Use Real L4M6 - 100% Cover Real Exam Questions [Oct-2022]
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CIPS L4M6 Exam Syllabus Topics:
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NEW QUESTION 60
Which of the following are considered 'wastes' which can be removed from a business? Select THREE.
- A. Inventory
- B. Transportation
- C. Stockout
- D. Equity
- E. Over-processing
Answer: A,B,E
Explanation:
The seven wastes (as defined by Taiichi Ohno) can be remembered as Tim Wood; transportation, inventory, motion, waiting, over-processing, over-production, defects. Some people add an S onto the end of Tim Wood to make Tim Woods (the s is for skills). In some modules of CIPS, they refer to 8 wastes and include skills, but in M6 they've only put the 7 on p.70.
NEW QUESTION 61
What is the correct order of the stages of team development?
- A. Storming, forming, norming, performing
- B. Storming, forming, performing, norming
- C. Forming, storming, norming, performing
- D. Forming, norming, performing, storming
Answer: C
Explanation:
The correct answer is Forming, storming, norming, performing (p.91). Note; some people add on two additional stages to this; mourning and adjourning. The study guide forgets to mention this, but the exam may ask you about these additional stages. So I strongly recommend doing some further reading on this (it's called the Tuckman Group Development Model)
NEW QUESTION 62
Victoria runs a hotel and has recently had several security issues such as attempted robberies. She has decided that she needs to hire a security firm to ensure these issues don't continue. She has done some research and has found there are several local security firms who may be able to provide services to her hotel. However, she hasn't decided exactly what she would require the security firm to do. What should be Victoria's next steps?
- A. Issue a Request for Proposal
- B. Issue a Request for Quotation
- C. Issue a Prior Information Notice
- D. Issue an Invitation to Tender
Answer: A
Explanation:
Victoria should use a 'request for proposal' - this allows the security firms to submit ideas on how best to serve the hotel. They might come up with some ideas that Victoria hasn't thought about and can price against their own ideas. As Victoria doesn't have a concrete specification, an ITT or RFQ are not appropriate. A PIN tells suppliers that a tender opportunity is coming up and is used in the Public Sector. A hotel is not a Public Sector organisation. See p.76 for more information on when to issue a Request for Proposal
NEW QUESTION 63
What is collaborative inertia?
- A. When a partnership is unable to create new ideas
- B. Where a third party is invited to join a partnership.
- C. the concept that the value and performance of two companies combined will be greater than the sum of the separate individual parts
- D. A situation when the apparent output from collaboration is considerably less than expected
Answer: D
Explanation:
The correct answer is 'A situation when the apparent output from collaboration is considerably less than expected'. This is verbatim the definition given in the study guide on p.166 A synergy is the concept that the value and performance of two companies combined will be greater than the sum of the separate individual parts.
NEW QUESTION 64
Beyond Say is a manufacturer of diamond rings. It sources a lot of different parts to create its products including diamonds, gold, cardboard boxes for the rings to go in, as well as stationary and copier paper for the offices. Although it doesn't buy many diamonds, these represent a large part of Beyond Say's spend. Which category of spend would diamonds represent?
- A. Option
- B. Option
- C. Option
- D. It isn't possible to tell
Answer: A
Explanation:
This is category 'A' spend in the ABC model - they represent a large value and a small number of purchases / suppliers. See p.17 for more information on the ABC Analysis
NEW QUESTION 65
Which of the following documents can be used at the selection stage of a tender process to ensure that short listed bidders meet the requirements of the buying organisation? Select TWO.
- A. Pre-Qualification Questionnaire
- B. Invitation to Tender
- C. Request for Information
- D. Request for Quotation
Answer: A,C
Explanation:
Request for Information and Pre-Qualification Questionnaire can be used for short-listing suppliers. Request for Quotation is used when the only variable is price and you would like suppliers to submit a price for you. Invitation to Tender would be the next stage after RFI / PPQ- this is sent out to those suppliers who have passed selection, and details the second stage of the competition. See p.75 for more details.
NEW QUESTION 66
The procurement department is sourcing new uniforms for its housekeeping team. Although the housekeeping team in itself doesn't hold a lot of power within the business, they have a high interest in the activity as it will be them who is wearing the items. When designing the specification, how should the procurement department manage the housekeeping team?
- A. Manage them closely- they're key players in this procurement activity
- B. Keep them informed- it's important the housekeeping team know what's going on at each stage of the procurement
- C. Keep them satisfied- they will be wearing the uniform so need to be happy with it
- D. Minimal effort is required as they do not hold a lot of power in the business.
Answer: B
Explanation:
The housekeeping team have low power and high interest. According to Mendelow's stakeholder matrix, this puts them in the bottom right corner which is 'keep informed'. See p.81 for more information
NEW QUESTION 67
Brian Air is a company that is trying to break into the air transport market. Which of the following could be barriers to entry for Brian Air? Select THREE
- A. access to capital
- B. licences and permits
- C. economies of scale
- D. health and safety
- E. ethical sourcing
Answer: A,B,C
Explanation:
Barriers to entry are economies of scale (in the air travel industry you can't just start off small and grow), access to capital (you need to already have a lot of money to buy airplanes) and licences and permits (you need to ensure you have the correct licences to fly planes). These are listed on p.41. Other barriers include; strong brand identity already dominant in the market, high switching costs for buyers, access to distribution networks and government policy.
NEW QUESTION 68
Which of the following relationship types require the most investment from the buyer?
