GSC 5650: Ch 5,6,7,9,12
Geographical Diversification Risk Implication:
By sourcing from geographically diverse regions, you have a backup when a disaster strikes, disabling suppliers in a specific region.
What does looking at production processes allow you to look for? a. A donut shop b. A retail store c. A job shop d. A highly automated process e. All of the above f. C & D only None of the above
C & D only
What is inventory pooling? a. Establishing designated safety stock with others in the industry b. Delaying product differentiation to a point as late as possible c. Sourcing from geographically diverse suppliers d. Standardizing parts as much as possible e. Developing multiple products that can supply the same item
Establishing designated safety stock with others in the industry
A complete FMEA usually does not include recommended actions to ensure that failure modes do not manifest themselves. TRUE OR FALSE
False
Elimination implies that your process needs significantly fewer human resources. TRUE OR FALSE
False
Moving to a wholly owned subsidiary is always the best option and allows you to retain control and reduce costs. TRUE OR FALSE
False
To understand the demand side of the business all you need to do is talk to marketing and sales. TRUE OR FALSE
False
Inventory Pooling Risk Implication
Inventory can reduce the costs of a supply disruption. To reduce your inventory investment, you may pool safety stock with firms, including rivals in your own industry.
Long lead times contribute to which risk? a. Quality risk b. Economics risks c. Risks of natural disasters d. Inventory risk e. Risk of terrorism
Long lead times contribute to which risk
In which step of the risk management process do you calculate the risk exposure value? a. Risk consequence b. Risk identification c. Risk mitigation d. Risk exposure e. Risk monitoring
Risk Exposure
In which phase of the risk management process is supply chain process mapping is especially useful? a. Risk consequence b. Risk identification c. Risk mitigation d. Risk exposure e. Risk monitoring
Risk Identification
In which step of the risk management process do you classify risks from trivial to severe? a. Risk consequence b. Risk identification c. Risk mitigation d. Risk exposure e. Risk monitoring
Risk consequence
To effectively align buying strategies, a supply manager must understand the overall goals of the business. TRUE OR FALSE
TRUE
What of the following is an objective of lean production? a. To reduce supply disruptions b. To become more innovative c. To eliminate waste, including to strive for zero inventory d. To mitigate the risk of global sourcing e. To aim for greater diversification
To eliminate waste, including to strive for zero inventory
A "shelter" service provider manages the hassles of getting the business up and running TRUE OR FALSE
True
Cost modeling helps you as a purchasing agent choose the supplier with the right capabilites. TRUE OR FALSE
True
FMEA allows us to brainstorm about what can go wrong and then thinking about possible ways to prevent a failure from happening. TRUE OR FALSE
True
FMEA usually starts by identifying the function or process that can experience a defect. TRUE OR FALSE
True
For continuity planning to be effective, you have to update your mitigation/recovery plans based on what happened during and after each disruption event. TRUE OR FALSE
True
Just because outsourcing is viable, that doesn't mean that it is your best option. TRUE OR FALSE
True
Price is an important strategic consideration in the geographic decision-making process. TRUE OR FALSE
True
Purchasing typically owns the global sourcing decision. TRUE OR FALSE
True
The goal of continuity planning is to prepare for a disruption before it strikes so that you can resume normal operation as quickly as possible. TRUE OR FALSE
True
The more control you have over price and availability, the better you can reduce risk. TRUE OR FALSE
True
There is a lot of volatility in pricing even in more common categories such as lumber. TRUE OR FALSE
True
Part Standardization Risk Implication
Using standard parts increases the number of supply options you can turn to when a disruption occurs.
What is postponement? a. Segmenting suppliers based on risk b. Ensuring careful contract language c. It is comparable to near-sourcing d. Waiting to customize a product until the last minute e. Waiting to customize a product until the last minute
Waiting to customize a product until the last minute.
Which of the following does risk identification address? d. What can go wrong? a. How are we doing? c. How severe is the impact? e. How acceptable is the risk? b. How likely is the risk?
