Question 1

A critical assessment of the increased supply risks associated with offshore sources must be made after contracting, not before a commitment is made.

Accepted Answer

A critical assessment of supply risks should be made before contracting to ensure informed decision-making and risk mitigation.

Question 2

The largest differences in communication styles across countries are message speed and level of content.

Accepted Answer

Message speed and level of content can vary greatly across different cultures and countries. In some cultures, communication may be very fast-paced and direct, while in others it may be slower and more indirect. Additionally, the level of detail and depth of information conveyed in communication can vary depending on cultural norms and expectations.

Question 3

Buyers are never reluctant to shift business from domestic sources to unknown offshore sources.

Accepted Answer

Buyers can be reluctant to shift their business from domestic sources to unknown offshore sources due to concerns about quality, reliability, language barriers, and cultural differences. They may also face additional costs for transportation, customs duties, and communication. Therefore, buyers often conduct extensive research and due diligence before deciding to work with offshore sources.

Question 4

The use of a full-service trading company may actually result in a lower total cost for international purchases compared with performing each activity individually.

Accepted Answer

Full-service trading companies often have established relationships with suppliers, which can lead to better pricing and terms. They also handle all aspects of the transaction, including logistics and compliance, which can save time and money compared to performing these activities individually.

Question 5

Always assume that an offshore company can automatically satisfy a buyer's performance requirements or expectations.

Accepted Answer

Offshore companies may not necessarily meet a buyer's performance requirements or expectations due to potential differences in quality, communication barriers, or other factors.

Question 6

Buyers should not underestimate the potential effects of extended distances on their ability to plan and manage a worldwide supply chain.

Accepted Answer

Extended distances can result in longer lead times, higher transportation costs, and increased communication challenges, all of which can impact a buyer's ability to effectively plan and manage a global supply chain. It is important to carefully consider these factors when evaluating potential suppliers and supply chain strategies.

Question 7

Developing countries seldom rely on personal relations and trust to cover many legal issues because of an adequate legal system.

Accepted Answer

Developing countries often rely on personal relations and trust to cover legal issues due to an inadequate legal system.

Question 8

A major complaint about Americans is our ignorance of other cultures.

Accepted Answer

While this is a generalization and not true for all Americans, there is a common stereotype that Americans lack knowledge or interest in other cultures outside of their own.

Question 9

What is an illegal activity in the United States is never an accepted business practice in many other regions.

Accepted Answer

Some activities that are illegal in the United States may be legal and accepted business practices in other regions due to differing laws and cultural norms.

Question 10

Cultural differences between countries seldom result in unwelcome surprises when buying internationally.

Accepted Answer

Cultural differences between countries can often result in unwelcome surprises when buying internationally. For example, different countries may have different legal requirements or standards for products, different social norms around negotiation or haggling, or different customs around gift-giving or tipping. It is important for buyers to research and understand these differences to avoid any misunderstandings or negative experiences.

Question 11

Trade shows are often one of the worst ways to gather information on many suppliers at one time.

Accepted Answer

Trade shows can be highly effective for gathering information on many suppliers at one time. They provide an opportunity to speak directly with representatives from multiple companies and see product demonstrations. However, it is important to carefully evaluate the information received at trade shows and consider other sources of information as well.

Question 12

The United States is still the undisputed product and process technology leader in the world.

Accepted Answer

While the United States remains a global leader in many areas of technology, it is no longer the undisputed leader in all aspects of product and process technology. Other countries, particularly in Asia and Europe, have taken leading positions in various sectors such as semiconductor manufacturing, telecommunications, and green energy technologies.

Question 13

In some societies, such as Thailand and Indonesia, saying "yes" is merely being polite and does not necessarily mean that they agree with what you are saying.

Accepted Answer

In some societies, saying "yes" is seen as a way of showing respect and politeness, even if they do not necessarily agree with what is being said.

Question 14

Few trade consulates have trade experts who are eager to do business with American buyers.

Accepted Answer

This statement is not entirely true as some trade consulates do have trade experts who are eager to do business with American buyers. It depends on the specific consulate and its priorities.

Question 15

U.S. purchasers stuck with domestic suppliers that produce poor quality often begin to source offshore components with the hope of improving end-product quality.

Accepted Answer

This statement suggests that U.S. purchasers may turn to foreign suppliers in order to improve the quality of the components used in their products. Therefore, the statement is true.

Question 16

Regardless of the technique used to overcome worldwide sourcing barriers, the effort will fail unless top management supports worldwide sourcing.

Accepted Answer

Top management support is crucial in the success of any initiative, including worldwide sourcing. Without their endorsement and leadership, it may be difficult to overcome the barriers that come with sourcing from different parts of the world.

Question 17

Most offshore organizations like dealing with the U.S. legal system and long contracts.

Accepted Answer

Offshore organizations often prefer shorter contracts and are wary of dealing with the U.S. legal system, which can be complex and time-consuming.

Question 18

In supply management, the cost/price benefits associated with sourcing in developing countries are an insignificant motivation for remaining competitive in an increasingly global environment.

Accepted Answer

The cost/price benefits associated with sourcing in developing countries can be a significant motivation for remaining competitive in an increasingly global environment, especially for products with low labor and material costs. However, other factors such as quality, reliability, and ethical considerations also play a crucial role in supply management.

Question 19

The most common method for overcoming barriers to worldwide sourcing involves education and training, which can generate support for the process as well help overcome the anxiety associated with change.

Accepted Answer

Education and training can indeed help overcome barriers to worldwide sourcing by generating support and reducing anxiety associated with change.

Question 20

Purchasing should consider only suppliers that capable of meeting rigid quality and delivery standards, although far too often price differentials become the primary criterion behind an offshore sourcing decision.

Accepted Answer

Purchasing should prioritize suppliers who can meet quality and delivery standards over price when considering offshore sourcing decisions.

Quiz 10: Worldwide Sourcing