BUS 230 Week 9 Quiz – Strayer New

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Chapter 12 and 13

Supplier Selection

73. Small suppliers:

a.         are most suited for large dollar value “A” requirements.

b.         usually represent very low risk to the purchaser.

c.         tend to have a strong financial base.

d.         often provide the greatest responsiveness and flexibility.

e.         tend to have an extensive management structure.

74. Reverse marketing is:

a.         encouraged by the rapid rate of technological change, growth in international trade, and the need to extract competitive advantage from supply chains. 

b.         when the buying organization has decided to stop making something inhouse and identifies a supplier from its existing supply base.

c.         is an aggressive, marketing-initiated, approach to finding and developing world class suppliers.

d.         requires that the marketing department in the  buyer’s organization  fully understand the needs of supply.

a.         is most appropriate when the product is fairly standard and available from multiple local suppliers.

 

75. Decision trees:

a.         may be useful in making effective supplier selection decisions the first-time a buying decision is made, but not on repetitive purchases.

b.         may be useful in making effective supplier selection decisions when making repetitive purchases, but not special, one-time purchases.

c.         may be useful in making effective supplier selection decisions if probabilities of success and failure are assessed for each option.

d.         are of limited value because options can only be evaluated qualitatively, not quantitatively.

e.         cannot reflect past decisions so they are useless as a decision tool when making  repetitive purchases.

76. Portfolio or quadrant analysis:

a.         may be used to develop longer-term strategies for moving categories of spend into a more desirable location on the spend map.

b.         may be used to justify, clarify or revise existing commodity strategies.

c.         is based on the Pareto curve.

d.         a and b.

e.         a, b and c.

77. To avoid risk, a buyer can:

a.         hedge in a commodities market.

b.         require bid or performance bonds.

c.         decide not to do business in certain countries.

d.         a and b.

e.         a, b, and c.

 

78. Which of the following statements supports single sourcing:

a.         there is a need to reduce supplier dependence on the buying organization.

b.         there is a high probability of a devastating natural disaster.

c.         there is a patent involved.

d.         there is volatility in the supply market.

e.         concerns exist about supplier capacity for future volume.

79. In the portfolio matrix, characteristics of goods and services in the leverage quadrant are:

a.         competitive supply market, substitution is possible, price per unit is important.

b.         competitive supply market, substitution is possible, and total cost is a primary focus.

c.         few suppliers with adequate capability so substitution and switching are difficult.

d.         item substitution is possible, switching is difficult, and many suppliers are available.

e.         item substitution and supplier switching are possible, but few suppliers are capable.

80. Assessment of a potential supplier’s financial situation:

a.         is usually unnecessary because it is highly unlikely that a supplier will go out of business, and, even if they do, it is relatively easy to replace a supplier.

b.         may yield substantial opportunities for negotiating favorable terms for both buying and selling organizations.

c.         is best left to the finance department which will alert supply to any issues that might adversely affect a pending deal.

d.         is always necessary and follows a strict protocol no matter what type of purchase or dollar value.

e.         seldom relies on financial information provided by the supplier..

 

81. Distributors, wholesalers, and retailers:

a.         never add enough value to a buyer to make it worth doing business with them.

b.         may be able to deliver at a lower cost than the manufacturer.

c.         may provide valuable services such as prompt delivery and filling emergency orders, but they cannot offer a better price than the manufacturer.

d.         have an indefensible value proposition in the typical modern supply chain.

e.         typically carry a very limited supply in an effort to keep inventory costs low.

82. Supply management's role in environmental considerations is:

a.         expanding because purchasing has primary responsibility for specification writing.

b.         limited because environmental issues have little impact on the acquisition cycle.

c.         expanding because the goal of zero environmental impact affects the buying cycle.

d.         limited by the product design developed by design engineers.

e.         limited to compliance with government laws and regulations.

True and False

1. The preferred hierarchy of supply chain strategies is (1) source reduction—design or use less, (2) reuse—multiple use of same item such as a package or container, (3) recycle—reprocess into raw material, (4) incinerate—at least extract energy, but create CO2 pollution at a minimum, (5) landfill—require space and transportation to store with potential impact on land and water.

2. The question of how much of a premium should be paid to conform with political directives such as Buy Local or Buy American is the subject of much ongoing debate.

3. Although online searching is commonplace in many areas of business, it has not become a common tool for gathering information on potential suppliers

4. Supplier development initiatives may be focused on (1) persuading an existing supplier to expand into new areas that meet the needs of the buying organization, and (2) locating a new, untried/unknown company and identifying potential areas of business.

5. The buyer's assessment of the risk associated with a supplier is influenced by whether it is a non-critical, leverage, bottleneck, or strategic purchase.

6. Site visits to suppliers are of little use to supply managers because of their subjective nature.

7. Buyers should always expect to receive samples free of charge from suppliers.

8. Loss exposure can be reduced by matching decisions about packaging, transportation, and security levels with the risk of loss.

9. Social problems should not be addressed through supply policy and practice.

10. In the context of supplier selection decisions, the term local is typically defined as suppliers within a 100 mile radius of the buying organization.

