TEST BANK Sourcing and Supply Chain Management – 4th edition Handfield, Monczka, Giunipero, and Patterson Chapter 2

1. Until an organization can streamline the day-to-day purchasing process, it will continually delay implementing other important strategic activities that help the organization become more competitive.

a. True

b. False

2. The objectives of a world-class purchasing organization do not need to move far beyond the traditional belief that purchasing’s primary role is to obtain goods and services in response to internal needs.

a. True

b. False

3. If a supplier’s components are defective and causing problems for manufacturing, then purchasing must work closely with the supplier to improve its quality.

a. True

b. False

4. The right of purchasing to evaluate and select suppliers means that sales representatives are never allowed to talk with non-purchasing personnel.

a. True

b. False

5. The authority to review material specifications is within purchasing’s span of control, although engineering sometimes disputes this right.

a. True

b. False

6. All purchasing needs must be forecasted ahead of time.

a. True

b. False

7. When creating a forecast for a needed product or service, internal customers may not always be able to express exactly what it is they will need at a single point in time.

a. True

b. False

8. For routine, off-the-shelf items, the purchase requisition may contain all the information that purchasing required.

a. True

b. False

9. When purchasing works directly with internal customers to anticipate future requirements, such as during new product development, purchasing is being reactive.

a. True

b. False

10. Buyers should use competitive bidding when price is a dominant criteria and the required item or service has straightforward material specifications.

a. True

b. False

11. The process that buyers use to select suppliers does not vary widely depending on the required item and the relationship that a buyer has with its suppliers.

a. True

b. False

12. For standard items, the negotiation process is an efficient method to purchase relatively straightforward requirements.

a. True

b. False

13. For complex items or items requiring untested or a new production process, purchasing can include additional information or attachments on its RFQ to assist the supplier, including detailed blueprints, samples, or technical drawings.

a. True

b. False

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