SCM Chapter 5

To help guide the strategic sourcing process, five core principles are recognized as key drivers to achieve the desired levels of value, which one is not one of those core principles

1. Access the total value 2. Develop individual sourcing strategies 3. Evaluate internal requirements 4. DRIVE CONTINUOUS SAVINGS

There are four steps in the Managing Sourcing and Procurement Processes. Which does not belong?

1. determine the type of purchase 2. determine the necessary levels of investment 3. evaluate the effectiveness of the strategic sourcing process 4. EXAMINE OFF SHORE AND E-PROCUREMENT SUPPLIERS

Which vendor selection criteria are described by production capability, labor relations, and operating controls?

Capability

In the Item Procurement Importance Matrix, what is described as high risk, high value?

Criticals

What vendor selection criteria are described by vendor attitude, cultural compatibility, training aids, packaging, and repair service?

Desirable capabilities

In the Item Procurement Importance Matrix, what describes high risk, low value?

Distinctives

What is an amalgam of catalogs from vendors within a market that is available via the internet called?

Electronic Marketplace

Which e-commerce business model used in procurement and sourcing has a seller-operated service that consist of a number of electronic catalogs from suppliers within a market?

Electronic Marketplace

An advantage of e-sourcing and e-procurement is that there is little risk involved.

False

Distinctives are low-risk, high value items that are fundamental to the company's finished product.

False

Landed costs are independent of sales/FOB terms.

False

Some firms are moving towards increasing their number of suppliers in order to encourage competition and low procurement costs.

False

Strategic sourcing is almost the same as procurement.

False

The most important factor in vendor selection is usually financial health.

False

What vendor selection criteria are described by price and financial stability?

Financial

In the Item Procurement Importance Matrix, what item is described as low risk, low value?

Generics

Which of these is not a form of purchasing?

Process improvement

Commodities are items or services that are low in risk but high in value.

True

E-Sourcing and e-Procrument are the same.

True

Procurement serves as a critical link between members of the supply chain.

True

The first step in managing sourcing and procurement is to determine the type of purchase.

True

There are seven steps in the Strategic Sourcing Methodology.

True

Vendors may offer varying levels of discounts from their published prices.

True

When a firm makes a "make" decision when analyzing whether to "make or buy," they may still have to purchase some types of inputs from outside suppliers.

True

In the Executive Sourcing Strategy step, the most important thing is to

choose a supplier or suppliers, depending on the objectives of the sourcing decision

In the Assess Supply Market step, the firm

identifies all possible suppliers that might be able to satisfy the user's needs.

Strategic sourcing as a process is far more broad and comprehensive than procurement. Overall, the process starts with the formation of a

steering committee

The concept that represents the sum of all costs associated with making and delivering products to the point where they are needed is called

total landed costs