Question 1

_____ refers to the extent to which, by choosing a certain course of action, management can meet a previously established goal or standard.
A) Operational benchmarking
B) Efficiency
C) Support-activity benchmarking
D) Effectiveness
E) None of the above.

Accepted Answer

Effectiveness refers to the degree to which a specific goal or objective is achieved. It measures the extent to which the organization has met its predetermined goals or objectives.

Question 2

Which of the following is one of the reasons for measuring performance?
A) Support better decision making.
B) Support better communication.
C) Provide performance feedback.
D) Motivate and direct behavior.
E) All of the above.

Accepted Answer

All of the above are reasons for measuring performance. Measuring performance can support better decision making, communication, and provide feedback to employees. It can also motivate and direct behavior by setting clear goals and expectations.

Question 3

A/An _____ is one that personnel cannot inappropriately influence the results of.
A) efficient measure
B) qualitative measure
C) quantitative measure
D) non-manipulable measure
E) None of the above.

Accepted Answer

A non-manipulable measure is one that is designed in a way that ensures the results cannot be influenced or altered by people involved in the process. This helps to ensure accurate and reliable data, making it an important consideration in many industries and contexts. Efficient, qualitative, and quantitative measures may also be important, but they do not necessarily address the issue of manipulability. Therefore, the best choice is D, non-manipulable measure.

Question 4

_____ refers to the relationship between planned and actual sacrifices made to realize a previously agreed-upon goal.
A) Strategic benchmarking
B) Effectiveness
C) Efficiency
D) Operational benchmarking
E) None of the above.

Accepted Answer

Efficiency refers to the relationship between planned and actual sacrifices made to realize a previously agreed-upon goal. It measures how well resources like money, time, and labor were utilized to complete a task or achieve an objective. Strategic benchmarking and operational benchmarking are methodologies used to improve efficiency and effectiveness in business processes. Effectiveness is the degree to which an objective is achieved, or how well it is accomplished. Therefore, choice C is the best option.

Question 5

_____ involves a comparison of one firm's market strategies against those of another.
A) Functional benchmarking
B) Strategic benchmarking
C) Operational benchmarking
D) Support-activity benchmarking
E) None of the above.

Accepted Answer

Strategic benchmarking involves comparing a company's overall strategies and approaches to those of another company in the same industry. This type of benchmarking focuses on high-level decisions and can help companies identify areas for improvement in their overall approach to the market. A, C, and D are all types of benchmarking, but they focus on more specific areas of a company's operations, such as processes, activities, or functions.

Question 6

A/An _____ demonstrates the impact of purchasing and supply strategies and actions on revenues of the firm.
A) income measure
B) target cost
C) revenue measure
D) target price
E) cost avoidance measure

Accepted Answer

A revenue measure demonstrates the impact of purchasing and supply strategies and actions on the revenues of the firm. It allows companies to assess the effectiveness of their supply chain management and procurement decisions in generating sales and improving profits.

Question 7

_____ is a process that the purchasing function follows when it performs benchmarking comparisons.
A) Strategic benchmarking
B) Support-activity benchmarking
C) Process capability
D) Operational benchmarking
E) Outsourcing

Accepted Answer

The best choice for the process that the purchasing function follows when it performs benchmarking comparisons is operational benchmarking. This type of benchmarking involves the comparison of specific processes or operations within an organization to those of other organizations in order to identify best practices and opportunities for improvement.

Question 8

A/An _____ would typically link to a contractual agreement whereby, for new technologies, the buying firm may get insight, some period of time before new technology developments are shared with other organizations.
A) TQM measure
B) first insight measure
C) cycle time reduction
D) responsiveness measure
E) None of the above.

Accepted Answer

A first insight measure would provide the buying firm with early access to new technology developments before they are shared with other organizations through a contractual agreement. TQM measure, cycle time reduction, and responsiveness measure are not relevant or related to this type of contractual agreement.

