Deck 14: Global Supply Management

Question 1

Nissan and Renault were able to reduce their purchasing spend by which technique?

A) Standardization
B) Cross-functional teams
C) Optimization
D) Simulation

Answer 1

A

Question 2

An employee hired to manage the overall purchasing cycle is likely performing which function?

A) Supply management
B) Procurement
C) Sourcing
D) Purchasing

Answer 2

C

Question 3

Seeking to reduce the amount of money spent by a firm when purchasing is referred to as _______.

A) revenue management
B) cost management
C) resource management
D) spend management

Answer 3

D

Question 4

All of the following are objectives of supply management EXCEPT this:

A) Diversify goods and services whenever possible to reduce costs
B) Purchase the required goods and services at the lowest total cost of ownership
C) Search for and develop best-in-class suppliers
D) Seek ways to improve the organization's competitive position

Question 5

"The identification, acquisition, access, positioning, and management of resources the organization needs or potentially needs in the attainment of its strategic objectives" refers to the concept of _______.

A) sourcing
B) supply management
C) purchasing
D) procurement

Question 6

A manager that is able to reduce a company's purchasing costs by 10% is likely practicing which function?

A) Yield management
B) Cross-function management
C) Spend management
D) Revenue management

Question 7

The amount of money that a firm spends on goods and services is referred to as _______.

A) COGS
B) purchase spend
C) supply spending
D) cost of supplies

Question 8

"Specifications development, value analysis, supplier market research, negotiation, buying activities, contract administration, inventory control, traffic, receiving and stores" refers to the concept of _______.

A) sourcing
B) supply management
C) quality control
D) procurement

Question 9

An employee hired to manage the acquisition of materials for a large lumber company is likely performing which function?

A) Supply management
B) Inventory
C) Sourcing
D) Purchasing

Question 10

All of the following are objectives of supply management EXCEPT this:

A) Ensure the required level of purchased item quality
B) Purchase the required goods and services at the lowest total cost of ownership
C) Search for and develop as many suppliers as possible
D) Seek ways to improve the organization's competitive position

Question 11

Purchasing goods and services for business purposes can alternatively be referred to as _______.

A) retail buying
B) service buying
C) commercial buying
D) commercial selling

Question 12

In the purchasing cycle, how many steps are involved with preparing for the acquisition of goods and services?

A) 1
B) 3
C) 4
D) 6

Question 13

The purchasing cycle is often broken down into a process with how many steps?

A) 1
B) 2
C) 4
D) 6

Question 14

A "major function of an organization that is responsible for acquisition of required materials, services, and equipment" refers to the concept of _______.

A) sourcing
B) supply management
C) purchasing
D) global sourcing

Question 15

Supply management across international borders is referred to as _______.

A) foreign management
B) global supply management
C) international purchasing
D) worldwide sourcing

Question 16

An employee hired to ensure that resources are properly positioned within an organization is likely performing which function?

A) Supply management
B) Procurement
C) Sourcing
D) Purchasing

Question 17

The professional organization ISM refers to the _______.

A) Institute for Supply Materials
B) Institute for Supply Management
C) Institute for Supplier Manufacturing
D) Institute for Serial Manufacturing

Question 18

An employee hired to vet potential suppliers is likely performing which function?

A) Supply management
B) Procurement
C) Sourcing
D) Capacity management

Question 19

"The entire purchasing process or cycle" refers to the concept of _______.

A) sourcing
B) supply management
C) purchasing
D) procurement

Question 20

In general, the cost of materials accounts for approximately (as of 2013) what percentage of the total value of a shipped product?

A) 20%
B) 40%
C) 60%
D) 80%

Question 21

The final step in the purchasing cycle is

A) Developing the sourcing strategy
B) Soliciting and evaluating bids
C) Notifying the selected supplier and implementing the contract
D) Collecting supplier information

Question 22

Muller Inc. is a supplier for a large auto manufacturer. For the auto manufacturer, Muller is part of its _______.

A) purchasing network
B) supply base
C) sourcing net
D) procurement chain

Question 23

In the purchasing cycle, how many steps are involved with the actual acquisition of goods and services?

A) 1
B) 3
C) 4
D) 6

Question 24

During an internal assessment of purchases, the purchases are commonly divided into _______.

A) spend slots
B) spend categories
C) spend silos
D) spend bins

Question 25

The fourth step in the purchasing cycle is

A) Collecting supplier information
B) Conducting an internal assessment
C) Developing the sourcing strategy
D) Assessing the market

Question 26

The third step in the purchasing cycle is

A) Collecting supplier information
B) Conducting an internal assessment
C) Developing the sourcing strategy
D) Assessing the market

Question 27

The fifth step in the purchasing cycle is

A) Developing the sourcing strategy
B) Soliciting and evaluating bids
C) Notifying the selected supplier and implementing the contract
D) Collecting supplier information

Question 28

Critical parts used in the production of a car are likely an example of _______.

