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L4M6 Exam Dumps For Certification Exam Preparation
NEW QUESTION # 133
Which of the following are not a valid reasons to terminate a relationship with a supplier? Select TWO.
- A. The supplier becomes insolvent
- B. The supplier made one late delivery
- C. Supply base rationalisation
- D. The supplier suddenly increases prices
- E. The supplier has a change in senior management
Answer: B,E
Explanation:
Two invalid reasons are; one late delivery and a change in senior management. Valid reasons to terminate a relationship are listed on p.107 and include the three listed here, as well as a material breach, damage to reputation and the supplier merges or is acquired by another company.
NEW QUESTION # 134
Which of the following are possible drivers for partnership sourcing? Select THREE.
- A. The need to improve performance to satisfy the end customer
To increase production costs and lead-times - B. The marketplace has become more volatile
- C. Working together will create synergies
- D. The protection of intellectual property rights
Answer: A,B,C
Explanation:
The correct answers are; The marketplace has become more volatile, Working together will create synergies and The need to improve performance to satisfy the end customer. Further Drivers of Partnership Sourcing can be found on p.127. The other answers are incorrect as entering a partnership won't protect intellectual property rights- in fact that's one of the big risks of entering into a partnership. Partnerships won't increase costs and lead-times, they're likely to decrease them.
NEW QUESTION # 135
In the public sector, there are many sources of information that a buyer can use to identify a suitable supplier. Which of the following could be used? Select THREE
- A. Tradeshows
- B. Intranet
- C. Internal stakeholders' knowledge
- D. OJEU
- E. Procurement Platforms
Answer: A,C,E
Explanation:
The correct answers are; tradeshows, internal stakeholders' knowledge and e-procurement platforms. Intranet is incorrect as this is an internal system so you wouldn't find information on external suppliers on here the careful not to confuse intranet with internet). OJEU is also incorrect; this is the platform on which tender opportunities in the public sector are published- its not a list of suppliers.
NEW QUESTION # 136
Which of the following are valid strategies for dealing with conflict? Select THREE
- A. Contesting
- B. Competing
- C. Compromising
- D. Collaborating
- E. Collecting
Answer: B,C,D
Explanation:
The three right answers are competing, collaborating and compromising. See the Thomas Kilmann Model on p.87. There are quite a few questions on this in the exam.
NEW QUESTION # 137
One of the fist stages of designing a Partnership is to come up with joint KPIs. These should be:
- A. Measurable, achievable and time-bound
- B. Relatable, specific and measurable
- C. Significant, measurable and achievable
- D. Time bound, difficult and relevant
Answer: A
Explanation:
The correct answer is Measurable, achievable and time-bound. This is from SMART KPIs on p. 151. Smart stands for specific, measurable, achievable, relevant, time-bound. In the exam they come up in different orders so be careful.
NEW QUESTION # 138
According to Michael Porter, what is procurement?
- A. a primary activity which provides a source of competitive activity
- B. a support activity which provides a source of competitive advantage
- C. a primary activity which provides value for money
- D. a secondary activity which provides value for money
Answer: B
Explanation:
This question refers to Porter's Value Chain (p.35). There's a couple of questions on this in the exam so try to learn it. Procurement is a 'support activity' on this matrix along with firm infrastructure, HR and technology development
NEW QUESTION # 139
Which of the following is a characteristic of a traditional contracting agreement?
- A. Emphasis on short-term business relationships
- B. Emphasis on single source arrangement
- C. Emphasis on mutual trust between purchaser and supplier
- D. Emphasis on quality assurance based on zero defects
Answer: A
Explanation:
Comprehensive and Detailed Explanation:
Traditional contracting agreements are typically characterized by:
* Short-Term Focus:These agreements often prioritize immediate needs over long-term collaboration.
* Transactional Nature:Emphasis is on price and terms rather than building strategic partnerships.
Reference:
"L4M6 Summarised Note"- Evocurement: L4M6 Summarised Note
NEW QUESTION # 140
David is sourcing a new cleaning contract as he is not impressed with his current cleaning company's performance. He believes that his current supplier has been overcharging him, and due to budget cuts, he is keen to secure a lower price than what he is paying now. His Manager has suggested using an e-auction as the procurement method. Is this the correct way forward?
- A. No- a reverse e-auction would be more suitable as it will secure the lowest price
- B. Yes- an e-auction is an electronic system so it will be easy for David to compare bids
- C. Yes- an e-auction will allow David to secure the lowest possible price
- D. No- a reverse e-auction will ensure only high quality suppliers bid for the opportunity
Answer: A
Explanation:
The correct answer is 'No- a reverse e-auction would be more suitable as it will secure the lowest price'. An E-auction is something like eBay- where bids go up in price. If David wants to secure a lower price, he should use a Reverse E-Auction- where suppliers bid lower than the previous bid in order to win. For example, Supplier 1 offers to fulfil the contract at £50k per year, Supplier 2 can offer to beat this price by bidding £48k per year. Although Reverse E-Auctions may ensure cheaper prices, there are a lot of disadvantages to using this method. See p.21 and p.76 for more information
NEW QUESTION # 141
Marcus is an account manager for a company that sells maintenance spares for air conditioning units. He has a customer who persistently pays late, is very demanding in terms of constant requests, and the profit margin on the account is minimal. If Marcus were to use a supplier preferencing model to map this customer, what category would he place them into?