Question 9

_____ focus on achieving standardization of components, systems, and services and application of currently used purchased items or the use of industry-standard versus unique items.
A) First insight measures
B) Standardization measures
C) Responsiveness measures
D) Cycle time reduction measures
E) Flexibility measures.

Accepted Answer

The statement clearly refers to standardization measures, which focus on achieving standardization of components, systems, and services, and the use of industry-standard versus unique items.

Question 10

Which of the following is not one of the common problems in measuring performance?
A) Too much detail.
B) Too much and wrong data.
C) Measures that are short-term focused.
D) Drive the wrong performance.
E) Measures of behavior versus accomplishments.

Accepted Answer

Too much detail is not typically considered a problem in measuring performance. In fact, having enough detail can provide a more accurate view of performance. The other options listed (B-E) are all common problems in measuring performance.

Question 11

Which of the following is not one of the benefits of benchmarking?
A) Helps identify the best business or functional practices to include in a firm's business plans.
B) Determines internal customer needs and wants.
C) Breaks down a reluctance to change.
D) Serves as a source of market intelligence.
E) Uncovers a previously unrecognized technological breakthrough.

Accepted Answer

Determining internal customer needs and wants is more directly a function of internal analysis and customer feedback mechanisms rather than benchmarking. Benchmarking typically involves comparing a company's processes, practices, or performance metrics to those of leading companies to identify areas for improvement, rather than focusing on internal customer needs and wants.

Question 12

_____ is the process of determining what the external customer is willing to pay for a product or service and then assigning specific cost targets to the components, assemblies, and systems that make up the product or service.
A) Specific costing
B) Target pricing
C) Total cost analysis
D) Cost avoidance
E) None of the above.

Accepted Answer

Target pricing is the process of determining the price that the customer is willing to pay and then working backward to determine specific cost targets for each component of the product or service. This allows companies to ensure that they are able to provide the product or service at a competitive price while still maintaining profitability.

Question 13

A/An _____ is the amount of time (in weeks or months) from concept to first shipment or provision of a product or service to the external customer.
A) on-time delivery measure
B) time-to-market target
C) responsiveness measure
D) first insight measure
E) cost avoidance measure

Accepted Answer

Time-to-market target refers to the amount of time it takes from when a product concept is developed to when it is first introduced in the market. It is an important measure for companies to stay competitive and gain market share. This measure is typically measured in weeks or months and can help a company to better manage its resources and ensure that it is delivering new products and services to its customers in a timely manner. Therefore, option B is the best choice.

Question 14

All of the following are examples of customer order measures except _____.
A) percentage of on-time delivery
B) total time from customer order to customer delivery
C) returned orders
D) warranty claims
E) inventory turns

Accepted Answer

Customer order measures are focused on tracking the efficiency and effectiveness of the order fulfillment process. Inventory turns, while important for overall supply chain management, are not directly related to customer order measurement. The other options (percentage of on-time delivery, total time from customer order to customer delivery, returned orders, and warranty claims) are all examples of customer order measures.

Question 15

_____ is the continuous measuring of products, services, processes, activities, and practices against a firm's best competitors or those companies recognized as industry or functional leaders.
A) Benchmarking
B) TCO
C) TQM
D) Effectiveness
E) Efficiency

Accepted Answer

Benchmarking is the continuous process of comparing one's own products, services, processes, activities, and practices against those of industry leaders or best competitors to identify areas of improvement and to establish and measure performance targets. TCO (Total Cost of Ownership) is the assessment of the total cost associated with an asset or investment over its entire life cycle. TQM (Total Quality Management) is a management approach that seeks to optimize the quality of products and services while minimizing costs and continually improving processes. Effectiveness is the degree to which a process, product, or service meets predetermined objectives or goals. Efficiency refers to how well resources are used to achieve a desired outcome.

