CIPS Exam L4M2 Topic 8 Question 31 Discussion

Actual exam question for CIPS's L4M2 exam

Question #: 31
Topic #: 8

[All L4M2 Questions]

Bob is a new procurement specialist at XYZ Ltd. He is assigned to categorise the company's sup-plies. After analysing, Bob realises that a group of low value products is sourced from a tiny geo-graphical area which is prone to flooding. What would be the best strategy to manage this category of products?

ASource this group of products from only one supplier

BFind an alternative source to secure supply

CAssign some of procurement jobs to user department

DForm partnership relationship with the current supplier

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 Claribel at Apr 09, 2024, 09:31 PM

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Shawnda

1 days ago

The best option here is B - Find an alternative source to secure supply. Relying on a single supplier from a flood-prone area is a huge risk that needs to be mitigated.

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