SCM 372 EXAM 2 CH 6-11 QUESTIONS & ANSWERS
To effectively align buying strategies, a supply manager must understand the overall
goals of the business.
True / False - Answer -True
What does the strategic positioning of BMW include?
a. Highest price
b. Lowest price
c. Fastest cars
d. High Quality
e. All of the above
f. None of the above - Answer -d. High Quality
Defining the company's competitive position has guidelines that include which of the
following?
a. Value proposition
b. Strategic positioning
c. Role of purchasing
d. Role of category
e. All of the above
f. A & D only - Answer -e. All of the above
The key to alignment is to understand the goals or mission of the organization that you
work for, then look at the goals of the operations area.
True / False - Answer -False
What does Aldi's sourcing strategy mean for you as a decision maker?
a. Everything you do needs to lower the cost of purchased goods--without sacrificing
quality.
b. Everything you do has established standards to assure that every product brought for
sales is fresh, socially responsible, and safe.
c. You need to scan the market to spot emerging trends and to keep the right product
and brands on the self.
d. All of the above
e. None of the above - Answer -a. Everything you do needs to lower the cost of
purchased goods--without sacrificing quality.
What does looking at production processes allow you to look for?
a. A donut shop
,b. A retail store
c. A job shop
d. A highly automated process
e. All of the above
f. C & D only
None of the above - Answer -f. C & D only
Your primary goal as a purchasing agent is to try to ensure an interrupted flow of
supply.
True / False - Answer -False
The nature of the item and process includes an assessment of which of the following?
a. Complexity
b. Types of materials
c. Labor content
d. Production processes
e. All of the above
f. None of the above - Answer -e. All of the above
The more control you have over price and availability, the better you can reduce risk.
True / False - Answer -True
Beyond total supply, as a purchasing agent, what else would you need to track?
a. Capacities
b. Optimization models
c. Capabilities
d. Cost drivers
e. All of the above
f. Only A & C - Answer -c. Capabilities
An action plan translates theory into practice.
True / False - Answer -True
Suppliers can only be segmented in one way.
True / False - Answer -False
What does an implementation planning document look at?
a. Who
b. What
c. Where
d. When
e. How
f. Why
g. All of the above
h. A, B, & D only
i. None of the above - Answer -h. A, B, & D only
,If a company spends $5 million annually on its goods and services, what percent of the
total spend is $4,000,000?
a. 1%
b. 5%
c. 8%
d. 10%
e. 15% - Answer -c. 8%
As a purchasinf agent, cost modeling helps you choose the supplier with the right
capabilites.
True / False - Answer -True
Whole Foods has a mission statement and strategic positioning similar to which
company?
a. Wal-Mart
b. School bus company
c. Aldi
d. BMW
e. All of the above
f. None of the above - Answer -d. BMW
Which of the following dimensions must be considered when developing your sourcing
strategy for a specific commodity?
a. Reshore versus offshore
b. Supply base rationalization
c. Supply risk management
d. Supplier development
e. All of the above
f. None of the above
g. C and D only - Answer -g. C and D only
When conducting a category analysis, the nature of the item and process includes
assessing which of the following questions?
a. How complex is the item you are assessing?
b. Can you forecast a need for the item?
c. What is your company's purchase history for the item?
d. What is it that your company needs?
e. All of the above
f. None of the above - Answer -a. How complex is the item you are assessing?
What issues does the supply side include?
a. Capabilities of existing suppliers
b. Aggregation of supply situation
, d. Potential shocks or disruptions
e. Governmental regulations
f. All of the above
g. None of the above - Answer -f. All of the above
Being able to manage the supply side of a business to better meet the demands of the
business is ___________________.
a. easy
b. challenging
c. cumbersome
d. an anomaly
e. All of the above
f. None of the above - Answer -b. challenging
What does Porter's Five Forces Analysis assess?
a. Threat of New Entry
b. Competitive Rivalry
c. Supplier Power
d. Buyer Power
e. All of the above
f. None of the above - Answer -e. All of the above
Strategic level cost modeling helps a supply manager make a selection between two
suppliers of the same material.
True / False - Answer -False
What is the percent of SGA?
Labor $2.00
Material $3.00
Overhead $3.00
Cost $8.00
SGA $0.80
Total Cost $8.80
Profit $0.88
Price $9.68
a. 1%
b. 5%
c. 10%
d. 15%
e. 100% - Answer -c. 10%
Executional level of cost modeling looks at labor content and shipping economics of a
purchased product.
