4.5.3 PROCUREMENT

Question 1

After researching the market what is the next step the project manager should take before obtaining quotations for the work, or issuing an invitation to tender?

(1) Write a procurement strategy
(2) Identify and pre-qualify the list of possible suppliers
(3) Evaluate the initial bids received
(4) Dismiss all suppliers who do not have a website

Answer 1

(2) Identify and pre-qualify the list of possible suppliers

Question 2

Which party carries most risk in a fixed price contract?

(1) The supplier
(2) The customer
(3) Both parties share the risk
(4) Risk is eliminated in this type of pricing mechanism

Answer 2

(1) The supplier

Question 3

What term is given to the contracts when the work is split into two stages and there are two contracts let, one for each stage?

(1) Comprehensive contracts
(2) Parallel contracts
(3) Sub-contracts
(4) Sequential contract

Answer 3

(4) Sequential contract

Question 4

When a main contract is let and part of it is sub-contracted, what means does the customer use to communicate with the sub-contractor?

(1) The customer sets up meetings directly with the sub-contractor concerned
(2) All communications should be routed via the main contractor
(3) Formal written communications is usually the best route
(4) Informal and formal communications direct to the sub-contractor

Answer 4

(2) All communications should be routed via the main contractor

Question 5

What is the “make or buy” decision?
(1) Make involves doing the work in house, buy involves outsourcing the work to an external
supplier
(2) It is used only in IT projects when deciding whether to outsource the work
(3) It only applies in outsourcing projects
(4) It applies to all projects but only when buying off the shelf packages

Answer 5

(1) Make involves doing the work in house, buy involves outsourcing the work to an external
supplier