Correct Original L4M5 Questions & Leader in Qualification Exams & Trustable L4M5: Commercial Negotiation

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CIPS L4M5 Exam Syllabus Topics:

SectionObjectives
Negotiation planning and preparation- Preparation techniques
  • 1. Information gathering and analysis
    • 2. BATNA and reservation points
      • 3. Setting objectives and targets
        Negotiation strategies and tactics- Approaches to negotiation
        • 1. Concession strategies
          • 2. Tactical behaviours and influence techniques
            • 3. Collaborative and competitive strategies
              Negotiation fundamentals- Principles of commercial negotiation
              • 1. Types of negotiation (distributive vs integrative)
                • 2. Definition and purpose of negotiation
                  Power, ethics and communication in negotiation- Influencing factors
                  • 1. Communication and interpersonal skills
                    • 2. Ethical considerations in negotiation
                      • 3. Sources of negotiation power

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                        CIPS Commercial Negotiation Sample Questions (Q113-Q118):

                        NEW QUESTION # 113
                        Which of the following best describes Leverage quadrant in Kraljic matrix?

                        Answer: B

                        Explanation:
                        In 1983, Peter Kraljic devised a means to segment the supplier base in the article in HBR. In this, he argued that supply items should be mapped against two key dimensions: risk and profitability.
                        Risk relates to the likelihood for an unexpected event in the supply chains to disrupt operations. For instance, in important areas of spend, such as tire suppliers for an automotive are business critical, and should a disruption occur, the auto company is likely itself to face substantial problems.
                        Profitability describes the impact of a supply item upon the bottom line. For certain areas of spend, such as stationery, supplies have only a negligible effect on profits. In other categories, a single source of supply can make or break a business.
                        Putting these two dimensions together yields a classic two-by-two matrix.
                        Source: Peter Kraljic, HBR


                        NEW QUESTION # 114
                        Should a buyer use closed questions in a negotiation?

                        Answer: C

                        Explanation:
                        Asking questions the right way is both an art and a science. Ask the question the wrong way, and the other negotiator might act like a turtle, becoming defensive and withdrawing into their shell. Ask the question the right way, and the other negotiator might "spill the beans.".
                        Closed Questions: How and when to use them?
                        Closed questions are those that require a short and focused answer, and are especially helpful in the beginning stages of the negotiation to encourage interaction. They can be used to clarify a point, or to reconfirm certain facts. For example, you can use a closed question to confirm the amount of units the company can produce in a week, or to clarify that what they are really saying is that they don't feel comfortable outsourcing their accounts to India. Most closed questions only require a simple "yes" or "no" response, so there really isn't much room for misinterpretation - great for finding out where both you and they stand.


                        NEW QUESTION # 115
                        A buyer continually states, during a negotiation, that budget constraints are impacting their ability to make concessions. What type of tactic are they using?

                        Answer: A


                        NEW QUESTION # 116
                        Which of the following are most likely to be fundamentals of Fisher & Ury's principled negotiation?
                        1. Depersonalise the argument
                        2. Focus on positions
                        3. Generate creative options
                        4. Using subjective criteria

                        Answer: B

                        Explanation:
                        Principled negotiation is based on four fundamentals: people, interest, options and criteria:

                        Diagram Description automatically generated
                        1st Principle: separate the people from the problem: Negotiator should depersonalise the situation and accepting that the subject matter of the negotiation. This can be difficult for untrained negotiators, but this is a key skill to develop
                        2nd principle: focus on interests, not positions: It is important in principled negotiations not to focus on their parties' positions (what are expressed during negotiations), but on the interests (underlying needs) behind them
                        3rd principle: invent options for mutual gains: this principle aims to help the parties find a solution that both would benefit from. The more options - or tradeables - that can be brought to the table the better.
                        4th principle: insist on using objective criteria: is about making sure that the negotiation stays focused on outcomes based on objective criteria and that it is productive.
                        LO 1, AC 1.2


                        NEW QUESTION # 117
                        A supplier has offered international football tickets to the procurement manager while they are in the middle of a contract negotiation. What should the procurement manager do?

                        Answer: D

                        Explanation:
                        Accepting gifts during a negotiation can createconflict of interestconcerns and may violate ethical standards.
                        Best practice requires rejecting such offers to maintain transparency and objectivity in decision-making.
                        Reference: L4M5 Commercial Negotiation 2nd edition (CORE), Section 1.4 - Ethics and Professional Standards in Negotiation


                        NEW QUESTION # 118
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