CIPS Managing Supply Chain Risk L5M2 Exam Questions

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Total 120 questions
Question 1

Which organisation created the Decent Work Agenda?



Answer : C

This is from ILO- the International Labour Organisation - see p.49 of the textbook. You should recognise all four of these acronyms as they come up in this module UN= United Nations - they have the Guiding Principles, ISO = produce standards for business practices and ETI = Ethical Trading Initiative - they have a base code for labour practices.


Question 2

The UK Companies (Miscellaneous Reporting) Regulations 2018 states that organisations with more than 250 employees must do what?



Answer : D

The correct answer is 'publish a summary of how the directors have engaged with employees'. For more information on this piece of legislation see p. 145


Question 3

SA 8000 is an alternative to which ISO?



Answer : D

SA8000 is Social Accountability, this is an alternative to ISO 20400 which is Sustainable Procurement. This is explained on p.53 of the study guide. ISOs are a popular exam topic, so ensure you know these four mentioned here before the exam


Question 4

What is the final stage of Deming's Plan - Do - Check cycle which is encouraged by ISO9001?



Answer : C

Act is the final stage. See p.25 for a diagram of the cycle.


Question 5

Rabbit Manufacturing operates several factories which create stuffed animals. As these stuffed animals are mainly bought for children, it is extremely important that the quality of the product is assured, and there are no dangerous or small parts which could become choking hazards. Which of the following are appraisal costs that the company should undertake in order to mitigate the risk of poor quality products entering the market?



Answer : A

Of these four answers only one is an appraisal cost and that is answer 1. The other three options are prevention costs. There is a table of appraisal costs and prevention costs on p. 26 Appraisal costs are reactive- they're done after the product is manufactured. Preventative costs are actions taken in quality assurance.


Question 6

Envy Manufacturing has several factories located in countries with poor reputations for human rights. It is concerned about potential risks of child labour being used within the supply chain. Envy Manufacturing has therefore decided to enlist the support of a third party auditing company to audit its factories. How should these audits be conducted? Select TWO



Answer : B, D

2 and 4 are correct. Audits should be unscheduled so that any issues can't be covered up in advance. Interviews with workers should also be conducted in private as this will allow them to speak their mind with confidence. Where interviews are conducted as a group there may be peer-pressure to say the correct thing. especially if there are managers around. see p.88 for information on Audits


Question 7

Which of the following is not an internal risk for a business who imports raw materials from abroad?



Answer : D

changes to import levies is an external risk. Not internal. See p.118-119 for more information on internal risks - this is a popular exam topic. Internal risks are stuff that happens inside a company, external risks are risks from the external environment (whether this is political, economical, weather etc)


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Total 120 questions