Chapter 4 -- Supply Management Integration for Competitive Advantage

True / False

1. Purchasing offices were once corporate backwaters, filled with people who didn’t dream of advancing to the top rungs
of their organization.
a. True Các văn phòng thu mua đã từng là nơi hoạt động lạc hậu của công ty, chứa đầy những người
b. Fals không mơ ước được thăng tiến lên các cấp cao nhất trong tổ chức của họ
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

2. Integration does not require that people create a common understanding of the end goal or purpose.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

3. Outsourcing products through low cost country sourcing environments or contract manufacturers is very much the same
as sourcing in North American buyer-seller situations.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

4. Because the links between operations and supply management have been so close, it is not unusual for supply
management to report directly to operations.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
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Chapter 4 -- Supply Management Integration for Competitive Advantage

NOTES: 1

5. Many firms are now colocating supply management personnel directly at operating locations so supply management
can respond quickly to operation’s needs.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

6. Perhaps the most important and challenging linkages exist between supply management and marketing/sales.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

7. Many supply management groups are recruiting commodity managers with very strong technical backgrounds, who are
able to talk the talk and walk the walk alongside their engineering counterparts.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

8. Supply management usually maintains significant data about individual activity costs that can increase total cost.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic

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Chapter 4 -- Supply Management Integration for Competitive Advantage

NOTES: 1

9. In collaboration, the relationship is bilateral; both parties have the power to shape its nature and future direction over
time.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

10. A long-term contract does not provide an incentive for a supplier to invest in new plants and equipment.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

11. The need for confidentiality regarding financial, product, and process information is the most frequently cited reason
for not developing closer supplier relationships.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

12. Closer buyer-supplier relationships interest all suppliers.

a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic

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Chapter 4 -- Supply Management Integration for Competitive Advantage

NOTES: 1

13. A shift to a more trusting buyer-supplier relationship is easy.

a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

14. External relationship management begins with internal relationship management: internal alignment is key.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

15. Experience reveals that cross-functional sourcing teams are usually part-time/continuous assignments, making the use
of sourcing teams a challenging way to work.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

16. A primary objective of using teams is to bring together individuals with common perspectives and expertise to
perform better on a task compared to individuals or departments acting along.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic

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Chapter 4 -- Supply Management Integration for Competitive Advantage

NOTES: 2

17. Perhaps the greatest benefit of team interaction is that once a team makes a decision, implementing the decision often
becomes easier due to group buy-in.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

18. The use of cross-functional sourcing teams guarantees a successful outcome to a project or assignment.
a. True can greatly enhance the potential for success, not guarantee
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

19. Membership on a team can have negative effects on individuals.

a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

20. A team may pressure an individual to support or conform to a lower production norm than the individual’s personal
norm.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic

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Chapter 4 -- Supply Management Integration for Competitive Advantage

NOTES: 2

21. Successfully using teams does not require extensive planning before a team should be allowed to pursue an
assignment.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

22. Organizations should use teams selectively due to limited resource availability.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

23. Interacting as a team requires the same set of skills as the skills required for traditional work.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

24. If team members receive delayed reinforcement, they will exert greater effort than if the reinforcement is immediate.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2
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Chapter 4 -- Supply Management Integration for Competitive Advantage
25. If positive work is never recognized or reinforced through rewards, the positive effort will likely be extinguished.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

26. The effectiveness of the sourcing team leader is one of the weakest predictors of team success.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

27. Being an effective team leader means satisfying a demand set of essential operating responsibilities and requirements
while still promoting the creativity, leadership ability, and cohesiveness of team members.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

28. Goal setting is not a critical cross-functional team requirement.

a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 2

29. Cross-functional sourcing teams are a less-than-ideal way to promote cross-organizational cooperation.

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Chapter 4 -- Supply Management Integration for Competitive Advantage

a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

30. Cross-functional sourcing teams that incorporate supplier participation report fewer problems coordinating work
activity between the team and key suppliers.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

31. In forward-thinking enterprises, supply management seldom plays a key role in the development of new products and
services.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 3

32. On supplier assessments, performance data should be weighted in such a manner that they are aligned with customer
performance requirements.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 3

33. Supplier selection should never occur before a new part is actually designed or reaches production.
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Chapter 4 -- Supply Management Integration for Competitive Advantage

a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 3

34. If given the opportunity, suppliers seldom have a major impact on the overall timing and success of a new product.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 3

35. According to research, the sharing of technology roadmaps often strongly influences the type of buyer-supplier
relationship that resulted in the integration process.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 3

36. The physical co-location of a supplier engineer at a buying company is increasingly becoming a part of the normal
product development process structure.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 3

