A senior executive claims that a move to a “just-in-time” logistics sy

QUESTION

A senior executive claims that a move to a “just-in-time” logistics system would be a mistake because even if the system is effective at reducing inventory and handling costs, the change would not be noticed by customers.

The executive claims that the change should be rejected as it runs counter to Clean Sweep’s goal of being customer-focused. Which of the following is the best criticism of the senior executive’s position?
A) It does not prove that focusing on the customer helps an organization become successful.
B) It does not suggest an improvement to Clean Sweep’s current system.
C) It fails to recognize that having a more efficient supply chain will allow Clean Sweep to offer more value to its customers.
D) It does not establish that the costs of switching to the new system would outweigh any cost-reduction benefits the system might provide.
E) It does not describe the inventory systems used by Clean Sweep’s competitors.

ANSWER

Answer: C
Explanation: C) The senior executive is basically saying that any change would have to be noticed by customers in order for the change to be a good one. But that doesn’t make sense. All other things being equal, saving money in production and distribution is a good thing even if the customers don’t notice the changes. Besides, as Choice C points out, having lower costs can allow Clean Sweep to offer more value, for example, by lowering prices. Choice A: The value of being customer-focused isn’t at issue here. The problem is that the senior executive takes it too far by claiming that every good idea must be perceived by the customer. Choices B, D, and E are accurate in that the argument does not do these things, but there is no reason to believe that they are necessary.