L3M2 Ethical Procurement and Supply Questions and Answers

Explanation

Buyers should work hard to ensure that their terms and conditions apply to the contract between buyer and seller.

They should seek to win 'the battle of the forms'.

Explanation

The others may be stakeholders, but the answer is 'stakeholders' - those who have a legitimate inter-est in what is going on.

Explanation

Once a supplier is contracted, monitoring performance is vendor rating.

Prior to a supplier being contracted, attempting to understand what their performance would be like is called 'supplier appraisal'.

Explanation

Quality.

Specification is fundamental to receiving the right quality.

Standards can be seen as a form of specification intended for recurrent use (Lysons)

Explanation

The statement is false.

CIPS actively campaigns against modern slavery anywhere in the world.

Explanation

Decline.

It seems pretty obvious, and I hope you can come up with one or two reasons for this being the cor-rect answer.

Explanation

FACE2FACE

An alternative to Carter's 10 C's.

Fixed assets, ability to deliver, cost, efficiency

Financial stability, ability to work with the buyer, commitment to quality, environmental / ethical factors.

Explanation

A specification should be all of the above.

Explanation

True lead time.

You may wish to argue regarding the QUESTION NO: of consumption, but my textbook tells me this is how it is. A true lead time could also be from recognition of the need through to delivery into the user's hands, I would suggest. For example, are we to say that a requirement for a fire extinguisher is un-fulfilled as it hangs on a hook next to the requisitioner for three years?

Explanation

Pareto Analysis is sometimes known as the 80-20 Rule. It is the basis of ABC Analysis.

'in any series of elements to be controlled, a selected small factor [say 20%] in terms of number of elements almost always accounts for a large factor [say 80%] in terms of effort'. The figures in square brackets are illustrative - Pareto did not include these numbers and the % can be otherwise. The principle that a small percentage of 'things' will soak up a large amount of resource is what actu-ally matters.

For example, if you have 100 suppliers, a disproportionate amount of energy / time / spend will be devoted to a small number of them. Similarly if you have 100 staff members. Or a stock range of thousands. Similarly for customers. And so on.

A relatively simple concept, worth it's weight in gold in my opinion - my favourite management concept.

Explanation

Value analysis.

This is simply a distinction between VA and VE.

Explanation

A force majeure clause in a contract may give rights to either party to suspend its obligations in the event of something untoward happening which is outside the control of the parties.

Examples might volcanic dust clouds, tidal waves or a pandemic. Often lesser events trigger (or are used to try to trigger) the use of such a clause.

Explanation

This is the Pareto Principle, which can be invaluable as a guide for any procurement person, or any manager.

The other names shown here are those of other well-known thinkers, all much earlier than Pareto.

Explanation

It's a cycle.

This is relevant to the measurement of cycle times, as featured in your syllabus.

Explanation

The Economic Order Quantity is a formula which attempts to calculate the most efficient quantity to order at any given time, by attempting to reconcile the cost of stockholding and the cost of plac-ing an order. This could then have implications for the timing of an order being placed.

The cost of holding stock can be reasonably accurately calculated and agreed with one's peers. However, determining the cost of placing an order can keep colleagues up late into the night, and can be a great topic to liven up a sleepy procurement / finance function.

Explanation

Make, do or buy decision.

Historically 'make or buy'. Now up dated to take account of services procurement ie 'should we do it ourselves?'

Explanation

Supply Management annual awards are external, and while they may be impressive, they are not to be relied upon as a measure of internal customer service.

The other answers offered however, can be effective in this regard.

Explanation

Commitment to Quality.

You will need to know the 10 C's for various exams at Advanced Certificate, CIPS Diploma, and possibly beyond...

Explanation

While one can take the view that your weekend is yours and nothing to do with your main employ-er, many contracts of employment prohibit extra work unless pre-agreed. In any event, it is likely to be seen as polite and respectful to seek permission from your main employer. The point about need-ing to rest at weekends (and during annual holidays) is a serious point: we should be able to func-tion effectively during normal working hours.

If your main employer does not give consent, you may wish to ask for a pay rise. :)

Explanation

Whilst alerting senior managers to wrongdoing within the organisation may be whistling in the wind, requiring one to wet one's whistle afterwards, the term for this increasingly common practice in organisations is 'whistleblowing'.

Explanation

The variance is adverse - more was spent than budgeted - this is not favourable.

Explanation

Key Performance Indicators should be specific, measurable, achievable, realistic and time-bound; or words very similar to those, meaning broadly the same.

Explanation

Business is all about the customer.

Explanation

This is the notion that the way people behave (and are treated) inside the organisation is likely to reflect the way they behave to others outside the organisation.