Deck 17: Business and Its Suppliers

Question 1

Which of these statements is true regarding lead firms and their suppliers in the wake of the global financial crisis?

A) The number of widely used suppliers decreased.
B) Lead firms preferred larger suppliers.
C) Lead firms sought ongoing strategic relationships.
D) All of the above.

Answer 1

D

Question 2

Lead firms often choose to develop their supplier's capabilities when the supplier has a strong management team,many resources,and high technical knowledge.

Answer 2

False

Question 3

A visual representation of the many links between a lead firm and its suppliers,superimposed on a geographical map is called a:

A) Linked list.
B) Supply chain map.
C) Supply web.
D) Network map.

Answer 3

B

Question 4

Assurance that a supplier is in compliance with the relevant code of conduct is determined by a supply chain audit.

Question 5

The term "supply webs" refers to the multiple steps taken to move a product or service from the most distant supplier to the customer.

Question 6

A growing trend is for lead firms to work collaboratively with their suppliers to build capabilities and create shared value.

Question 7

A 2013 survey of senior supply chain managers from more than 800 global firms found that the primary reason for engaging in supplier social responsibility was to improve the financial bottom line.

Question 8

An organization that purchases goods or services from another company is known as a supplier.

Question 9

As a stakeholder,suppliers' interests include:

A) Earning income.
B) Utilizing productive capacity efficiently.
C) Building short-term, but profitable, business relationships.
D) Both A and B, but not C.

Question 10

Because supply chains have become heavily globalized,government regulation efforts are now more concentrated and increasingly effective.

Question 11

Lead firms sometimes create contradictory demands on suppliers,for example by insisting on low costs as well as compliance with expensive environmental standards.

Question 12

All overseas supplier factories that pay low wages are engaging in a highly unethical social practice.

Question 13

An emerging method of auditing suppliers involves gathering factory conditions directly from employees using their mobile phones.

Question 14

A supplier that controls critical worker skills and technical know-how holds which type of power over their lead firm?

A) Economic.
B) Informational.
C) Legal.
D) Voting.

Question 15

One reason lead firms do not change suppliers is due to moral obligation to the workers and community not to cause job loss.

Question 16

Global lead firms that depend on farmed,extracted,or mined resources run a relatively high risk for human rights abuses by their suppliers.

Question 17

A company can develop its own code of conduct or adopt an NGO or industrywide code.

Question 18

When a supply chain audit is conducted,workers are usually willing to share their experiences with the auditors.

Question 19

Suppliers that dump toxic chemicals,emit air pollution,or reduce biodiversity have little impact on the lead firm that buys their products.

Question 20

Which type of supplier is hired to provide products or services directly to a lead firm?

A) Tier-1.
B) Tier-2.
C) Subcontractors.
D) Networks.

Question 21

When a lead firm invests in supplier resources or offers training,this is an example of:

A) Root cause analysis.
B) Supplier development.
C) Supply chain auditing.
D) Shared value.

Question 22

Which of these statements accurately describe codes of conduct?

A) Most early codes of conduct were developed by individual companies.
B) The adoption rate of industry-specific codes of conduct is currently decreasing.
C) Standard-setting organizations have failed to influence industries and individual firms.
D) The costs of building common industry standards have become prohibitive.

Question 23

When suppliers endure audit after audit by different lead firms,this is called:

A) Crowd-sourced auditing.
B) Third-party auditing.
C) Audit chaos.
D) Audit fatigue.

Question 24

Social impacts of global supply chains include:

A) Wages.
B) Working conditions.
C) Employee health.
D) All of the above.

Question 25

The International Labor Organization (ILO)identifies child labor by which factors?

A) A child's age.
B) The work hours.
C) The child's work experience.
D) Both A and B, but not C.

Question 26

Which type of supplier audit is being used when a company hires and trains its own staff of auditors?

A) External.
B) Third-party.
C) Factory.
D) Internal.

Question 27

What is one drawback of conducting supplier audits?

A) Workers trust the auditors to the point of giving away company secrets.
B) Audits scale so well across the supply chain that only general averages can be collected.
C) On-site inspections are expensive.
D) On-site inspections are so fast that teams must conduct hundreds of them in a single day.

Question 28

Which of these statements is not true about supply chain transparency?

A) A firm's social, ethical, and environmental responsibility is revealed.
B) Technology is enhancing supplier transparency.
C) Brand loyalty among consumers is reduced by a firm's revelations.
D) Recent audits and certifications are publicized.

