CIPS L4M2 Exam - 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, 06:03 PM

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Adolph

6 months ago

Not sure about A, seems too basic for value analysis.

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Jaime

6 months ago

Wait, is D really a reason? That’s surprising!

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Barbra

6 months ago

C seems relevant too, but not as much as A and E.

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Valentin

7 months ago

I think B is also important, though.

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Nell

7 months ago

Definitely A and E!

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Elke

7 months ago

I’m a bit confused, but I feel like D could relate to value analysis since it involves specifications.

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Willie

7 months ago

I practiced a question similar to this, and I think B is more about financial planning rather than value analysis.

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Jovita

7 months ago

I remember something about determining the value of components, so A might be correct too, but I’m not entirely sure.

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Launa

8 months ago

I think value analysis is mainly about finding cost reduction opportunities, so I’m leaning towards E.

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Glenn

8 months ago

This is a good test of my understanding of value analysis. I'll methodically go through each option and choose the two that best fit the question.

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Derrick

8 months ago

I'm confident I know the main reasons for value analysis, but I'll double-check the options to make sure I don't miss anything.

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Nada

8 months ago

Okay, let's see here. I think A and E are the two most relevant reasons based on the question. I'll select those.

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Twanna

8 months ago

Hmm, I'm a bit unsure about this one. I'll need to carefully read through the options and think about which two make the most sense.

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Glen

8 months ago

This looks like a straightforward value analysis question. I'll focus on identifying the key reasons an organization might implement it.

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Emogene

1 year 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

1 year 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

11 months ago

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

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Katheryn

11 months ago

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

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Alesia

11 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

1 year 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

12 months ago

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

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Brynn

12 months ago

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

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Peggie

1 year ago

A) To determine the value of each component used

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Alexia

1 year 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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