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What are the four key tasks associated with the 'Need' step in the procurement operational cycle?
What does the 'Operational cycle' in procurement involve?
What are the three stages of the operational procurement as shown in figure 1.7?
What is the purpose of documentation in the procurement and supply process?
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What is the purpose of a purchase requisition in the procurement process?
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What is the advantage of computerized procurement systems?
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What is the purpose of a purchase order in the procurement process?
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What is the crucial purpose of the purchase order process?
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What information should a purchase order include?
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What is the first step in the procurement process?
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What is the purpose of a purchase order in relation to credit purchases?
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What is the purpose of a purchase requisition?
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What is the purpose of physically receiving the goods or service in the procurement process?
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What is the role of purchase orders in aiding budgetary control?
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What is the purpose of various types of documentation in the procurement and supply process?
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What is the advantage of purchase orders in providing an audit trail?
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What is the purpose of a delivery note in the procurement process?
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What is the purpose of a three-way match in the procurement process?
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What is the purpose of a bill of materials (BOM) in procurement?
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What is the purpose of a specification in procurement?
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What is the purpose of a delivery note number in the procurement process?
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What does a goods received note indicate in the procurement process?
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What is the purpose of a pre-qualification questionnaire (PQQ) in the procurement process?
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What is the purpose of an invitation to ask questions in a request for proposal (RFP)?
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What distinguishes a request for proposal (RFP) from a request for quotation (RFQ)?
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What is the purpose of a project budget in running a request for proposal (RFP)?
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What is the main focus of an entrepreneurial attitude in procurement?
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In a multi-national organization, what is the risk of having procurement in each country's operations?
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What is a benefit of centralizing procurement in a multi-national organization?
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What factor helps in deciding whether to centralize procurement?
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What is the purpose of competition laws in regulating business practices?
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What is the impact of competition on product development and service standards?
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What is the purpose of competition laws in the United States and European Union?
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What is the intention behind deregulation in an industry?
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What is the purpose of competition laws in China and Russia?
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What does competition law generally prohibit?
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What is the effect of competition on companies and their workforce?
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What is the purpose of deregulation in industries?
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What is the aim of the Agreement on Government Procurement (GPA)?
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What is the estimated percentage of public sector procurement in the European Union's GDP?
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What is the purpose of the European Union Directives related to public procurement?
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What is the estimated annual procurement spend of all UN agencies combined in 2010?
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What is the main purpose of delegation in management?
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What is the main concept of authority in delegation?
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What is the purpose of the World Trade Organization's Agreement on Government Procurement?
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What is the estimated annual value of government procurement opened to international competition through the GPA?
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What is the main purpose of the European Union Directives related to public procurement?
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What is the aim of the Agreement on Government Procurement (GPA)?
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What is the estimated percentage of public sector procurement in the European Union's GDP?
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What is the purpose of the European Union Directives related to public procurement?
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What is the purpose of a Procurement Pre-Qualification Questionnaire (PQQ)?
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What is the key component of an Invitation to Tender (ITT)?
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What guides behavior in procurement and supply?
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What forms the basis for an organization's policies?
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What is a policy in the context of an organization's operation?
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What are the key principles in Unilever's Responsible Sourcing Policy?
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What helps suppliers assess risks and price the job accurately in the procurement process?
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What are the information requirements in a Procurement Pre-Qualification Questionnaire (PQQ)?
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What does an Invitation to Tender (ITT) provide to suppliers?
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What is the primary purpose of documented policies and procedures in procurement and supply?
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What is the significance of a draft contract template in procurement?
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What is the role of principles, values, and mission statements in an organization's policies?
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What percentage of GDP does public sector procurement represent worldwide?
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How many signatories are involved in the Agreement on Government Procurement (GPA) within the World Trade Organization?
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What is the estimated percentage of the European Union's GDP that its public procurement represents?
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What is the main aim of the ASEAN Economic Community regarding competition laws and policies?
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When did Hong Kong's Competition Ordinance come into force?
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What is the main purpose of the Agreement on Government Procurement (GPA) within the World Trade Organization?
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What is the estimated percentage of public sector procurement in the European Union's GDP?
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What is the main focus of EU Directives related to public procurement?
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What is the main aim of China's competition law?
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What is the main aim of Vietnam's competition law?
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What is the main purpose of the EU Directives related to public procurement?
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What does the Agreement on Government Procurement (GPA) within the World Trade Organization require for public procurement?
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What is the primary purpose of category management in procurement?
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In larger organizations, what is deemed necessary for procurement?
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What is the role of strategic direction in procurement?
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What triggers sourcing activity in organizations?
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What is the primary responsibility of procurement in organizations?
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What is the key focus of information management in procurement?
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What is the purpose of contract management in procurement?
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What is the primary goal of supplier relationship management in procurement?
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What is the nature of procurement processes in organizations?
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In organizations where procurement is strategic, who is likely to lead the function?
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What are typical procurement and supply policies in strategic organizations?
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What is the primary focus of responsible sourcing in organizations?
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In a multi-national organization, where is procurement often located when it is not seen as a strategic function?
