A manufacturer develops a new product that will be more efficient and easier to use than previous versions. Prototypes are created, evaluated, and approved, and the company begins large scale
production.
Three months into production, costs rise beyond expectations, due to one of the raw materials not providing the economies of scale predicted by the design team. This results in a net loss at the
recommended price point. Which of the following actions should the design team have taken to prevent this situation?
A sourcing manager is negotiating a contract with a human resources supplier that has access to employee data, including social security numbers. The supplier proposes an annual cap of $10,000 on overall liability. In this situation, which of the following is the MOST important stakeholder for the sourcing manager to consult in regard to this supplier?
A small company identifies a market need for a new device. However, the firm is relatively young and does not have much design expertise. In this situation, which of the following would be the BEST option for bringing the new product concept to market?
A company's accounting department implements a new system to track liabilities for capital assets. The reports developed by this system exclude some important indirect procurement data (e.g., transactions related to test equipment), as this information is tracked by another system. Which of the following is the BEST course of action for the firm to take in this situation?
A manufacturing plant employs an enterprise resource planning (ERP) system. The supply management staff find the data provided by this system to be incomplete or incorrect. Which of the following should the supply management staff do FIRST In order to obtain more useful information?
A supply manager is conducting financial analysis of bidders. The supply manager wants to select the supplier that is most efficient In the use of its assets. Based on the following information, which supplier should the supply manager choose?
A sourcing manager is asked by a stakeholder to purchase electronic signature software. To avoid additional license fees, the stakeholder wants an inclusive price covering all of the software's functionality. However, the budget available for the purchase is limited, and an all-inclusive package will drive up price. Given this situation, which of the following is MOST important for the stakeholder to provide before the sourcing manager contacts potential suppliers?
A buying organization requires suppliers to maintain an on-time delivery rate greater than 90%. Based on the data below, which of the following can be concluded regarding the delivery performance of these three suppliers?
Supplier A ScoreSupplier B ScoreSupplier C Score
Total Shipments10002000500
Late Shipments6012551
EFG, Inc., a research firm, buys an ultra-high efficiency filter from Supplier A, which is the only capable source for this component. Supplier A informs EFG that the filter will soon be discontinued. EFG's supply manager finds filters with similar—though not identical—characteristics from another source and brings a small sample in for testing. The initial results are acceptable. Given this situation, which of the following is the MOST appropriate next step for the supply manager to take?
The ability to explain how and why decisions are made in support of business plans is important because it allows a supply manager to
