CIPS Exam L4M2 Topic 10 Question 49 Discussion

Actual exam question for CIPS's L4M2 exam

Question #: 49
Topic #: 10

[All L4M2 Questions]

Which of the following are typically reasons why an organisation implements value analysis? Select TWO that apply:

ATo determine the value of each component used

BTo decide whether there will be sufficient surplus funds to reinvest in the business

CTo shape and manage supply market

DTo provide an outline business case for the specification

ETo find cost reduction opportunities by optimising the components used

Show Suggested Answer

Suggested Answer: C

The buying organisation is keen to encourage innovation so they should use the outcome or output based specification. In an outcome-based specification, umbrella statements like 'good quality', 'ambient temperature', 'convenient way' are often used. This may confuse the suppliers, and it's hard to check the solution that supplier offers. On the other hand, ouput-based specifications often include measurable requirements. For example, a specification for air conditioning system states that the system should maintain the room temperature at 19-24 degrees Celsius. Therefore, output specification is more appropriate in this case.

LO 3, AC 3.1

by Chaya at Oct 21, 2024, 07:03 PM

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Emogene

4 months ago

Wait, is this exam sponsored by the 'Department of Redundancy Department'? A and E sound pretty much the same to me!

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Alesia

4 months ago

Ah, I see now. C and E are the way to go. Value analysis is all about shaping the supply market and finding cost optimization opportunities.

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Ettie

2 months ago

It's important to focus on those aspects to ensure efficiency and effectiveness in the business.

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Katheryn

2 months ago

Definitely, those are the main goals of value analysis in an organization.

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Alesia

2 months ago

I agree, shaping the supply market and finding cost reduction opportunities are key reasons for implementing value analysis.

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Merilyn

4 months ago

Haha, I bet the person who wrote this question was trying to trick us. B is totally off-base - value analysis is not about determining if there are surplus funds!

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Vivan

3 months ago

Yeah, I agree. B doesn't make sense at all in the context of value analysis.

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Brynn

3 months ago

E) To find cost reduction opportunities by optimising the components used

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Peggie

3 months ago

A) To determine the value of each component used

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Alexia

4 months ago

Hmm, I'm not so sure about B and D. Those options seem more like high-level business considerations rather than the typical reasons for value analysis.

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