A) low risk, functional
B) high risk, functional
C) low risk, innovative
D) high risk, innovative

Question 29

What type of cards are often used to streamline the purchasing process for low-risk, functional goods?

A) Risk
B) Procurement
C) Supply
D) Employee

Question 30

A bid that conforms to the invitation to bid is said to be _______.

A) responsible
B) inexpensive
C) responsive
D) reliable

Question 31

The second step in the purchasing cycle is

A) Collecting supplier information
B) Conducting an internal assessment
C) Developing the sourcing strategy
D) Assessing the market

Question 32

A bid that indicates that the bidder is capable and willing to perform the work as specified is said to be _______.

A) responsible
B) inexpensive
C) responsive
D) reliable

Question 33

Office supplies are an example of what type of goods?

A) Low risk, functional
B) High risk, functional
C) Low risk, innovative
D) High risk, innovative

Question 34

The lowest priced bidder must also be _______.

A) responsive
B) responsible
C) responsive and responsible
D) neither responsive nor responsible

Question 35

The list of suppliers that a firm is currently using is referred to as the firm's _______.

A) supply network
B) supply net
C) supply stockpile
D) supply base

Question 36

In a competitive-bidding environment, the contract is usually awarded to

A) The least objectionable bidder
B) The lowest priced bidder
C) The most qualified bidder
D) The highest priced bidder

Question 37

The plan to manage the supply of purchased items is referred to as a _______.

A) purchasing plan
B) sourcing strategy
C) sourcing plan
D) purchasing strategy

Question 38

A firm would be most likely to stock extra safety stock of which type of item?

A) Low risk, functional
B) Low risk, innovative
C) High risk, functional
D) High risk, innovative

Question 39

Typical resources for assessing suppliers may include all of the following EXCEPT _______.

A) supplier directories
B) trade magazines
C) sales presentations
D) the lowest cost

Question 40

The first step in the purchasing cycle is

A) Collecting supplier information
B) Conducting an internal assessment
C) Developing the sourcing strategy
D) Assessing the market

Question 41

A supplier might need to receive what before being allowed to quote prices or receive an order from a firm?

A) Purchaser qualification
B) Supply requisitions
C) Procurement permissions
D) Supplier certification

Question 42

Which of the following is used for low cost, noncritical purchases?

A) RFI
B) RFQ
C) IFB
D) Verbal quotes

Question 43

Which of the following is NOT a way for a firm to obtain pricing information and plans from suppliers?

A) Verbal quotes
B) Request for inquiry
C) Request for quote
D) Invitation to bid

Question 44

Which of the following is a formal request for pricing, services, and plans?

A) RFI
B) RFP
C) IFB
D) Verbal quotes

Question 45

Which of the following is similar to an RFQ but can be used for high-cost and complex services?

A) RFI
B) RFP
C) IFB
D) Verbal quotes

Question 46

If a firm is producing near current capacity, they may consider which reason for outsourcing?

A) Lower cost
B) Insufficient capacity
C) Lack of technology or expertise
D) Better quality

Question 47

Salvage value is what type of total cost of ownership cash flow?

A) Acquisition
B) Ownership
C) End of life
D) Salvage value is not a type of total cost of ownership cash flow.

Question 48

Purchase price is what type of total cost of ownership cash flow?

A) Acquisition
B) Ownership
C) End of life
D) Purchase price is not a type of total cost of ownership cash flow.

Question 49

A statement of work may be included with what?

A) RFI
B) RFP
C) IFB
D) Verbal quotes

Question 50

Which of the following is used to collect information on price, product design, timing, and other terms of interest?

A) RFI
B) RFQ
C) IFB
D) Verbal Quotes

Question 51

Which of the following is NOT a type of total cost of ownership cash flow?

A) Acquisition
B) Ownership
C) End of life
D) Inventory

Question 52

Seeking a reduction in costs is an example of which reason for outsourcing?

A) Lower cost
B) Insufficient capacity
C) Lack of technology or expertise
D) Better quality

Question 53

All of the following are reasons for outsourcing EXCEPT this:

A) Lower cost
B) Insufficient capacity
C) Lack of technology or expertise
D) Lower quality

Question 54

Training cost is what type of total cost of ownership cash flow?

A) Acquisition
B) Ownership
C) End of life
D) Transportation cost is not a type of total cost of ownership cash flow.

