L4M1

Question 1

What are the Carter’s 10 C’s?

Answer 1

Competence
Commitment
Capacity
Compliance
Cost
Communication
Control
Cashflow
Consistency
Compatibility

Question 2

What are the 5 R’s?

Answer 2

Price
Place
Quality
Quantity
Time

Question 3

What are the 4 D’s for Conflict of Interest?

Answer 3

Distance
Delegate
Disclose
Disassociate

Question 4

What are the Codes of Ethical Conduct?

Answer 4

Values
Principles
Personal Responsibility
Compliance 
Reporting

Question 5

Functions of an IT-based Inventory Management System

Answer 5

MANAGING DEMAND - the right quantities and time to satisfy need
FORECASTING DEMAND: Avoid over/under stock
CONTROL STOCK LEVELS
ENSURING COMPLIANCE WITH PROCUREMENT POLICIES - e.g. triggering automatic acquisitions
CAPTURING GOODS IN INFORMATION ACCURATELY - stock balance, contract management, pay systems
CONTROLLING: receipts, inspections, storage & issuing of supplies to users

Examples of this include: MRP, MRP2, Kanban, WMS

Question 6

Describe areas where waste can be eliminated as part of a Supply Chain Management system?

Answer 6

TIMWOOD
Transportation
Inventory
Motion
Waiting
Over-production
Over-processing
Defects

Question 7

What are the various functions of procurement strategy?

Answer 7

CLIP SWAQ

Procurement is the strategic function of an organisation that involves obtaining something - either tangible or intangible

ADDED VALUE
COST
INVENTORY
LOGISTICS
PURCHASING (plus ordering and expediting)
QUALITY
SUPPLY (plus delivery)
WASTE MANAGEMENT

Question 8

Organisational costs may be made up of…

Answer 8

TIME
MATERIAL
EFFORT
OPPORTUNITY

Of which these would be:

DIRECT - directly associated with a job or contract e.g. bricks, cement, timber
INDIRECT - not directly associated with a job or contract e.g. salary of support staff, rent, broadband contracts
FIXED - these do not change with the output e.g. salaries of management team, insurance, rent
VARIABLE - these change related to the output e.g. raw materials, haulage, wages for temp staff

Question 9

Name the 11 costs that are typical for an organisation

Answer 9

CAPITAL PURCHASES
INSURANCE
MARKETING
RAW MATERIALS
R&D
SALARIES/PENSIONS
SERVICES (eg cleaning, catering, IT support)
SUNDRY ITEMS (eg stationery, cleaning products, uniforms)
TRAINING
UTILITIES
VEHICLES/TRANSPORT

Question 10

Outline FIVE steps of the PROCUREMENT CYCLE?

Answer 10

1. Understand need - ensure the need is as per the consumer’s requirements and is clearly defined to potential suppliers
2. Pre-procurement, market testing and engagement - review demographics and trends and evaluate the life cycle stage of the need
3. Develop documentation: RFQ/ITT - give the suppliers a chance to provide an offer
4. Supplier selection – Supplier visits/Pre-Qualification Questionnaire/ Carter’s 10 C’s, the TCO approach - ensure the buyer can fulfil the need
5. Contract performance review-contract management /SLA’s/KPI’s - develop relationships, manage change, maintain strategy

Question 11

How is the Kraljic Matrix used to help manage the supplier relationships associated with each type of procurement?

Answer 11

High cost, high risk = Strategic suppliers (e.g. major project supplier)
High cost, low risk = Leverage suppliers (e.g. utilities)
Low cost, high risk = Bottleneck suppliers (e.g. Monopoly in marketplace)
Low cost, low risk = Routine suppliers (e.g. stationery)