- A. Nuisance
- B. Exploitable
- C. Core
- D. Development
Answer: A
Explanation:
Comprehensive and Detailed Explanation:
In the Supplier Preferencing Model, customers are categorized based on their attractiveness and value to the supplier. A "Nuisance" customer is characterized by low profitability and high maintenance, often requiring disproportionate resources relative to the benefits they provide. Such customers may be deprioritized or even considered for discontinuation by the supplier.
Reference:
CIPS L4M6 Study Guide
NEW QUESTION # 142
Why is it more difficult for buyers in the public sector to build relationships with suppliers?
- A. There are regulations that state competitive tender processes must be undertaken regularly
- B. Buyer power is weak in the public sector
- C. There are regulations prohibiting public sector buyers from developing relationships
- D. Buyer power is strong in the public sector
Answer: A
Explanation:
It can be difficult for buyers in the private sector to build relationships with suppliers because of rules that state competitive tenders must be undertaken every few years (within the EU this is usually every 4). This means that both parties aren't as invested in developing the relationship as it's possible the contact will end shortly. Competitive tendering is a requirement in the public sector to ensure value for money for taxpayers.
See p.79 for further details. There are no rules stating Public Sector organisations can't have good relationships with suppliers, and in fact most will have good relationships with their current suppliers- the issue is that neither party can get too invested in the relationship as everyone knows it may end shortly. There are rules, however, against entering into Partnership relationships (which is discussed in chapter 3).
NEW QUESTION # 143
In a partnership who is responsible for decision making?
- A. The supplier
- B. The project steering committee
- C. The buyer
- D. Both the supplier and the buyer
Answer: D
Explanation:
The correct answer is both the supplier and the buyer- joint decision making is a key aspect of partnership relationships. A project steering committee decides on priorities, suggests improvements, conducts audits etc.
See p.152
NEW QUESTION # 144
When using portfolio analysis, in which segment would you place a product with high expenditure, potentially provided by a large number of suppliers?
- A. Leverage
- B. Acquisitive
- C. Critical
- D. Strategic
Answer: A
Explanation:
Comprehensive and Detailed Explanation:
In the Kraljic Matrix, products are categorized based on supply risk and profit impact:
* Leverage items:These have a high profit impact but low supply risk. They are often high-expenditure items available from multiple suppliers, allowing the buyer to leverage purchasing power to negotiate better terms.
Given the product has high expenditure and is available from many suppliers, it fits into the 'Leverage' category.
Reference:
CIPS L4M6 Study Guide
NEW QUESTION # 145
Which of the following are possible drivers for partnership sourcing? Select THREE.
- A. The marketplace has become more volatile
- B. The need to improve performance to satisfy the end customerTo increase production costs and lead- times
- C. Working together will create synergies
- D. The protection of intellectual property rights
Answer: A,B,C
Explanation:
The correct answers are; The marketplace has become more volatile, Working together will create synergies and The need to improve performance to satisfy the end customer. Further Drivers ofPartnership Sourcing can be found on p.127. The other answers are incorrect as entering a partnership won't protect intellectual property rights- in fact that's one of the big risks of entering into a partnership. Partnerships won't increase costs and lead-times, they're likely to decrease them.
NEW QUESTION # 146
A large construction group has a critical contract with a brick supplier. This represents high-value spend and the contract has a five-year duration. What type of commercial relationship would be the most appropriate?
- A. Closer Tactical
- B. Transactional
- C. Outsourcing
- D. Partnership
Answer: D
Explanation:
A partnership is the most appropriate type of relationship for high-value, long-term contracts involving strategic goods or services. This relationship allows both parties to work collaboratively toward common goals, share risks, and ensure continuity and quality over the long term. According to the CIPS L4M6 study materials, partnership relationships are encouraged where there is a high level of interdependence and shared objectives.
NEW QUESTION # 147
A buyer has a requirement to purchase 1,000 widgets for a manufacturing company. The widgets are critical for the next stage of the manufacturing process. What would be the key selection criterion for this buyer?
- A. Ability to deliver by the deadline
- B. Ability to produce low-cost widgets
- C. Ability to add value to the order
- D. Ability to meet ISO standards
Answer: A
Explanation:
When procuring critical components essential for the continuity of manufacturing processes, timely delivery becomes paramount. Delays can halt production lines, leading to significant financial losses.Therefore, the supplier's ability to meet delivery deadlines is the key selection criterion, as emphasized in the CIPS L4M6 study guide.
NEW QUESTION # 148
Barry is a procurement manager at Sea Biscuits, a company which manufactures biscuits in the shape of dolphins and starfish. He works in an office that orders stationary regularly for its 100 person workforce.
Stationary is a low-spend category item and Barry often orders stationary from different suppliers based on which supplier can provide the item the cheapest at that point in time. According to the Kraljic matrix, what type of suppliers provides stationary to Barry?