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What influences the decision to centralize procurement in multi-nationals?
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What is the primary purpose of competition laws in the United States, European Union, China, and Russia?
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What is the aim of deregulation in industries?
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What often accompanies deregulation in sectors previously controlled by the government?
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What do competition laws prohibit?
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What is the primary focus of competition laws in the United States and European Union?
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What is the main intention behind deregulation in previously state-controlled industries?
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What is the purpose of competition laws in China and Russia?
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What is the effect of competition on companies and their workforce?
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What is the aim of the Agreement on Government Procurement (GPA)?
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What is the purpose of privatization in sectors previously controlled by the government?
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What is the purpose of a Procurement Pre-Qualification Questionnaire (PQQ)?
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What is the key component of an Invitation to Tender (ITT)?
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What guides behavior in procurement and supply?
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What forms the basis for an organization's policies?
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What is a policy in the context of an organization's operation?
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What are the key principles in Unilever's Responsible Sourcing Policy?
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What helps suppliers assess risks and price the job accurately in the procurement process?
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What are the information requirements in a Procurement Pre-Qualification Questionnaire (PQQ)?
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What does an Invitation to Tender (ITT) provide to suppliers?
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What is the primary purpose of documented policies and procedures in procurement and supply?
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What is the significance of a draft contract template in procurement?
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What is the role of principles, values, and mission statements in an organization's policies?
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Which of the following is NOT one of the top five processes in the procurement process according to figure 4.8?
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In larger organizations, what justifies the need for a professional procurement department?
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What is the purpose of category management in procurement?
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What is the role of the procurement director in relation to supply chain risk of failure?
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In a strategic function organization, who is likely to head up the procurement and supply department?
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What is the purpose of the information management process in procurement?
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What triggers sourcing activity in procurement?
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What is the purpose of contract management in procurement?
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What is the primary responsibility of senior managers in very small organizations regarding procurement?
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What is the purpose of the procurement plan in a strategic function organization?
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What is the primary purpose of the strategic direction process in procurement?
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What is the primary responsibility of the managing director in a strategic function organization?
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Study Notes
Procurement and Supply Process Overview
- The procurement process involves several key stages: requisition, authorization and order, and delivery.
- Researching available suppliers is the first step, followed by selecting a provisional supplier, checking terms, and placing an order.
- Upon delivery, the process involves physically receiving the goods or service, checking the invoice for accuracy, and updating relevant records.
- Various types of documentation, such as requisitions and purchase orders, support the procurement and supply process.
- A purchase requisition is an internal document used to inform the procurement department about the need for an item, and it requires authorization.
- Computerized procurement systems have several advantages, including reducing the time procurement staff spend interacting with buyers, providing an audit trail, and aiding in budgetary control.
- Purchase orders are used to make purchases on credit, set clear expectations, create a legally binding document, organize the workforce, and aid in budgeting and providing an audit trail.
- The purchase order process involves approval by a buyer based on the requisition, and if not approved, it is returned to the requisitioner with reasons for rejection.
- A purchase order should include a unique reference number and relevant information such as expected delivery date, item description, quantities ordered, and item prices.
- Once the purchase order is approved, a copy is sent to the requisitioner, often the warehouse for physical goods, to enable planning of activities and capacity management.
- The purchase order process is crucial for creating a legally binding document and organizing the workforce.
- The procurement process involves various documentation types, such as requisitions and purchase orders, to support the operational cycle in procurement and supply.
Procurement and Supply Management in Organizations
- In organizations where procurement is not seen as a strategic function, it often reports to an operations director or finance director.
- The largest and most complex organizations, such as multi-nationals, face the challenge of deciding where to locate procurement and supply.
- Multi-nationals approach the dilemma of centralization and decentralization differently, with various benefits associated with each approach.
- Factors influencing the decision to centralize procurement include standardization of purchased items, size of operations, and geographic proximity of the operations.
- Competition is important for stimulating innovation and improving quality, service standards, and reducing costs in an economy.
- Competition laws, known as antitrust or competition law, are in place in the United States, European Union, China, and Russia to regulate competition and prevent anti-competitive practices.
- Competition law prohibits practices or agreements that prevent free trade and competition, bans predatory pricing, and monitors mergers and acquisitions to avoid monopolies.
- Deregulation occurs when a government reduces or eliminates restrictions on an industry to make competition in overseas markets easier for its own country's businesses.
- Deregulation and competition law in the UK allowed competition to enter previously state-controlled industries, such as the Post Office, British Rail, and local bus services.
- The intention of deregulation was to improve services, reduce costs, and privatize government assets in these sectors.
- Deregulation is often accompanied by the government selling its assets in these sectors, a process known as privatization.
- Deregulation and competition law are related to law on deregulation and state aid, aiming to improve competition and reduce restrictions on industries.
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Description
Test your knowledge of the procurement and supply process with this overview quiz. Explore key stages, documentation types, and the role of purchase orders in creating a legally binding document. Master the requisition, authorization, and delivery stages, as well as the benefits of computerized procurement systems.