Chapter 8 Quiz

Which of the following is not one of the four steps in the supplier selection process? a. Performance monitoring b. Negotiation c. Evaluation d. Approval e. All of the above are steps in the process

Negotiation

Which step in the process helps you determine how important each criterion is? a. Decide on criteria b. Set weights c. Define scoring system d. Evaluate options e. Calculate results

Set weights

As a core customer you and a highly capable/desirable supplier are a good match. True or False

True

The approval stage of supplier selection parallels draft day in which of the following ways? a. You've done your homework and know who is qualified to sell to you b. You need to pick the best available supplier c. You always pick the right supplier d. Top management joins the process for small-dollar-value buys e. None of the above—i.e., the two are not comparable f. Only A & B

A & B

When draft day arrives, which of the following are appropriate ways to define the deal and get a contract signed? a. Reverse auctions b. Negotiation c. Competitive bidding d. Buying consortiums e. All of the above f. Only A, B, & C

A, B, C

When might a supplier legitimately determine you are NOT a customer of choice? a. If suppliers' capacity is exceeded by market demand and you buy a relatively low volume but require delivery in frequent, small quantities. b. If your service requirements are so high that you are causing the supplier to lose money. c. If your negotiations are so fierce that the supplier makes unprofitable concessions. d. None of the above—the customer is always right. e. Whenever they feel like it and want to pay you back for the way you treat them. f. Only A, B, & C

A, B, C

Defining clear key selection criteria help you to collect consistent and comparable data. Which of the following criteria are important to consider and compare? a. Price b. Reach/scalability c. Management Strength d. Cultural fit e. A and D only f. A, B, C, D

A, B, C, D

Under which circumstance do you need to search for a new supplier? a. New product or service introduction b. New suppliers have entered the market c. Your current supplier overpromised and is underperforming d. Testing the market e. All of the above f. A and B only

All of the above

Which of the following is a valuable source of supplier information? a. Current suppliers b. Personal contacts c. Directories d. Trade shows e. All of the above are sources of supplier information

All of the above are sources of supplier information

Which of the following are a good match for strategic buys? a. Nuisance b. Exploitable c. Development d. Core e. A and B f. C and D

C & D

Which of the following is not one of the four reasons to include a multi-criteria analysis in your toolkit? a. Comprehensiveness b. Intuitiveness c. Quantifiability d. Applicability e. Disciplined

Comprehensiveness

Which of the following is a good match between buyer and supplier for all types of buys? a. Nuisance b. Exploitable c. Development d. Core e. None of the above

Core

An item that is purchased that has many suppliers available and is of low importance to your organization should have the following selection process characteristics . . .? a. Detailed b. Thorough c. Efficient d. Interactive e. None of the above f. All of the above

Efficient

How can you increase your attractiveness as a customer—i.e., become a customer of choice? a. Call the supplier to ask questions b. Tell the supplier what you can do for him c. Offer a transactional relationship d. Ensure that you are a source of learning e. None of the above

Ensure that you are a source of learning

Which step in the process asks you to fill in your comparison matrix? a. Decide on criteria b. Set weights c. Define scoring system d. Evaluate options e. Calculate results

Evaluate options

As an exploitable customer of routine buys you are confident in the supplier's pricing strategy. True or False

False

Caveat Emptor means let the seller beware. True or False

False

A customer that is exploitable . . .? a. Has to pay premium pricing. b. Has relatively high value to the business. c. Has high attractiveness to the supplier, particularly with a long-term perspective. d. Is a good long-term partner.

Has to pay premium pricing

How can you increase your attractiveness as a customer—i.e., become a customer of choice? a. Increase the amount you spend b. Increase the amount of service you ask for c. Increase the demands on the supplier d. Call the supplier more frequently to talk e. None of the above

Increase the amount you spend

You are responsible for buying an item that has many capable and competent suppliers available and your spend is quite large for your company. How would this item be classified on the strategic sourcing matrix? a. Routine b. Leverage c. Critical d. Bottleneck e. It does not get classified

Leverage

Single sourcing is a strategy used by some organizations. Which of the following is not a benefit of single sourcing? a. Volume consolidation b. Strategic versus transactional relationship c. Synergies between multiple suppliers benefit the buyer d. Market competition between suppliers drives down price e. Neither C nor D are benefits of single sourcing f. All of the above are benefits

Neither C nor D are benefits of single sourcing

Multi-criteria analysis is a tool that helps you compare "distinctly different" options. True or False

True

One way to depict the supplier selection process is by using the metaphor of a funnel? True or False

True

Purchasing consortiums are a good way to aggregate buys and gain industry intelligence. True or False

True

Selecting the right suppliers is your most important job? True or False

True

To calculate results you multiply the score for each criterion by the associated weight and add up the results. True or False

True

Two keys to success in routine buys are having the right controls and keeping it simple and straightforward. True or False

True

Which of the following characterizes how you should manage routine buys? a. They are unimportant b. You should outsource them to the supplier c. You should spend a lot of your own time working on the purchase d. Use P-cards and catalogs to outsource to the end user e. None of the above

Use P-cards and catalogs to outsource to the end user

Which of the following is true about critical buys? a. You want to automate and outsource supplier selection. b. They represent 80% of the buys within the organization c. You use a cross-functional category team d. They are managed by the end user e. None of the above are true about critical buys

You use a cross-functional category team