What can go wrong
What is the supplier's overhead as a percent of labor given the following information? Labor $2.00 Material $3.00 Overhead $3.00 Cost $8.00 SGA $0.80 Total Cost $8.80 Profit $0.88 Price $9.68 a. 150% b. 200% c. 100% d. 125% e. 0%
a. 150%
What does Aldi's sourcing strategy mean for you as a decision maker? a. Everything you do needs to lower the cost of purchased goods--without sacrificing quality. b. Everything you do has established standards to assure that every product brought for sales is fresh, socially responsible, and safe. c. You need to scan the market to spot emerging trends and to keep the right product and brands on the self. d. All of the above e. None of the above
a. Everything you do needs to lower the cost of purchased goods--without sacrificing quality.
One of the two basic reason why supply manager negotiate is to...? a. Expand value for the buying company and the supplier, if possible. b. To drive down price to as low of a level as possible. c. To increase competition for commodity-like spend. d. All of the above e. None of the above
a. Expand value for the buying company and the supplier, if possible.
When conducting a category analysis, the nature of the item and process includes assessing which of the following questions? a. How complex is the item you are assessing? b. Can you forecast a need for the item? c. What is your company's purchase history for the item? d. What is it that your company needs? e. All of the above f. None of the above
a. How complex is the item you are assessing?
Just-in-time is related to which other principle? a. Lean production b. Outsourcing c. Globalization d. Greater competition e. More complex supply chains
a. Lean production
Which of the following are two types of offshoring? a. Offshore production, Global sourcing b. Insourcing, Offshore production c. Global sourcing, Outsourcing d. Insourcing, Outsourcing e. None of the above
a. Offshore production, Global sourcing
How is the risk exposure value computed? a. Risk consequence index x Risk probability index b. Risk consequence index + Risk probability index c. Risk consequence index - Risk probability index d. Risk consequence index / Risk probability index e. 1 - (Risk consequence index + Risk probability index)
a. Risk consequence index x Risk probability index
Which is the second step to a Multi-criteria analysis? a. Set weights d. Define scoring system b. Evaluate options c. Calculate results e. Decide on criteria
a. Set weights
LEGO's outsourcing issues were driven by the goal of _____________ the supply chain but ended up adding ______________________ to the supply chain as they outsourced to Flextronics. a. Simplifying, complexity b. Developing new products, the same products c. Entering new countries, local suppliers d. Improved cash cycle, significant costs e. More fun for purchasing, lots of headaches
a. Simplifying, complexity
Dividing suppliers into different groups based on the risk they pose to a company is referred to as what? a. Supplier segmentation b. Supplier selection c. Supplier monitoring d. Supplier auditing e. Supplier site visits f. Both A and D
a. Supplier segmentation
What is the downside to subcontracting? a. The loss of some control over the production process. b. The hassle of getting the business up and running. c. The high levels of technological support that is needed. d. All of the above e. Only A & C
a. The loss of some control over the production process.
For a high labor content item you could look for suppliers in China a. true b. false
a. True
Cash comes from (and is used for) three types of activities. Which of the following does not represent one of those activities? a. Cash from fundraising activities b. Cash from financing activities c. Cash from investment activities d. Cash from operating activities
a. cash from fundraising activities.