Question 55

ISO 9000 may play a role in a firm's _______.

A) purchasing certification program
B) supplier certification program
C) customer certification program
D) borrower certification program

Question 56

Disposal cost is what type of total cost of ownership cash flow?

A) Acquisition
B) Ownership
C) End of life
D) Disposal cost is not a type of total cost of ownership cash flow

Question 57

Maintenance cost is what type of total cost of ownership cash flow?

A) Acquisition
B) Ownership
C) End of life
D) Maintenance cost is not a type of total cost of ownership cash flow.

Question 58

Insurance cost is what type of total cost of ownership cash flow?

A) Acquisition
B) Ownership
C) End of life
D) Insurance cost is not a type of total cost of ownership cash flow.

Question 59

Which of the following is used when purchasing specifications can be clearly stated (for relatively small purchases)?

A) RFI
B) RFQ
C) IFB
D) Verbal quotes

Question 60

Transportation cost is what type of total cost of ownership cash flow?

A) Acquisition
B) Ownership
C) End of life
D) Transportation cost is not a type of total cost of ownership cash flow.

Question 61

If a firm has excess capacity, this is an example of what reason for producing in-house?

A) No competent supplier
B) Better quality control
C) Use of idle capacity
D) Protect proprietary technologies

Question 62

Using internal resources to make goods and services that were previously outsourced is referred to as _______.

A) crowdsourcing
B) insourcing
C) offshoring
D) inshoring

Question 63

If a firm lacks expertise to manufacture an item, they may consider which reason for outsourcing?

A) Lower cost
B) Insufficient capacity
C) Lack of technology or expertise
D) Better quality

Question 64

Technology that needs to be protected is an example of what reason for producing in-house?

A) No competent supplier
B) Better quality control
C) Use of idle capacity
D) Protect proprietary technologies

Question 65

The primary trade agreement affecting the United States, Canada, and Mexico is _______.

A) NAFTA
B) EU
C) COMESA
D) ASEAN

Question 66

In a make-or-buy break-even analysis, F's refer to _______.

A) fixed costs
B) variable costs
C) both fixed and variable costs
D) neither fixed nor variable costs

Question 67

An alternative name for insourcing is _______.

A) clearsourcing
B) nearsourcing
C) frontsourcing
D) backsourcing

Question 68

Approximately what percentage of firms reported doing at least some sourcing internationally?

A) 10%
B) 25%
C) 50%
D) 80%

Question 69

Which of the following is NOT a reason to consider producing in-house?

A) Protect proprietary technology
B) Better quality control
C) Use of idle capacity
D) Too many competent suppliers

Question 70

It is projected that imports will continue to increase by approximately what percentage per year in developed countries?

A) 1%
B) 2%
C) 6%
D) 20%

Question 71

If no suppliers are available, this is an example of what reason for producing in-house?

A) No competent supplier
B) Better quality control
C) Use of idle capacity
D) Protect proprietary technologies

Question 72

If the firm is capable, it might choose the make option. This is an example of what reason for producing in-house?

A) No competent supplier
B) Better quality control
C) Use of idle capacity
D) Protect proprietary technologies

Question 73

If it is more economical to choose the make option, this is an example of what reason for producing in-house?

A) No competent supplier
B) Better quality control
C) Use of idle capacity
D) Lower cost

Question 74

The use of a mix of insourcing and outsourcing is referred to as _______.

A) fixed sourcing
B) low sourcing
C) co-sourcing
D) multisourcing

Question 75

The main driver that firms reported for purchasing internationally was _______.

A) better quality
B) lower cost
C) made by sustainable means
D) faster delivery

Question 76

If a firm desires fine control of lead time and logistics costs, it might choose the make option. This is an example of what reason for producing in-house?

A) Control of lead time and logistics
B) Better quality control
C) Lower cost
D) Protect proprietary technologies

Question 77

Suppliers may have better technologies, processes, and skilled labor. This may be what reason to consider outsourcing?

A) Lower cost
B) Insufficient capacity
C) Lack of technology or expertise
D) Better quality

Question 78

It is projected that imports will continue to increase by approximately what percentage per year in developing countries?

A) 1%
B) 2%
C) 6%
D) 20%

Question 79

The break-even point refers to the point at which _______.

A) make cost > buy cost
B) make cost = buy cost
C) make cost < buy cost
D) Make cost and buy cost are unrelated to the break-even point.

Question 80

In a make-or-buy break-even analysis, V's refer to _______.

A) fixed costs
B) variable costs
C) both fixed and variable costs
D) neither fixed, nor variable costs