Salim is using the CIPS Procurement and Supply Cycle to run a tender for a new item. He needs to complete a Make vs Buy assessment. Under which stage of the cycle should this be done?
Answer(s): B
The correct stage is Market/commodity and options [including make vs buy assessment], which isStage 2 of the CIPS Procurement and Supply Cycle. This stage focuses on analysing the external market, internal requirements, and identifying whether to make a product in-house or source it externally.A Make vs Buy assessment helps determine whether the organisation has the capacity, skills, and resources to produce the item internally, or whether outsourcing would deliver greater value. Factors such as cost, risk, quality, lead time, and strategic alignment are evaluated.Other stages differ:High-level specification [Stage 1]: Focuses on defining what is needed, not sourcing decisions.Develop strategy/plan [Stage 3]: Comes after options are analysed, where the sourcing path is chosen.Market engagement [Stage 4]: Involves engaging suppliers, which cannot happen until the Make vs Buy decision is made.This makes Stage 2 the most accurate point for such an assessment.[Ref: CIPS L5M6 Study Guide, pp.3536 Procurement Cycle, Make vs Buy analysis]
When completing a tender exercise, in addition to price and quality, which factors may also be considered?
Answer(s): A
The correct answer is CSR [Corporate Social Responsibility]. In modern procurement, tenders are no longer evaluated solely on price and quality. Organisations increasingly consider ethical, environmental, and sustainability performance as part of supplier evaluation. CSR factors include labour practices, carbon footprint, use of sustainable materials, and compliance with ethical trading standards.Other options represent different procurement tools but are not additional evaluation factors:TCO [Total Cost of Ownership]: A financial analysis tool, not a tender factor.ITT [Invitation to Tender]: A formal document, not a factor.PQQ [Pre-Qualification Questionnaire]: Used for initial supplier screening, not tender evaluation.Integrating CSR into tenders reflects the wider move towards responsible procurement. It ensures suppliers align with the buyer's values and long-term risk management priorities.[Ref: CIPS L5M6 Study Guide, p.39 CSR considerations in tenders]
In mitigating risks within the supply chain, which two factors should be assessed when evaluating potential risks?
Answer(s): B,D
The two most important factors when assessing supply chain risks are Severity and Likelihood. These are typically measured on a scale [e.g., 15], with the product of the two giving a risk score.Severity measures the potential impact on the organisation if the risk materialises. For example, supplier insolvency may severely disrupt operations.Likelihood assesses the probability of the event occurring.The combination of severity × likelihood determines whether a risk is low, medium, or high, and informs mitigation strategies.Other options are less central:Location may influence likelihood but is a sub-factor.People involved is not a formal assessment criterion.Cost can be a consequence but is part of severity, not a separate factor.Using severity and likelihood ensures risks are prioritised based on both impact and probability, allowing category managers to allocate resources effectively.[Ref: CIPS L5M6 Study Guide, p.40 Risk assessment and mitigation protocols]
In order for Category Management to succeed, is business commitment and stakeholder buy-in essential?
The correct answer is Yes business commitment and top management endorsement is essential. Category management is a strategic approach that requires cross-functional collaboration and long- term alignment with business objectives. Without commitment from senior leadership, procurement lacks the authority, resources, and stakeholder engagement necessary to implement effective category strategies.Option B is incorrect because category management is strategic, not merely tactical. Options C and D underestimate the interdependence of categories and the need for broad business support. Even low-spend categories can carry risks or opportunities requiring strategic oversight.CIPS emphasises that full endorsement by senior management ensures stakeholder buy-in, smooth adoption of new processes, and maximisation of category benefits. Lack of support often results in fragmented efforts, limited compliance, and failure to achieve intended value.[Ref: CIPS L5M6 Study Guide, p.46 Importance of stakeholder commitment]
Penelope works for an international manufacturer. Which categories are most likely to be outsourced? [Select TWO]
Answer(s): B,E
The categories most likely to be outsourced are Marketing services and Facilities Management [FM]. These are examples of indirect spend categories where external providers often offer specialist expertise, cost efficiency, and scalability.CIPS identifies five indirect categories frequently outsourced: Marketing, Facilities Management, IT/Communications, Human Resources, and MRO [Maintenance, Repairs, Operations]. Outsourcing these allows organisations to focus internal resources on core competencies such as manufacturing or R&D.Raw materials, warehousing, and operations are typically core to production and therefore managed internally or strategically sourced, rather than fully outsourced. While warehousing may sometimes be outsourced [3PL], it is not listed among the primary categories in the study guide.Outsourcing decisions must balance cost, risk, and strategic importance. For example, outsourcing FM reduces overheads while ensuring professional management of buildings and services, whereas marketing agencies provide creativity and campaign expertise.[Ref: CIPS L5M6 Study Guide, pp.4647 Categories commonly outsourced]
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