- A. strategic alliance
- B. adversarial
- C. single source
- D. partnership
Answer: D
Explanation:
Partnerships require the most investment out of those listed. The only relationship type that requires more investment than Partnerships is Co-Destiny. See p.9 for more information on this
NEW QUESTION 69
Which of the following is characteristic of an adversarial relationship?
- A. They are only used for one-off purchases
- B. The outcome of the deal is more important than the long term relationship
- C. The price is more important than the quality of the product
- D. The communication is always poor
Answer: B
Explanation:
In an adversarial relationship "the outcome of the deal... is more important than maintaining the relationship over a long-term period" p.7. They can be characterised by poor communication and can be used for one-off purchases but be careful for words in answers such as 'only' and 'always', as these can be misleading; adversarial relationships aren't always for one-off purchases, and communication isn't always poor. The other answer is incorrect (price is more important) because it doesn't describe the relationship, which is what the question asked.
NEW QUESTION 70
According to Michael Porter, what is procurement?
- A. a support activity which provides a source of competitive advantage
- B. a primary activity which provides a source of competitive activity
- C. a primary activity which provides value for money
- D. a secondary activity which provides value for money
Answer: A
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 71
Innovation is a key consideration when entering into a partnership. Is this statement true?
- A. Yes- joint innovation projects are often a strong motivation for entering into a partnership
- B. No- innovation is best achieved in a contractual relationship where KPIs can be monitored closely.
- C. Yes- innovation is the only reason to enter into a partnership
- D. No- the key consideration when entering a partnership is cost reduction
Answer: A
Explanation:
The correct answer is 'Yes- joint innovation projects are often a strong motivation for entering into a partnership'. The other options are simply not true statements. A lot of the questions on the 'Partnerships' chapters of the book are common-sense questions like this. It involves reading the Question: and using logic, rather that relying on your knowledge of procurement. If you found this Question: easy - that's a good sign for the exam.
NEW QUESTION 72
In the 1990s a company spent a lot of time and money developing a device that you could carry around that could play CDs. The product spent a long time in development but when it was released the sales figures were very disappointing. This was in part due to the fact another product was released at a similar time which had much more developed technology and could play music without the cumbersome size of a portable CD player. Which of the following did the company not consider when developing the product?
- A. rivalry among existing competitors
- B. threat of substitution
- C. threat of new entrant
- D. power of buyers
Answer: B
Explanation:
The portable CD player has been replaced with a substitute product. This threat wasn't considered by the company and this resulted in poor sales. There are many questions in the exam on Porter's 5 Forces - see p. 39
NEW QUESTION 73
Which of the following is not a type of tender process used in the Public Sector?
- A. Unrestricted
- B. Competitive Dialogue
- C. Restricted
- D. Competitive Procedure with Negotiation
Answer: A
Explanation:
Unrestricted is not a type of tender. The 5 types are; open, restricted, competitive with negotiation, competitive dialogue and innovative partnership (though this last one is very rare in the public sector). The five types are explained in detail on p.77
NEW QUESTION 74
Which of the following are primary activities, according to Porter's Value Chain? Select THREE.
- A. Inbound Logistics
- B. Operations
- C. Procurement
- D. Marketing and Sales
- E. Human Resources
Answer: A,B,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. Primary activities are; inbound logistics, operations, outbound logistics, marketing and sales, after sales- service
NEW QUESTION 75
'tail spend' is a common category used in procurement and describes a category of items. What characteristics do theses items have?
- A. Low value, high volume
- B. High value, high volume
- C. High value, low volume
- D. Low value, low volume
Answer: A
Explanation:
Tail spend items are low value, high volume. P. 132
NEW QUESTION 76
Kirsty is designing a specification for a new contract and wants to include some qualitive KPIs for the new supplier, as well as quantitative. Which of the following could she include? Select TWO.
- A. Deliveries in full and on time
- B. Cost savings
- C. Early supplier involvement
- D. Information sharing
- E. Trust
Answer: D,E
Explanation:
The correct answers are information sharing and trust. Further qualitative KPIs are listed on p.102. Deliveries in full and on time would be a quantitative KPI and early supplier involvement is not a KPI at all.
NEW QUESTION 77
Which of the following is not a stage in the relationship life-cycle?
- A. design the specification
- B. qualification
- C. performance management
- D. on-boarding
Answer: A
Explanation:
Designing the specification is not a stage in the relationship cycle- this would be done before the relationship begins. There are 6 stages of the relationship cycle; on-boarding, qualification, segmentation and risk management, performance management, development and innovation, phase out. P.13
NEW QUESTION 78
Under what circumstances should a competitive tender not be completed? Select TWO.
- A. When there is a clear specifications
- B. When the items are of high value
- C. When the items are of low value
- D. When there is not a clear specification
Answer: C,D
Explanation:
Note the word 'NOT' in the question. In order for a competitive tender to be successful, there should be a clear specification in place (i.e. you need to know what you want, in order for suppliers to bid for it). Competitive tendering should also only be used for high value purchases; it's time consuming to do, so you wouldn't do it for low value items such as pens for the office. Therefore the correct answer to this question is 'items are of low value' and 'there isn't a clear specification'. There's a useful table on p.73 of when you would and wouldn't use a competitive tender.
NEW QUESTION 79
What is value mapping?
- A. Make vs Buy decision
- B. Creating value through the elimination of waste and operational inefficiencies
- C. Segmenting suppliers based on the value they bring to the company
- D. Analysing the costs that go into making a product
Answer: B
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 80
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