2022 Realistic L4M6 Dumps Questions To Gain Brilliant Result
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CIPS L4M6 Exam Syllabus Topics:
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NEW QUESTION 46
Sandra is a buyer for a large supermarket and has been increasing unhappy with the performance of a long-term supplier of bananas. Over time the deliveries have become unreliable and this has had impacts on the supermarket's profitability. What should Sandra do first?
- A. Give written notice to the supplier of plans to terminate
- B. Obtain business approval to terminate the contract
- C. Develop an exit strategy
- D. Review the market and look for an alternative supplier
Answer: B
Explanation:
The first step is to obtain business approval to terminate. If Senior Management don't give approval, then the rest of the stages can't happen and Sandra will be stuck with her current banana supplier. There's a good diagram on p.109 detailing the steps to supplier termination.
NEW QUESTION 47
Pablo has run an open- competition to secure a new contract for a supplier of paper for his Birthday Card making company. He has received 10 submissions from various suppliers and needs to put a team together to evaluate the bids. What type of team should Pablo consider?
- A. A team composed of internal and external stakeholders
- B. A team composed of internal stakeholders
- C. A team of procurement experts
- D. A cross-functional team
Answer: D
Explanation:
Pablo should use a 'cross-functional team'. CIPS love 'cross-functional teams' and refer to them frequently throughout the study guide. A cross-functional team is people from different departments who come together for a purpose, such as to evaluate a tender. The benefit of using a cross-functional team is that you get people with different experiences and knowledge. So in this example a Cross-Functional team could compose of people from various departments such as procurement, logistics, manufacturing and legal. P.76
NEW QUESTION 48
Which of the following documents can be used at the selection stage of a tender process to ensure that short listed bidders meet the requirements of the buying organisation? Select TWO.
- A. Request for Information
- B. Request for Quotation
- C. Pre-Qualification Questionnaire
- D. Invitation to Tender
Answer: A,C
Explanation:
Request for Information and Pre-Qualification Questionnaire can be used for short-listing suppliers. Request for Quotation is used when the only variable is price and you would like suppliers to submit a price for you. Invitation to Tender would be the next stage after RFI / PPQ- this is sent out to those suppliers who have passed selection, and details the second stage of the competition. See p.75 for more details.
NEW QUESTION 49
Lee is a procurement manager at Real Pirates Ltd and he has a contract with Peg Leg Industries for the supply of fake, wooden legs for his team of Pirates. Real Pirates Ltd have been working with Peg Leg Industries for almost 10 years but recently Lee has discovered he will need to terminate the contract due to 'Contract Frustration'. What could be the reason for this?
- A. The supplier has leaked confidential information about Real Pirates Ltd to a competitor
- B. An unexpected incident has occurred beyond anyone's control
- C. The supplier has committed a material breach
- D. The supplier has become insolvent
Answer: B
Explanation:
The correct answer is 'An unexpected incident has occurred beyond anyone's control'. A good example of this would be the Covid-19 pandemic- neither the buyer nor supplier could have predicted this, and if this means that the contract can't be completed - then the contract can be terminated (in the UK at least). A way to avoid this would be to include a Force Majeur clause listing possible circumstances that could occur. When there's a Force Majeur clause, these eventualities are now classed as foreseen rather than unforeseen. See p.108
NEW QUESTION 50
ABC is a company which sources a vital component from a supplier. There are only a few suppliers in the industry and without this component, ABC would not be able to produce their final product. What type of relationship should ABC seek to develop with their supplier?
- A. outsource
- B. strategic alliance
- C. transactional
- D. arms length
Answer: B
Explanation:
As the component is vital to their business, ABC should seek a collaborative relationship with the supplier. There are three types of collaborative relationship (co-destiny, partnership and strategic alliance). Of these only strategic-alliance is given as an option. Remember - strategic purchase = collaborative relationship with supplier. There are many questions on the Relationship Spectrum on the exam. See p.5 for more details
NEW QUESTION 51
Why is it more difficult for buyers in the public sector to build relationships with suppliers?
- A. There are regulations that state competitive tender processes must be undertaken regularly
- B. Buyer power is weak in the public sector
- C. There are regulations prohibiting public sector buyers from developing relationships
- D. Buyer power is strong in the public sector
Answer: A
Explanation:
It can be difficult for buyers in the private sector to build relationships with suppliers because of rules that state competitive tenders must be undertaken every few years (within the EU this is usually every 4). This means that both parties aren't as invested in developing the relationship as it's possible the contact will end shortly. Competitive tendering is a requirement in the public sector to ensure value for money for taxpayers. See p.79 for further details. There are no rules stating Public Sector organisations can't have good relationships with suppliers, and in fact most will have good relationships with their current suppliers- the issue is that neither party can get too invested in the relationship as everyone knows it may end shortly. There are rules, however, against entering into Partnership relationships (which is discussed in chapter 3).
