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CIPS Category Management Sample Questions (Q37-Q42):
NEW QUESTION # 37
When completing a tender exercise, in addition to price and quality, which factors may also be considered?
- A. CSR
- B. PQQ
- C. TCO
- D. ITT
Answer: A
Explanation:
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]
NEW QUESTION # 38
The process of designing a product with a trusted supplier in order to eliminate costs that may appear at the delivery stage is known as which cost management strategy?
- A. Cost out
- B. Cost engineering
- C. Cost acceptance
- D. Cost down
Answer: A
Explanation:
The correct term is Cost Out, a proactive cost management approach where the buyer collaborates with the supplier during the design phase to eliminate unnecessary costs before they arise. This ensures efficiency and value creation throughout the product lifecycle. For example, designing packaging to minimise waste or using standardised components to avoid expensive customisation.
This differs from:
* Cost acceptance, where the buyer accepts the supplier's price without analysis.
* Cost engineering, a broader process of optimising costs through design and process evaluation.
* Cost down, which typically involves reducing costs after production by analysing processes, renegotiating contracts, or improving efficiency.
Cost Out is especially relevant for strategic or high-value categories where innovation and collaboration with suppliers can generate long-term savings. It is consistent with category management's emphasis on strategic supplier partnerships.
[Ref: CIPS L5M6 Study Guide, p.80 - Cost Out vs Cost Down strategies]
NEW QUESTION # 39
When implementing procurement projects, it is important for Category Managers to consider the "human side" of change. Why is this?
- A. Change will always bring about a positive result
- B. A change cannot be made without buy-in from everyone
- C. Ignoring stakeholders' feelings may result in rework or a poor result
- D. Everybody is resistant to change
Answer: C
Explanation:
The correct answer is ignoring stakeholders' feelings may result in rework or a poor result. In category management, implementing change-whether new sourcing strategies, supplier consolidation, or digital tools-affects multiple stakeholders. People often resist change, either passively or actively. CIPS highlights a model where typically 20% embrace change, 60% accept it cautiously, and 20% actively oppose it.
If stakeholders' concerns are ignored, resistance can derail projects, leading to delays, poor adoption, or the need for costly rework. For example, if end-users are not engaged in developing specifications, the final product may not meet needs, requiring adjustments later.
Options A and B overstate the issue; not everyone resists change, but enough stakeholders may to cause disruption. Option D is incorrect because change can also bring risks and negative consequences if poorly managed.
Effective change management in procurement requires communication, stakeholder engagement, and addressing emotional as well as technical challenges.
[Ref: CIPS L5M6 Study Guide, p.68 - Managing the human side of change]
NEW QUESTION # 40
Which of the following industries is the only one that does not have a specific SIC code?
- A. Services
- B. Finance
- C. Agriculture
- D. Retail
Answer: A
Explanation:
The services industry does not have a specific SIC code because it is highly diverse, spanning multiple activities that do not fit neatly into a single classification.
[Ref: CIPS L5M6 Study Guide, p.88 - SIC classification limitations]
NEW QUESTION # 41
Which of the following parts of a SWOT analysis summarise activities and characteristics which are internal to the business? Select TWO.
- A. Opportunities
- B. Weaknesses
- C. Strengths
- D. Threats
Answer: B,C
Explanation:
A SWOT Analysis distinguishes between internal factors (strengths and weaknesses) and external factors (opportunities and threats). Strengths are internal capabilities, resources, or skills that give the organisation an advantage in the market-such as strong supplier relationships, unique expertise, or cost leadership.
Weaknesses are internal limitations, such as lack of investment, poor technology, or inadequate processes.
These are factors the organisation has direct control over and can improve. On the other hand, opportunities and threats are external influences outside the business's direct control, such as market trends, legislation, or competitor actions. For category management, applying SWOT allows managers to assess the current position of categories and design strategies that build on strengths and address weaknesses. This analysis also ensures that procurement strategies remain aligned with organisational goals and competitive environments. The correct recognition of internal versus external factors is essential to avoid misdiagnosis and wasted effort.
Reference: CIPS L5M6 Study Guide, p.121
NEW QUESTION # 42
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