GSC Procurement Midterm

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  1. What are some examples of Operational Activities?
    • Placing Purchase Orders
    • Transactionally focused activities
    • Managing Supplier relationships
  2. What are some examples of Strategic Activities?
    • Supplier development responsibilities
    • Coordinating the procurement system
    • Managing Risk in the supply chain
  3. What are some benefits of having a Centralized Authority?
    • Leveraging of volume purchases
    • Transportation savings
    • Reduction in cost of services
  4. What are some benefits of Decentralization?
    • Faster response time for multiple locations
    • Better understanding of location requirements
    • Specialty Buyers can evolve
  5. What does ROI stand for?
    Resource, Optimization, & Innovation
  6. What are the 3 types of Supplier/Buyer Relationships?
    • Transactional
    • Collaborative
    • Alliance
  7. What are some characteristics of Transactional Relationships?
    • Absence of concern
    • Cost, data, & forecasts are not shared
    • Price is the focus
  8. What are some advantages to Transactional Relationships?
    • Less purchasing time and effort is required
    • Lower skill levels are required
  9. What are some Disadvantages of Transactional Relationships?
    • Inflexible when flexibility is required
    • Potential for communication difficulties
    • Suppliers provide minimum service
  10. What are some characteristics of Collaborative Relationships?
    • Longer term contracts
    • Reduce total costs
    • Increased investment in R&D and Training
  11. What are some benefits of Supply Alliances?
    • Lower total cost
    • Improved quality
    • Improved continuity of supply
  12. What are some situations where an Alliance may not be appropriate?
    • Non competitive market
    • No hard savings from partnership
    • No internal customer buy in
  13. What are the 7-steps of Strategic Sourcing?
    • 1. Analyze Spend
    • 2. Profile Category
    • 3. Develop Strategy
    • 4. Develop RFQ & Negotiate OR Manage Demand
    • 5. Contract with Supplier
    • 6. Manage suppliers
    • 7. Improve suppliers
  14. What stages are in the "Discovery" section of Strategic Sourcing?
    Analyze Spend & Profile Category
  15. What stage is in the "Evaluation" section of Strategic Sourcing?
    Develop Strategy
  16. What stages are in the "Selection" section of Strategic Sourcing?
    • Develop eRFQ & Negotiate OR Manage Demand
    • &
    • Contract with Suppliers
  17. What stages are in the "Development & Manage" section of Strategic Sourcing?
    Manage Suppliers & Improve Suppliers
  18. What happens in a Reverse Auction?
    • Real time interaction between company and supplier.
    • Effective for achieving cost savings
    • Can have negative effects on Long-Term relationships
  19. What is RFP stand for?
    Request for Proposal
  20. What does ESI stand for?
    Early Supplier Involvement
  21. Explain the 70/30 approach
    • 70% of volume is awarded to one supplier
    • 30% of volume is awarded to the other supplier
    • Economies of scale are obtained from big supplier
    • Competition is obtained from little supplier
  22. What are some advantages of single sourcing?
    • Lower total cost
    • Buyer has more influence
    • Improved commitment from supplier
  23. What are some advantages of Multiple Sourcing?
    • Maintains competition
    • Provides a back up source
    • Easier to reach volume requirements
  24. What were 3 elements of change from the WSU Procurement presentation?
    • Department Organization
    • eProcurement
    • Sourcing Strategies
  25. WSU Procurement Presentation: What changed in their Strategic Sourcing?
    Transition from a transactional approach to a strategic analysis of commodity
  26. WSU Procurement Presentation: What changed in their eCommerce?

    The industry that
    responded quicker would be perceived to have better customer service
    • Improved negotiated vendor pricing
    • Easy to use marketplace to access prices
    • Focused on spend analysis & campus needs
  27. What are the categories in the 2x2 Matrix? (From Left to Right)
    • Leverage, Strategic
    • Routine,   Bottleneck
  28. 2x2 Matrix: Leverage
    • High expenditure area
    • Goods & services are readily available
  29. 2x2 Matrix: Strategic
    • Few qualified supply sources
    • Complex specifications (critical design to quality)
  30. 2x2 Matrix: Routine
    • Many sources
    • Low value
  31. 2x2 Matrix: Boottleneck
    • Very complex specifications
    • Few alternate products
Card Set:
GSC Procurement Midterm
2013-10-09 05:02:17

Midterm exam
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