Question 1

Purchasing is becoming less responsible for sourcing indirect goods and services required by internal groups.

Accepted Answer

Purchasing departments are increasingly responsible for sourcing not only direct materials but also indirect goods and services required by internal groups, as organizations recognize the cost savings and efficiency improvements that can be achieved through centralized procurement strategies.

Question 2

The key to the success of any company is the quality of its employees.

Accepted Answer

The quality of employees directly impacts the success of a company. Skilled and dedicated employees can drive growth and productivity, while poor-quality employees can cause setbacks and harm company culture.

Question 3

An abundance of competitors and choices have conditioned customers to want higher quality, faster delivery, and products and services tailored to their individual needs at a higher total cost.

Accepted Answer

Customers typically desire higher quality, faster delivery, and personalized products and services, but they often want these benefits at a lower total cost, not higher. The abundance of competitors and choices usually leads to more competitive pricing and value for customers.

Question 4

According to Porter, a firm's value chain is composed of primary and support activities that can lead to competitive advantage when configured properly.

Accepted Answer

Porter's value chain concept identifies primary activities such as inbound logistics, operations, outbound logistics, marketing and sales, and service, as well as support activities such as procurement, technology development, human resource management, and firm infrastructure. When these activities are properly aligned and configured, they can lead to competitive advantage for a firm.

Question 5

Global sourcing is a requirement and no longer a luxury for most firms.

Accepted Answer

In today's global economy, most firms cannot solely rely on local suppliers and must explore global sourcing options to remain competitive and meet customer demands.

Question 6

Few of the features that make their way into final products originate with suppliers.

Accepted Answer

Suppliers often provide input and recommendations for product features, but ultimately the decision to include them in the final product rests with the company. The company considers various factors such as market demand, cost, feasibility, and alignment with the overall product strategy before deciding which features are included in the final product.

Question 7

Supply chain management does not require the coordination of activities and flows that do not extend across boundaries.

Accepted Answer

Supply chain management requires not only the coordination of activities and flows within an organization but also across boundaries with suppliers, distributors, and other partners in the supply chain.

Question 8

The routine ordering and follow-up of basic operational supplies is a strategic responsibility.

Accepted Answer

The routine ordering and follow-up of basic operational supplies is an administrative responsibility rather than a strategic one. Strategic responsibilities involve long-term planning and decision-making that drive the overall direction and success of the organization.

Question 9

The development of strategic purchasing practices can only help a company maintain its competitive position in a rapidly changing business environment.

Accepted Answer

Strategic purchasing practices not only help maintain a company's competitive position but can also enhance it by improving efficiency, reducing costs, and fostering innovation through the selection of suppliers that provide high-quality goods and services.

Question 10

In Period 4 of the evolution of purchasing and supply chain management, firms faced stable competition and had access to abundant material - conditions that historically have diminished the overall importance of purchasing.

Accepted Answer

The answer of In Period 4 of the evolution of...

Question 11

Cost management is no longer an integral part of purchasing and supply chain management.

Accepted Answer

Cost management is still an integral part of purchasing and supply chain management as it involves managing costs throughout the procurement process and optimizing spend to achieve better value for the organization.

Question 12

The traditional approach to purchasing and supply management is to build relations with suppliers to jointly pull costs out of the product or service and expect suppliers to contribute innovative ideas that continually add value to a firm's products and services.

Accepted Answer

The traditional approach to purchasing and supply management often focused on price negotiations, cost-cutting, and ensuring supply rather than building long-term relationships with suppliers for joint innovation and value addition. The description provided aligns more closely with contemporary, strategic approaches to supply chain management.

Question 13

Supply management is a broader concept than purchasing.

Accepted Answer

While purchasing is a component of supply management, supply management also encompasses activities such as sourcing, inventory management, supplier relationship management, and logistics.

Question 14

Competition today is no longer between firms; it is between the supply chains of those firms.

Accepted Answer

In today's global economy, competition has shifted from individual firms to their entire supply chains. Supply chain management has become a critical aspect of a company's success, as efficiency and coordination across the supply chain can lead to a competitive advantage.

Question 15

Sophisticated customers, both industrial and consumer, no longer talk about price increases - they demand price reductions!​

Accepted Answer

Sophisticated customers now focus on getting the most value for their money and negotiating for lower prices. They are less willing to accept price increases without clear justification from the provider.

Question 16

The availability of low-cost domestic supplier alternatives has led to the shift away from outsourcing and offshoring.

Accepted Answer

The answer of The availability of low-cost domestic supplier alternatives...

Question 17

Today's emphasis on supplier quality has shifted from detecting defects at the time of receipt or use to prevention early in the materials-sourcing process.

Accepted Answer

The statement is true. The focus now is on preventing defects before they occur, rather than simply detecting them at the time of receipt or use. This shift in emphasis has led to the development of supplier quality management systems and the implementation of proactive quality improvement programs.

Question 18

Distribution management involves the management of packaging, storing, and handling of materials at receiving docks, warehouses, and retail outlets.

Accepted Answer

Distribution management does indeed involve the management of packaging, storing, and handling of materials at receiving docks, warehouses, and retail outlets.

Question 19

Formal organizational charts portray the entirety of the workings of an organization.

Accepted Answer

Formal organizational charts portray the formal structure and hierarchy of an organization, but they do not depict all aspects of its operations, such as informal networks or communication flows.

Question 20

In the manufacturing sector, the percentage of purchases to sales averages 55 percent.

Accepted Answer

The statement is true, as the percentage of purchases to sales in the manufacturing sector typically averages around 55 percent. This means that for every dollar in sales, 55 cents are spent on materials, components, and other inputs needed for production.

Quiz 1: Introduction to Purchasing and Supply Chain Management