Chapter 4

Question 1

Process of acquiring goods and services from a third-party vendor through direct purchasing.

Answer 1

Procurement

Question 2

Cycle time of traditional procurement

Answer 2

4 Days and 6 Hours

Question 3

Cycle time of E-procurement

Answer 3

1 Day and 2 Hours

Question 4

Types of procurement strategies

Answer 4

1. Cost reduction
2. Sustainable Purchasing
3. Risk Management
4. Supplier Relationship Management
5. Global Sourcing
6. Total Quality Optimization

Question 5

Type of strategy is beneficial to organizations in accounting for company expenditure and improving organizational functions.

Answer 5

Cost reduction

Question 6

Ideal option for businesses striving toward minimizing their carbon footprint.

Answer 6

Sustainable Procurement

Question 6

Also known as green purchasing, it highlights the procurement of quality goods and services with low environmental impact.

Answer 6

Sustainable Purchasing

Question 7

Part of any business transaction or process.

Answer 7

Risks

Question 8

Concentrates on minimizing risks related to the procurement of goods and services.

Answer 8

Risk mitigation

Question 9

Emphasizes forming robust supplier relationships and empowering them to enhance their capabilities.

Answer 9

Supplier relationship management

Question 10

A well-defined strategy that entails procuring products and services from an expansive range of international suppliers.

Answer 10

Global Sourcing

Question 11

Method of strategy that ensures quality procurement by way of acquiring the right products that adhere to the highest standards.

Answer 11

Total Quality Optimization

Question 12

Involves the gathering of facts, data, observations, and trends about the marketplace in which supplier conduct business.

Answer 12

Supply Chain Analysis

Question 13

Involves an assessment of multiple key areas that impact the full Sourcing and Procurement spectrum.

Answer 13

Spend Management

Question 14

Subset of Spend Management; Involves all of the common processes that you would expect - data retrieval, cleansing, classifications, interpretation, and presentation.

Answer 14

Spend Analysis

Question 15

Advantage of Supply Chain Market Analysis

Answer 15

1. It helps identify market opportunities
2. It helps guide interaction w/ supplier
3. It can help reduce expenses
4. It improves efficiency

Question 16

Strategic tool used by procurement and supply chain professionals to identify and minimize supply risks.

Answer 16

Kraljic Matrix

Question 17

This quadrant is represented by items which are least critical to your business and account for least expenditure.

Answer 17

Routine

Question 18

SKUs/Service in this quadrant are similar to routine quadrant but the spend value is very high for these items.

Answer 18

Leverage

Question 19

These SKUs/Services are characterized by high risk and low annual expenditure value.

Answer 19

Bottleneck

Question 20

These items are very critical to your business; spend value of these items is higher and offers higher level of attractiveness to suppliers for doing business with your company.

Answer 20

Critical

Question 21

It was developed in the 1970s to improve the purchasing process.

Answer 21

Electronic Data Interchange (EDI)

Question 22

The rapid advent of internet technology in the ______ spurred the growth of more flexible internet-based e-procurement systems.

Answer 22

1990s

Question 23

Advantages of E-procurement System

Answer 23

1. Time savings
2. Cost savings
3. Accuracy
4. Real time-use
5. Mobility
6. Trackability
7. Management benefits
8. Supplier Benefits