If the situation requires it then you need to have enough ____ to reverse an outsourcing and/or location change decisions a. guts b. glory c.. game d. giggles e. greem
a. guts
As you negotiate with a potential employer, you ask for an additional $3.00 in annual salary. The employer asks why you want this increase, and learns that you need to begin repaying a student loan. The employer states that he cannot increase you salary, but that his company can assume your loan at 0% interest rate. IN this example, what has the employer identified. a. Interest b. position c.. demand d. reservation value e. All of the above
a. interest
A company that is growing sales and increasing profits can go bankrupt. a. true b. false
a. true
A popular destination to offshore IT services is the Philippines a. true b. false
a. true
Ariba is both a platform and a technological solution that can help in automation and elimination a. true b. false
a. true
Automation is a way to take high labor content jobs and reduce the labor cost. a. true b. false
a. true
Companies are challenged in understanding their core competencies a. true b. false
a. true
Depreciation can be used to reduce your tax burden. a. true b. false
a. true
Intellectual property is a critical issue in all countries. a. True b. False
a. true
Interest and taxes don't have anything to do with the quality of your operating decisions a. true b. false
a. true
Modern purchasing organizations are fully involved in the make versus buy analysis. a. true b. false
a. true
Operating profit tells you how well your company is being managed. a. true b. false
a. true
Success in life depends on your ability to negotiate well. a. true b. false
a. true
Supply management negotiations tend to be more formalized than personal negotiations. a. true b. false
a. true
Supply managers are responsible for ensuring that they get the best products and services from their suppliers. a. true b. false
a. true
Supply managers negotiate for many reasons a. true b. false
a. true
The make or buy decision often comes along ad-hoc and unstructured a. true b. false
a. true
The most obvious focus of a negotiation is the price that you will pay to a supplier. a. true b. false
a. true
To asses a supplier's financial health you need to look at a more than its bottom line. a. true b. false
a. true
What does a maverick buyer do? a. Rides horses b. Does not incorporate the purchasing department c. Lives on a ranch d. Has an assigned level of spend e. All of the above f. None of the above
b. Does not incorporate the purchasing department
Which is the fourth step to a Multi-criteria analysis? b. Evaluate options e. Decide on criteria d. Define scoring system c. Calculate results a. Set weights
b. Evaluate options
Just-in-time is related to which other principle? a. Lean production b. Outsourcing c. Globalization d. Greater competition e. More complex supply chains
b. Globalization
All are reason for outsourcing except a. Internal capabilities b. High internal capacity c. Accessing qualified personnel d. Capital Investment and innovation e. Taking out cost f. All of the above
b. High internal capacity
Risk probability addresses which of the following questions? a. How are we doing? b. How likely is the risk? c. How severe is the impact? d. What can go wrong? e. How acceptable is the risk?
b. How likely is the risk?
Why is part standardization able to reduce risk? a. You are able to monitor quality much better b. You increase the supply options you can turn to when a disruption occurs c. Standardized parts are easier describe in an RFP/RFQ d. Standardized parts are likely much preferred by your customers e. Standardized parts can be purchased in bulk
b. You increase the supply options you can turn to when a disruption occurs
Being able to manage the supply side of a business to better meet the demands of business a. easy b. challenging c. cumbersome d. automated e. all of the above f. none of the above
b. challenging
Being able to manage the supply side of a business to better meet the demands of the business is ___________________. a. easy b. challenging c. cumbersome d. an anomaly e. All of the above f. None of the above
b. challenging
At the end of the day, as a supply professional you will negotiate for two basic reasons: to claim value your company, and to lower price. a. true b. false
b. false
In a negotiation, the RV is used to calculate BATNA a. True b. False
b. false
Reputational impact is a relatively easy concept to quantify a. true b. false
b. false
The balance sheet shows the difference between what a company owns and owners equity a. true b. false
b. false
You have to write a check to pay for depreciation at the end of the year a. true b. false
b. false
What is the use of a 'limited time offer' in a negotiation an example of? a. The ding tactic b. Investment in time c. Limited authority d. Ultimatums e. The power of silence
b. investment in time
As you negotiate with a supplier, you attempt to drive down price by pointing out an undesirable characteristics of her product. This is an example of which negotiation tactic? a. the 90/10 rule b. The ding tactic c. The limited quality tactic d. The power of quality e. Playing hard ball
b. the ding tactic
Which of the following are key criteria to where we should outsource? a. Attractiveness of the people that live in the region. b. Infrastructure and the ability to move around the town c. Capabilities to perform the actual work d. Competencies of the local government e. None of the above.
