SCM 486 CH7

E-Procurement benefits by category are: Indirect, Direct, and __________

Sourcing

In a reverse auction the competition between the sellers drives the price _______, instead of _______, so the buyer pays _________ at the expense of the seller.

down / up / less

There are many benefits to using EDI. For a smaller company, EDI may help ________

all of the above

There are many benefits to using EDI. For larger firms, the main benefit(s) is (are) generally ________________

all the above

To extend the commitment to increasing productivity in all departments within a given facility, many companies have adopted the concept of __________.

profit centers

Indirect purchasing can be divided into two categories:

operating resource management and maintenance repair and operations

With __________, conditions are somewhat different. First, the buying firm initializes the auction by submitting a description of the product or service. Sellers then place bids based on their offer to fulfill the buyer s needs.

reverse auctions

Businesses that use reverse auctions, or e-auctions, have given testimonials of savings of more than ____ percent.

50

As EDI really takes hold and international EDI becomes more commonplace a major stumbling block will be overcoming the language barriers that now exist. The most widespread EDI language in the United States is _________________

ANSI X12 standard

Many of the e-procurement software vendors fail to take into account __________________________ and getting suppliers to participate in the e-procurement system.

All of the above.

The main elements of an EDI system are:

All of the above.

The negotiated agreement between buyers and sellers includes the following terms: the type of material, ________________, stocking policy, and delivery requirements.

All of the above.

__________ materials are directly related to the production of the finished goods.

Direct

______ is the direct computer transmission of orders and other transaction information.

EDI

There are some definite benefits to utilizing ______. The first major benefit is reduced labor. Higher information quality due to a reduction in data entry errors also can be attributed to ______

EDI / EDI

It is a good idea to implement e-procurement on systems that have a high supply risk and low profit impact, especially if there are a very limited number of suppliers to choose from.

False

__________ materials are any commodity or service that is not directly involved in the production of finished goods.

Indirect

_____ purchasing is concerned with critical maintenance and replacement parts, highly engineered machine parts, and manufacturing equipment..

MRO

______ purchasing is a term used for purchasing office equipment, furniture, office supplies, forms, computers, travel services, maintenance services, light bulbs, janitorial supplies, and many other relatively low-cost items.

ORM

__________ professionals are primarily charged with the responsibility for controlling the total cost of ownership (TCO).

Purchasing

_____________________ is a universal term given to any technology that uses radio waves to identify and track items.

Radio frequency identification, or RFID

__________ may not be the solution for all commodity buying. As an example, if there are too few sellers, ___________ will not yield the best price.

Reverse auctions / reverse auctions

_________________ is a stockless inventory method for ordering and stocking MRO and related items. The use of ________________ will aid the firm in reducing ordering and inventory costs.

Systems contracting / systems contracting

Anything that will immediately impact profits or bottleneck your operations is not a good place to experiment with a new electronic procurement system.

True

Buyers and sellers located on different continents can meet electronically. E-sourcing will also lead to higher transactional accuracy and cost reductions for the entire supply chain. E-sourcing creates value by : 1. Reducing the total cost of ownership. 2. Streamlining the purchasing process and 3. Business innovation

True

E-purchasing has lead to significant cost saving and coordinated efficiency.

True

RFID tags can be read through snow, fog, ice, paint, and crusted grime, unlike the barcode system. The tag also can be programmed to hold information such as the item s serial number, color, size, manufacture date, and current price, as well as a list of all distribution points the item reaches as it moves before arriving at a store.

True

The seven (7) steps to effectively implement e-procurement are: 1. Start with non-critical items. 2. Bring all internal stakeholders on board with your new procurement process to establish internal customer behavior. 3. Streamline, map, test, troubleshoot, and improve the process before expanding it to external suppliers. Work with a favored supplier to test the system. 4. Leverage your system once it s running. Exploit your full purchasing power by using reverse auctions. 5. Aggregate buyers within your organization to increase your purchasing power and gain better pricing. 6. Use an incremental approach to expand your system. 7. Once the bumps have been ironed out of the system, move on to the manufacturing operations.

True

To maintain trust and cooperation between buying and selling firms, reverse auctions should be used carefully.

True

According to the Lewin-Schein theory of change the change process consists of the following three steps:

Unfreezing / Moving / Refreezing

A more devastating downside of ______________ is the buyer/seller relationship damage that may result from this method of buying. The buyer runs the risk of alienating both current and potential sources for the goods/services.

reverse auctions

One problem with indirect purchasing is the tendency for employees to intermittently buy indirect items off contract. This practice is referred to as ________________.

maverick purchasing

Top management support has long been recognized as one of the _______ important ingredients necessary for the ___________ of any organizational change, and the same holds true for the ____________ of an EDI system.

most / introduction / introduction

Unlike the barcode-based tracking system, a radio frequency identification system offers a __________________________________ .

no-contact, no-line-of-sight reading and tracking system.

Recognizing that purchase price is but one element of the total cost picture, the scope of ____________ goes far beyond the purchase price for any given item.

systems contracting

The _____________ process requires the use of a negotiated agreement between buyers and sellers.

systems contracting

The way in which the process of developing and implementing an EDI system is managed can greatly influence the success of implementation. Four key areas are:

top management support, commitment to the project, influence, and institutionalization.