SCMN 2150 Exam 2 Robert Straw |
Questions with Solutions
What is procurement? - -The purchase of merchandise or services at the
optimum possible total cost in the correct amount and quality
- What is strategic sourcing? - -an institutional procurement process that
continuously improves and re-evaluates the purchasing activities of a
company
- What is the difference between traditional purchasing and strategic
sourcing? - -strategic sources seeks for continuous improvement
- What are the steps in the procurement process and why is it important to
follow them? - -1) Identify material & service needs
2) Evaluate supplier options
3) Select supplier
4) Release orders and receive products
5) Measure and manage performance
It is important to follow these steps because you do not want to make a
decision based on incomplete information
- What are the goals of supply chain management and why is it important? -
-To buy products and services....
- At the right price
- From the right source
- At the right specification
- In the right quantity
- For delivery at the right time
- To the right internal customer
It is important because it wants to generate a sustainable advantage through
lower costs, higher quality, and better service from our global supply base of
trading partners
- What is a quadrant analysis and why is it important? - -A quadrant analysis
is a visual tool that categorizes data or elements into four quadrants based
on two criteria, helping to prioritize and make decisions from either the
products or services. It is important for simplifying complex data, identifying
trends, and making informed choices in various fields.
, - Why is it important to evaluate supplier performance? - -- To monitor KPIs
(key performance indicators) and take corrective action, to ensure value is
provided by suppliers
- To create visibility into process and performance across the entire supply
management lifecycle
- Fill Rate - -Total Quantity Received / Total Quantity Ordered
- Defect Rate - -Total Quantity Defective / Total Quantity Received
- On Time - -Orders Received On Time / Total Orders
- Perfect Purchase Order Percent - -Order arrives on time, without defects,
and with perfect documentation at the right location with correct quantities
of all SKUs (stock keeping unit) ordered
- What is a supplier scorecard and how are they created and utilized? - --
Monitor performance across multiple metrics over extended time period
- Categorize suppliers based on their scores
- Offer additional business to best performers
- What are the 7 steps of strategic sourcing? - -1. Analyze product
categories used by the business, spending patterns, and the processes and
departments involved.
2. Develop a sourcing strategy based on business goals.
3. Analyze the supplier market and create a supplier portfolio.
4. Define request for proposal criteria and templates.
5. Negotiate with and select suppliers.
6. Integrate suppliers into existing processes, onboarding any new vendors
or outsourcing providers.
7. Track performance metrics and optimize the sourcing plan, as needed
- What is holding procurement back? - -1. Lack of KPIs and metrics to
monitor the effectiveness of the performance tomeet the goals of the
relationship. If KPIs do exist, they are generally focused on safety and
adherence to payment terms with a very limited view, if any, on performance
and productivity
2. Unwillingness for end-users / operations groups to modify day to day
interactions with suppliers
3. Lack of executive support and commitment to the new operating model
developed through the contracting process
- What types of large-scale changes are companies planning in the coming
out of the pandemic? - -1. Expand their supply base
2. Shrink their global supply chain and rely on local suppliers
3. Increase inventory levels
Questions with Solutions
What is procurement? - -The purchase of merchandise or services at the
optimum possible total cost in the correct amount and quality
- What is strategic sourcing? - -an institutional procurement process that
continuously improves and re-evaluates the purchasing activities of a
company
- What is the difference between traditional purchasing and strategic
sourcing? - -strategic sources seeks for continuous improvement
- What are the steps in the procurement process and why is it important to
follow them? - -1) Identify material & service needs
2) Evaluate supplier options
3) Select supplier
4) Release orders and receive products
5) Measure and manage performance
It is important to follow these steps because you do not want to make a
decision based on incomplete information
- What are the goals of supply chain management and why is it important? -
-To buy products and services....
- At the right price
- From the right source
- At the right specification
- In the right quantity
- For delivery at the right time
- To the right internal customer
It is important because it wants to generate a sustainable advantage through
lower costs, higher quality, and better service from our global supply base of
trading partners
- What is a quadrant analysis and why is it important? - -A quadrant analysis
is a visual tool that categorizes data or elements into four quadrants based
on two criteria, helping to prioritize and make decisions from either the
products or services. It is important for simplifying complex data, identifying
trends, and making informed choices in various fields.
, - Why is it important to evaluate supplier performance? - -- To monitor KPIs
(key performance indicators) and take corrective action, to ensure value is
provided by suppliers
- To create visibility into process and performance across the entire supply
management lifecycle
- Fill Rate - -Total Quantity Received / Total Quantity Ordered
- Defect Rate - -Total Quantity Defective / Total Quantity Received
- On Time - -Orders Received On Time / Total Orders
- Perfect Purchase Order Percent - -Order arrives on time, without defects,
and with perfect documentation at the right location with correct quantities
of all SKUs (stock keeping unit) ordered
- What is a supplier scorecard and how are they created and utilized? - --
Monitor performance across multiple metrics over extended time period
- Categorize suppliers based on their scores
- Offer additional business to best performers
- What are the 7 steps of strategic sourcing? - -1. Analyze product
categories used by the business, spending patterns, and the processes and
departments involved.
2. Develop a sourcing strategy based on business goals.
3. Analyze the supplier market and create a supplier portfolio.
4. Define request for proposal criteria and templates.
5. Negotiate with and select suppliers.
6. Integrate suppliers into existing processes, onboarding any new vendors
or outsourcing providers.
7. Track performance metrics and optimize the sourcing plan, as needed
- What is holding procurement back? - -1. Lack of KPIs and metrics to
monitor the effectiveness of the performance tomeet the goals of the
relationship. If KPIs do exist, they are generally focused on safety and
adherence to payment terms with a very limited view, if any, on performance
and productivity
2. Unwillingness for end-users / operations groups to modify day to day
interactions with suppliers
3. Lack of executive support and commitment to the new operating model
developed through the contracting process
- What types of large-scale changes are companies planning in the coming
out of the pandemic? - -1. Expand their supply base
2. Shrink their global supply chain and rely on local suppliers
3. Increase inventory levels
