Certified Supply Chain Professional (CSCP) Practice Exam

What must be evaluated if projected available balance (PAB) falls to a negative value?

1. The supplier's ability to meet demand

2. The master production schedule

3. The transportation plan for product delivery

4. The current sales and marketing strategy

The correct answer is: The master production schedule

When the projected available balance (PAB) falls to a negative value, it indicates a potential shortage of inventory, signaling that demand is expected to exceed supply. In such a situation, evaluating the master production schedule becomes crucial. This schedule dictates what products need to be manufactured, when they need to be produced, and in what quantities. When PAB is negative, adjusting the master production schedule can help align production with actual demand, ensuring that sufficient inventory is available to meet customer requirements. The other areas like the supplier's ability to meet demand, the transportation plan for product delivery, and the current sales and marketing strategy are also important in a comprehensive supply chain assessment. However, the immediate corrective action that directly addresses the inventory issue at hand is through adjustments in the master production schedule. This ensures that production aligns closely with demand forecasts and prevents further negative impacts on inventory levels.