Discuss ISM LEAD Exam Topic 4 Question 10

A supply manager conducts a risk assessment of the company's top five suppliers. One of these suppliers---a sole source of an integral component---has just one database location and no cloud storage. Any calamity could put supply of the component at risk. In this situation, which of the following is the BEST long-term course of action for the supply manager to take?

AAnalyze the feasibility of insourcing the component

BCollaborate with IT to offer available database capacity at one of the firm's locations

CWork with engineering to reduce the component's uniqueness and allow for alternate sources

DRevise the contract to require the supplier to obtain a backup database facility

Suggested Answer: C

Risk Assessment Overview: The sole source supplier has a single database location, creating a risk for the supply of an integral component.

Long-term Solution: Reducing the component's uniqueness to allow for alternate sources is a strategic approach. It mitigates the risk associated with dependency on a single supplier and enhances supply chain resilience.

Collaborative Approach: Working with engineering to modify the component design ensures compatibility with multiple suppliers, broadening the supplier base and reducing supply chain vulnerability.

Importance of Alternative Sources: Diversifying the supplier base is crucial in risk management to avoid disruptions caused by supplier-specific issues.

Reference: Supply chain risk management literature, such as 'The Resilient Enterprise' by Yossi Sheffi and guidelines from the Institute for Supply Management (ISM), supports the strategy of reducing dependency on single suppliers through component standardization.

Get Premium LEAD Questions as Interactive Web-Based Practice Test or PDF Real Exam Format Detailed Explanations Instant Access Get Your Practice Test

34 comments · newest first

Isreal 11 months ago

Wait, why isn't there already a backup? This is concerning.

Eun 12 months ago

Reducing uniqueness is a solid idea, more options are always better!

Maile 12 months ago

Collaborating with IT sounds smart, but will they actually do it?

Olive 1 year ago

Insourcing could be a risky move, not sure it's the best option.

Annett 1 year ago

Definitely need a backup database for that supplier!

Galen 1 year ago

Collaborating with IT to expand database capacity sounds practical, but I wonder if that really addresses the core issue of dependency on a sole supplier.

Audra 1 year ago

I practiced a similar question where we had to evaluate supplier risks, and I feel like insourcing might not be the best long-term solution, so I’m leaning away from A.

Jess 1 year ago

I'm not entirely sure, but I think working with engineering to reduce uniqueness could help us find alternative suppliers, which might be option C?

Mose 1 year ago

I remember discussing the importance of having backup systems in place, so option D seems like a solid choice.

Casie 1 year ago

Revising the contract to require a backup database facility seems like the most straightforward option. I'll focus on evaluating the supplier's ability to implement that.

Mammie 1 year ago

Reducing the component's uniqueness to allow for alternate sources - that could be an interesting approach. I'll need to dig into the engineering details on that one.

Oliva 1 year ago

Collaborating with IT to offer database capacity sounds like a practical idea. I'll make sure to consider the feasibility and costs involved.

Wilburn 1 year ago

Hmm, insourcing the component could be a good long-term solution, but it might be complex to implement. I'll have to think that through.

Carline 1 year ago

This seems like a tricky question. I'll need to carefully weigh the pros and cons of each option.

Shaquana 1 year ago

This seems like a good opportunity to apply my knowledge of SQL syntax. I'll carefully consider each option and choose the one that best matches the requirement.

Barney 2 years ago

This question is so dry, I could use a glass of water. But option D is the clear choice - gotta protect that supply chain, even if it costs a little extra.

Sharika 2 years ago

↳ replying to Barney

True, better safe than sorry when it comes to such a critical supplier.

Ernie 2 years ago

↳ replying to Barney

I agree, it may cost more but it's worth it to ensure continuity in production.

Teresita 2 years ago

↳ replying to Barney

Option D is definitely the way to go. Can't risk losing that component supply.

Rikki 2 years ago

Hmm, I'm leaning towards A. Insourcing could give us more control and flexibility. Who needs a sole source supplier anyway? Let's bring it in-house!

Omega 2 years ago

I agree with Mindy, having the supplier obtain a backup database facility would mitigate the risk.

Jodi 2 years ago

B is the way to go. Leveraging existing IT infrastructure is smart and cost-effective. Plus, the supplier won't have to do all the heavy lifting.

Yoko 2 years ago

↳ replying to Jodi

Collaborating with IT is a strategic move that can prevent potential disruptions in the supply chain.

Isabelle 2 years ago

↳ replying to Jodi

It's a practical solution that benefits everyone involved. Good call on leveraging existing resources.

Annita 2 years ago

↳ replying to Jodi

I agree, collaborating with IT is a smart move. It minimizes risk and ensures continuity.

Marnie 2 years ago

↳ replying to Jodi

B is definitely the best option. It's a win-win for both parties.

Desirae 2 years ago

But wouldn't it be better to collaborate with IT to offer database capacity at one of the firm's locations? That way we have more control over the situation.

Laurel 2 years ago

I'd go with C. Reducing the component's uniqueness opens up the field and diversifies the supply chain. Efficiency and redundancy, that's the key!

Mindy 2 years ago

I think the best long-term course of action is to revise the contract with the supplier.

Carylon 2 years ago

Option D for sure! Backup database facility is a no-brainer for a sole source supplier. Gotta have that insurance, you know?

Hildred 2 years ago

↳ replying to Carylon

Those could be good short-term solutions, but having a backup database facility is essential for long-term risk management.

Goldie 2 years ago

↳ replying to Carylon

But wouldn't it be better to also explore other options like insourcing or collaborating with IT?

Andra 2 years ago

↳ replying to Carylon

I agree, having a backup database facility is crucial for ensuring continuity of supply.

Cassi 2 years ago

↳ replying to Carylon

Option D for sure! Backup database facility is a no-brainer for a sole source supplier. Gotta have that insurance, you know?

ISM LEAD Exam - Topic 4 Question 10 Discussion