Incentives that focus only on the local impact of an action result in decisions that
A) do not maximize total supply chain profits.
B) maximize total supply chain profits.
C) minimize total supply chain profits.
D) minimize total supply chain cost.
E) none of the above

Question

Quizplus · Accepted Answer

Incentives that only focus on the local impact of an action may lead to decisions that optimize the performance of one function or organization in the supply chain, but not the supply chain's overall efficiency. Without considering the impact of an action on the entire system, it may lead to suboptimal results, which will not maximize total supply chain profits. Therefore, choice A is the correct option.

Incentives That Focus Only on the Local Impact of an Action