CIPS L4M1 LATEST UPDATE – 2025 – Complete Exam
Questions and Answers with Explanations for Strategic
Procurement, Supply Chain Impact, and Stakeholder
Management | ALREADY GRADED A+
Stakeholders - (answers)In any activity an organization undertakes, whether strategic,
operational or tactical, the activity can only be successful with the input, commitment and
support of its key stakeholders. Gaining and maintaining the support and commitment of
stakeholders requires a continuous process of engaging the right stakeholders at the right
time and understanding and managing their expectations.
Global Supply Chains - (answers)a dynamic worldwide network when a company purchases
or uses goods or services from overseas. It involves people, information, processes and
resources involved in the production, handling and distribution of materials and finished
products or providing a service to the customer.
Whole Life Costing - (answers)takes into account the total cost of a product or service over
its lifetime, from concept through to disposal including purchase, hire or lease, maintenance,
operation, utilities, training and disposal. It is important for procurement to take all these
elements into consideration when making decisions and comparing the costs of buying,
renting or leasing equipment particularly. In most cases the purchase costs are only a small
proportion of the cost of operating it.
Stakeholder mapping - (answers)A systematic way to identify the expectations, needs,
importance, and relative power of various stakeholders.
Value Generation - (answers)Creating value from the supply base can be achieved by not
only focusing on price but also increasing operational performance, driving efficiencies,
working collaboratively or developing continuous improvement activities.
Procurement Cycle - (answers)the cyclical process of key steps when procuring goods or
services.
,Steps of the Procurement Cycle - (answers)1. Understand Need and develop High level Spec.
2. Market/Commodity and options (inc make or buy assessment).
3. Develop Strategy/plan
4. Pre-procurement market test and market engagement.
5. Develop documentation, PPQ/detailed spec/combine with 1.
6. Supplier selection to participate in ITT/RFQ/negotiation.
7. Issue ITT/RFQ.
8. Bid/Tender Evaluation and validation.
9. Contract award and implementation.
10. Warehouse logistics and receipt.
11. Contract performance review and continuous improvement.
12. SRM and SC management and development.
13. Asset management/end of life and lessons learnt.
Contract Management - (answers)delivers a great amount of data and intelligence that
support the smooth running of a business. Historically, the purpose of a contract as a legal
document was to protect the parties from negative consequences of its breaches. Today,
when companies are facing increasing pressures to reduce costs and improve financial and
operational performance, forming and managing new trading relationships is critical for
success. How well an organisation manages its relationships with partners defines the two
core elements of bottom line performance: increasing revenues and decreasing costs. ...
plays an important role by ensuring the smooth running of operations, protecting the
organisation from risks and shaping the buyer-supplier relationships (Aberdeen Group, 2007;
Saxena, 2008).
Application of Technology - (answers)E-Procurement systems can be utilised in the Request
for Information (RFI), Request for Proposal (RFP) and Request for Quotation (RFQ) process as
well as for e-Tendering, e-Auctioning, vendor management, catalogue management,
purchase ordering, order status, shipment status, e-invoicing, e-payment and contract
management.
,eSourcing / eProcurement systems P2P - (answers)relates to the electronic procurement of
products or services via the internet. Other systems such as electronic data interchange (EDI)
and enterprise resource planning (ERP) are also forms of...
International Labour Organisation - (answers)The only tripartite U.N. agency, since 1919 it
brings together governments, employers and workers of 187 member States , to set labour
standards, develop policies and devise programmes promoting decent work for all women
and men.
Supplier evaluation & appraisal - (answers)is conducted at the tender stage and can be in the
form of either a questionnaire, interview or site visit to assess the supplier's capability in
terms of capacity, financial stability, quality standards, performance and organisational
structure and processes in place. Both existing and potential suppliers are scored on
suitability and either approved or rejected to be added onto the approved supplier list (ASL).
This helps to improve existing suppliers performance and also can periodically ensure you
have the right sized and fit of suppliers on you approved list.
Supplier Selection - (answers)is an important organisational process: purchased products
represent between 40% and 60% of end product sales and have a direct impact on the cost
and quality of products. In addition, even a small cost gained by selecting a good supplier
can have great impact on benefits (Aiter et al., 2011).