c. Capabilities to perform the actual work
The risk priority number is the product of which of the following? a. Severity and likelihood of occurrence b. Detectability and likelihood of occurrence c. Likelihood of occurrence, severity, and detectability d. Likelihood of occurrence, detectability, probability of occurrence e. Risk magnitude, risk severity and detectability
c. Likelihood of occurrence, severity, and detectability
Asking questions or making statements such as "Can you explain that to me again?", "I'm not sure I understand," and "Why can't I do this?", with the hopes of wearing down the other party and gaining a concession, is an example of which negotiation tactic? a. The power of talk b. The power of the question c. Playing dumb d. Questioning assumptions e. The gift of gab
c. Playing dumb
What does hallowing out of corporations mean? a. Too much has been reshored b. Too much flesh and not enough bone c. Relinquished too much of your core capability d. Outsourcing of core competencies e. None of the above
c. Relinquished too much of your core capability
Which is usually the last step in a risk management process? a. Risk consequence b. Risk identification c. Risk mitigation d. Risk exposure e. Risk monitoring
c. Risk mitigation
Suppliers can be segmented in many ways except by: a. Commodity b. Business unit c. Size of business d. Technological evolution e. All of the above f. None of the above
c. Size of business
You can acquire services from Dun & Bradstreet to help do a better job with which of the following? a. Hedging b. Near-sourcing c. Supplier monitoring d. Postponement e. Contract language f. All of the above
c. Supplier monitoring
Which of the following are costs that are challenging to quantify? a. Ocean Transportation b. Duties c. Support costs d. Tariffs e. All of the above f. None of the above
c. Support costs
What astonishing announcement did Adidas make in June of 2016? a. They were going out of business b. They were entering the computer business c. They reshored shoe manufacturing to Germany d. They reshored shoe manufacturing to China e. Their cost of goods sold decreased 30%
c. They reshored shoe manufacturing to Germany
What astonishing announcement did adidas make in June 2016? a. they were going out of business b. They were entering the computer business c. They reshored shoe manufacturing to Germany d. They reshored shoe manufacturing to China e. Their cost of goods decreased 30%
c. They reshored shoe manufacturing to Germany
Beyond total supply, as a purchaing agent, what else do you need to track? a. capacities b. optimization models c. capabilities d. cost drivers e. all of the above f. Only A & C
c. capabilities
The balance sheet helps you answer particular questions about your supplier. Which of the following is not one of these questions? a. what assumptions is the supplier making b. do total assets outweigh total liabilities? c. How much money is the supplier making? d. Can the supplier pay its bills? e. All of the above are found on the balance sheet
c. how much money is the supplier making
What does hallowing out of corporations mean? a. Too much has been reshored b. To much flesh and not enough bone c. Lots of bones but not enough flesh d. outsourcing of core competencies e. none of the above
c. lots of bones but not enough flesh
What does the term " expanding the pie" refer to? a. Value proposition b. value claiming c. value creation d. value evaluation e. value math
c. value creation
Which of the following is the best use of an ultimatum, based on the recommendations presented in the courseware? a. "The best that I can do is $2.25 per unit with a quality level of 99.9%. Take it or leave it." b. "The best that I can do is 2.25 per unit with a quality level of 99.99%. I will give you until 9:00 a.m tomorrow to decide." c. "My last offer was my best offer. Take it or leave it." d. "The best that I can do is 2.25 per unit with a quality level of 99.99%, or 2.30 per unit with a quality level of 99.95%. e. "I do not want to pay more than 2.25 per unit with a quality level of 99.9%, but I maybe able to go just a little bit higher.
d. "The best that I can do is 2.25 per unit with a quality level of 99.99%, or 2.30 per unit with a a quality level of 99.95%.
Porsche outsources between which percentages? a. 10-20% of its components/services b. 30-40% of its components/services c. 50-60% of its components/services d. 80-90% of its components/services e. Don't have a clue!