NEW QUESTION 52
Under what circumstances should a competitive tender not be completed? Select TWO.
- A. When the items are of low value
- B. When the items are of high value
- C. When there is not a clear specification
- D. When there is a clear specifications
Answer: A,C
Explanation:
Note the word 'NOT' in the question. In order for a competitive tender to be successful, there should be a clear specification in place (i.e. you need to know what you want, in order for suppliers to bid for it). Competitive tendering should also only be used for high value purchases; it's time consuming to do, so you wouldn't do it for low value items such as pens for the office. Therefore the correct answer to this question is 'items are of low value' and 'there isn't a clear specification'. There's a useful table on p.73 of when you would and wouldn't use a competitive tender.
NEW QUESTION 53
When outsourcing, which legislation details the rights of employees who may find themselves now working for the outsourcing company?
- A. PCR 2015
- B. ITT
- C. OJEU
- D. TUPE
Answer: D
Explanation:
The correct answer is TUPE: Transfer of Undertakings (Protection of Employment). Details on TUPE can be found on p.115
NEW QUESTION 54
Which of the following are considered 'wastes' which can be removed from a business? Select THREE.
- A. Over-processing
- B. Inventory
- C. Transportation
- D. Equity
- E. Stockout
Answer: A,B,C
Explanation:
The seven wastes (as defined by Taiichi Ohno) can be remembered as Tim Wood; transportation, inventory, motion, waiting, over-processing, over-production, defects. Some people add an S onto the end of Tim Wood to make Tim Woods (the s is for skills). In some modules of CIPS, they refer to 8 wastes and include skills, but in M6 they've only put the 7 on p.70.
NEW QUESTION 55
Brian Air is a company that is trying to break into the air transport market. Which of the following could be barriers to entry for Brian Air? Select THREE
- A. ethical sourcing
- B. licences and permits
- C. health and safety
- D. access to capital
- E. economies of scale
Answer: B,D,E
Explanation:
Barriers to entry are economies of scale (in the air travel industry you can't just start off small and grow), access to capital (you need to already have a lot of money to buy airplanes) and licences and permits (you need to ensure you have the correct licences to fly planes). These are listed on p.41. Other barriers include; strong brand identity already dominant in the market, high switching costs for buyers, access to distribution networks and government policy.
NEW QUESTION 56
Mendelow's Stakeholder Matrix categorises stakeholders into four groups and provides insight into how these stakeholders should be managed. What is a limitation to using this Matrix to categorise stakeholders?
- A. The categories are hard to remember
- B. The Matrix doesn't consider the power these stakeholders have
- C. The Matrix doesn't consider whether the stakeholder is for or against the activity
- D. Nowadays, Stakeholders fall into more than four categories
Answer: C
Explanation:
The correct answer is 'The Matrix doesn't consider whether the stakeholder is for or against the activity'. For a list of other limitations of using Mendelow's Stakeholder Matrix see p.82
NEW QUESTION 57
Robbie is a procurement manager at a public sector organisation. He is running a tender which is worth £2m and so will advertise this on OJEU. His manager has reminded Robbie to include CPV codes on the tender. What purpose would this serve?
- A. To ensure more suppliers bid for the tender
- B. To ensure suppliers can find the opportunity
- C. To ensure suppliers know the deadline for tender submission
- D. To ensure only qualified suppliers bid for the tender
Answer: B
Explanation:
CPV codes help suppliers find opportunities they can bid for. CPV codes are a numerical classification for products e.g. Strawberry Jam is 15332296 and when they are included on a Tender, any supplier who is registered with that same CPV code will get a notification that the tender is live. CPV codes are discussed on p.72 but not in much detail- so don't worry if you don't know much about them. So long as you know the above, you'll be fine.
NEW QUESTION 58
Which of the following factors would you use to analyse the macro-environment? Select THREE.
- A. social
- B. cultural
- C. political
- D. philosophical
- E. legislative
Answer: A,C,E
Explanation:
STEEPLE is what is used to analyse the macro-environment; the factors are; social, technological, economic, environmental, political, legislative and ethical. Details of this can be found on p.43-44
NEW QUESTION 59
In the 1990s a company spent a lot of time and money developing a device that you could carry around that could play CDs. The product spent a long time in development but when it was released the sales figures were very disappointing. This was in part due to the fact another product was released at a similar time which had much more developed technology and could play music without the cumbersome size of a portable CD player. Which of the following did the company not consider when developing the product?
