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ISM Supply Management Core Exam Sample Questions (Q162-Q167):

NEW QUESTION # 162
A firm buys a particular product that has low business impact and low supply market complexity. How would this product be categorized using the Kraljic classification model?

A. Bottleneck
B. Strategic
C. Leverage
D. Noncritical

Answer: D

NEW QUESTION # 163
Which of the following options is an example of a liability?

A. A bond purchased at a premium
B. Outstanding preferred stock
C. Payment received in advance from a customer
D. The private mortgage of a CFO

Answer: C

NEW QUESTION # 164
A supply manager Is leading a team in developing a strategic sourcing strategy for the company's corporate-wide desktop and laptop computer procurement. Several business unit managers get into a heated debate over the relative Importance and exposure of desktop computers for their specific business units. Some units consider the desktop computer to be a low risk/low value commodity, while others consider them to be high risk/high value critical items. How should the supply manager proceed?

A. Develop a desktop computer sourcing strategy based on medium risk and medium value
B. Conduct a regression analysis to more accurately assess the risk and value of the desktop computers
C. Tell the business unit managers to come to an agreement on the risk and value assessment of the computers
D. Divide the desktop computers into two groups: one high risk/high value, and the other low risk/low value

Answer: D

Explanation:
In a situation where there is a disagreement among business units about the risk and value of desktop computers, the supply manager should consider the different perspectives and categorize the desktops accordingly. Dividing the desktop computers into two groups (high risk/high value and low risk/low value) accommodates the varying needs and assessments of different business units. This approach allows the sourcing strategy to be tailored to meet the specific requirements of each group, ensuring that both critical and non-critical needs are addressed appropriately.
References:
* Kraljic, P. (1983). Purchasing must become supply management. Harvard Business Review.
* CIPS (Chartered Institute of Procurement and Supply). (2021). Procurement and Supply Chain Management.

NEW QUESTION # 165
An exploration firm's supply manager meets with the fleet operations team to plan for the acquisition of vehicles to be used in company operations on a remote Pacific island. As removing the old vehicles from the island has proven to be a significant problem, the team requests the inclusion of a "take-back" requirement in the contract. Which of the following is the BEST way for the supply manager to respond to this request?

A. The supply manager should oppose the idea, as the sourcing process should be focused on acquisitions.
B. The supply manager should refer the issue to the environmental quality manager.
C. The supply manager should oppose the idea, as a take-back program from a remote island would be cost prohibitive.
D. The supply manager should include this requirement in the firm's upcoming procurement.

Answer: D

NEW QUESTION # 166
An educational institution that delivers continuing education programs to business leaders has seen increased demand for its program in multiple languages. The supply manager responsible for the sourcing, contracting, and relationship development of these training providers has noticed its customers in other countries using local instructors who can better relate to the audiences. Which of the following supply base innovation skills is the supply manager facing?

A. Managing transformation
B. Managing decision-making
C. Managing differences
D. Managing breakthroughs

Answer: C

Explanation:
The supply manager is dealing with the need to source training providers who can cater to diverse linguistic and cultural audiences. This situation involves managing differences, as the supply manager must navigate and leverage these differences to find suitable local instructors who can effectively deliver the programs. This skill is critical in ensuring that the training meets the unique needs of different customer bases.
References
* Cross-cultural management and supply chain diversity literature.
* Case studies on managing differences in global supply chains.

NEW QUESTION # 167
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