d. 80-90% of its components/services
The longer parties negotiate, the more willing they are to make concessions. The discussion mentions that roughly ___% of the concessions in a negotiation are made during the last ___% of the negotiation: a. 50/10 b. 60/40 c. 70/30 d. 80/20 e. 90/10
d. 80/20
As you implement continuity planning, what questions should you ask? a. How likely is each disruption? b. What are each disruption's potential impacts? c. How prepared are you to respond to each disruption? d. All of the above e. Only A & B
d. All of the above
Whole Foods has a mission statement and strategic positioning similar to which company? a. Wal-Mart b. School bus company c. Aldi d. BMW e. All of the above f. None of the above
d. BMW
One strategy to reduce risks is to have a backup supplier in case your incumbent is not able to deliver. What is this strategy called? a. Inventory pooling b. Hedging c.Postponement d. Dual- or multi-sourcing e. Single-sourcing
d. Dual- or multi-sourcing
________ are key to making offshoring/outsourcing work. a. archiving systems b. people c. internal capacity d. unions e. forklifts
d. unions
Defining the company's competitive position has guidelines that include which of the following? a. Value proposition b. Strategic positioning c. Role of purchasing d. Role of category e. All of the above f. A & D only
e. All of the above
The nature of the item and process includes an assessment of which of the following? a. Complexity b. Types of materials c. Labor content d. Production processes e. All of the above f. None of the above
e. All of the above
When considering implementation in Stage 4 of the of the outsourcing/offshoring process, what issues should you consider? a. How to communicate expectations and monitor performance? b. What level of intensity should the relationship be? c. How will continuous improvement be driven? d. Who will be on the team? e. All of the above f. Only A, B, & C
e. All of the above
Which of the following activities can be outsourced? a. Purchasing b. Payment collections c. Risk management d. Design of products e. All of the above f. Only B, C, & D
e. All of the above
Which of the following are among the top three exporter countries? a. Philippines b. United States c. Mexico d. Germany e. B and D only f. A and C only Bookmark question for later
e. B and D only
Which of the following is not contributing to an increased emphasis on risk management? a. Globalization b. Outsourcing c. Faster clockspeeds d. Increasing customer demands e. None of the above; that is, they all contribute to the increasing importance of risk management
e. None of the above; that is, they all contribute to the increasing importance of risk management
Which is usually not part of an FMEA? a. Severity b. Detectability c. Likelihood d. Potential effects e. None of the above; that is, they are all part of an FMEA
e. None of the above; that is, they are all part of an FMEA
Which of the following is true of disruption scanning. a. Proactive scanning is part science; that is, it is data driven b. Proactive scanning is part art, requiring that you ask "What if . . .?" c. Almost all disruptions are completely unforeseeable—that's why you do continuity planning d. All of the above e. Only A & B
e. Only A & B
Why does Toyota offshore to the US? a. Toyota wants to be perceived as local. b. Production costs in the US is less expensive c. Toyota wants to produce where they sell. d. All of the above c
e. Only A & C
A risk heat map usually has the following two axes? a. Risk severity and risk magnitude b. Risk rank and risk exposure c. Risk probability and risk likelihood d. Risk impact and risk exposure e. Risk likelihood and risk impact
e. Risk likelihood and risk impact
Which of the following is not true of a FEMA? a. FMEA stands for failure mode and effect analysis b. FMEA relies in a structured worksheet c. In FMEA, you think about possible defects and how you can mitigated or prevent them d. FMEA extends the risk management process by accounting for how well we are able to detect defects e. Since FMEA has been developed for detecting failures in process, it is difficult to apply in purchasing
e. Since FMEA has been developed for detecting failures in process, it is difficult to apply in purchasing
What is hedging? a. Segmenting suppliers based on risk b. Ensuring careful contract language c. It is comparable to near-sourcing d. Waiting to customize a product until the last minute e. The purchase of future contracts
e. The purchase of future contracts
Which of the following are common negotiations process mistakes? a. Rely on assumptions b. Don't understand counterpart c. Don't invest time d. Lack of convincing positions e. All of the above
e. all of the above
Which of the following is an example off a negotiation? a. A purchasing manager meets with a supplier to discuss the delivery of products prior to signing a contract. b. Your roommate agrees to wash the dishes if you cook meals/ c. You haggle with a street vendor about the price of a pair of shoes. d. The president of the U.s meets with the premier of China to discuss carbon emissions. e. all of the above
e. all of the above
what does an income statement do?
