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CIPS Defining Business Needs Sample Questions (Q204-Q209):

NEW QUESTION # 204
An automotive manufacturer is sourcing rubber components from Company A. The specification given to the supplier state that the component should be 1 meter long, without mentioning the tolerance. Enthusiast with the opportunity, engineers at Company A work hard to cut the components with tolerance at only +/- 1mm.
The head and tail of the component is then joined together to form a circular band. After that it is stretched over another component. To fit this purpose, the rubber component can be at any length from 80cm to 110cm.
This is an example of...?

A. Over processing
B. Waiting
C. Unnecessary motion
D. Defects

Answer: A

Explanation:
This questions is intended to ask students about types of waste in Lean principles.
Lean was born out of manufacturing practices but in recent time has transformed the world of knowledge work and management. It encourages the practice of continuous improvement and is based on the fundamental idea of respect for people. Womack and Jones defined the five principles of Lean manufacturing in their book "The Machine That Changed the World". The five principles are considered a recipe for improving workplace efficiency and include: 1) defining value, 2) mapping the value stream, 3) creating flow,
4) using a pull system, and 5) pursuing perfection.
Lean principles aim to eliminate waste in processes. The eight wastes of Lean principles are:
- Defects
- Over-production
- Waiting
- Not using talent
- Transport and handling
- Inventory
- Motion waste
- Excess processing
In the scenario, the component is processed more than necessary. The engineers try to make them as accurate as possible with very little tolerance. In fact, the component does not need to be that precise. This excesses buyer's requirements and incurs costs for both buyer and supplier. The scenario is an example of over processing (or excess processing).
Overprocessing is one of the seven wastes of lean manufacturing (or 7 mudas); Overprocessing is adding more value to a product than the customer actually requires such as painting areas that will never be seen or be exposed to corrosion.
Overprocessing as one of the seven wastes is caused by having unclear standards and specifications, many operators will try to do the best job possible and will not always be aware of what truly adds value to the product or even the end use. They will therefore often expend time polishing and finishing components that do not require it.
Reference:
- CIPS study guide page 153-156
- Waste of Overprocessing; causes, costs, examples solutions, symptoms (leanmanufactur-ingtools.org) LO 3, AC 3.4

NEW QUESTION # 205
The bargaining strength of suppliers is likely to be high in which of the following situations? (Select TWO)

A. There is a limited number of suppliers in relation to buyers
B. The buyer's requirement is urgent
C. The buyer is educated on supply markets
D. The buyer's spend is a high proportion of the supplier's revenue
E. The buyer is large in size relative to the supplier

Answer: A,B

Explanation:
Comprehensive and Detailed Explanation (from CIPS L4M2: Supply Market Analysis) Supplier power is high when:
* Few suppliers exist relative to demand # less competition.
* Urgent demand gives suppliers leverage over buyers.
A and D would reduce supplier power; C (educated buyer) also weakens it.
Relevant CIPS L4M2 Sections:
* Porter's Five Forces - supplier power
* Market structure and urgency as power drivers

NEW QUESTION # 206
A buyer is undertaking an analysis of the market. This analysis has focused on the relative power of the main buyers in the market. It has also focused on the changes in capacity available amongst the key suppliers in this market. Which of the following describes this analysis?

A. Demand and supply analysis
B. Regulatory analysis
C. Consumer analysis
D. Industrial analysis

Answer: A

NEW QUESTION # 207
Alexander has identified that he wishes to use a performance-based specification for the purchase of a new HR staffing scheduling system. Was this the correct course of action?

A. No, because technology is changing rapidly
B. Yes, because suppliers have greater technical knowledge than the buying organisation
C. No, because there are clear objective criteria for evaluating alternative solutions
D. Yes, because a specific blueprint is necessary for functional requirements

Answer: B

NEW QUESTION # 208
When procuring an IT equipment, at which stage the buyer's expectations are translated into a technical specification?

A. In-service support
B. Design
C. Installation
D. Customer support

Answer: B

Explanation:
IT equipment is typically linked with through-life contracts. This type of contract not only deal with the specification and the price of a machinery, but also other stages such as design, manufacture, installation, in-service support, decommission and disposal. Among these stages, the design stage is when buyer's requirements are translated into technically correct specification.
Reference:
LO 3, AC 3.2

NEW QUESTION # 209
......

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