2. Orders likely to increase as they travel up the chain

3. All ordering is done centrally

4. Excessive forecasts are required for operation

The correct answer is: Orders likely to increase as they travel up the chain

A significant drawback of a pull system is that orders are likely to increase as they travel up the chain. In a pull system, production is based on actual demand rather than forecasts, which can lead to fluctuations in order quantities as organizations respond to customer demand. As each step in the supply chain reacts to the demand from the next step, a cascade effect can occur, increasing the orders as they move upstream. This can create inefficiencies and potential delays, especially if the system is not well synchronized. Recognizing this characteristic highlights the importance of effective communication and coordination among all players in the supply chain. An effective pull system requires that all participants be aligned in their operations to manage the variability in demand without causing excessive strain on any one part of the supply chain. This pulls attention to the necessity of balancing responsiveness with stability in order management.