e. all of the above
Which of the following are common negotiation outcome mistakes? a. Leave money on the table b winner's curse c. Failing to ask d. Lack clear objectives e. Only A, b, and C
e. only A, B, and C
Why do you need to be financially literate as a purchasing professional? a. you can't always trust the numbers- financial fraud b. Window dressing - accounting is an art and a science c. Assumptions and estimates - limited data to estimate how well a company is doing. d. Suppliers might be playing with the numbers e. None of the above f. A, B, C and D
f. A, B, C and D
Conditions might change from the time your initial offshoring decision was made. What might this require you to do? a. Reassess costs b. Reassess labor c. Renegotiate with suppliers d. Find new suppliers e. Change locations f. All of the above g. None of the above
f. All of the above
What issues does the supply side include? a. Capabilities of existing suppliers b. Aggregation of supply situation d. Potential shocks or disruptions e. Governmental regulations f. All of the above g. None of the above
f. All of the above
What does financial literacy mean? a. You understand assumptions and estimates of plant managers b. you can create a firm's financial statements c. You can make better decisions using financial numbers. d. You can analyze and understand decisions made by other managers. e. All of the above f. c and d only
f. c and d only
Supplier capabilities are influence by what? a. labor cost savings b. risk of knowledge loss c. international outsourcing experience d. critically of labor cost savings e. all of the above f. none of the above
f. none of the above
As a category specialist, you need to develop expertise on which of the following? a. Price b. Data retrieval c. Puzzles e. Availability e. All of the above f. None of the above g. A and D only
g. A and D only
A buy decision is also called reshoring. TRUE OR FALSE
False
Southwest Airlines is known for which risk management strategy? a. Near-sourcing b. Postponement c. Supplier segmentation d. Hedging e. Part standardization
Hedging
Dual or Multi-Sourcing Risk Implication
If your primary supplier suffers a disruption, you have a backup supplier.
An action plan translates theory into practice. TRUE OR FALSE
True
You might need to negotiate even in the case of mundane situations, such as your favorite band coming to town. a. true b. false
a. true
You might need to negotiate personal situations like what movie to watch. a. true. b. false
a. true
What does the strategic positioning of BMW include? a. Highest price b. Lowest price c. Fastest cars d. High Quality e. All of the above f. None of the above
d. High Quality
In a buyer-supplier negotiation, what is the top of the ZOPA formed by? a. The buyer's RV b. The supplier's RV c. The buyer's target d. The supplier's target e. None of the above
A. The buyer's RV
Which of the following is not true of a risk management process? a. It provides a structured approach to think about risks b. It can help us to identify risk mitigation strategies c. It offers a way to quantify risks d. It can help us eradicate all risks e. It helps us in controlling risks
d. It can help us eradicate all risks
What is the "who should do it" question also called? a. Geographic location b. Production planning c. Contracting d. Make versus buy e. None of the above
d. Make versus buy
What is the expectation that if one party makes a concession, the other party will make next concession called? a. concession expecatation b. quid pro quo c. Multiple concession expectation d. Norm of reciprocity e. Serial concession pattern
d. Norm of expectation
The threat of leaving the negotiation table is known as what? a. The walk off b. The turnaround c. The table turn d. The walkway e. The turntable
d. The walkaway
For high-technology processing you might look at a/n _____ process technology a. easy b. difficult c. cumbersome d. automated e. all of the above f. none of the above
d. automated
For high-technology processing you might look at a/n ___________process technology. a. easy b. difficult c. cumbersome d. automated e. All of the above f. None of the above
d. automated
If the best supplier is located outside of your home country, the decision to buy overseas is known as outsourcing. TRUE OR FALSE
False
Strategic level cost modeling helps a supply manager make a selection between two suppliers of the same material. TRUE OR FALSE
False
Suppliers can only be segmented in one way. TRUE OR FALSE
False
The key to alignment is to understand the goals or mission of the organization that you work for, then look at the goals of the operations area. TRUE OR FALSE
False
You need a computer with high speed and high RAM in order to perform cost modeling. TRUE OR FALSE
