CORE Exam Dumps - Supply Management Core Exam

The ability to explain how and why decisions are made in support of business plans is important because it allows a supply manager to influence internal stakeholders. By clearly communicating the rationale behind decisions, supply managers can gain buy-in and support from other departments, ensuring alignment and cooperation. This influence is crucial for the successful implementation of supply chain strategies and achieving organizational goals.

References

ISM (Institute for Supply Management). Effective Stakeholder Management.

CIPS (Chartered Institute of Procurement & Supply). Communication Skills for Supply Chain Professionals.

Project Timeline: The construction must begin within four months and be completed within a year.

Performance Monitoring: To ensure timely completion, setting clear milestones and requiring progress reports keeps the project on track and allows for early identification of potential delays.

Liquidated Damages: Including liquidated damages clauses for noncompliance provides a financial incentive for the contractor to meet deadlines and minimizes the risk of delays.

Accountability: This comprehensive approach ensures accountability and provides mechanisms to enforce timely project completion.

References

ISM. (n.d.). Effective Contract Management and Performance Monitoring.

CIPS. (n.d.). Best Practices in Project Management for Procurement.

To determine which supplier is most efficient in the use of its assets, we calculate the return on assets (ROA) for each supplier. ROA is calculated as:

ROA=Net IncomeAssets\text{ROA} = \frac{\text{Net Income}}{\text{Assets}}ROA=AssetsNet Income​

Supplier D: ROA = 50 / 20 = 2.5

Supplier A: ROA = 100 / 10 = 10

Supplier C: ROA = 200 / 400 = 0.5

Supplier B: ROA = 200 / 100 = 2

Supplier A has the highest ROA at 10, indicating the highest efficiency in using its assets to generate income.

References:

Financial analysis methods in supply chain management.

Return on assets (ROA) calculation and interpretation.

In the Kraljic Matrix, products are classified based on their impact on the business and the complexity of the supply market. The four categories are:

Leverage Items: High business impact, low supply market complexity.

Noncritical Items: Low business impact, low supply market complexity.

Bottleneck Items: Low business impact, high supply market complexity.

Strategic Items: High business impact, high supply market complexity.

A product with low business impact and low supply market complexity fits into the Noncritical category. These items typically have many suppliers, are easy to manage, and do not significantly affect the firm's operations or profitability.

References

Kraljic, P. (1983). "Purchasing must become supply management." Harvard Business Review, September-October 1983.

Sales Representative’s Promise: The sales representative from XYZ Company provided documentation that the product would meet or exceed ABC's specifications.

Express Warranty: An express warranty is created when a seller makes a promise or provides assurance that a product will meet certain standards or specifications.

Non-Conforming Goods: Upon inspection, the product did not meet the required specifications and could not be used for its intended purpose.

Buyer's Rights: Under the Uniform Commercial Code (UCC) and similar laws, the buyer has the right to return non-conforming goods and seek a full refund when an express warranty has been breached.

Conclusion: ABC is entitled to return the product and receive a full refund due to the breach of the express warranty.

References

UCC (Uniform Commercial Code). (n.d.). Article 2 - Sales.

ISM. (n.d.). Managing Warranties and Product Non-Conformance.

Conducting a reverse auction with a clear statement of work is the best course of action for a firm wanting to have all temporary labor services provided by one supplier at the lowest possible cost. A reverse auction allows suppliers to bid against each other in real-time, driving down the price. Providing a clear statement of work ensures that all bidders understand the requirements and can offer competitive pricing for the same set of services, ultimately resulting in cost savings for the firm.

References:

Jap, S. D. (2003). An Exploratory Study of the Introduction of Online Reverse Auctions. Journal of Marketing.

CIPS (Chartered Institute of Procurement and Supply). (2021). Procurement and Supply Chain Management.

In portfolio analysis, purchases for which the buying organization consolidates spend with a handful of suppliers but still maintains competition are BEST classified as D. leverage. This classification is used when a company uses its buying power to consolidate spend and negotiate better terms, while still keeping a competitive environment among a few suppliers to ensure optimal value and innovation12.

Soliciting cross-functional input when developing a category management plan is crucial because it ensures that the plan considers the perspectives and requirements of various stakeholders and functional areas. This collaboration helps in creating a comprehensive and effective plan that addresses the needs of the entire organization, leading to more sustainable and long-term solutions.

References

CIPS (Chartered Institute of Procurement & Supply). Cross-functional Team Collaboration in Category Management.

ISM (Institute for Supply Management). Benefits of Cross-functional Teams in Supply Management.