CLA Procurement & Strategic Sourcing 2 — Questions and Answers
Question 1: Which type of sourcing strategy spreads purchases across multiple suppliers to reduce risk?
- Multiple sourcing (Correct answer)
- Single sourcing
- Sole sourcing
- Captive sourcing
Correct answer: Multiple sourcing
Multiple sourcing distributes purchases among several suppliers, reducing dependence on any one source and mitigating supply disruption risk.
Question 2: A supply base rationalization initiative typically aims to:
- Reduce the number of active suppliers to improve management efficiency and leverage (Correct answer)
- Increase the number of suppliers for redundancy
- Eliminate all long-term contracts
- Shift from domestic to international suppliers only
Correct answer: Reduce the number of active suppliers to improve management efficiency and leverage
Supplier rationalization consolidates the supply base to fewer, higher-performing vendors, improving relationships and negotiating power.
Question 3: Which procurement document legally commits a buyer to purchase goods or services from a supplier?
- Purchase order (Correct answer)
- Request for quotation
- Supplier scorecard
- Bill of lading
Correct answer: Purchase order
A purchase order is a legally binding commercial document issued by a buyer that authorizes a supplier to deliver specified goods or services at agreed terms.
Question 4: Early supplier involvement (ESI) in new product development primarily benefits a company by:
- Leveraging supplier expertise to improve design and reduce costs before production begins (Correct answer)
- Delaying product launch to gather more market data
- Eliminating the need for competitive bidding
- Reducing the number of required quality inspections
Correct answer: Leveraging supplier expertise to improve design and reduce costs before production begins
ESI integrates supplier knowledge during design, enabling cost-effective materials selection, improved manufacturability, and faster time to market.
Question 5: Maverick spending in procurement refers to:
- Purchasing outside of approved contracts and processes without authorization (Correct answer)
- Strategic investment in new supplier development
- Emergency spot purchases due to supply disruption
- Centralized buying decisions made without department input
Correct answer: Purchasing outside of approved contracts and processes without authorization
Maverick spending occurs when employees bypass established procurement channels, reducing leverage, compliance, and cost savings.
Question 6: Category management in strategic sourcing groups similar spend areas together to:
- Develop tailored strategies that maximize value across related purchases (Correct answer)
- Standardize all purchase orders to a single format
- Eliminate specialized suppliers from the supply base
- Reduce the number of procurement staff needed
Correct answer: Develop tailored strategies that maximize value across related purchases
Category management applies a focused strategy to a cluster of related spend, enabling deeper market insight and stronger negotiating leverage.
CLA Procurement & Strategic Sourcing 2
Which type of sourcing strategy spreads purchases across multiple suppliers to reduce risk?