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| Section | Objectives |
|---|---|
| Understand how to develop a business case for requirements to be sourced from external suppliers | - Analyse how market factors affect procurement |
| Understand market management in procurement and supply | - Contrast direct costs and indirect costs
|
| Understand the use of specifications in procurement and supply |
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問題 #22
Which of the following activities are considered as primary activities of an organization according to Porter's value chain? Select TWO that apply:
答案：B,E
解題說明：
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
問題 #23
How can a procurement department meet the business needs when purchasing leverage items?
答案：B
解題說明：
Leverage items are high-value, low-risk goods or services - where buyers have strong bargaining power and can use tactics like competitive tendering to gain favourable terms.
The CIPS L4M2 Study Guide, Chapter 4: Business Case and Sourcing Decisions, describes leverage items using the Kraljic Matrix:
"Leverage items are typically sourced using competitive tendering, framework agreements, and other methods that maximise value from the supply market." Option analysis:
* A. Long-term partnerships - Suitable for strategic or critical items.
* B. Efficient processes - Important but not the key strategy for leverage items.
* C. Call-off contracts - Can be used but apply more to routine items.
* D. Competitive tendering - Correct. A main strategy for exploiting purchasing power.
Correct answer: D
CIPS Study Guide Reference:
* Module: L4M2 - Defining Business Needs
* Chapter 4: Business Case Development
* Section: Sourcing Strategy - Kraljic Matrix
問題 #24
A charity is reviewing their spend and budget after an operation in flooded areas. They realise that the operators save money against the budgeting plan. This saving is known as...?
答案：C
解題說明：
The difference between the actual spend and budgeted spend is known as variance. The formula for variance is:
Variance = Actual spend - Budgeted spend
Variances can be adverse/unfavourable or favourable ie they can be positive or negative.
Be very careful with these terms. A positive or a negative variance may be favourable or it may be adverse/ unfavourable.
Adverse variances
Adverse variances are those variances that are unfavourable to the firm. Examples would be sales below plan; costs above budget, cash receipts lower than expected, and overtime payment more than forecast.
Favourable variances
Favourable variances are those variances that are beneficial to the business. Examples would be sales ahead of plan, costs below budget, and wages below forecast.
Positive variance
A positive variance occurs where 'actual' exceeds 'planned' or 'budgeted' value. Examples might be actual sales are ahead of the budget.
Negative variance
A negative variance occurs where 'actual' is less than 'planned' or 'budgeted' value. Examples would be when the raw materials cost less than expected, sales were less than predicted, and labour costs were below the budgeted figure.
When the operators create saving, it means that the Actual spend is less than Budgeted spend. Therefore the variance is negative.
Reference:
- Variance analysis
- CIPS study guide page 57-59
LO 1, AC 1.4
問題 #25
Which of the following are typically reasons why an organisation implements value analysis? Select TWO that apply:
答案：A
解題說明：
Value analysis is a systematic review of the production, purchasing and product design processes to reduce overall product costs. This can be accomplished through a variety of activities, including the following:
- Designing products to use lower-tolerance parts that are less expensive
- Switching to lower-cost components
- Standardizing parts across product platforms in order to achieve volume discounts
- Altering production processes to minimize the amount of production cycle time, thereby reducing labor costs
- Introducing automation to strip labor costs out of the production process
- Altering product packaging to lower its cost while still protecting the product The process is not a wholesale attack on costs. Costs are only reduced when the result will not im-pact the perceived level of quality experienced by customers, or the level of customer satisfaction.
Reference: CIPS study guide page 160-163
LO 3, AC 3.4
問題 #26
You are a senior buyer in a large manufacturing company. The engineering team is looking for a product that will assist them in a new innovative project. The technology is evolving and the product supplied is likely to be bespoke to the supplier. You are suggesting the use of a performance specification as a part of the tender. What is the main reason for this?
答案：A
問題 #27
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