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| Section | Objectives |
|---|---|
| Topic 1: Understand the use of specifications in procurement and supply | |
| Topic 2: Understand how to develop a business case for requirements to be sourced from external suppliers | - Analyse how market factors affect procurement |
| Topic 3: Understand market management in procurement and supply | - Contrast direct costs and indirect costs
|
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質問 # 268
Raheem is the head of procurement at a care home. He decides to use a performance specification for the purchase of a new intelligent patient record IT system. Is this a correct approach?
正解：A
解説：
Comprehensive and Detailed Explanation (from CIPS L4M2 - Developing Specifications) A performance specification sets out what the system must do or achieve rather than how it should be built.
According to CIPS L4M2, performance specifications:
* Encourage supplier innovation because they give flexibility in how to meet the outcomes.
* Are suitable where the supplier has more technical expertise.
* Allow technological improvements to be incorporated.
In this case, a complex IT system benefits from supplier innovation, so using a performance specification is correct.
Option A aligns directly with L4M2 principles.
Relevant L4M2 references:
* Section: "Types and purpose of specifications"
* Subsection: "Encouraging innovation through performance specifications"
質問 # 269
A market has a considerable number of buyers and suppliers. Analysis of the market reveals that loyalty from buyers is relatively low and switching to alternative providers is commonplace. Which of the following market characteristics is supporting this type of buyer behaviour?
正解：C
質問 # 270
Which of the following activities are considered as primary activities of an organization according to Porter's value chain? Select TWO that apply:
正解：D、E
解説：
Primary activities consist of inbound logistics, operations, outbound logistics, sales & marketing, service.
Second activities consist of firm infrastructure, human resource management, technology development and procurement The following graph illustrate the value chain (Source: Smartsheet) Graphical user interface, diagram Description automatically generated
Picking and delivery components is inbound logistics.
Maintenance is an example of operations activity.
Sourcing transportation services is an activity of procurement
Assembly design is an activity in research and development (Technology) Recruiting is an activity of human resource management
質問 # 271
A company department is writing a business case to justify the purchase of an expensive piece of capital equipment. Which of the following should be included in the business case?
* Terms and conditions of contract
* Tender evaluation criteria
* Degree of added value
* Financial plan
正解：B
解説：
A business case for capital investment should focus on value, costs, financial return, and strategic benefit - not detailed procurement steps like contract terms or tender scoring.
The CIPS L4M2 Study Guide, Chapter 4: Business Case Development, states:
"The business case should demonstrate the value added to the organisation and include financial justifications such as cost-benefit analysis, payback period, and ROI." Option analysis:
* 1. Terms and conditions - Belong in the contract stage, not in the business case.
* 2. Tender evaluation criteria - Important for sourcing but not part of the business justification.
* 3. Degree of added value - Correct. A core element of any business case.
* 4. Financial plan - Correct. Financial implications, ROI, and funding models must be included.
Correct answer: C (3 and 4 only)
CIPS Study Guide Reference:
* Module: L4M2 - Defining Business Needs
* Chapter 4: Business Case Development
* Section: Contents of a Business Case
質問 # 272
Andrew is responsible for procurement of capital assets at Lumber Ltd. He is devising new business case for the purchase of a new band saw. The purchase price of the saw is $50,000. Andrew estimates that the machine will generate $10,000 per year of net cash flow. What is the payback period of this band saw?
正解：D
解説：
Payback period is the time in which the initial outlay of an investment is expected to be recovered through the cash inflows generated by the investment. It is one of the simplest investment apprais-al techniques.
Since cash flow estimates are quite accurate for periods in the near future and relatively inaccurate for periods in distant future due to economic and operational uncertainties, payback period is an indicator of risk inherent in a project because it takes initial inflows into account and ignores the cash flows after the point at which the initial investment is recovered.
The formula to calculate the payback period of an investment depends on whether the periodic cash inflows from the project are even or uneven.
If the cash inflows are even (such as for investments in annuities), the formula to calculate payback period is:
Payback Period = Initial Investment / Net Cash Flow per Period
When cash inflows are uneven, we need to calculate the cumulative net cash flow for each period and then use the following formula:
Payback Period =A + (B/C)
Where,
A is the last period number with a negative cumulative cash flow;
B is the absolute value (i.e. value without negative sign) of cumulative net cash flow at the end of the period A; and C is the total cash inflow during the period following period A Cumulative net cash flow is the sum of inflows to date, minus the initial outflow.
Reference:
- Payback Period | Formulas, Calculation & Examples (xplaind.com)
- CIPS study guide page 44-47
LO 1, AC 1.3
質問 # 273
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