SC exam 2

the operating philosophy that focuses on waste reduction and value enhancement is known as:

LEAN

which one of the following is NOT part of the 7 tools of quality control?

LEAN layouts

which of the following is the best description of a preferred supplier?

a supplier who best meets your company's overall purchasing requirements

costs incurred in the process of finding or discovering defects including testing, evaluating, and inspecting quality is categorized as which of the following?

appraisal costs

why might a company decide to outsource (i.e., buy) a product they currently make?

because they don't have the capacity in their internal factory to meet demand

a tender, proposal, or quotation submitted in response to a solicitation (i.e., RFP, RFQ) from a contracting authority is known as:

bid

the application of ethical principles in business situations is known as:

business ethics

total quality management (TQM) is an integrated organizational effort to improve quality at every level. Which one of the following is not part of TQM?

customer segmentation

the six sigma 5 step plan referred to as DMAIC stands for:

define, measure, analyze, improve, control

the primary goal of purchasing includes all of the below, EXCEPT:

develop as many good quality suppliers as possible for each material or service

which of the following is NOT a reason for buying or outsourcing?

due to a lack (i.e., shortage) of procurement personnel

the manufacturing strategy in which the product is designed, engineered, and built to specifications only after the order has been received is called what? it is used when products are unique and extensively customized for the specific needs of individual customers

engineer-to-order (ETO)

a high return on assets (ROA) is an indication that a company has a high level/value of assets compared to a low profit margin

false

a purchase order is legally binding once it is officially issued by the buyer to the supplier

false

forward vertical integration refers to a company acquiring one or more of their sources of supply

false

in a spend analysis, purchases that involve items representing a low percentage of the firms total spend and having very little supply risk, are categorized as leverage purchases

false

in the context of total cost of manufacturing (TCM), procurement, production, inventory, warehousing, and transportation per unit costs each go down as volume goes up

false

industrial buyers purchase raw materials and other components for conversion into a finished product, but they do not purchase services or capital equipment

false

sourcing sustainability is described as the ability to meet current needs of the supply chain without costing the company any additional time or money

false

the goal of six sigma is the elimination of waste and the minimization of the amount of all resources (including time) used in the operation of a company

false

which one of the following is NOT part of the 8 wastes identified through LEAN manufacturing?

insufficient capacity

a strategic partnership with a supplier:

is a commitment over an extended period to work together to the mutual benefit of both parties

the term for a visual signal that authorizes production or the movement of materials to the next workstation is:

kanban

what is the sourcing strategy the involves commodify items where many alternatives of supply exist, supply risk is low, spend is high, and there are potential procurement savings?

leverage

to make or process raw materials into a finished product, especially by the means of a large-scale industrial operation is called:

manufacture

which of the following is NOT an element of LEAN manufacturing?

mass customization

the fastest or most immediate way that a purchasing person can directly impact the profit of their company is to:

obtain a price reduction on the items they are buying

buying materials and components from suppliers instead of making them in-house is known as:

outsourcing

in public purchasing for the government and non-profit sector, bidders are generally required to furnish bonds as incentive to ensure that the successful bidder will fulfill the contract awarded. Which type of bond provides protection against 3rd party liens (i.e., debts) not fulfilled by the bidder?

payment bonds

which manufacturing process can be characterized as creating a custom product for each customer?

project process

an internal document that defines the need for goods and services. this document does not constitute a contractual relationship with any external party

purchase requisition

the process of pre-qualifying supplier to enter a website at a pre-designated time and date to try to underbid competition is known as?

reverse auctions

the e-procurement process has many advantages. Which one of those listed below is NOT one of these advantages?

segmentation

the quality management philosophy that focuses on improving the overall quality of process outputs by identifying and removing the causes of defects and minimizing variability in manufacturing and business processes is known as:

six sigma

if you understand the total cost of ownership (TCO), then you know:

that you need to consider all the related costs over the life cycle of the project

which of the following is NOT a reason to have a single supplier?

to spread the risk of a supply disruption

"supply management" is a newer term that encompasses all acquisition activities beyond the simple purchase transaction

true

among other advantages, preferred suppliers are more likely to provide capacity for meeting unexpected demand and also provide cost efficiency due to economies of scale

true

co-sourcing is the sharing of a process or function between internal staff and an external provider (i.e., a supplier)

true

ethical sourcing policies should include things such as reporting of supplier compliance to stakeholders, and detailing ethical sourcing expectations to suppliers

true

in-sourcing is defined as reverting to in-house production when external quality, delivery, and services do not meet requirements

true

outsourcing creates an opportunity for the company that is outsourcing a product, to reduce their own staffing levels

true

products with short product life cycles, volatile demand, high profit margins, and relatively little competition are known as innovative products

true

strategic sourcing is a comprehensive approach for locating and sourcing key suppliers which often includes the business process of analyzing the total spend by material category

true

the practice of supplier co-location involves a suppler's employee being imbedded in a buyer's purchasing department to forecast demand, monitor inventory, and place orders for the item(s) provided by the supplier

true

the process to evaluate a supplier's capabilities and their capacity to supply a product or service to the buyer is known as supplier certification

true

the purchasing tool described as "a detailed capabilities document used to determine a supplier's capability and interest in the production of a product or service" is called a request for proposal (RFP)

true

what is the term used in business to describe the in-depth process of capturing internal and external customer's stated and understated expectations, preferences, likes, and dislikes?

voice of customer (VOC)

the goal of a good supplier performance evaluation system is to provide metrics that are:

understandable, easy to measure, and focused on real value-added results

when using a weighted criteria evaluation system with five or more categories, suppliers should be ranked based on their score in only the two highest weighted categories

false