- A. Bottleneck
- B. routine
- C. leverage
- D. strategic
Answer: B
Explanation:
Stationary is a routine item; it is ordered often (as Barry uses different suppliers), it is a low category spend, and low risk to the business' operations (a late delivery of pens isn't going to stop the company making its biscuits). There are lots of questions on Kraljic in the exam - do revise this topic and ensure you understand each of the four quadrants of the matrix (see p.20)
NEW QUESTION # 149
Which of the following tender processes available to a buyer involves a Pre-Qualification Questionnaire (PQQ) to identify, assess, and create a shortlist of suppliers being invited to the Invitation to Tender (ITT) stage? Select TWO that apply.
- A. Competitive Bidding Procedure
- B. Open Procedure
- C. Restricted Procedure
- D. Mini-Competition Procedure
- E. Two-stage Procedure
Answer: C,E
Explanation:
The Restricted and Two-stage procedures involve a PQQ stage to shortlist suppliers before issuing an ITT.
This approach is common for contracts requiring stringent supplier qualifications.
NEW QUESTION # 150
Danny is procuring a new IT software, which he doesn't know much about. He has done a bit of research on the internet but is still unsure how much he can expect to pay. What should be Danny's next step?
- A. Issue an ITT
- B. Issue a RFQ
- C. Issue a RFI
- D. Issue an OJEU
Answer: C
Explanation:
Danny should issue a RFI (Request for Information). His next step would be to find out more about the products available by asking suppliers for information- this will help him put a spec together before he goes out to tender. The other options mean; RFQ - request for quotation- when you ask suppliers to submit a price.
ITT- Invitation to tender - a document you send out to suppliers which details all the information about the tender (this usually involves both price and quality components of assessment). OJEU- Official Journal of the European Union- where tenders for the Public Sector are published. For more info on RFI see p.74
NEW QUESTION # 151
National Hospital Trust (NHT) has entered into a partnership relationship with a major facilities management provider. The two organizations have agreed on the approach to undertake regular reviews and audits. The audit approach will include which of the following?
- A. Specification development and management
- B. Category management and supplier rationalization
- C. Lessons learned and continuous improvement
- D. Macro and micro environmental analysis
Answer: C
Explanation:
Regular reviews focusing on lessons learned and continuous improvement ensure the partnership remains effective and aligned with objectives. This supports ongoing collaboration and operational excellence.
NEW QUESTION # 152
A buyer is intending to purchase a new product for their business; however, the market has a large number of suppliers. What would be the most beneficial way for them to initially narrow down the supply options?
- A. Predefine minimum standards suppliers must meet
- B. Look at lowest-cost suppliers only
- C. Go only to companies they have bought other products from
- D. Preselect companies who have the largest market share
Answer: A
Explanation:
Setting minimum standards helps filter suppliers efficiently, ensuring that only capable and reliable suppliers are considered. This approach supports both cost and quality objectives.
NEW QUESTION # 153
A company purchases products from a supplier that falls into the 'strategic' segment of the supply positioning grid. They are drawing up a formal partnership agreement with the supplier. The supplier views the company as core to their business. What would be an important clause to include in the agreement to help make sure the partnership worked in a fully collaborative way?
- A. Liquidated damages
- B. Time of the essence
- C. Continuous improvement
- D. Force majeure
Answer: C
Explanation:
Comprehensive and Detailed Explanation:
In strategic partnerships, including a continuous improvement clause is vital. This clause commits both parties to ongoing efforts to enhance processes, reduce costs, and improve quality over time. Such a commitment ensures that the partnership remains dynamic and responsive to changes, fostering long-term collaboration and mutual benefit.
Reference:
CIPS L4M6 Study Guide
NEW QUESTION # 154
A partnership was created between a company and one of its local suppliers when the managing directors of each company met and thought partnering could be a good idea. No other departments were included in the discussions. The partnership has been in place for over a year, but neither of the companies has achieved any additional benefits. The company has been unable to offer any increased business to the supplier, and the supplier has been unable to improve on the quality of its products. The partnership is going to be terminated.
What is a possible main reason for the failure of the partnership?
- A. Cultural differences
- B. Poor planning
- C. Market changes
- D. Distance barrier
Answer: B
Explanation:
Partnerships require careful planning, including alignment of goals, stakeholder involvement, and clear expectations. Poor planning leads to unmet objectives and lack of value generation, as highlighted by CIPS.
NEW QUESTION # 155
A company is about to invite tenders for a contract to clean external windows at several premises, all at least three storeys high. It is going to do this in two stages. For the first stage, it will issue a pre-qualification questionnaire (PQQ) and, from the replies, select at least five potential suppliers to invite to tender. Which of the following is a selection criterion rather than an award criterion?
- A. Method statements for previous contracts
- B. Environmental impact assessment
- C. Risk assessments at the premises
- D. Price that will be charged
Answer: A
Explanation:
Selection criteria focus on the supplier's capability and experience (e.g., method statements). Award criteria are used to evaluate and compare proposals during the tender process, such as price or environmental considerations.
NEW QUESTION # 156
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