SCM Test #2

T or F: Award-winning suppliers serve as role models for other suppliers and may therefore be exempt from audits and certification programs

False

T or F: ISO 14000 certification is a series of management and quality standards in design, development, production, installation, and service.

False

Which Manufacturing Strategy can be described as producing products to put into inventory based on a demand forecast?

Make-to-Stock

T or F: The role of workers in Lean is to create the cultural change needed for Lean to succeed.

False

Which of the following are described as Agents licensed by the governmental regulatory authority to conduct business on behalf of importers, for a service fee?

Import Brokers

What is the term for an internal document that defines the need for goods and/or services?

Purchase Requisition

T or F: Lean is an operating philosophy or mindset that attempts to minimize the impact of supply variability and flaws in forecasting through the use of safety stock inventories

False

Which of the following is NOT one of the keys to successful strategic partnerships?

Building independent objectives

T or F: Backward Vertical Integration refers to a company acquiring one or more of their sources of supply.

True

T or F: Strategic Sourcing is the process of identifying a company that provides a needed good or service

False

Which quality expert is is widely considered to be the father of Total Quality Management?

W. Edwards Demming

Which cost of quality category includes performing audits to confirm that the quality system is operating properly?

Appraisal Costs

T or F: A Supplier Code of Conduct is intended to inform suppliers of ethical sourcing expectations and is typically a condition for becoming an approved supplier.

True

Which of the following is the best description of a Preferred Supplier?

A supplier who best meets all of your company's overall purchasing requirements

What company originated the concept of Six Sigma?

Motorola

The purchasing tool described as "A document used to solicit bids (i.e., price and delivery) from interested and qualified suppliers for goods or services that the organization needs to obtain", is known as?

Request for Quote

T or F: One of the main reasons to consider purchasing from an international global source is the opportunity to improve quality, cost, and delivery performance

True

T or F: Products with low profit margin, relatively stable demand, and high levels of competition, are known as Functional Products.

True

T or F: Root Cause Analysis is a term that describes a wide range of approaches, tools, and techniques used to uncover causes of problems.

True

T or F: Products with short product life cycles, volatile demand, high-profit margins, and relatively little competition, are known as Innovative Products.

True

T or F: Strategic Sourcing is a comprehensive approach for locating and sourcing key suppliers, so that an organization can leverage its consolidated purchasing power to find the best possible values in the marketplace.

True

Candidates for a Supplier Certification Program include suppliers who meet one or more of the following criteria, EXCEPT?

A supplier who has a minimal number of significant negative quality related include specified time period

A proposal or quotation submitted in response to a solicitation from a contracting authority is known as what?

Bid

T or F: Lean is a disciplined, statistical-based, data-driven methodology for identifying and removing the causes of defects and minimizing variability in manufacturing and in business processes.

False

Which of the following is an internal document that defines the need to purchase goods and/or services? This document does not constitute a contractual relationship with any external party.

Purchase Requisition

The Six Sigma 5-Step Plan referred to as DMAIC stands for?

Define, Measure, Analyze, Improve, Control

Which of the following is TRUE?

VMI stands for Vertically Managed Inventory

T or F: In the context of Total Cost of Manufacturing (TCM), in general terms, procurement, manufacturing, inventory, warehousing, and transportation per unit costs each go up as volume goes up.

False

Which of the following is NOT one of the drivers of Strategic Sourcing?

Increasing the selling price of the product

Which of the following new technologies can improve supplier selection and increase the effectiveness of supplier relationship management?

Artificial Intelligence

In which type of manufacturing process would each individual item in the group go through one stage of the production process before the whole group moves on to the next stage?

Batch Production

Why might a company decide to outsource (i.e., buy) a product that they currently make in their company-owned operations?

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

All of the following are reasons for Buying or Outsourcing an item from a supplier, EXCEPT for which one?

Because you want to use existing idle capacity in your own company operations

The application of ethical principles in business situations is known as?