It relies on multiple assessment techniques which include both quantitative and qualitative
methods (Choi and Hartley, 1996). At the same time, many organisations continue to select
suppliers based on experience and intuition - selective and unreliable approaches (Kontio,
1996). The most common evaluation criteria used to select suppliers are: financial health,
expertise, operational performance metrics, business processes and practices, enabling
behaviours or cultural factors and risk factors (Aiter et al., 2011).
eSourcing - (answers)automates contract lifecycle management (CIPS: Electronic Commerce
and e-Business). Today, eSourcing and eProcurement form the core of the e-Purchasing cycle
(BuyIT, 2004). eProcurement is the process through which employees of the purchasing
organisations access supplier online catalogues, select items, conduct the purchasing
process and communicate directly with suppliers (Leenders et al., 2002). ESourcing, on the
other hand, is a broader concept as it incorporates the key elements of the buying process,
, such as knowledge, specification, requests for quotation/tender/e-auction,
evaluation/negotiation and contract (CIPS: Electronic commerce and e-Business).
The Purchase to Pay (P2P) Process - (answers)underpins many sub-processes from sourcing
and negotiating terms, ordering, receipting and payment, through to contract and
relationship management (Lysons and Farrington)
supply chain governance - (answers)the system of directing the behaviors and decisions of
procurement within an organization via legislative, executive and judicial processes.
Procurement also needs to establish effective governance of the supply chains they put in
place.
Centralized Procurement - (answers)implies that purchasing decisions are made either by
company headquarters or some regional or divisional level
Decentralized Procurement - (answers)an organisation's activities are spread over a number
of plants or locations.
Procurement Policy Development - (answers)developed in order to establish the rules of
how procurement should be conducted specific to the organisation.
Procurement Strategy Development - (answers)developed in order to establish the direction
of how procurement should be organised in order to implement the procurement policy.
Global Standard for Procurement and Supply - (answers)is a comprehensive competency
framework. Used by individuals and organisations to enhance performance, the Standard
sets the benchmark for what good looks like in procurement and supply at all levels and
across all sectors. It helps individuals to identify current operating skills and abilities and
what is needed to progress.
GDPR - (answers)General Data Protection Regulation
Questions and Answers with Explanations for Strategic
Procurement, Supply Chain Impact, and Stakeholder
Management | ALREADY GRADED A+
Stakeholders - (answers)In any activity an organization undertakes, whether strategic,
operational or tactical, the activity can only be successful with the input, commitment and
support of its key stakeholders. Gaining and maintaining the support and commitment of
stakeholders requires a continuous process of engaging the right stakeholders at the right
time and understanding and managing their expectations.
Global Supply Chains - (answers)a dynamic worldwide network when a company purchases
or uses goods or services from overseas. It involves people, information, processes and
resources involved in the production, handling and distribution of materials and finished
products or providing a service to the customer.
Whole Life Costing - (answers)takes into account the total cost of a product or service over
its lifetime, from concept through to disposal including purchase, hire or lease, maintenance,
operation, utilities, training and disposal. It is important for procurement to take all these
elements into consideration when making decisions and comparing the costs of buying,
renting or leasing equipment particularly. In most cases the purchase costs are only a small
proportion of the cost of operating it.
Stakeholder mapping - (answers)A systematic way to identify the expectations, needs,
importance, and relative power of various stakeholders.
Value Generation - (answers)Creating value from the supply base can be achieved by not
only focusing on price but also increasing operational performance, driving efficiencies,
working collaboratively or developing continuous improvement activities.
Procurement Cycle - (answers)the cyclical process of key steps when procuring goods or
services.
,Steps of the Procurement Cycle - (answers)1. Understand Need and develop High level Spec.
