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Oliver is a procurement manager and he is trying to work out the likelihood that a supplier fails to deliver to the warehouse two days in a row. Which of the following methodologies should Oliver use?
Suggested Answer: A
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The correct answer is 1 - the 3rd party can provide broader experience and expertise. They can advise on best practice and will know how to advise Robot Ltd as they will have experience across a wide range of companies. This is explained on p.91 of the study guide
33 comments · newest first
DU
Dustin
11 months ago
Binomial is definitely the best option for two consecutive failures!
DA
Dannette
11 months ago
Poisson? Really? That doesn't seem right for this situation.
MA
Marisha
12 months ago
Wait, why not normal distribution? Seems like a solid choice too.
HE
Helga
12 months ago
Totally agree, it fits the scenario perfectly!
MA
Marla
1 year ago
I think binomial distribution is the way to go here.
BU
Buddy
1 year ago
I feel like value at risk is more about financial metrics, so it probably wouldn't apply to this situation with supplier deliveries.
LA
Lavonna
1 year ago
I practiced a similar question where we had to determine probabilities for discrete events, and I think the Poisson distribution could be relevant too.
TH
Thurman
1 year ago
I'm not entirely sure, but I remember something about normal distribution being used for continuous data, so that might not fit here.
EM
Emerson
1 year ago
I think Oliver might want to use the binomial distribution since he's looking at the probability of a specific number of failures over a set period.
ST
Stevie
1 year ago
Value at risk seems like an odd choice for this problem. That's typically used for financial risk, not supply chain reliability. I'm going to rule that one out and focus on the probability distributions instead.
FL
Flo
1 year ago
Okay, I think the binomial distribution makes the most sense here. We have a binary outcome (deliver or not deliver) and we're looking at the probability of a specific number of "failures" (two days in a row). I'll work through the binomial formula to calculate the likelihood.
CL
Claribel
1 year ago
Hmm, I'm a bit unsure about this one. I know normal distribution is commonly used for continuous variables, but I'm not sure if that applies here. Maybe I should review the characteristics of the other distributions to see which one is more appropriate.
DO
Dominga
1 year ago
This seems like a straightforward probability question. I'd start by thinking through the different distribution options and which one best fits the scenario of a supplier failing to deliver two days in a row.
TH
Therese
1 year ago
I heard Oliver's supplier is so unreliable, they're sponsored by the Bermuda Triangle.
MA
Marylin
1 year ago
Poisson Distribution might also work well in this case, considering the supplier's track record.
KA
Kaitlyn
1 year ago
I agree, binomial distribution is the best choice for this scenario.
AL
Alishia
1 year ago
Oliver should use binomial distribution to calculate the likelihood.
DO
Dorsey
2 years ago
Wow, value at risk? That's for stock market analysis, not procurement. I think Oliver needs to stick to the basics here - the binomial distribution is the way to go.
IZ
Izetta
2 years ago
Oh, come on! Normal distribution? That's for, like, bell curves and stuff. This is all about supplier reliability. Clearly, the binomial distribution is the way to go.
BE
Bettye
1 year ago
User 3: I agree, binomial distribution is the way to go for this scenario.
OL
Oliva
1 year ago
User 2: User Comment: I agree, binomial distribution seems more appropriate for supplier reliability.
WE
Wendell
1 year ago
User 1: I think normal distribution is not the right choice here.
LE
Lemuel
2 years ago
I think Poisson Distribution could also work, as it deals with the number of events happening in a fixed interval of time.
NI
Nida
2 years ago
I agree with Sharee, binomial distribution is the most appropriate for this scenario.
CA
Casie
2 years ago
Hmm, I'm not so sure. Binomial distribution seems a bit too simplistic. Maybe the Poisson distribution would be a better fit, since it's often used for rare events like supplier failures.
FR
Frankie
2 years ago
I think binomial distribution might not capture the variability of supplier failures accurately.
VE
Vesta
2 years ago
I agree, Poisson distribution would be more appropriate for rare events.
SH
Sharee
2 years ago
Oliver should use binomial distribution.
HU
Huey
2 years ago
I think Oliver should use the binomial distribution method. It's perfect for analyzing the probability of a supplier failing to deliver on two consecutive days.
VE
Vesta
1 year ago
Oliver should definitely avoid using the value at risk methodology for this particular analysis.
SA
Sarina
2 years ago
I'm not sure, but I think the normal distribution method might also be worth exploring.
CH
Christene
2 years ago
I think Oliver should also consider the Poisson Distribution method, it could provide valuable insights.
JE
Jeanice
2 years ago
I agree, the binomial distribution method is the most appropriate for this scenario.