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NEW QUESTION 47
What is value mapping?

• A. Segmenting suppliers based on the value they bring to the company
• B. Analysing the costs that go into making a product
• C. Creating value through the elimination of waste and operational inefficiencies
• D. Make vs Buy decision

Answer: C

Explanation:
The definition of value mapping is given on p.69 this is; 'a process in which value is created through the elimination of waste and operational inefficiencies'. It ties into JIT / Lean.

NEW QUESTION 48
You work at XYZ manufacturers and a competitor has just released a rival washing machine to the product that you make. This model is proving popular with customers. What competitive force is at play?

• A. supplier power
• B. threat of substitution
• C. threat of new entrant
• D. buyer power

Answer: C

Explanation:
This is a threat of a new entrant. The competitor has now entered the washing machine market and is competing directly with you. This is not a threat of substitution as it is the same product. A substitution would be if they invented a new product that washed clothes and people started buying this instead of washing machines. There are many questions in the exam on Porter's 5 Forces - see p. 39

NEW QUESTION 49
According to Michael Porter, what is procurement?

• A. a primary activity which provides a source of competitive activity
• B. a primary activity which provides value for money
• C. a secondary activity which provides value for money
• D. a support activity which provides a source of competitive advantage

Answer: D

Explanation:
This question refers to Porter's Value Chain (p.35). There's a couple of questions on this in the exam so try to learn it. Procurement is a 'support activity' on this matrix along with firm infrastructure, HR and technology development

NEW QUESTION 50
A supplier is working with a buyer who represents a large percentage of his business. Without this particular buyer, the supplier would likely go out of business. There has been a dispute in the last invoice which the buyer is not happy about. What technique should the supplier use when talking to the buyer about this?

• A. Competing- the supplier needs to earn more money as they are struggling financially
• B. Avoiding- the supplier should avoid talking with the buyer as this may result in conflict
• C. Accommodating- the supplier should show a large degree of co-cooperativeness as the buyer is important to their survival
• D. Accepting - the supplier should accept that conflict should sometimes occur in buyer: supplier relationships and work hard to avoid them

Answer: C

Explanation:
The correct answer is 'accommodating'. This Question: is based
on the Thomas-Kilmann Conflict model on p.87. This comes up quite a bit in the exam. It is comprised of 5 techniques for dealing with conflict; competing, collaborating, compromising, avoiding and accommodating. In this instance, the supplier should have a high degree of co-cooperativeness and a low degree of assertiveness as the long-term relationship is very important- more important than the outcome of the disputed invoice.

NEW QUESTION 51
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