Exam 9: Supplier Management and Development: Creating a World-Class Supply Base

In an absence of competition situation, a supplier may hold the buyer hostage by unduly raising prices without justification or becoming too complacent, particularly when there are higher switching costs.

The remaining suppliers in a rationalized and optimized supply base are seldom capable of performing additional tasks or providing other products and services that add value to the buyer-supplier relationship.

_____ allows a buying organization to react more quickly when supply chain risk events occur by already having previously prepared plans and proposed responses in place in advance of the actual risk event.

Multiple sourcing can add quality variability to the sourced product because of the use of different materials, manufacturing techniques, and processes.

Which of the following is not a supplier-specific barrier to supplier development?

Direct involvement in a supplier's operations by buyer personnel is the most challenging part of any supplier development process.

Supplier rationalization and optimization should be a one-time activity.

The prime reason for hedging is to protect the buyer against major swings in the value of a future purchase.

Considering the cost-based supplier evaluation system, the actual cost per nonconformance event may be difficult to estimate or calculate, as many traditional cost accounting systems are not designed to identify and capture such data.

The _____ requires the systematic evaluation of the performance of individual suppliers and ultimate placement into one of three categories.

Scenario analysis is technically considered forecasting and attempts to explore and prepare for possible future scenarios that may have a significant negative impact on the costs and operations of an organization.

All of the following are advantages of a categorical supplier evaluation system except _____.

Which of the following is not one of the advantages of a rationalized and optimized supply base?

In _____, a buyer selects or develops suppliers with multiple or redundant capabilities.

The _____ is a normalization factor for the supplier performance index (SPI) that eliminates high-dollar lot bias.

Buyers can minimize supply disruption risk from a single suppler by selecting a supplier with multiple production facilities.

Which of the following is not one of the typical uses of supplier measurement data?

Which of the following is not one of the management uses for the data derived from a comprehensive cost-base supplier evaluation system?​

A large supply base means the duplication of a wide range of supply management activities, adding to acquisition cost without a corresponding increase in value added to the customer.

Short-term purchase contracts that award small volumes of business to multiple suppliers decrease production costs and provide incentive for individual supplier investments in process improvement.