Leadership and Transformation in Supply Management

Question 1

Under which of the following circumstances is the effectiveness of a project team MOST likely to be enhanced?

A. When the team leader has clear authority and knowledge of subjects discussed

B. When the team leader feels comfortable working independent of outside relationships

C. When the team members are collectively responsible for reaching the team's goals

D. When the team members are willing and able to make ongoing time commitments

Correct Answer: C

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Question 2

A supply manager issues a purchase order to buy battery packs over the next three years. The battery packs will be used for multiple applications within the company. The first shipment is delivered in accordance with the quality standards and the delivery schedule outlined in the purchase order. Shortly thereafter, the supply manager is informed by an end user that the batteries from a second shipment are missing a component and are of no value. The supply manager immediately notifies the supplier it is in material breach and terminates the purchase order. The supply manager then informs the user departments of this decision.
Which of the following BEST describes what the supply manager did wrong (if anything) in this scenario?

A. The supply manager failed to communicate with the user departments to assess the impact of the problem before terminating the purchase order.

B. The supply manager failed to research which user departments would be impacted by the decision to terminate the purchase order with the supplier.

C. The supply manager acted properly.

D. The supply manager failed to validate that the batteries were defective.

Correct Answer: A

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Question 3

The chief procurement officer (CPO) for a large municipal government obtains funding for a new e-procurement system. After the system has been operational for a year, the city council's finance committee requests a status report, with emphasis on whether or not the system has realized projected benefits. Future funding for e-procurement depends on whether the council is satisfied with progress. Though the system has yielded many positive results, savings have not yet met expectations. Given this situation, which of the following is the BEST approach for the CPO to take to address the council's concerns?

A. Compare the system's performance to the service level agreement

B. Document planned and achieved process improvements

C. Provide detailed data on cost savings per order

D. Revise organizational procedures for better system reporting

Correct Answer: B

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Question 4

When prioritizing a supply management department's goals and objectives for the coming year, the department should place the MOST emphasis on which of the following?

A. Ways in which the department can support the organization

B. First priorities in the functional planning process

C. Key items identified by the business unit planning process

D. Goals that will have greatest impact on the department

Correct Answer: A

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Question 5

An organization institutes a program whereby employees visit a local high school to meet with students and introduce them to careers in business. This firm is likely to be one that has a

A. desire to provide employees leadership opportunities

B. sales strategy targeting high school age consumers

C. goal to develop a pipeline of future talent

D. strong commitment to social responsibility

Correct Answer: D

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Question 6

A new supply manager with little experience in procure-to-pay (P2P) systems is looking to evaluate software options for the company. Which of the following is the BEST course of action for the supply manager to take?

A. Locate a mentor from another company with experience in P2P

B. Ask questions of senior leadership to better understand their P2P needs

C. Review third-party research on current P2P solutions

D. Recommend the P2P system used at the supply manager's previous company

Correct Answer: C

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Question 7

Representatives from various departments at a research center meet to discuss the renovation of a lab. The firm's supply manager has been asked to facilitate the discussion. In preparation, the supply manager outlines each department's role and asks for their priorities. This information is used to show the departments how much they have much in common and how they can assist each other in achieving their goals. Which of the following tools is the supply manager using?

A. Authority

B. Consensus

C. Reciprocity

D. Commitment

Correct Answer: C

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Question 8

A supply manager for CDE Inc. hires several young supply management professionals. The new staff members are eager to gain experience and use their technological skills. Some staff members, however, are planning to retire, and the supply manager does not want to lose their expertise and perspective. Given this situation, which of the following is the BEST course of action for the supply manager to take?

A. Use functional rotation to expand the new employees' skills

B. Match new employees with experienced employees in mentoring relationships

C. Offer the new staff members opportunities to work on special projects

D. Facilitate hands-on training and internal workshops for the new staff members

Correct Answer: B

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Question 9

A corporation's supply management organization is working with the information technology (IT) department to review its spend categories and identify opportunities for improvement. Which of the following will likely be of GREATEST interest to the firm's senior management?

A. Supplier scorecards for key IT suppliers

B. Reduced acquisition costs for IT products and services

C. Increased use of local suppliers of IT hardware and services

D. Quarterly business reviews with key IT suppliers

Correct Answer: B

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Question 10

A company sales director reports that profits have been declining for mature but successful product offerings. The CEO asks for recommendations to address this issue. The firm's supply manager and sales director have had a strained working relationship in the past, but the supply manager believes supply management could make valuable contributions toward improving profitability. Given this situation, which of the following should be the supply manager's FIRST course of action?

A. Meet with board members to discuss a results-driven strategy to the problem

B. Offer to work with the sales director to identify possible joint solutions

C. Develop a new policy to correct the problem

D. Talk with the CEO about supply management's role

Correct Answer: B

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Question 11

A company is facing growing pressure to reduce costs by finding less expensive suppliers of raw materials offshore. However, the sourcing team has little experience with offshore suppliers. To prepare the team, which of the following actions by the supply manager will have the GREATEST impact?

A. Revising performance evaluation criteria to emphasize cost savings

B. Obtaining approval for new positions with higher experience requirements

C. Restructuring the department to concentrate on priority material categories

D. Using diagnostic tools to target specific training needs for the staff

Correct Answer: D

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Question 12

A supply management audit finds that sole source purchases have increased significantly due to the inexperience of the sourcing team, and that the waiving of competition is not justified in many cases. This has resulted in increased costs, as well as noncompliance with organizational policies requiring competitive solicitations. Which of the following is the BEST way to rectify this situation?

A. Train staff in solicitation policies and practices

B. Improve audit procedures to identify problem areas sooner

C. Report noncompliance to management in user departments

D. Make sole source review a key performance indicator (KPI)

Correct Answer: A

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Question 13

CDE, Inc. is a U.S.-based sporting apparel company. CDE contracts with a manufacturer in another country to produce a specialized line of clothing. In the first few months, sales of the new line are very disappointing. It is then discovered that the manufacturer is marketing counterfeit copies of the new line in the U.S. and abroad, thus undercutting CDE's pricing and damaging its reputation. Given this situation, which of the following should CDE do FIRST?

A. File a complaint with U.S. Customs and Border Protection against the manufacturer

B. Issue a cease and desist notification and reassess production risk

C. File suit against the manufacturer in its home country and the United States

D. Notify the World Trade Organization of copyright breach by the manufacturer

Correct Answer: B

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Question 14

A cross-functional team for a specialty art materials manufacturer is analyzing several hobby painting sets, each made at a different location. The supply manager asks the team to discuss packaging needs. As brainstorming progresses, a few team members comment that many paint jars look quite similar, and one member asks whether distinctive labels could be used to differentiate various types of paint. This change is implemented, saving costs through larger volumes and minimized shortages. Which of the following BEST describes what process the supply manager has facilitated?

A. Synergy

B. Internal negotiations

C. Contribution to profit

D. Aggregation

Correct Answer: D

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ISM Leadership and Transformation in Supply Management - LEAD Exam Practice Test

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