Question 16

All of the following are examples of e-transaction measures except _____.
A) days/weeks/months of supply of inventory
B) absolute number of suppliers
C) percentage of suppliers
D) percentage of advanced shipping notices
E) electronic funds transfer

Accepted Answer

Days/weeks/months of supply of inventory is not a measure of e-transaction, it is a measure of inventory management. The rest of the options (B, C, D, and E) are measures of e-transaction.

Question 17

The _____ measure expresses a maximum number (in absolute or percentage terms) of level of defects allowable for any particular product, assembly, or service.
A) Effectiveness
B) Efficiency
C) TQM
D) Cost avoidance
E) PPM

Accepted Answer

PPM stands for "parts per million" and is a measure of quality control that expresses the maximum allowable number of defects per million parts produced. This measure is commonly used in manufacturing and production industries to ensure high levels of quality in products.

Question 18

A _____ is the increase or decrease in cost resulting from a change in purchasing strategy or practice brought about by an individual or a group.
A) cost change
B) cost avoidance
C) target cost
D) target price
E) purchase price variance

Accepted Answer

The answer of A _____ is the increase or decrease...

Question 19

_____ represents the difference between a price paid and a potentially higher price (which might have occurred if purchasing had not obtained the lower price through a specific effort or action).
A) Target cost
B) Cost reduction
C) Target price
D) Cost avoidance
E) None of the above.

Accepted Answer

Cost avoidance represents the difference between a price paid and a potentially higher price that might have occurred if purchasing had not obtained the lower price through a specific effort or action. Cost reduction and target cost refer to measures taken to decrease costs, while target price is the market price a company aims for when setting prices for its products. Therefore, the correct answer is D) Cost avoidance.

Question 20

_____ measures include tracking actual transportation costs against some preestablished objective, demurrage and detention costs, and premium transportation.
A) Transportation cost avoidance
B) PPM
C) Field failure rate
D) Target prices achieved
E) Transportation cost reduction

Accepted Answer

The measures mentioned (tracking actual transportation costs, demurrage and detention costs, and premium transportation) all relate to transportation cost reduction, which is the focus of option E.

Quiz 19: Performance Measurement and Evaluation

_____ refers to the extent to which, by choosing a certain course of action, management can meet a previously established goal or standard.

Which of the following is one of the reasons for measuring performance?

A/An _____ is one that personnel cannot inappropriately influence the results of.

_____ refers to the relationship between planned and actual sacrifices made to realize a previously agreed-upon goal.

_____ involves a comparison of one firm's market strategies against those of another.

A/An _____ demonstrates the impact of purchasing and supply strategies and actions on revenues of the firm.

_____ is a process that the purchasing function follows when it performs benchmarking comparisons.

A/An _____ would typically link to a contractual agreement whereby, for new technologies, the buying firm may get insight, some period of time before new technology developments are shared with other organizations.

_____ focus on achieving standardization of components, systems, and services and application of currently used purchased items or the use of industry-standard versus unique items.

Which of the following is not one of the common problems in measuring performance?

Which of the following is not one of the benefits of benchmarking?

_____ is the process of determining what the external customer is willing to pay for a product or service and then assigning specific cost targets to the components, assemblies, and systems that make up the product or service.

A/An _____ is the amount of time (in weeks or months) from concept to first shipment or provision of a product or service to the external customer.

All of the following are examples of customer order measures except _____.

_____ is the continuous measuring of products, services, processes, activities, and practices against a firm's best competitors or those companies recognized as industry or functional leaders.

All of the following are examples of e-transaction measures except _____.

The _____ measure expresses a maximum number (in absolute or percentage terms) of level of defects allowable for any particular product, assembly, or service.

A _____ is the increase or decrease in cost resulting from a change in purchasing strategy or practice brought about by an individual or a group.

_____ represents the difference between a price paid and a potentially higher price (which might have occurred if purchasing had not obtained the lower price through a specific effort or action) .

_____ measures include tracking actual transportation costs against some preestablished objective, demurrage and detention costs, and premium transportation.