Question 1

Strategic sourcing requires one-way improvement efforts where the buying firm tells the supplying firm what is best.

Accepted Answer

Strategic sourcing involves collaborative efforts between the buying and supplying firms. The buying firm works with the supplier to identify opportunities for improvement and both parties work together to implement changes. It's a two-way improvement effort.

Question 2

Strategic sourcing is about understanding the markets you're purchasing from inside and out and learning from your own organization and your suppliers' organizational processes,working as a mediator between suppliers and your organization,and capturing information and using it to improve relationships.

Accepted Answer

Strategic sourcing involves all the aspects mentioned in the statement including understanding markets, learning from organizational processes, working as a mediator, and capturing information to improve relationships.

Question 3

When a group or network of firms collaborates in a partnership (alliance)fashion; the collaboration is sometimes referred to as a tactical network.

Accepted Answer

The term typically used for a group or network of firms collaborating in a partnership fashion is "strategic network" or "strategic alliance," not "tactical network." This collaboration is aimed at achieving long-term strategic goals rather than short-term or tactical objectives.

Question 4

The term value chain means we include the supply chain in our analysis and management with:

Accepted Answer

The value chain concept includes the downstream portion of the chain, such as marketing and distribution, as it focuses on adding value to the product or service from production to the end consumer.

Question 5

When we add the term networks to the supply and value chains, we are emphasizing the need to focus on and interactively communicate with:

Accepted Answer

The answer of When we add the term networks to...

Question 6

SM does not require change driven by upper management.

Accepted Answer

SM, or social media management, may involve changes in organizational strategy, communication, and customer service. These changes often require buy-in and support from upper management to be successful.

Question 7

The five “right objectives” of purchasing are:

Accepted Answer

The answer of The five “right objectives” of purchasing are:...

Question 8

World-class supply managers need not improve supply processes before the processes have been implemented.

Accepted Answer

World-class supply managers recognize the importance of improving supply processes even before they have been implemented. This helps to ensure that the processes are optimized and efficient from the beginning and provides a solid foundation for future improvements.

Question 9

When the group of firms view each other as partners and collaborate effectively for the good of the larger group,then they leave established an extended enterprise characterized by virtual integration.

Accepted Answer

Virtual integration is a concept in which a group of firms work together and view each other as partners to achieve common goals. This approach allows for efficient collaboration and the sharing of resources and knowledge. When firms establish this kind of extended enterprise, it can lead to improved competitiveness and overall success for the group.

Question 10

The major reason supply management can greatly improve a firm’s return on investment (ROI) is:

Accepted Answer

Every dollar saved in purchasing directly contributes to profit, thus improving the firm's ROI.

Question 11

Strategic sourcing differs from tactical purchasing in that this activity periodically:

Accepted Answer

Strategic sourcing involves analyzing the organization's spend, analyzing the supply market, and developing sourcing strategy and plans. Tactical purchasing, on the other hand, focuses on the day-to-day activities involved in purchasing goods and services. Therefore, the best answer is E, which includes all three activities associated with strategic sourcing. Choice D is incorrect because outsourcing basic business services such as security is not part of strategic sourcing or tactical purchasing.

Question 12

The concept of a supply chain means we analyze and manage:

Accepted Answer

The concept of a supply chain involves analyzing and managing a chain or network of upstream suppliers, which is the best option out of the given choices. Converters, original equipment manufacturers (OEM), and extractors may be part of the supply chain but do not fully encompass it. "Key suppliers" is a vague term as all suppliers in the supply chain could be considered key to some degree.

Question 13

Strategic sourcing is about dominating the markets you're purchasing from through force and intimidation,never letting the supplier forget that you are the "boss."

Accepted Answer

This statement is incorrect. Strategic sourcing is about building strong relationships with suppliers and leveraging those relationships to negotiate better deals, not about using force and intimidation.

Question 14

When the group of firms view each other as partners and collaborate effectively for the good of the larger group,then they leave established a transactional relationship.

Accepted Answer

When the group of firms view each other as partners and collaborate effectively for the good of the larger group, they have established a collaborative or strategic partnership. A transactional relationship usually refers to a situation where the firms have a simple, one-off exchange of goods or services for a price, without a long-term commitment or collaboration.

Question 15

Maintenance is an issue that should be considered after equipment has been purchased.

Accepted Answer

Maintenance should be considered before purchasing equipment to ensure that the equipment can be properly and cost-effectively maintained over its expected lifespan, impacting total cost of ownership and operational efficiency.

Question 16

The term supply management is broader than the purchasing function because it:

Accepted Answer

The answer of The term supply management is broader than...

Question 17

Supply management’s impact on the bottom line includes the ability to increase sales by:

Accepted Answer

A is the best choice as it directly links supply management to increasing sales through reducing product development time by using cross-functional teams including suppliers. B and C may impact the bottom line by lowering costs, but they don't necessarily lead to an increase in sales. D is incorrect as it includes all the options, some of which are not directly linked with increasing sales. E is also incorrect as supply management does have an impact on the bottom line, therefore none of the above is not a valid answer.

Question 18

Strategic sourcing requires two-way continuous improvement process work from each organization.

Accepted Answer

Strategic sourcing involves continuous monitoring and improvement of both the buying organization and the supplier. It is a collaborative effort that requires both parties to work towards achieving mutual goals and improving the overall value chain. Therefore, the statement is true.

Question 19

Supply management does not have much of an impact on the bottom line.

Accepted Answer

Supply management can have a significant impact on the bottom line through cost savings, improved efficiency, and better supplier relationships. Effective supply management can help businesses reduce costs and improve profitability.

Question 20

“Lean Thinking” can help reduce total cost of ownership (TCO), this means the supply team in the entire “chain” must work to:

Accepted Answer

Lean thinking aims to eliminate waste and optimize value-added activities. This means reducing costs that do not add value to the final product or service, such as excess inventory, unnecessary transportation, and overproduction. Such costs are referred to as non-value costs. Therefore, reducing non-value costs will help lower the total cost of ownership (TCO) for the organization.

Quiz 1: The Progression to Professional Supply Management