Which of the following indicators is most appropriate to use as a measure of supply chain utilization?
A. Production equipment productivity
B. Net asset turnover
C. Value-added productivity per employee
D. Upside flexibility
Answer: B
Explanation:
Context: Measuring supply chain utilization involves understanding how effectively resources are
used in the supply chain.
Options Breakdown:
A. Production equipment productivity: This measures the efficiency of production equipment but not overall supply chain utilization.
B. Net asset turnover: This ratio measures how efficiently a company uses its assets to generate sales, reflecting overall supply chain utilization.
C. Value-added productivity per employee: This focuses on employee productivity rather than supply chain utilization.
D. Upside flexibility: This measures the ability to increase production when needed but does not reflect utilization.
Correct Answer Justification: Net asset turnover is an appropriate indicator of supply chain utilization as it reflects the efficiency of asset use in generating revenue.
Reference: Financial performance metrics in supply chain management Textbooks on supply chain efficiency and utilization
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