CHAPTER 13

Supplier Evaluation and Supplier Relations

83. A weighted point evaluation system:

a.         is seldom used because the costs usually outweigh the benefits.

b.         includes evaluation criteria, an importance factor for each, and a rating system.

c.         includes efficiency and effectiveness metrics weighted by users perceptions.

d.         is the most commonly used process because of ease of design and use.

e.         allows each rater to weight the criteria, but all raters user the same rating scales.

84. To select a potential supplier-partner, the buyer should consider:

a.         both hard and soft factors with an eye toward long-term outcomes.

b.         both hard and soft factors with an eye toward short-term outcomes.

c.         soft factors such as congruence of management values and compatibility.

d.         hard factors such as quality, quantity, cost, and technology.

e.         the willingness of the supplier to quickly change processes for results.

85. A goal of supply chain management is to:

a.         gain competitive advantage by acquiring confidential information from chain members.

b.         drive down prices through competitive online bidding.

c.         push inventory as far down the supply chain as possible.     

d.         reduce uncertainty and risks between and among members of the supply chain.

e.         increase competition by increasing the number of suppliers in the supply chain.

 

86. Which of the following is a result of forming a buyer-supplier partnership:

a.         the amount of time committed to the buyer-supplier relationship is greatly reduced.

b.         buyer-supplier relationships are greatly improved at the expense of internal relationships.

c.         the buying organization can enjoy the benefits of horizontal integration without the disadvantages.

d.         the design process and the introduction of new designs is faster due to earlier supplier and supply involvement.

e.         significant quality improvements occur and total cost typically increases.

87. One of the assumptions on which the purchasing-supplier satisfaction model is based is that:

a.         the satisfaction level cannot be assessed well enough to draw definitive conclusions.

b.         the purchaser and supplier always have the same perceptions of the same relationship.

c.         attempts to move to a different position fall only in the win-lose and win-win categories.

d.         there are few tools and techniques available to move positions or improve stability.

e.         an unsatisfied party may use various tools to improve the relationship.

 

88. Reverse marketing is:

e.         discouraged by the rapid rate of technological change and growth in international trade. 

f.          when the buying organization has decided to stop making something in house and identifies a supplier from its existing supply base.

g.         is an aggressive, purchaser-initiated, approach to finding and developing world class suppliers.

h.         requires that the marketer fully understand the needs of the buying organization now and in the future.

i.          is most appropriate when the product is fairly standard and available from multiple local suppliers.

89. To enhance the chance for successful strategic alliances, the supply manager must:

a.         ensure that price formulation and price escalator clauses are included in the contract terms and conditions.

b.         clearly establish what is required from the supplier and the penalties for failure to perform.

c.         reinforce the notion that the supply manager can easily switch to another alliance if the supplier fails to perform. 

d.         analyze the supplier’s capability for e-procurement and ensure that the supplier can effectively and efficiently manage online catalogs.

e.         identify suppliers whose management views on quality and productivity match those of the buying organization and have both parties establish expectations.

 

90. Trends in supply management include:

a.         switching suppliers frequently through online auctions to get price discounts.

b.         limiting the number of suppliers and focusing on results from key suppliers.

c.         increasing the number of suppliers and developing closer relationships.

d.         negotiating shorter term contracts with fewer suppliers to increase leverage.

e.         greater concentration of the supplier selection decision in procurement.

91. Early supply and supplier involvement (ESI):

a.         pulls both the buyer and supplier into the need recognition and description stages of the acquisition process.

b.         pulls the buyer into relationship management stage and pulls the supplier into need recognition and description. 

c.         pulls the buyer into the need recognition and description stages and pulls the supplier into the measurement stage. 

d.         pulls the buyer into the measurement stage and pulls the supplier into the need recognition and description stages.

e.         pulls both the buyer and supplier into the process of measuring results and developing action plans for performance improvement.

92. Supply chain management effectiveness is driven primarily by the organization’s ability to manage the:

a.         internal link between supply management and its internal customers.

b.         internal link between supply management and senior management.

c.         internal and external links of customers, the buying organization and suppliers.

d.         external link between a buying organization and its key suppliers.

e.         external link between a buying organization and its key customers.

True and False

11. Taking negative measures to shift the satisfaction level in the buyer-seller relationship will have little impact on short term objectives, but will positively affect the relationship in the long-term.

12. The perception of a buyer-seller relationship is based on both the results and the process used to attain them. 

13. An unwillingness to single source and enter into a buyer-supplier partnership is indefensible in a progressive purchasing and supply management organization.

14. Buyer-supplier relationships fall somewhere on a continuum from traditional, adversarial relationships to fully integrated, seamless relationships.

15. Exceptional suppliers anticipate the operational and strategic needs of the purchaser, and are capable of meeting and exceeding them.

16. Supplier goodwill can be measured regularly through surveys conducted by third party research organizations.

17. Strategic supply management focuses on only those suppliers of high dollar or high value goods and services.  

18. Adversarial negotiations and decisions based on total cost of ownership are hallmarks of a successful buyer-supplier partnership.

19. Early supplier involvement only extends to an organization’s first tier suppliers because it is the responsibility of these suppliers to manage subsequent tiers of suppliers.

20. Supply management is critical to effectively managing supply chains, but demand management is not.