Important CIPS L4M2 Exam Questions

Answer: B, C, D

Answer: B, D

Explanation:

Comprehensive and Detailed Explanation (from CIPS L4M2 -- Market and Supplier Power)

Supplier power decreases when:

Many substitutes exist (buyers can switch easily).

Low switching costs allow buyers to change suppliers without penalty.

Options A, C, and E describe conditions that increase supplier power or are irrelevant to it.

Hence, B and D are correct.

Relevant L4M2 references:

''Supplier power within Porter's Five Forces''

''Factors reducing supplier influence: substitution and switching costs''

Answer: A

Explanation:

Explanation

According to US Department of the Navy, Benchmarking is a strategic and analytic process of continuously measuring an organisation's products, services, and practices against a recognised leader in the studied area.

Successful benchmarking will help you:

- Find who does the process best and close the gap

- Recognise the leading organisations in a process or activity

- Create performance standards derived from an analysis of the best in business

- Ensure that comparisons are relevant

- Measure your performance, your processes, and your strategies against best in business

- Measure business processes

- Assess performance over time

- Accelerate continuous process improvement (CPI)

- Establish more credible goals for CPI

- Establish actionable objectives

- Discover and clarify new goals

- Establish customer expectations of business standards set by the best suppliers in industry

- Help your organisation achieve breakthrough improvements

- Create a sense of urgency for change

- Increase customer satisfaction

- Become direction setting

- Provide a positive, proactive structured process

Benchmarking does not:

- Copy the other's processes

- Steal other business confidentiality

- Stop. Benchmarking is a continuous process.

- CIPS study guide page 49-51

- The Department of the Navy Benchmarking Handbook

LO 1, AC 1.3

Answer: D

Explanation:

Detailed

Conformance specifications outline specific technical standards or requirements that a product must meet. These ensure uniformity and compliance but do not allow flexibility for suppliers to innovate. Reference: CIPS Level 4, Specification Standards.

Answer: A

Explanation:

Comprehensive and Detailed Explanation (from CIPS L4M2: Business Case Development)

A business case should include:

Costs and risks (financial, operational, reputational)

Expected business benefits (value, performance, compliance)

Supplier lists or informal notes are not part of a formal business case.

Relevant CIPS L4M2 Sections:

Key contents of a business case

Risk and benefit analysis in procurement justification