37. Suppliers of critical nonstandard commodities are involved much later in the product development initiative.

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Chapter 4 -- Supply Management Integration for Competitive Advantage

a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 3

38. Early visibility to product requirements allows supply management to share critical information with suppliers that can
help avoid delays.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 3

39. Suppliers are never an invaluable source of ideas for process improvement.
a. True
b. Fals
e
ANSWER: False
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 3

40. Many companies are encouraging suppliers to provide a permanent on-site representative who can aid the company in
improving customer order fulfillment processes.
a. True
b. Fals
e
ANSWER: True
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 3

Multiple Choice

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Chapter 4 -- Supply Management Integration for Competitive Advantage
41. _____ involves professionally managing suppliers and developing close working relationships with different internal
groups.
a. Purposeful cooperation
b. Program management
c. Credible commitment
d. Supply integration
e. Relationship
management
ANSWER: d
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 1

42. _____ is the process of incorporating or bringing together different groups, functions, or organizations, either formally
or informally, physically or by information technology, to work jointly and often concurrently on a common business-
related assignment or purpose.
a. Cooptation
b. Program management
c. Collaboration
d. Collusion
e. Integration
ANSWER: e
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 1

43. Which of the following are not considered relationship management skills?
a. Ability to conduct detailed price and cost
analyses
b. Ability to act ethically.
c. Ability to listen effectively.
d. Ability to communicate.
e. Ability to use creative problem-solving.
ANSWER: a
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

44. All of the following are examples of the different methods that supply management will apply to achieve integration
except _____.
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Chapter 4 -- Supply Management Integration for Competitive Advantage

a. Cross-functional or cross-organizational committees and teams

b. Hiring English majors into supply management to correct document language
c. Information systems such as videoconferencing and webmail
d. Process-focused organizations that are dedicated to certain processes
e. Colocation of suppliers and customers
ANSWER: b
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 1

45. _____ is defined as the process by which two or more parties adopt a high level of purposeful cooperation to maintain
a trading relationship over time to achieve specific goals.
a. Supply base
management
b. Collaboration
c. KPI
d. Supply integration
e. SRM
ANSWER: b
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 1

46. All of the following are characteristics that define a collaborative buyer-supplier relationship except _____.
a. one or a limited number of suppliers for each purchased item or family of
items
b. a win-win approach to reward sharing
c. open exchange of information
d. a credible commitment to work together during difficult times
e. the buyer unilaterally resolving disputes
ANSWER: e
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

47. Which of the following is not a common obstacle to closer buyer-seller relationships?
a. Long-term contracts.
b. Confidentiality.
c. Limited interest by

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Chapter 4 -- Supply Management Integration for Competitive Advantage

suppliers.
d. Legal barriers.
e. Resistance to change.
ANSWER: a
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 1

48. [A/An] _____ consists of personnel from different functions and increasingly from suppliers who are brought together
to achieve supply management or supply chain-related tasks.
a. Big R
b. External RM
c. cross-functional sourcing team
d. Little r
e. Internal RM
ANSWER: c
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 2

49. Which of the following is not a benefit of using a cross-functional sourcing team?
a. Reduced time to complete a task.
b. Increased innovation.
c. Joint ownership of decisions.
d. Enhanced communication among functions or organizations.
e. Groupthink.
ANSWER: e
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 2

50. Which of the following is not a potential drawback of using a cross-functional sourcing team?
a. Team process loss.
b. Reduced innovation.
c. Negative effects on individual members.
d. Poor team decisions.
e. Groupthink.
ANSWER: b
DIFFICULTY: Easy
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Chapter 4 -- Supply Management Integration for Competitive Advantage

KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 2

51. _____ is a function of the professional’s ability to translate supply market data into compelling insights that solve
business problems and to enable organizational connections and networking that accelerate business success.
a. SRM
b. Groupthink
c. Reciprocity
d. Process gain
e. Relationship
capital
ANSWER: e
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

52. _____ occurs when a team does not complete its task in the best or most efficient manner or members are not
motivated to employ their resources to create a successful outcome.
a. Groupthink
b. KPI
c. Collaboration
d. Process loss
e. Synergy
ANSWER: d
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

53. When _____ is present, the total group effort is _____ the expected sum of the individual parts.
a. process loss….less than
b. groupthink….more than
c. process loss….more than
d. collaboration….less than
e. synergy….the same as
ANSWER: a
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic

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Chapter 4 -- Supply Management Integration for Competitive Advantage

NOTES: 2

54. _____ is the tendency of a rational group or team to arrive at a bad decision when other information is available.
a. Serendipity
b. Collusion
c. Process loss
d. Maverick
spend
e. Groupthink
ANSWER: e
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 2

55. Which of the following is not an example of an appropriate use of a cross-functional team?
a. New product development.
b. Preparing a RFQ for a routine commodity product.
c. Locating a new production facility.
d. Developing a commodity or purchase family strategy.
e. Establishing a new business unit.
ANSWER: b
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

