ISM CORE - Supply Management Core Exam
A multi-divisional corporation seeks to leverage its overall spend by creating a consolidated supply base of preferred suppliers offering the most competitive costs and services. Though stakeholders Involved in the planning process seem to support leveraging efforts, the actual results have been disappointing, as the divisions continue to buy from past suppliers rather than from the preferred suppliers. In which of the following ways can supply management BEST improve the rate of buying through the preferred suppliers?
A director of supply management is tasked with determining where savings can be found in indirect cost categories. If needed, the company will consider hiring additional staff to negotiate and administer contracts. Which of the following is the FIRST step the supply manager should take?
A US-based manufacturing firm receives a quoted price for an item from an offshore supplier of $.40 each (in US dollars), delivered duty paid to its US plant per Incoterms® 2020 rules, in minimum quantities of 20,000 units. The buying organization uses 80,000 units per year, and the carrying cost is 25%. The item price is fixed for one year. What are the total costs of purchasing annual requirements from this supplier?
A supply manager for an electronics manufacturer is asked to source packaging for the company's new printed circuit board. The specifications recommend 0.50 mm tolerances, with a projected breakage ratio of 0.50%, at a cost of $1.00 each. The supply manager finds an alternative source that is specified at 0.60 mm tolerances, with a projected breakage ratio of 0.75%, at a cost of $0.80 each. If the cost of the new circuit board is $120 per unit, which packaging should the supply manager recommend and why?
DEF, Inc. wants to ensure adequate material supply for an emerging product with high quality specifications for the raw materials. Given this situation, which of the following would be the BEST course of action for DEF to take?
A supplier's willingness to deal with rejected materials, fill surges in orders, and provide technical support will be MOST affected by which of the following?
Motivated by public relations considerations, a company decides to insource the manufacture of a major product. This decision was MOST likely made to bring about
A team from RST, Inc. is conducting a negotiation session with a supplier. During the session, RST's lead negotiator perceives that various members of the supplier's team are being evasive on the issue of the supplier's capacity to handle the project. However, there is no apparent sign that the other members of RST's team share this perception. Given this situation, which of the following is the BEST course of action for the lead negotiator to take?
RST Bus Corporation contracts with Supplier X to buy 5,000 gallons of diesel fuel per month over the course of a year. After the first delivery is used in RST's fleet of tour buses, several of the buses stall on the highway. An inspection by RST's mechanics determines that the damage was caused by contaminated fuel. RST's supply manager notifies Supplier X that no further deliveries will be accepted, and that the supplier is expected to pay the cost of the repairs to the buses. In response, Supplier X cites its contract clause disclaiming warranties and liability, and its e-mail acceptance of RST's purchase order, including a statement that Supplier X's terms and conditions were applicable and available upon request. Supplier X contends that RST must accept all scheduled deliveries.
In this situation, which of the following is the BEST course of action for RST's supply manager to take?
When developing a category management plan, which of the following is the BEST reason for soliciting cross-functional input?
