SCM 453 Exam 2 ch 6 - 10

____ is a simultaneous engineering approach that occurs between buyer and supplier and seeks to maximize the benefits received by taking advantage of the supplier's design capabilities.

Early supplier design involvement

A buyer has no greater influence even though it has a relative size advantage over the supplier or represents a larger share of the supplier's total business.

False

An emphasis on process rather than finished product demands that a supplier provide evidence of its process capability to buyers on a one-time basis.

False

In general, the less important the commodity, the more likely that cross-functional members and user groups will be involved in building category strategies.

False

Ineffective metrics (in a supplier evaluation and selection system) allow different individuals to interpret and score similarly the same performance categories under review.

False

It is just as easy to implement JIT with international suppliers as it is for domestic suppliers.

False

Suppliers seldom use trade journals to advertise their products or services.

False

Supply base optimization usually refers to increasing the number of suppliers used.

False

Supply base rationalization and optimization should be a one-time activity.

False

The prime reason for hedging is to protect the buyer against major swings in the value of a future purchase.

False

The supplier performance index never provides an incomplete or misleading assessment of supplier performance.

False

When purchasers find that suppliers' capabilities are not high enough to meet current or future expectations, those suppliers should always be eliminated from the supply base.

False

Which of the following is not one of the eight key principles of total quality management?

Focus on output rather than process.

Which of the following is not one of the eight key principles of total quality management?

Inspect for quality at the end of the production line.

Which of the following is not one of the examples of Porter's threat of new entrants?

Supplier concentration.

____ is a tool to structure and segment the supply base and is used as a means of classifying suppliers into one of four types.

The portfolio analysis matrix

Direct involvement in a supplier's operations by buyer personnel is the most challenging part of any supplier development process.

True

Duty rates vary widely over seemingly small differences between items.

True

In the initial stages of supply management strategy development, supply management adopts essentially a short-term approach and reacts to complaints from its internal customers when deliveries are late, quality is poor, or costs are too high.

True

It is far less expensive and more efficient in the long run to avoid generating the defect in the first place than it is to inspect for it once it is created.

True

Progressive supply managers are working with their legal group to develop pre-established contract language that can be cut and pasted during a supplier negotiation.

True

Purchasing's role in countertrade is not as visible as marketing's role.

True

Sharing currency fluctuation risk with a supplier works best on items that have a set delivery date such as with capital equipment.

True

Social culture and laws, personnel skills and abilities, and business culture are three areas where differences are the greatest across different geographic units.

True

Supplier size does become a factor where one firm decides to leverage its purchases from one or a few suppliers.

True

A/An ____ has demonstrated its performance capabilities through previous purchase contracts and therefore receives preference during the supplier selection process.

preferred supplier

The ____ of a strategic sourcing process is a clear statement of the goals and objectives of the sourcing project, which is officially announced shortly after the team's first few meetings.

project charter

All of the following are elements of market risk in a supply base except ____.

regional political risk

The ____ provides all suppliers, regardless of their performance history, a chance to remain in the supply base.

"improve or else" approach

The average North American manufacturing firm spends ____ of its sales dollar on purchased goods and services.

55%

____ include the direct costs of measuring quality, specifically checking for possible defects.

Appraisal costs

Which of the following is not one of the usual roles of an international purchasing office?

Conduct sales and marketing-related activities.

____ is the sum of the understandings that govern human interaction in a society.

Culture

Which of the following is not one of the criteria used to determine whether to buy direct vs. using a distributor?

Distance between the manufacturer and the distributor.

____ are more responsive to the buying firm's changing needs and can economically make frequent smaller deliveries.

Local suppliers

In overcoming the barriers to supplier development, which of the following is not one of the approaches typically used?

Multiple sourcing.

The ____ is a normalization factor for the supplier performance index that eliminates high-dollar lot bias.

Q adjustment factor

____ can be defined as how supply chain members communicate and collaborate regarding sources of risk, utilizing risk management tools to mitigate and minimize risk and uncertainty across the supply chain.

SCRM

____ involves an analysis of the supply base to ensure that only the most capable and highest performing suppliers are kept in the supply base after it is reduced.

Supply base optimization

Which of the following is not a commonly accepted source of information regarding potential supply sources?

Television advertising.

Which of the following is one of the dimensions used in developing a clear understanding of the buyer's expectations and requirements?

The ability of the buying company to succinctly identify, clearly define, quantify, or specify its technical and sourcing requirements.

According to Dick Locke, all of the following are advice about language and communication except ____.

always use English in dealing with worldwide suppliers

An effective supplier quality manual will contain all of the following except ____.

approved marketing expenses

A/An ____ is a discrepancy, nonconformance, or missing requirement that will have a significant negative impact on an important area of concern in an audit statement.

performance problem

The ____ the proportion of the final product that suppliers provide, the ____ the impact they will have on overall product cost and quality.

larger....greater

A ____ has a high volume of internal consumption, is readily available, is important to the business, and represents a significant proportion of spend.

leverage commodity

All of the following are examples of how a finance department can support international currency requirements except ____.

pay in U.S. dollars

A/An ____ can be changed or canceled at any time by the buyer without the seller's consent.

revocable letter of credit

If the purpose of buying currency contracts is to realize a net gain, then the purchaser is ____ and not ____.

speculating....hedging

In ____, there is an intense focus on identifying and eliminating the common causes of waste that add cost, time, and effort to the product or service while not adding value to the customer.

the Honda BP process