56. A _____ is one that requires members to use a variety of higher-level skills, supports giving members regular
feedback about performance, results in an outcome with a significant effect on the organization and others outside the
team, and provides members autonomy for deciding how they will do the work.
a. gray box design
b. statement of work
c. technology roadmap
d. meaningful task
e. traditional buyer-supplier relationship
ANSWER: d
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 2

57. Which of the following is not a requirement of being an effective team member?
a. Understands the team’s task – the member has task-relevant knowledge.
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Chapter 4 -- Supply Management Integration for Competitive Advantage

b. Has the time to commit to the team.

c. Has the right corporate political connections.
d. Has the ability to work with others in a group.
e. Can assume an organizational rather than strict functional perspective.
ANSWER: c
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 2

58. Management can exert subtle control over a team’s tasks through all of the following except _____.
a. authorizing the creation of the sourcing team
b. selecting the team’s task
c. selecting the team leader and members
d. conducting performance reviews and holding teams accountable for performance
outcomes
e. sitting in on all team meetings
ANSWER: e
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 2

59. Which of the following is not true regarding establishing sourcing team goals?
a.Teams with established goals often use those goals as a basis for evaluating how well
the team is performing.
b.Teams will establish, on average, challenging rather than easy goals.
c.External pressure on a team to set goals usually results in the setting of more
challenging goals.
d.Teams establish goals only because they have to.
e.Teams with goals perform better, on average, than teams that are asked simply to
perform their best without explicit end goals.
ANSWER: d
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 2

60. All of the following are examples of how supply management should monitor and anticipate activity in its supply
market except _____.
a.ensuring that cost accounting keeps track of historical prices paid
b.forecasting long-term supply and prices for its basic commodities
c.monitoring technological innovations that impact its primary materials or make
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Chapter 4 -- Supply Management Integration for Competitive Advantage

substitute materials economically attractive

d.evaluating not only its existing suppliers but also other potential suppliers
e.providing timely visibility to new-product requirements
ANSWER: a
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 3

61. All of the following questions are important in considering new or existing suppliers for integration except _____.
a.Is the supplier capable of hitting affordable targets regarding cost, quality,
conductivity, weight, and other performance criteria?
b.Does the supplier have sufficient marketing funds for promoting its new products?
c.Will the supplier be able to meet product introduction deadlines?
d.Will the supplier be able to increase capacity and production fast enough to meet our
market share requirements?
e.Do the supplier’s personnel have the required training to start up required processes
and debug them?
ANSWER: b
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 3

62. Using _____, the supplier is given blueprints and told to make the product from them.
a. black box design
b. gray box design
c. red box design
d. white box design
e. shadow box design
ANSWER: d
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 3

63. Using _____, the supplier’s engineers work cooperatively with the buying company’s engineers to jointly design the
product.
a. shadow box design
b. gray box design
c. red box design
d. white box design

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Chapter 4 -- Supply Management Integration for Competitive Advantage

e. black box design

ANSWER: b
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 3

64. Using _____, suppliers are provided with functional specifications and are asked to complete all technical
specifications, including materials to be used, blueprints, and so on.
a. shadow box design
b. white box design
c. gray box design
d. red box design
e. black box design
ANSWER: e
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 3

65. The term _____ refers to the set of performance criteria and products and processes an organization intends to develop
or manufacture.
a. concurrent engineering
b. early supplier
involvement
c. process loss
d. technology roadmap
e. R&D plan
ANSWER: d
DIFFICULTY: Easy
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 3

66. Which of the following are not examples of technology roadmaps?

a. Incorporation of new AICPA accounting standards into existing accounting systems.
b. Projected performance specifications for a class of products or processes.
c. An intention to integrate a new material or component.
d. Development of a product to meet customer requirements that is currently unavailable
in the market.
e. Integration of multiple complementary technologies that results in a radically new
product.
ANSWER: a
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Chapter 4 -- Supply Management Integration for Competitive Advantage

DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Remembering
OTHER: Analytic
NOTES: 3

67. All of the following are elements of successful supplier suggestion programs except _____.
a.the savings from the suggestion are often shared 50/50, not kept solely by the buying
company
b.the program focuses on cost improvement, not simply cutting the supplier’s margins
c.successful buying companies provide prompt feedback to the supplier on its
suggestion and also implement good suggestions promptly
d.it is critical to acknowledge the supplier’s suggestion, through an awards program,
newsletter, or announcement at a supplier conference
e.the supplier should be allowed to keep 100% of the savings since it came up with the
idea
ANSWER: e
DIFFICULTY: Moderate
KEYWORDS: Bloom’s:
Understanding
OTHER: Analytic
NOTES: 3

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