False
Your primary goal as a purchasing agent is to try to ensure an interrupted flow of supply. TRUE OR FALSE
False
Risk severity and risk probability can be graphically depicted using what? a. Risk acceptance pyramid b. Heat map c. Risk mitigation graph d. Supplier segmentation pyramid e. Risk management plot
Heat map
You should use ______________________ to build the total cost of ownership model at the commodity (or category) level. a. excel spreadsheets b. optimization models c. pricing standards d. cost drivers e. None of the above
d. cost drivers
There is a "line" for which some costs fall above and others fall below. What is the "line" an important determinant of? a. cogs b. operating expenses c. bonuses d. gross profit e. none of the above
d. gross profit
Which financial statement shows you how your efforts contribute to profit? a. cash flow statement b. balance sheet c. 401K d. Income statement e. None of the above
d. income statement
The "make" decision is most clearly related to which of the following? a. outsourcing b. reshoring. c. offshoring d. insourcing e. onshoring f. all of the above g. c, d, and e only
d. insourcinng
The primary reasons that the startup company had problems with their offshore web developer include all except: a. unclear specification b. delayed payment c. poor relationship management d. reasonable supplier selection criteria e. mimicking competitors
d. reasonable supplier selection criteria
What is one problem that might arise due to lack of detailed instructions? a. ingredients b. paperwork c. rules d. specifications e. tariffs
d. specifications
Total cost of ownership models require some brainstorming with other functional areas. TRUE OR FALSE
True
What is the primary outcome of disruption assessment? a. A clear understanding of all of the risks that might affect your operations b. A set of priorities to help you effectively use resources to mitigate risks c. A pretty heat map d. All of the above e. Only A & C
b. A set of priorities to help you effectively use resources to mitigate risks
What are the other options that a company could choose besides the make vs. buy decision? a. Buy or rent b. Automate or eliminate c. Sell or buy d. Eliminate or buy e. None of the above
b. Automate or eliminate
What is the rate of change in an industry called? a. Velocity b. Clockspeed c. Efficiency d. Swiftness e. Speed
b. Clockspeed
Location attractiveness is not influenced by what? a. Language, cultural proximity b. Difficulty in performance measurement c. Labor quality d. Labor cost savings e. All of the above influence location attractiveness
b. Difficulty in performance measurement
External spend, as a fraction of total cost, has increased for most companies. Which risk does this impact the most? a. Inventory risk b. Quality risk c. Transit loss risk d. Risk of natural disasters e. Economics risks
b. Quality risk
Which is usually the first step in a risk management process? a. Risk measurement b. Risk identification c. Risk mitigation d. Risk evaluation e. Risk assessment
b. Risk identification
What are some key strategic considerations to include for certain locations? a. access to customers b. access to innovation c. flexibility d. total cost e. all of the above f. none of the above
b. access to innovation
If a company spends $5 million annually on its goods and services, what percent of the total spend is $400,000? a. 1% b. 5% c. 8% d. 10% e. 15%
c. 8%
Supplier terms add additional cost elements to the total cost of ownership. These terms include which of the following? a. Warehousing and materials costs b. Payment terms c. Delivery frequency d. Transportation costs e. Only B&C f. Only A & D g. none of the above
e. only b and c
Purchasing plays a key role in the make versus buy decision! Other functions that may play a role include which of the following? a. Top Management b. Finance/accounting c. Production management d. Production engineering e. Suppliers f. All of the above g. Only C & E
f. All of the above
Which of the following would be a reason for insourcing? a. New technologies emerge b. New suppliers come to market c. Costs change d. Politics shift e. Only B & C f. All of the above
f. All of the above
Which of the following is not part of the Outsourcing/Offshoring process? a. Capability Analysis b. Vulnerability Analysis c. Location Analysis d. Implementation e. All of the above, i.e. none of these are part of the process f. None of the above, i.e. all are part of the process
f. None of the above, i.e. all are part of the process
What should you do if an item is not critical to competitive advantage and you are very capable of performing the task? a. Perform internally b. Invest to perform internally c. Keep internal d. Offshore e. Reshore f. None of the above; i.e., need more information
