QUESTION: 9

A garden centre has recently purchased some lollypop sticks to use as plant labels. The staff have written the name of the plant on the lollypop stick and put it next to the plant. This helps them identify which plant is which. However, after a couple of weeks, the lollypop sticks have become mouldy and the writing has faded. Staff are now struggling to identity their plants. The Manager of the garden centre is considering returning the lollypop sticks and asking for a full refund as they were not fit for purpose. Can the Manager do this?

Yes- the lollypop sticks have gone mouldy- this is unacceptable
Yes- so long as the manager kept the receipt
No- as this was not the lollypop sticks intended purpose
No- the manager cannot prove that the product is faulty

Answer(s): C

Explanation:

The correct answer is `no- as this was not the lollypop sticks intended purpose'.
When deciding if something is fit for purpose, you must consider its intended and common purpose. In this case it would be for making lollypops. As the garden centre is using them for something other than their intended purpose, they can't complain if it doesn't work. Fit for purpose is discussed on p.65

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QUESTION: 10

Fred is a new procurement manager at a large engineering firm. They procure 100s of components and use these to make kitchen appliances such as kettles and toasters. He has been asked by his manager to look into procuring a new component which will go into a new environmentally friendly kettle and has been asked to ensure that the firm receives value for money.
What should Fred do?

Hold an open competition
Contact current suppliers to try and get a good deal
Invite known suppliers to bid for the contract
Put together a business case to make the product in-house

Answer(s): A

Explanation:

Fred should hold a competition as this is a `key way of achieving value for money' p.67. Fred shouldn't put a business case together to make the product in-house without doing a make vs buy analysis, and that analysis showing make is the way to go. As the firm buy in 100s of components, it's very unlikely that making the component in-house would bring `value for money'. He should also be careful of only looking at current suppliers or known suppliers- the best supplier of this new component might be unknown to the engineering firm at present.

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QUESTION: 11

Which of the following are considered `wastes' which can be removed from a business? Select THREE.

Over-processing
Stockout
Equity
Transportation
Inventory

Answer(s): A,D,E

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.

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QUESTION: 12

Tim manages the procurement department at a large retailer. He wants to ensure that his team are achieving value for money in their procurement activities.
Which of the following should Tim set up?

ITT
Audit
Framework
Contract

Answer(s): B

Explanation:

Tim should do an audit. P.71 of the textbook says "to ensure that a procurement department is achieving value for money, an audit should be undertaken"

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