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SCMN 3730 EXAM 2 NEWEST 2024-2025 ACTUAL
EXAM COMPLETE 70 QUESTIONS AND
CORRECT DETAILED ANSWERS (VERIFIED
ANSWERS) |ALREADY GRADED A+
What are the two opportunities for procurement to positively impact the balance sheet? - CORRECT ANSWER --Reduce inventory investment -Increase days payable -Inventory investment; increase inv. turns -Days-payable outstanding; increase cash -Fixed asset mgt; tooling and equipment
What are the key value drivers for each quadrant strategy? For each quadrant, how does procurement drive savings (strategy) to
the "bottom line"? - CORRECT ANSWER --Tactical: not critical
to business (best price wins); try to automate
-Leverage: not critical but a lot of money involved (contract
with few suppliers to gain improved pricing structure); continuous improvement
-Bottleneck: not a lot of money but very critical to business
(work closely with company to improve bottleneck or consider purchasing company if able) 1 / 3
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-Strategic: critical and a lot of money (develop long-term
partnerships with suppliers)
Compare and contrast a tactical vs. strategic methodology to implementing procurement cost savings - CORRECT ANSWER--Tactical = single company focused on supply chain cost reduction efforts (reduce total landed cost) -Strategic = integrative approach focused on improving costs throughout supply chain (reduce total cost of ownership; get everyone to reduce your costs)
What is the concept of Total Cost of Ownership (TCO) and how does it apply to procurement processes? - CORRECT ANSWER--TCO = acquisition, ownership, and post ownership
costs (net present value of all): long-term integrative approach
>Routine analysis performed by purchasing to define decision making processes >Analyze all acquisition related costs
TCO - CORRECT ANSWER -Total Cost of Ownership -Routine analysis performed by purchasing to define the sourcing decision-making process -The sourcing team should typically research and prepare analysis for management's consumption 2 / 3
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-Research process must be adapted to each enterprise -Purchasing must analyze all acquisition related costs when making supply management decisions -TCO is the net present value (NPV)
-Equation: TCO = Acquisition + Ownership + Post-Ownership
Costs
What costs are included in each of the TCO segments? -
CORRECT ANSWER --*Acquisition (TLC)*: purchase price,
planning costs, quality costs, business taxes, financing costs, inbound transport
-*Ownership*: downtime costs, supply risk cost, cycle time
costs, conversion costs, non-value added costs, supply chain costs
-*Post-Ownership*: environmental costs, warranty costs,
product liability costs, customer dissatisfaction costs
Compare and contrast TCO to Total Landed Cost (TLC) concept. - CORRECT ANSWER -Acquisition costs are TLC costs, TCO includes ownership and post-ownership
What are the categories of cost savings and how are each
defined? - CORRECT ANSWER --*Realized cost savings*: can
find on income statement (implemented and used)
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