Question 29

According to a 2013 survey of senior supply chain managers,what is the leading reason to invest in supplier social responsibility?

A) To reduce costs.
B) To satisfy government regulations.
C) To create a positive image and enhance brand equity.
D) To avoid disruptions of product supply.

Question 30

According to a recent survey of supply chain managers,which of these social and environmental issues was the most important?

A) Supplier diversity.
B) Energy efficiency.
C) Ethical issues.
D) Health and safety.

Question 31

Which of these conditions raise environmental concerns for supply chain managers?

A) The distance of transporting goods from their source to the consumer.
B) Efficiency within the supply chain.
C) The consolidation of carbon emissions.
D) Both A and B, but not C.

Question 32

The lack of jurisdiction of home country governments over supplier behavior is exemplified by:

A) The United States Department of Labor having no control over safety in Indonesia.
B) OSHA being unable to enforce laws in Alabama.
C) Business elites in developing countries effectively blocking regulation.
D) The Global Compact having moral authority but no enforcement power.

Question 33

Which of these programs offer a common auditing tool for sharing data on the labor,environmental and ethical practices of suppliers?

A) Sustainable Compliance Initiative.
B) Federal Trade Commission.
C) Sedex Global.
D) Both A and C, but not B.

Question 34

Which groups often collaborate when developing industry-wide codes of conduct?

A) Government officials.
B) Employees.
C) Consumer representatives.
D) All of the above.

Question 35

According to a recent survey,what percentage of firms would terminate a supplier if serious violations were found?

A) 7 percent.
B) 26 percent.
C) 48 percent.
D) 97 percent.

Question 36

Richard M.Locke argues that global supply chains are best managed through a combination of public and private governance because:

A) Government-enforced laws give legitimacy to demands for workplace changes.
B) Regulators benefit from record-keeping required by private companies' codes of conduct.
C) Public and private organizations are able to share the enforcement workload.
D) All of the above.

Question 37

This type of audit is perceived by stakeholders as more objective and reliable:

A) Internal.
B) Third-party.
C) Government.
D) Crowd-pleasing.

Question 38

Under which of these conditions is private governance most likely to emerge?

A) Small lead firms have leverage over larger suppliers.
B) Large lead firms have leverage over larger suppliers.
C) The public is totally satisfied with a firm's social and environmental performance.
D) Firms with highly visible brands are more vulnerable to reputational damage.

Question 39

How can a lead firm improve a supplier's performance when the cost to replace the supplier is high?

A) Engage the supplier in capability-building.
B) Fire the supplier.
C) Report the supplier to the Better Business Bureau.
D) Build the supplier's products internally.

Question 40

About 80 percent of human trafficking victims are:

A) Women and girls forced into prostitution.
B) Men enslaved into farming.
C) Men and women involuntarily placed in textile factories.
D) Low-paid hospitality workers.

Question 41

Studying the underlying cause of repeated supplier violations is called:

A) Capability-building.
B) Supplier scoring.
C) Root cause analysis.
D) Supply chain auditing.

Question 42

Which of these measures is (are)frequently used to rate suppliers when using an integrated supplier scorecard?

A) Environmental performance.
B) Product quality.
C) Number of employees.
D) Both A and B, but not C.

Question 43

When firms invest in suppliers to exchange knowledge and collaborate on improvements,they create shared value for:

A) The supplier only.
B) The lead firm only.
C) Both the supplier and the lead firm.
D) The public.

Question 44

When lead firms work with suppliers they can create shared value such as:

A) Higher income for the supplier.
B) Higher quality products for customers.
C) A more stable supply of products.
D) All of the above.

Question 45

Under what conditions might a lead firm choose to develop a supplier rather than replace them?

Question 46

The Gap,General Motors and Patagonia are presented as three examples of firms capturing the extraordinary complexity of the business-supplier relationship.Identify the major components of these examples as a model for other firms to follow in managing its supplier stakeholder relationship.

Question 47

Discuss the social,ethical,and environmental issues that affect suppliers.Provide three examples of suppliers that are currently raising concerns for their lead firms.

Question 48

Define suppliers and explain their interests and power,especially as related to lead firms.How has globalization affected the supply chain?

Question 49

Describe the three types of supplier audits: internal,third-party and crowd-sourced.

Question 50

Explain why some companies are establishing their own forms of private regulation.

Question 51

What is the first step that lead firms take to develop their suppliers?

A) Creating shared value.
B) Capability building.
C) Supplier monitoring.
D) Publicizing the results.

Question 52

Select a common product and create a supply chain map showing the product movement from source to consumer.