The trust is built based on the other party's professional qualifications or proven or certified technical capability or experience is known as...?
Answer(s): D
Trust is the expectation that the other party will behave in a predictable and mutually acceptable way. In inter-firm relationships, the presence and absence of trust can affect the level of cost in a relationship. The existence of trust is taught to lower the transaction cost in a relationship. Dr. MariSako identified taxonomy of 3 types of trust in commercial relationship, which is very useful from the perspective of procurement.Contractual trust: Trust based on the contract with TOP. This is potentially the weakest source of trust if there is nothing else to base the trust on, but it is the quickest to establish. Competence trust: Trust based on TOP's professional qualifications or proven or certified technical capability or experience.Goodwill trust: Trust based on knowing TOP has your interest at heart and will not behave opportunistically. This is potentially the strongest type of trust, but it takes the longest time to build.
Can a party gain huge advantages in negotiation from setting room layout?
Answer(s): B
Essentially, for trained negotiators under most circumstances, the physical locations of negotiations and the room layout should not make much difference to the outcomes of the meeting. It is reasonable to assume that most commercial negotiations are based at least initially on a principled- or pragmatic-type approach. It is arguable also that any advantage gained through intentionally creating an uncomfortable environment to put short-term pressure on TOP is likely to be short-lived as TOP will likely reflect on this later and seek means to get even.
Economic growth can be measured by...?
Gross Domestic Product (GDP) is the monetary value of the goods and services manufactured or supplied in a financial period. In general terms, when the GDP rate falls or slows down, there will be a fall in demand for goods and services demanded in the economy, with a fall in firms' revenue and profit margins. When GDP is rising, there will be an increase in demand. Consumer Price Index (CPI) is weighted measurement that evaluates the average cost of a basket of goods bought by a consumer.Producer Price Index (PPI) is average changes in prices that a producer receives in return for its goods or services.Small Business Lending Index (SBLI) is an indicator of small business lending trends.
Which of the following is considered a strength of a `logical' style negotiator?
A useful and simple shorthand for preferred negotiation styles is summarised by four simple descriptor: 'warm', 'tough', 'logical' and 'dealer', which can be applied to describe individuals' dominant preferred style in most circumstances.Warm - a people personTough - a hard-nosed negotiatorLogic - a numbers personDealer - a trader who loves bargainingStrengths, weaknesses of logical style are described below:Table Description automatically generated
Which of the following are most likely to turn buying organisation into an unattractive customer in supplier's perspective? Select TWO that apply.
Answer(s): A,D
Becoming a preferred customer to supplier's perspective can increase the purchaser's leverage in negotiation. Beside the size of buying organisation or its spend, the following may be sufficient to differentiate the buyer from other buying organisations:Simple procurement processes: Using SRM technology may help to simplify the process Simple contracting processesClear and concise documentation: Reduced paperwork helps both supplier and buyer save their time and resources.Absence of onerous supplier terms and conditionsOn-time paymentTransparent processes: Unclear tender award criteria can be seen as opaque. Suppliers who attended the tendering processes cannot know the reasons why their bids are rejected and hesitate to attend other tendering.Ethical behaviour: Suppliers may prefer a buyer who adopts CSR policy because they can predict potential customer's behaviour. Demands for kickback are unethical behaviours.
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