Certified Supply Chain Professional (CSCP) Practice Exam

Which metric would NOT be used to measure the success of a VMI initiative?

1. Reduction of the bullwhip effect

2. Improved customer service ratings

3. Reduced lead times

4. Reduced stockouts/spoiled goods

The correct answer is: Improved customer service ratings

The metric that would not typically be used to measure the success of a Vendor Managed Inventory (VMI) initiative is the improvement in customer service ratings. While customer service is an essential aspect of overall business performance, it is more of a broader, subjective measure that encompasses various factors beyond just inventory management. Customer service ratings can be influenced by various external factors such as product quality, delivery reliability, customer communication, and the responsiveness of customer service teams, none of which are directly tied to the core functions of a VMI initiative. In contrast, metrics like the reduction of the bullwhip effect, reduced lead times, and reduced stockouts/spoiled goods are directly related to the goals and outcomes of VMI. VMI aims to streamline inventory management, enhance the accuracy of demand forecasting, and improve efficiency within the supply chain. Therefore, these metrics provide more direct indicators of how well the VMI program is functioning and its impact on inventory optimization and operational effectiveness. They reflect the tactical operational changes brought about by implementing VMI, making them more relevant to assessing VMI success.