Free CIPS L5M7 Practice Exam with Questions & Answers | Set: 2

Outsourcing can improvequalitywhen a specialist provider performs the activity better than in-house teams.

Short cited extract: “Outsourcing to specialist providers can enhance quality and performance.” (L5M7 Study Guide, p. 94)

Ahierarchical culturevaluesstability, control, and formal structure, with defined authority levels.

Short cited extract: “Hierarchy culture – stability, rules, and control mechanisms.” (L5M7 Study Guide, p. 60)

JIT is aLeantechnique to minimise inventory and produce “only what is needed, when needed,” thereby removing waste from processes. Short cited phrase: “only when needed” (L5M7 Study Guide, p.111).

Rationalisationincludesreducing supplier numbersand practices such astier-skippingto simplify the network and reduce cost/complexity. Short extract: “rationalisation—reduce supplier base; consider tier-skipping.” (L5M7 Study Guide, p.11)

Aclosed-loop supply chainreturns used products to the chain forreuse/recycling/remanufacture. Short extract: “closed loop – products/materials re-enter the supply chain.” (L5M7 Study Guide, pp.5–7)

AFishbone Diagramidentifiesroot causesof problems by categorising factors (e.g., people, process, materials, environment).

Short cited term: “used to identify root causes of problems.” (L5M7 Study Guide, p. 126)

TQM is aholisticphilosophy requiringorganisation-wideadoption and leadership commitment; partial/isolated adoption undermines results. Short cited terms: “holistic,” “organisation-wide commitment” (L5M7 Study Guide, p.118).

Vertical collaborationoccursbetween different tiers(e.g., buyer–supplier) to coordinate capabilities for customer value. Short cited term: “vertical collaboration … different levels/tiers” (L5M7 Study Guide, p.90).

Differentiation Strategyinvolves offering products withunique attributesthat customers value and are willing to pay more for, thus achieving competitive advantage.

Short cited term: “differentiation – unique product features at premium price.” (L5M7 Study Guide, p. 177)

Cost-plus pricingis based onactual material and labour costs plus an agreed marginfor overheads and profit.

Short cited extract: “Cost-plus = actual cost + agreed mark-up for profit/overheads.” (L5M7 Study Guide, p.191)