CPPB Domain II - Procurement Planning &
Analysis UPDATED ACTUAL Exam
Questions and CORRECT Answers
Strategic Procurement Planning (SP2) - CORRECT ANSWER - Transformation of the entity's
missions, goals, and objectives into measureable activities to be used to plan, budget, and
manage the procurement function within the entity.
SWOT - CORRECT ANSWER - In any planning situation, procurement professionals should
be prepared to analyze the various factors an entity could potentially face (strengths, weaknesses,
opportunities, threats)
The Pareto Principle - CORRECT ANSWER - 20% of people yield 80% of production, while
80% of people yield only 20% of the production (80% of procurement cost is from 20% of
purchase orders issued) a small amount of people produce most of the work and a large amount
of people produce the least amount of work.
Performance Metrics: Inputs - CORRECT ANSWER - Measures resources used: labor,
materials, equipment, and supplies. Demand for goods and services may also be considered.
Performance Metrics: Outputs - CORRECT ANSWER - Records activity that can be
measured (e.g. total spend, total number of new contracts, total number of employees who
obtained certification).
Performance Metrics: Outcomes - CORRECT ANSWER - Assess results of an activity and
show whether expected results were achieved (client service levels, improved performance of
suppliers, employee retention).
Performance Metrics: Efficiency - CORRECT ANSWER - Measures ratio of inputs to
outputs/outcomes. When outcomes are increased and inputs are decreased, more efficiency is
generated. Less administrative time on PO, etc.
, Performance Metrics: Effectiveness - CORRECT ANSWER - Measures the quality and
effects of the outcomes. How long it takes to process a request or turnaround time to receive
goods or services.
Common Procurement Delivery Outcomes - CORRECT ANSWER - Right source, services,
place, price, materials, quantity, time (SS/PP/MQT)
Benchmarking - CORRECT ANSWER - Measuring a process, service, or good against the
characteristics of the recognized leaders in the given area of review. (Procurement identifies
world class entities with which to compare its practices, policies, and performance outcomes).
Procurement Profile - CORRECT ANSWER - Adds decision making intelligence to a spend
analysis through Spend Analysis (range of goods and services available), Market Analysis (the
markets that provide them), Supply Positioning (risks in the market that could affect the entity's
operations).
Supply Positioning - CORRECT ANSWER - Analyzing the complexity of the supply
marketplace and its impact on entity service delivery.
Two major forces impacting government procurement - CORRECT ANSWER - 1) difficulty
of securing a supply of goods and services 2) the amount expended for each good and service
consumed by the entity.
Buying Plan - Includes 4 major parts - CORRECT ANSWER - Demand Analysis, Market
Analysis, Supplier Analysis, Value Analysis.
Demand Analysis - CORRECT ANSWER - Used to estimate annual requirements based on
previous year plus anticipated use for upcoming year. Uses ABC system based on Pareto
principle and categorizes goods into classifications.
Market Analysis - CORRECT ANSWER - Researching product availability, market volatility,
supply and demand, and price. Should be a continuous process in order to adjust schedules to
achieve maximum availability and best price.
Analysis UPDATED ACTUAL Exam
Questions and CORRECT Answers
Strategic Procurement Planning (SP2) - CORRECT ANSWER - Transformation of the entity's
missions, goals, and objectives into measureable activities to be used to plan, budget, and
manage the procurement function within the entity.
SWOT - CORRECT ANSWER - In any planning situation, procurement professionals should
be prepared to analyze the various factors an entity could potentially face (strengths, weaknesses,
opportunities, threats)
The Pareto Principle - CORRECT ANSWER - 20% of people yield 80% of production, while
80% of people yield only 20% of the production (80% of procurement cost is from 20% of
purchase orders issued) a small amount of people produce most of the work and a large amount
of people produce the least amount of work.
Performance Metrics: Inputs - CORRECT ANSWER - Measures resources used: labor,
materials, equipment, and supplies. Demand for goods and services may also be considered.
Performance Metrics: Outputs - CORRECT ANSWER - Records activity that can be
measured (e.g. total spend, total number of new contracts, total number of employees who
obtained certification).
Performance Metrics: Outcomes - CORRECT ANSWER - Assess results of an activity and
show whether expected results were achieved (client service levels, improved performance of
suppliers, employee retention).
Performance Metrics: Efficiency - CORRECT ANSWER - Measures ratio of inputs to
outputs/outcomes. When outcomes are increased and inputs are decreased, more efficiency is
generated. Less administrative time on PO, etc.
, Performance Metrics: Effectiveness - CORRECT ANSWER - Measures the quality and
effects of the outcomes. How long it takes to process a request or turnaround time to receive
goods or services.
Common Procurement Delivery Outcomes - CORRECT ANSWER - Right source, services,
place, price, materials, quantity, time (SS/PP/MQT)
Benchmarking - CORRECT ANSWER - Measuring a process, service, or good against the
characteristics of the recognized leaders in the given area of review. (Procurement identifies
world class entities with which to compare its practices, policies, and performance outcomes).
Procurement Profile - CORRECT ANSWER - Adds decision making intelligence to a spend
analysis through Spend Analysis (range of goods and services available), Market Analysis (the
markets that provide them), Supply Positioning (risks in the market that could affect the entity's
operations).
Supply Positioning - CORRECT ANSWER - Analyzing the complexity of the supply
marketplace and its impact on entity service delivery.
Two major forces impacting government procurement - CORRECT ANSWER - 1) difficulty
of securing a supply of goods and services 2) the amount expended for each good and service
consumed by the entity.
Buying Plan - Includes 4 major parts - CORRECT ANSWER - Demand Analysis, Market
Analysis, Supplier Analysis, Value Analysis.
Demand Analysis - CORRECT ANSWER - Used to estimate annual requirements based on
previous year plus anticipated use for upcoming year. Uses ABC system based on Pareto
principle and categorizes goods into classifications.
Market Analysis - CORRECT ANSWER - Researching product availability, market volatility,
supply and demand, and price. Should be a continuous process in order to adjust schedules to
achieve maximum availability and best price.