f. None of the above; i.e., need more information
You work for a company located in the United States and have decided to buy customer contact center services from a company located in India. What is this is called? a. Reshoring b. Backshoring c. In-sourcing d. Outsourcing e. Offshoring f. Offshore Outsourcing g. All of the above
f. Offshore Outsourcing
What are the main areas to look at during the outsourcing decision process? a. Consider the strategic implications of outsourcing b. Evaluate cost and performance implications c. Decide who are the right decision makers d. Identify formal processes e. All of the above. f. Only A, B, & C
f. Only A, B, & C
Why can't you take a supplier's word for its physical fitness a. suppliers have no idea what an income statement or balance sheet is. b. suppliers don't compile financial information c. Suppliers tend to present overly optimistic data d. suppliers may lack the capability to present financials accurately e. a and b. f. c and b g none of the above
f. c and b
Which of the following dimensions must be considered when developing your sourcing strategy for a specific commodity? a. Reshore versus offshore b. Supply base rationalization c. Supply risk management d. Supplier development e. All of the above f. None of the above g. C and D only
g. C and D only
What is reserving an outsource offshore decision known as? a. Outsourcing b. Offshoring c. reshoring d. insourcing e. onshoring f. All of the above g. c, d, and e only
g. c, d, and e only
What does an implementation planning document look at? a. Who b. What c. Where d. When e. How f. Why g. All of the above h. A, B, & D only i. None of the above
h. A, B, & D only
To compute the risk exposure value, you need which two indices? a. Risk consequence index and risk probability index b. Risk probability index and risk likelihood index c. Risk consequence index and risk severity index d. Risk severity index and risk likelihood index e. Risk magnitude index and risk scale index
a. Risk consequence index and risk probability index
Calculate the supplier score given the following parameters: Criteria Weight Score Weighted Score Price 25% 100 25 Quality 30% 50 15 Lead time 30% 80 24 Delivery 15% 100 15 Total weighted score a. 40 b. 79 c. 64 d. 100 e. You have no clue
b. 79
Liabilities = assets + owner's equity a. true b. false
b. false
Which of the following statements is false? a. There is a high level of apathy toward supply risk management b. Most companies do not quantify risks when outsourcing production c. Companies are well versed in supply chain risk management d. Risk management is a challenging domain in need of more attention e. Many companies do not have a risk management plan in place
c. Companies are well versed in supply chain risk management
Sales minus cost is equal to what? a. cogs b. gross profit c. net profit d.interest and taxes e. none of the above
c. net profit
Of the $50,000,000 in spend $6,500,000 is spent on travel. What percent of the total spend is on travel? a. 1% b. 5% c. 8% d. 13% e. 20%
d. 13%
Porshe outsources between which percentage?
d. 80-90% of its component services
Who is an internal customer? a. The cafeteria manager b. The production manager c. The finance manager e. The guard e. All of the above are potential customers of a supply manager
e. All of the above are potential customers of a supply manager
Which of the following risks can have an impact on your supply chain? a. Regulations b. Port congestion c. Economic instability d. Changes in economic conditions e. All of these f. Only A & C
e. All of these
Which of the following supplier requests should raise a red flag regarding a supplier's financial health? a. Urgent re-pricing b. Check pickup c. Funding for capital expenditures d. Delay of cost reductions e. All of these f. Only A and B
e. All of these
In order to perform cost modeling what do you need to understand? a. Data triangulation b. Total cost of ownership c. Key drivers d. Cost elements e. All the above f. None of the above
e. All the above
New product development activities can impact which of the following? a. cash flow statement b. profit c. cogs d. balance sheet e. Income statement f. all of the above
f. all of the above
What are the strategic drivers behind outsourcing? a. Access to new markets b. Competitive pressures c. industry practice d. Business process redesign e. System redundancy f. All of the above
f. all of the above
The outsourcing decision is really about who can do the job best. TRUE OR FALSE
True
All suppliers should be treated equal in regards to financial assessment. a. true. b. false
B. false