Business Ethics

Which element of Lean is described as a system based on making little changes on a regular basis, anywhere changes can be made, to reduce process, delivery, and quality problems?

Continuous Improvement

Which tool of quality control is used to study how a process changes over time?

Control Chart

Benefits derived from implementing an e-procurement system include all of the following EXCEPT?

Decentralizing Purchasing

An outsourcing program can result in all of the following positive outcomes, EXCEPT?

Decreased need for supplier management

The key characteristics to consider in the development and implementation of a Supplier Relationship Management System, include all of the following, EXCEPT?

Detachment

The primary goals of purchasing include all of the below, EXCEPT?

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

The best supplier candidates for Supplier Relationship Management (SRM) include all of the following EXCEPT?

Developmental suppliers that need to make improvements

All of the following are reasons for Making an item in your own company operations, EXCEPT for which one?

Due to insufficient capacity in your company operations

Which Lean related process can be described as a strategy to increase the level of services to consumers through close cooperation among retailers, wholesalers, and manufacturers?

Efficient Consumer Response

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)

Which one of the following is NOT one of the 12 steps in the basic Purchasing Process

Expediting

In a Spend Analysis, purchases that involve items representing a low percentage of the firm's total spend and having very little supply risk, are categorized as Leverage Purchases.

False

T or F: An effective supplier certification program may increase the time spent on incoming inspections.

False

T or F: Backward Vertical Integration refers to a company acquiring one or more of their customer organizations.

False

T or F: Sourcing Sustainability is described as the ability to meet the current needs of the supply chain without costing the company any additional time or money.

False

T or F: Supplier Relationship Management is a comprehensive approach for locating and sourcing key suppliers, so that an organization can leverage its consolidated purchasing power to find the best possible values in the marketplace

False

T or F: 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.

False

T or F: Total Quality Management is the term used in business to describe the in-depth process of capturing internal and external customer's expectations, preferences, likes, and dislikes.

False

Which of the following is NOT one of the advantages of e-Procurement?

Inaccuracy

Benefits of implementing an effective supplier certification program include all of the following EXCEPT?

Increasing the supplier base

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

Job Shop Production Process

Which element of Lean can be described as moving people and materials when and where needed, and as soon as possible?

Lean Layouts

Which general sourcing category comprises items where many alternatives of supply exist, and supply risk is low. Spend is high and there are potential procurement savings?

Leverage

Which sourcing strategy would typically be used for items with low profit margins, relatively stable demand, and high levels of competition?

Multi-source

The purchasing tool described as "A standard business process whose purpose is to collect written information about the capabilities of various suppliers", is known as?

Request for Information

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

Segmentation

Performance Measures should be S.M.A.R.T. which is an acronym that means?

Specific, Measurable, Achievable, Relevant, Time-oriented

T or F: Among other advantages, preferred suppliers are more likely than non-preferred suppliers to provide capacity for meeting unexpected demand, and also provide cost efficiency due to economies of scale.

True

T or F: In the context of Total Cost of Manufacturing (TCM), in general terms, procurement, manufacturing, and transportation per unit costs each go down as volume goes up.

True

T or F: Intermittent Production Processes are used to produce a large variety of products with different processing requirements in lower volumes.

True

T or F: The Weighted-Criteria Evaluation is typically used to select a supplier or to evaluate the performance of a supplier

True

T or F: Through collaborative negotiations both side work together to maximize the outcome or create a win-win result

True

T or F: Total Cost of Ownership is the sum of the cost elements Quality, Service, Delivery, and Price

True

T or F: Waste encompasses wait times, inventories, material and people movement, processing steps, variability, any other non-value-adding activity.

True

A key supplier's activities to help the buyer's company reduce cost, improve quality and reduce new product development time beginning with the initial design phase, are known as?

Value Engineering

Which sourcing concept involves a supplier directly managing the buyer's inventories to reduce the buyer's inventory carrying costs and avoid stockouts?

Vendor Managed Inventory

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

Voice of the Customer (VOC)