True / False - Answer -False
To effectively align buying strategies, a supply manager must understand the overall
goals of the business.
True / False - Answer -True
What does the strategic positioning of BMW include?
a. Highest price
b. Lowest price
c. Fastest cars
d. High Quality
e. All of the above
f. None of the above - Answer -d. High Quality
Defining the company's competitive position has guidelines that include which of the
following?
a. Value proposition
b. Strategic positioning
c. Role of purchasing
d. Role of category
e. All of the above
f. A & D only - Answer -e. All of the above
The key to alignment is to understand the goals or mission of the organization that you
work for, then look at the goals of the operations area.
True / False - Answer -False
What does Aldi's sourcing strategy mean for you as a decision maker?
a. Everything you do needs to lower the cost of purchased goods--without sacrificing
quality.
b. Everything you do has established standards to assure that every product brought for
sales is fresh, socially responsible, and safe.
c. You need to scan the market to spot emerging trends and to keep the right product
and brands on the self.
d. All of the above
e. None of the above - Answer -a. Everything you do needs to lower the cost of
purchased goods--without sacrificing quality.
What does looking at production processes allow you to look for?
a. A donut shop
,b. A retail store
c. A job shop
d. A highly automated process
e. All of the above
f. C & D only
None of the above - Answer -f. C & D only
Your primary goal as a purchasing agent is to try to ensure an interrupted flow of
supply.
True / False - Answer -False
The nature of the item and process includes an assessment of which of the following?
a. Complexity
b. Types of materials
c. Labor content
d. Production processes
e. All of the above
f. None of the above - Answer -e. All of the above
The more control you have over price and availability, the better you can reduce risk.
True / False - Answer -True
Beyond total supply, as a purchasing agent, what else would you need to track?
a. Capacities
b. Optimization models
c. Capabilities
d. Cost drivers
e. All of the above
f. Only A & C - Answer -c. Capabilities
An action plan translates theory into practice.
True / False - Answer -True
Suppliers can only be segmented in one way.
True / False - Answer -False
What does an implementation planning document look at?
a. Who
b. What
c. Where
d. When
e. How
f. Why
g. All of the above
h. A, B, & D only
i. None of the above - Answer -h. A, B, & D only
,If a company spends $5 million annually on its goods and services, what percent of the
total spend is $4,000,000?
a. 1%
b. 5%
c. 8%
d. 10%
e. 15% - Answer -c. 8%
As a purchasinf agent, cost modeling helps you choose the supplier with the right
capabilites.
True / False - Answer -True
Whole Foods has a mission statement and strategic positioning similar to which
company?
a. Wal-Mart
b. School bus company
c. Aldi
d. BMW
e. All of the above
f. None of the above - Answer -d. BMW
Which of the following dimensions must be considered when developing your sourcing
strategy for a specific commodity?
a. Reshore versus offshore
b. Supply base rationalization
c. Supply risk management
d. Supplier development
e. All of the above
f. None of the above
g. C and D only - Answer -g. C and D only
When conducting a category analysis, the nature of the item and process includes
assessing which of the following questions?
a. How complex is the item you are assessing?
b. Can you forecast a need for the item?
c. What is your company's purchase history for the item?
d. What is it that your company needs?
e. All of the above
f. None of the above - Answer -a. How complex is the item you are assessing?
What issues does the supply side include?
a. Capabilities of existing suppliers
b. Aggregation of supply situation
, d. Potential shocks or disruptions
e. Governmental regulations
f. All of the above
g. None of the above - Answer -f. All of the above
Being able to manage the supply side of a business to better meet the demands of the
business is ___________________.
a. easy
b. challenging
c. cumbersome
d. an anomaly
e. All of the above
f. None of the above - Answer -b. challenging
What does Porter's Five Forces Analysis assess?
a. Threat of New Entry
b. Competitive Rivalry
c. Supplier Power
d. Buyer Power
e. All of the above
f. None of the above - Answer -e. All of the above
Strategic level cost modeling helps a supply manager make a selection between two
suppliers of the same material.
True / False - Answer -False
What is the percent of SGA?
Labor $2.00
Material $3.00
Overhead $3.00
Cost $8.00
SGA $0.80
Total Cost $8.80
Profit $0.88
Price $9.68
a. 1%
b. 5%
c. 10%
d. 15%
e. 100% - Answer -c. 10%
Executional level of cost modeling looks at labor content and shipping economics of a
purchased product.
True / False - Answer -False
