BUS 460 Exam 2 Question and
answers verified to pass 2025
SRM Process - correct answer ✔Provides the structure for how relationships
with suppliers are developed and maintained.
Challenges:
-Managing and coordinating different culture, multiple locations, etc.
-Competitive pressures, cost efficiency, product innovation (expertise)
Goal:
To improve processes and eliminate demand variability and unnecessary
activities
SRM Components - correct answer ✔1. Selecting and managing suppliers
2. Developing suppliers
3. Integrating with suppliers
*Do firms treat their suppliers in the same way?
80/20 rules - key suppliers
*SRM vs. CRM
Supplier's impact on firms profitability vs. profitability of customers
SRM Strategic Sub Processes - correct answer ✔Review corporate,
marketing, manufacturing and sourcing strategies
,Identify criteria for categorizing suppliers
Provide guidelines for the degree of customization in the Product/Service
Agreement
Develop framework of metrics
Develop guidelines for sharing process improvement benefits with suppliers
Review Corporate, Marketing, Manufacturing and Sourcing Strategies -
correct answer ✔Identify product and service components that are key to the
organization's success now and in the future
Identify Criteria for Categorizing Suppliers - correct answer ✔Potential
criteria include: Profitability/growth/stability, Technology, Capacity, Innovation,
Quality, Volume purchased, Criticality/service level required,
Sophistication/compatibility
-Criteria focused on the performance measuring suppliers
-Tailor PSAs based on supplier categorization
Provide Guidelines for the Degree of Customization in the PSA - correct
answer ✔Consider quality/cost implications of various differentiation
alternatives
Select boundaries for degree of differentiation
e.g. cost, innovation, supply chain, quality, improvement
, Develop Framework of Metrics - correct answer ✔•Outline metrics of
interest- increased productivity, freight cost, facility realignment, order cost, IS
cost, on-time delivery, etc.
•Relate metrics to the supplier's impact on profitability and the profitability for
the supplier
Develop Guideline for Sharing Process Improvement Benefits with Suppliers -
correct answer ✔Outline options for sharing the benefits of process
improvements
E.g. gain sharing in the PSAs
JIT Just-in-time Production /TPS - correct answer ✔-Manufacturing based on
planned elimination of all waste and on continuous improvement of
productivity
-Reduce 1) flow times within production system and 2) response times from
suppliers and to customers
-Purpose:
"the right material, at the right time, at the right place, and in the exact
amount"
Reduce material inventory and resulting costs (funds tied to actual inventory,
space for inventory, resources to manage inventory)
JIT II and III - correct answer ✔Strengthened supplier-customer relationships
JIT II:
-Implemented by Bose in 1987
answers verified to pass 2025
SRM Process - correct answer ✔Provides the structure for how relationships
with suppliers are developed and maintained.
Challenges:
-Managing and coordinating different culture, multiple locations, etc.
-Competitive pressures, cost efficiency, product innovation (expertise)
Goal:
To improve processes and eliminate demand variability and unnecessary
activities
SRM Components - correct answer ✔1. Selecting and managing suppliers
2. Developing suppliers
3. Integrating with suppliers
*Do firms treat their suppliers in the same way?
80/20 rules - key suppliers
*SRM vs. CRM
Supplier's impact on firms profitability vs. profitability of customers
SRM Strategic Sub Processes - correct answer ✔Review corporate,
marketing, manufacturing and sourcing strategies
,Identify criteria for categorizing suppliers
Provide guidelines for the degree of customization in the Product/Service
Agreement
Develop framework of metrics
Develop guidelines for sharing process improvement benefits with suppliers
Review Corporate, Marketing, Manufacturing and Sourcing Strategies -
correct answer ✔Identify product and service components that are key to the
organization's success now and in the future
Identify Criteria for Categorizing Suppliers - correct answer ✔Potential
criteria include: Profitability/growth/stability, Technology, Capacity, Innovation,
Quality, Volume purchased, Criticality/service level required,
Sophistication/compatibility
-Criteria focused on the performance measuring suppliers
-Tailor PSAs based on supplier categorization
Provide Guidelines for the Degree of Customization in the PSA - correct
answer ✔Consider quality/cost implications of various differentiation
alternatives
Select boundaries for degree of differentiation
e.g. cost, innovation, supply chain, quality, improvement
, Develop Framework of Metrics - correct answer ✔•Outline metrics of
interest- increased productivity, freight cost, facility realignment, order cost, IS
cost, on-time delivery, etc.
•Relate metrics to the supplier's impact on profitability and the profitability for
the supplier
Develop Guideline for Sharing Process Improvement Benefits with Suppliers -
correct answer ✔Outline options for sharing the benefits of process
improvements
E.g. gain sharing in the PSAs
JIT Just-in-time Production /TPS - correct answer ✔-Manufacturing based on
planned elimination of all waste and on continuous improvement of
productivity
-Reduce 1) flow times within production system and 2) response times from
suppliers and to customers
-Purpose:
"the right material, at the right time, at the right place, and in the exact
amount"
Reduce material inventory and resulting costs (funds tied to actual inventory,
space for inventory, resources to manage inventory)
JIT II and III - correct answer ✔Strengthened supplier-customer relationships
JIT II:
-Implemented by Bose in 1987