- A. rivalry among existing competitors
- B. threat of substitution
- C. power of buyers
- D. threat of new entrant
Answer: B
Explanation:
The portable CD player has been replaced with a substitute product. This threat wasn't considered by the company and this resulted in poor sales. There are many questions in the exam on Porter's 5 Forces - see p. 39
NEW QUESTION 60
Which of the following is a valid reason for ending a relationship with a supplier?
- A. the supplier has a new CEO who you don't like
- B. the supplier delivered one delivery late
- C. force majeur
- D. the contract has ended
Answer: D
Explanation:
CIPS state the following reasons for the end of supplier relationships; the contract comes to a natural end, the contract is re-tendered, a material breach or the supplier becomes insolvent (p.15) In this case the only valid option is 'the contract has ended'.
NEW QUESTION 61
In public sector procurement, according to EU legislation, certain items must be procured via open-competition. What type of items are these?
- A. Items that are produced by lots of suppliers
- B. Items of strategic importance
- C. Items that are imported from outside the EU
- D. Items of high value
Answer: D
Explanation:
The correct answer is 'items of high value'. This links into the EU procurement principle of 'Proportionality' meaning that the procurement process must be proportionate to the value of the contract. Therefore, high value contracts must be procured via competition. What is considered 'high value' is decided by 'thresholds'. These are amended every 2 years to account for inflation etc, but you don't need to know what the thresholds are for this exam. P.75
NEW QUESTION 62
Which of the following is not a type of tender process used in the Public Sector?
- A. Competitive Dialogue
- B. Unrestricted
- C. Restricted
- D. Competitive Procedure with Negotiation
Answer: B
Explanation:
Unrestricted is not a type of tender. The 5 types are; open, restricted, competitive with negotiation, competitive dialogue and innovative partnership (though this last one is very rare in the public sector). The five types are explained in detail on p.77
NEW QUESTION 63
A partnership relationship can be described as any relationship between a buyer and supplier where there is a good level of communication and both parties are happy with each other's performance. Is this statement TRUE?
- A. Yes- partnerships are characterised by strong relationships
- B. No- only strategic relationships involve good levels of communication.
- C. No- good levels of communication can exist in other types of relationships
- D. Yes- partnerships are the only relationship type where both parties are happy with each other's performance
Answer: C
Explanation:
The correct answer is 'No- good levels of communication can exist in other types of relationships'. The study guide makes a point that not all good buyer: supplier relationships are partnerships. In fact 70% on supplier relationships will not be partnerships (according to Lambert who is quoted on p.131)
NEW QUESTION 64
You work at XYZ manufacturers and a competitor has just released a rival washing machine to the product that you make. This model is proving popular with customers. What competitive force is at play?
- A. threat of substitution
- B. threat of new entrant
- C. buyer power
- D. supplier power
Answer: B
Explanation:
This is a threat of a new entrant. The competitor has now entered the washing machine market and is competing directly with you. This is not a threat of substitution as it is the same product. A substitution would be if they invented a new product that washed clothes and people started buying this instead of washing machines. There are many questions in the exam on Porter's 5 Forces - see p. 39
NEW QUESTION 65
If a stakeholder has high power in a business but isn't interested in your procurement activity, what should be your management style for dealing with this stakeholder?
- A. Keep them informed - they have high power
- B. Minimum effort is required as they're not interested- do nothing
- C. Manage closely - they're a key player
- D. Keep them satisfied - they have high power
Answer: D
Explanation:
The correct answer is 'keep satisfied' because the stakeholder is high power and low interest. This is the top left corner of Mendelow's Stakeholder Matrix - see p.81
NEW QUESTION 66
In which procurement process is a PQQ not issued?
- A. Competitive Dialogue
- B. Open
- C. Restricted
- D. Competitive Procedure with Negotiation
Answer: B
Explanation:
Open Tender processes are a one-stage process which issues and ITT. It has no PQQ (selection) stage. P. 77
NEW QUESTION 67
Janet runs a factory which produces 1 million bread rolls every day. It requires a large amount of flour, and for this to be delivered regularly- in time with manufacturing operations. There are very few suppliers in the market place that can deliver the quality of flour Janet requires in the quantities required. Janet has just established a contract with Friendly Flour Limited - what type of supplier is Friendly Flour Limited to Janet?
- A. routine
- B. bottleneck
- C. strategic
- D. leverage
Answer: C
Explanation:
Friendly Flour Ltd is a strategic supplier; this is a critical supplier, responsible for core products. They represent a high risk impact and a high cost impact. This is the top-right hand corner of the Kraljic matrix. There are lots of questions on Kraljic in the exam - do revise this topic and ensure you understand each of the four quadrants of the matrix (see p.20)
NEW QUESTION 68
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