OMGT TEST 2 3123 ECU QUESTIONS
AND ANSWERS
Supply Management Defined - CORRECT ANSWERS ✅✅ -Sourcing decisions and
purchasing activities (collectively Supply Management) serve to link a company with its
upstream supply chain partners
Supply Management is..... - CORRECT ANSWERS ✅✅ -...the broad set of activities
carried out by organizations to:
- analyze sourcing opportunities
- develop sourcing strategies
- select suppliers
- analyze and negotiate price and cost
- carry out all the activities required to procure goods and services
Why is Supply management is critical for global - CORRECT ANSWERS ✅✅ -to
compete globally for advances in information systems and changes in environment.
"______-______"-ask Kirchoff
Why is Supply management is critical financial impact for the average manufacturer
because - CORRECT ANSWERS ✅✅ -nearly 60% of the product value comes from
material, on average
Over 60% of firms total COGS is controlled by - CORRECT ANSWERS ✅✅ -
Purchasing
Supply management represents a major opportunity - CORRECT ANSWERS ✅✅ -to
increase profitability
Pretax earnings increased - CORRECT ANSWERS ✅✅ -% increase = (COGS X %)
/ pretax earnings
Pretax profit old - CORRECT ANSWERS ✅✅ -= Pretax earnings / Sales (how much
you make on every $1 of sales)
To increase profit through sales requires: - CORRECT ANSWERS ✅✅ -(COGS X %)
/ Pretax profit old = ## increases ( from old Sales to (sales + ##)
Why Supply Management is critical for performance impact - CORRECT ANSWERS
✅✅ -Quality
, Delivery
Technology
Responsiveness
Similar management goals
Problem solving
Study Performance impact chart chapter 7 slide 12 - CORRECT ANSWERS ✅✅ -
The Supply Management (SM) process - CORRECT ANSWERS ✅✅ -1. Assess
Opportunities
2. Profile internally/ externally
3. Develop the Sourcing Strategy
4. Screen Suppliers and create selection criteria
5. Conduct Supplier Selection
-Negotiate
-Ordering *procure to pay cycle*
-Follow up and expediting *pay cycle*
-Receipt and inspection *pay cycle*
-settlement & payments *pay cycle*
-Records maintenance *pay cycle*
THE SM PROCESS :
Assess Opportunities, Profile internally / Externally, Develop the sourcing Strategy and
Screen Suppliers and create Selection Criteria - CORRECT ANSWERS ✅✅ -
Typically, more strategic and difficult to accomplish
THE SM PROCESS:
Ordering, Follow up and expediting, receipt and inspection, Settlement & Payments,
and Records maintenance - CORRECT ANSWERS ✅✅ -Typically, more tactical and
easier to accomplish
1. Assess Opportunities - CORRECT ANSWERS ✅✅ -Spending analysis on the
company bulk spending and suppliers highest spending
1. Assess Opportunities firms purchasing needs - CORRECT ANSWERS ✅✅ -New
Projects and Existing Projects
2. Profile Internally / Externally - Sourcing decisions are high-level, often strategic
decisions: - CORRECT ANSWERS ✅✅ -Which product will use resources within the
firm and products will be provided by external supply chain?
AND ANSWERS
Supply Management Defined - CORRECT ANSWERS ✅✅ -Sourcing decisions and
purchasing activities (collectively Supply Management) serve to link a company with its
upstream supply chain partners
Supply Management is..... - CORRECT ANSWERS ✅✅ -...the broad set of activities
carried out by organizations to:
- analyze sourcing opportunities
- develop sourcing strategies
- select suppliers
- analyze and negotiate price and cost
- carry out all the activities required to procure goods and services
Why is Supply management is critical for global - CORRECT ANSWERS ✅✅ -to
compete globally for advances in information systems and changes in environment.
"______-______"-ask Kirchoff
Why is Supply management is critical financial impact for the average manufacturer
because - CORRECT ANSWERS ✅✅ -nearly 60% of the product value comes from
material, on average
Over 60% of firms total COGS is controlled by - CORRECT ANSWERS ✅✅ -
Purchasing
Supply management represents a major opportunity - CORRECT ANSWERS ✅✅ -to
increase profitability
Pretax earnings increased - CORRECT ANSWERS ✅✅ -% increase = (COGS X %)
/ pretax earnings
Pretax profit old - CORRECT ANSWERS ✅✅ -= Pretax earnings / Sales (how much
you make on every $1 of sales)
To increase profit through sales requires: - CORRECT ANSWERS ✅✅ -(COGS X %)
/ Pretax profit old = ## increases ( from old Sales to (sales + ##)
Why Supply Management is critical for performance impact - CORRECT ANSWERS
✅✅ -Quality
, Delivery
Technology
Responsiveness
Similar management goals
Problem solving
Study Performance impact chart chapter 7 slide 12 - CORRECT ANSWERS ✅✅ -
The Supply Management (SM) process - CORRECT ANSWERS ✅✅ -1. Assess
Opportunities
2. Profile internally/ externally
3. Develop the Sourcing Strategy
4. Screen Suppliers and create selection criteria
5. Conduct Supplier Selection
-Negotiate
-Ordering *procure to pay cycle*
-Follow up and expediting *pay cycle*
-Receipt and inspection *pay cycle*
-settlement & payments *pay cycle*
-Records maintenance *pay cycle*
THE SM PROCESS :
Assess Opportunities, Profile internally / Externally, Develop the sourcing Strategy and
Screen Suppliers and create Selection Criteria - CORRECT ANSWERS ✅✅ -
Typically, more strategic and difficult to accomplish
THE SM PROCESS:
Ordering, Follow up and expediting, receipt and inspection, Settlement & Payments,
and Records maintenance - CORRECT ANSWERS ✅✅ -Typically, more tactical and
easier to accomplish
1. Assess Opportunities - CORRECT ANSWERS ✅✅ -Spending analysis on the
company bulk spending and suppliers highest spending
1. Assess Opportunities firms purchasing needs - CORRECT ANSWERS ✅✅ -New
Projects and Existing Projects
2. Profile Internally / Externally - Sourcing decisions are high-level, often strategic
decisions: - CORRECT ANSWERS ✅✅ -Which product will use resources within the
firm and products will be provided by external supply chain?