2. Market/Commodity and options (inc make or buy assessment).
3. Develop Strategy/plan
4. Pre-procurement market test and market engagement.
5. Develop documentation, PPQ/detailed spec/combine with 1.
6. Supplier selection to participate in ITT/RFQ/negotiation.
7. Issue ITT/RFQ.
8. Bid/Tender Evaluation and validation.
9. Contract award and implementation.
10. Warehouse logistics and receipt.
11. Contract performance review and continuous improvement.
12. SRM and SC management and development.
13. Asset management/end of life and lessons learnt.
Contract Management - (answers)delivers a great amount of data and intelligence that
support the smooth running of a business. Historically, the purpose of a contract as a legal
document was to protect the parties from negative consequences of its breaches. Today,
when companies are facing increasing pressures to reduce costs and improve financial and
operational performance, forming and managing new trading relationships is critical for
success. How well an organisation manages its relationships with partners defines the two
core elements of bottom line performance: increasing revenues and decreasing costs. ...
plays an important role by ensuring the smooth running of operations, protecting the
organisation from risks and shaping the buyer-supplier relationships (Aberdeen Group, 2007;
Saxena, 2008).
Application of Technology - (answers)E-Procurement systems can be utilised in the Request
for Information (RFI), Request for Proposal (RFP) and Request for Quotation (RFQ) process as
well as for e-Tendering, e-Auctioning, vendor management, catalogue management,
purchase ordering, order status, shipment status, e-invoicing, e-payment and contract
management.
,eSourcing / eProcurement systems P2P - (answers)relates to the electronic procurement of
products or services via the internet. Other systems such as electronic data interchange (EDI)
and enterprise resource planning (ERP) are also forms of...
International Labour Organisation - (answers)The only tripartite U.N. agency, since 1919 it
brings together governments, employers and workers of 187 member States , to set labour
standards, develop policies and devise programmes promoting decent work for all women
and men.
Supplier evaluation & appraisal - (answers)is conducted at the tender stage and can be in the
form of either a questionnaire, interview or site visit to assess the supplier's capability in
terms of capacity, financial stability, quality standards, performance and organisational
structure and processes in place. Both existing and potential suppliers are scored on
suitability and either approved or rejected to be added onto the approved supplier list (ASL).
This helps to improve existing suppliers performance and also can periodically ensure you
have the right sized and fit of suppliers on you approved list.
Supplier Selection - (answers)is an important organisational process: purchased products
represent between 40% and 60% of end product sales and have a direct impact on the cost
and quality of products. In addition, even a small cost gained by selecting a good supplier
can have great impact on benefits (Aiter et al., 2011).
It relies on multiple assessment techniques which include both quantitative and qualitative
methods (Choi and Hartley, 1996). At the same time, many organisations continue to select
suppliers based on experience and intuition - selective and unreliable approaches (Kontio,
1996). The most common evaluation criteria used to select suppliers are: financial health,
expertise, operational performance metrics, business processes and practices, enabling
behaviours or cultural factors and risk factors (Aiter et al., 2011).
eSourcing - (answers)automates contract lifecycle management (CIPS: Electronic Commerce
and e-Business). Today, eSourcing and eProcurement form the core of the e-Purchasing cycle
(BuyIT, 2004). eProcurement is the process through which employees of the purchasing
organisations access supplier online catalogues, select items, conduct the purchasing
process and communicate directly with suppliers (Leenders et al., 2002). ESourcing, on the
other hand, is a broader concept as it incorporates the key elements of the buying process,
, such as knowledge, specification, requests for quotation/tender/e-auction,
evaluation/negotiation and contract (CIPS: Electronic commerce and e-Business).
The Purchase to Pay (P2P) Process - (answers)underpins many sub-processes from sourcing
and negotiating terms, ordering, receipting and payment, through to contract and
relationship management (Lysons and Farrington)
supply chain governance - (answers)the system of directing the behaviors and decisions of
procurement within an organization via legislative, executive and judicial processes.
Procurement also needs to establish effective governance of the supply chains they put in
place.
Centralized Procurement - (answers)implies that purchasing decisions are made either by
company headquarters or some regional or divisional level
Decentralized Procurement - (answers)an organisation's activities are spread over a number
of plants or locations.
Procurement Policy Development - (answers)developed in order to establish the rules of
how procurement should be conducted specific to the organisation.
Procurement Strategy Development - (answers)developed in order to establish the direction
of how procurement should be organised in order to implement the procurement policy.
Global Standard for Procurement and Supply - (answers)is a comprehensive competency
framework. Used by individuals and organisations to enhance performance, the Standard
sets the benchmark for what good looks like in procurement and supply at all levels and
across all sectors. It helps individuals to identify current operating skills and abilities and
what is needed to progress.
GDPR - (answers)General Data Protection Regulation
