CIPS Supplier Relationships L4M6 Exam
Questions & Answers 2024/25
What is a connected stakeholder? - ANSWERSA stakeholder that has a strong interest in a company's
activities. This is due to its contractual or commercial relationship with the company.
What do internal stakeholders include? - ANSWERSInternal end users, contract managers, legal team,
employees.
What do connected stakeholders include? - ANSWERSSuppliers, Customers and clients
What do external stakeholders include? - ANSWERSCompetitors, communities, government and other
public agencies
What is the definition of value for money? - ANSWERSThe most advantageous combination of price and
quality that makes a product or service fit for purpose and will achieve the buyer's required outcomes.
This needs to be reviewed in terms of whole life costs.
Value for money is often described as the three E's, what are the three E's? - ANSWERSEconomy,
Efficiency, Effectiveness
What are typical factors taken into account in defining value for money? - ANSWERSFitness for purpose,
quality, total lifetime costs, risk, environmental and sustainability issues.
Creating value for money with competition. - ANSWERSIn the public sector there are legal rules to
support the creation of value for money, transparency and fairness.
What can happen when there is a lack of compliance with procurement processes and procedures? -
ANSWERSLack of contract coverage, Maverick buying activity, May end up with a product or service that
is unfit for purpose, procurement activity is not assessed and managed in a consistent way.
, How can procurement add value when understanding the need? - ANSWERSMake or buy decision,
support the formation of a cross-departmental team to develop the specification, review where branded
products could be replaced by substitute non-branded products or materials to reduce costs, encourage
standardisation
What is value mapping? - ANSWERSA process in which value is created by reducing or eliminating waste
and operational inefficiencies.
What are the seven wastes? (TIMWOOD) - ANSWERSTransportation, Inventory, motion, Waiting, Over
production, over processing, defects.
How can can value be added through a strategic approach? - ANSWERS- Review spend across various
areas
-Following on from spend reviews they could aggregate demand and consolidate spend.
-Supplier relationship management and risk management plans
-Specialist category and supplier knowledge.
Added value through suppler relationships - ANSWERS-Being able to identify and use an appropriate
approach to deal with supplier.
-Innovation developed as part of collaborative projects with strategic suppliers
-Reduction of waste
-Resilience and risk reduction
What are sources of information that a buyer can use to identify a suitable supplier? - ANSWERSInternal
stakeholders/user department knowledge, preferred supplier lists, internet searches, networking.
Supplier identification in the private sector? - ANSWERSThe private sector buyer is free to invite as many
suppliers to participate as it feels are relevant.
Supplier identification in the public sector? - ANSWERSSupplier identification in the public sector is a
more transparent process than in the private sector. In the public sector in the EU the buyer will be
required to advertise the requirement in the OJEU. It will then need to select which common
procurement vocabulary modes match its requirements.
Questions & Answers 2024/25
What is a connected stakeholder? - ANSWERSA stakeholder that has a strong interest in a company's
activities. This is due to its contractual or commercial relationship with the company.
What do internal stakeholders include? - ANSWERSInternal end users, contract managers, legal team,
employees.
What do connected stakeholders include? - ANSWERSSuppliers, Customers and clients
What do external stakeholders include? - ANSWERSCompetitors, communities, government and other
public agencies
What is the definition of value for money? - ANSWERSThe most advantageous combination of price and
quality that makes a product or service fit for purpose and will achieve the buyer's required outcomes.
This needs to be reviewed in terms of whole life costs.
Value for money is often described as the three E's, what are the three E's? - ANSWERSEconomy,
Efficiency, Effectiveness
What are typical factors taken into account in defining value for money? - ANSWERSFitness for purpose,
quality, total lifetime costs, risk, environmental and sustainability issues.
Creating value for money with competition. - ANSWERSIn the public sector there are legal rules to
support the creation of value for money, transparency and fairness.
What can happen when there is a lack of compliance with procurement processes and procedures? -
ANSWERSLack of contract coverage, Maverick buying activity, May end up with a product or service that
is unfit for purpose, procurement activity is not assessed and managed in a consistent way.
, How can procurement add value when understanding the need? - ANSWERSMake or buy decision,
support the formation of a cross-departmental team to develop the specification, review where branded
products could be replaced by substitute non-branded products or materials to reduce costs, encourage
standardisation
What is value mapping? - ANSWERSA process in which value is created by reducing or eliminating waste
and operational inefficiencies.
What are the seven wastes? (TIMWOOD) - ANSWERSTransportation, Inventory, motion, Waiting, Over
production, over processing, defects.
How can can value be added through a strategic approach? - ANSWERS- Review spend across various
areas
-Following on from spend reviews they could aggregate demand and consolidate spend.
-Supplier relationship management and risk management plans
-Specialist category and supplier knowledge.
Added value through suppler relationships - ANSWERS-Being able to identify and use an appropriate
approach to deal with supplier.
-Innovation developed as part of collaborative projects with strategic suppliers
-Reduction of waste
-Resilience and risk reduction
What are sources of information that a buyer can use to identify a suitable supplier? - ANSWERSInternal
stakeholders/user department knowledge, preferred supplier lists, internet searches, networking.
Supplier identification in the private sector? - ANSWERSThe private sector buyer is free to invite as many
suppliers to participate as it feels are relevant.
Supplier identification in the public sector? - ANSWERSSupplier identification in the public sector is a
more transparent process than in the private sector. In the public sector in the EU the buyer will be
required to advertise the requirement in the OJEU. It will then need to select which common
procurement vocabulary modes match its requirements.
