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ISM Supply Management Core Exam Sample Questions (Q172-Q177):

NEW QUESTION # 172
ABC, Inc. has a supply management department responsible for placing orders. In spite of this, a designer from ABC's engineering department places an order with Supplier X for several products.
When the shipment arrives, it is rejected by the receiving department, as they cannot verify the order with supply management. To avoid this situation, the designer should have

• A. requested supply management issue an "after the fact" purchase order
• B. notified the supervisor of the engineering department of the immediate need for the item
• C. coordinated product needs with supply management prior to order commitment
• D. delayed placing the order until after looking at comparable items from other suppliers

Answer: C

 

NEW QUESTION # 173
Which of the following is the PRIMARY reason an organization's executive team and internal stakeholders should be aligned on the definitions of cost savings reporting?

• A. To ensure appropriate risk management strategies are being adopted
• B. To ensure financial professionals can audit the cost savings reporting process
• C. To ensure supply management is adding value
• D. To ensure price baselines can be adjusted for comparison purposes overtime

Answer: C

Explanation:
* Cost Savings Reporting: Accurate cost savings reporting is essential for demonstrating the value that supply management brings to the organization.
* Alignment on Definitions: When the executive team and internal stakeholders are aligned on the definitions of cost savings, it ensures that the reported savings are understood and accepted across the organization.
* Value Demonstration: This alignment shows that supply management is effectively contributing to the company's financial performance and strategic goals.
* Other Considerations: While auditability, baseline adjustments, and risk management are important, the primary reason for alignment is to clearly demonstrate the value added by supply management.
References
* ISM Professional Series: Cost Management
* CIPS Knowledge on Financial Management in Procurement

 

NEW QUESTION # 174
Which of the following histograms, each with nine observations, has a median of five? A)

B)

C)

D)

• A. Option A
• B. Option B
• C. Option C
• D. Option D

Answer: D

 

NEW QUESTION # 175
For valuation purposes, the opportunity cost and inflation are two main concepts that explain the:

• A. Riskiness of a project
• B. Economic value added
• C. Real rates of interest
• D. Time value of money

Answer: D

 

NEW QUESTION # 176
A firm is developing a solicitation to purchase materials in order to meet the needs of a new product launch.
The firm anticipates that some or all of its existing suppliers will respond to the solicitation. Given this situation, which of the following is the BEST requirements gathering approach for the firm?

• A. Describe, define, document and build approach
• B. Pilot and redesign approach
• C. Repetitive requirements gathering and testing
• D. Joint requirements development sessions

Answer: D

Explanation:
* Situation Context: The firm is developing a solicitation for materials for a new product launch, and existing suppliers are expected to respond.
* Collaboration Need: Joint requirements development sessions involve collaborating with key stakeholders, including existing suppliers, to gather comprehensive requirements.
* Detailed Understanding: This approach ensures a detailed and accurate understanding of the needs, leveraging the suppliers' expertise and knowledge of their capabilities.
* Alignment: It aligns the expectations of all parties involved, resulting in more precise and effective solicitation documents.
* Outcome: This method increases the likelihood of receiving proposals that meet the firm's exact requirements and supports a successful new product launch.
References
* ISM Professional Series: Supply Management Core
* CIPS Guide to Procurement Requirements Gathering

 

NEW QUESTION # 177
......

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