The Purchasing and Supply Manager's Guide To The C.p.m. Exam

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Edition: 1st
Format: Paperback
Pub. Date: 2005-05-09
Publisher(s): Wiley
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Summary

Real World Scenarios for Practical Insights into the Field of Purchasing and Supply ManagementWhether you're a purchasing or supply management professional seeking to validate the skills and knowledge acquired through years of practical experience, or a relative newcomer to the field looking to strengthen your resume, the C.P.M. certification from the Institute for Supply Management (ISM) provides you with the means to do so. The Purchasing and Supply Manager's Guide to the C.P.M. Exam was developed to help you prepare for the four modules that comprise the C.P.M. exam, and includes additional study tools designed to reinforce understanding of crucial subject areas.KEY TOPICS INCLUDE: Purchasing Process. Identifying requirements, preparation of solicitations, supplier analysis, contract execution, implementation, and administration. Supply Environment. Negotiations, information technology, quality issues, internal relationships, and external relationships. Value Enhancement Strategies. Sourcing analysis, supply and inventory management, value enhancing methods, forecasting and strategies. Management. Management and organization, and human resource management. This Study Guide is not sponsored by, endorsed by, or affiliated in any way with the Institute for Supply Management (ISM). ISM and C.P.M. are trademarks or registered marks of the Institute for Supply Management. This publication may be used in assisting students to prepare for the C.P.M. exam, but neither Harbor Light Press nor ISM warrants that use of this publication will ensure passing of the exam.Note: CD-ROM/DVD and other supplementary materials are not included as part of eBook file.

Author Biography

John Seminak, MBA/CPM, is founder, managing director and instructor for San Jose State University, Professional Development curriculum in Supply Chain Management & Purchasing. Fred Sollish, MS/CPM, is a former President and CEO of the Institute for Supply Managements Silicon Valley affiliate. Fred is an Instructor and program coordinator for the University of California, Santa Cruz and California State University, San Jose.

Table of Contents

Introduction xix
Assessment Test xxv
Part I Operational Purchasing Practices
1(132)
Procurement and Best Business Practices
3(26)
Understanding Procurement
4(4)
Understanding and Conveying Requirements
5(1)
Creating Strategic Plans and Tactics
6(2)
Finding Innovative Methods and Exploring Alternatives
8(1)
Providing Purchasing Services
8(7)
Accepting Orders
9(3)
Placing Orders
12(3)
Mastering Procurement and Business Tactics
15(8)
Budgets and Expense Allocation
16(1)
Establishing Procurement Methods
17(1)
Internal Cost-Related Analysis Tools
18(4)
Keeping Supplier Information
22(1)
Summary
23(1)
Exam Essentials
23(2)
Review Questions
25(2)
Answers to Review Questions
27(2)
Sourcing
29(32)
Establishing Requirements
30(8)
Creating and Organizing Requirements
30(2)
Developing Specifications and Formats
32(5)
Specification Traps
37(1)
Locating and Developing Sources of Supply
38(7)
Source Types
38(2)
Types of Competition
40(2)
Locating Suitable Suppliers
42(1)
Determining Changing Marketplace Factors
43(2)
Obtaining Bids and Proposals
45(4)
Bidding Guidelines
45(1)
Formulating the Bid or Proposal Type
46(3)
Managing Sourcing Data
49(2)
Types of Sourcing
49(1)
Maintaining Sourcing Lists
50(1)
Regulatory Factors Governing Purchasing
51(4)
Uniform Commercial Code
51(1)
Antitrust Legislation
51(2)
Other Governmental Legislation
53(1)
Foreign Trade Regulations
54(1)
Summary
55(1)
Exam Essentials
56(2)
Review Questions
58(2)
Answers to Review Questions
60(1)
Selecting Suppliers and Measuring Performance
61(24)
Selecting the Supplier and Awarding the Contract
62(12)
Evaluating Offers
62(5)
Applying Selection Criteria
67(7)
Reviewing, Approving, and Issuing the Contract
74(1)
Administering the Contract
74(5)
Implementing Performance Standards and Rating Systems
74(2)
Following Up and Expediting
76(1)
Developing Good Practices
76(2)
Managing Records and Data
78(1)
Summary
79(1)
Exam Essentials
79(2)
Review Questions
81(2)
Answers to Review Questions
83(2)
Administering Contracts
85(24)
Contract Essentials
86(13)
Contract Essentials
87(1)
Contract Requirements
88(1)
Contract Types
89(6)
Methods of Exchange
95(2)
Other Contract Elements
97(1)
Legal Authority and the Buyers' Responsibilities
97(2)
Reviewing Contracts for Legal Requirements
99(2)
Aligning Contracts and Practices with Policy
101(2)
Conformance to Law
101(1)
Ethical Principles
102(1)
Maintaining Purchasing Documents and Records
103(1)
Summary
104(1)
Exam Essentials
105(1)
Review Questions
106(2)
Answers to Review Questions
108(1)
Administering Contracts for Supplier Compliance
109(24)
Managing Contract Compliance
110(7)
Post Purchase Order Administration
110(5)
Supplier Relationship Management (SRM)
115(2)
Tracking and Expediting Deliveries
117(2)
Tracking and Monitoring Shipments
117(1)
Expediting Orders
118(1)
Handling Supplier-Related Deviations
119(9)
Dealing with Inadequate Performance
119(5)
Resolving Errors and Omissions
124(1)
Resolving Supplier Conflicts
125(3)
Summary
128(1)
Exam Essentials
128(2)
Review Questions
130(2)
Answers to Review Questions
132(1)
Part II Managing Systems and Relationships
133(112)
Managing Negotiations
135(24)
Assessing the Negotiating Environment
136(7)
The Competitive Environment
137(2)
Early Involvement
139(1)
Gathering Information and Analysis
140(3)
Preparing for the Negotiation
143(6)
Selecting and Leading the Negotiating Team
143(1)
Formulating Objectives and Developing Strategies
144(5)
Conducting the Negotiation
149(4)
Creating the Climate
149(2)
Adopting a Negotiating Style
151(1)
Documenting the Negotiation
152(1)
Summary
153(1)
Exam Essentials
154(1)
Review Questions
155(2)
Answers to Review Questions
157(2)
Using Computer-Based Systems
159(20)
Using Basic Information Technology Processes
161(4)
Computer Basics
161(2)
Platforms
163(1)
Software Applications
164(1)
Using Software for Procurement
165(7)
General Business Applications
165(2)
Supply Management Applications
167(5)
Impact of Automation on Procurement Organizations
172(1)
Sourcing Supply Management Tools
172(2)
Software
173(1)
Summary
174(1)
Exam Essentials
175(1)
Review Questions
176(2)
Answers to Review Questions
178(1)
Managing Quality
179(18)
Managing Quality Performance
180(5)
Quality Assurance
180(2)
Measuring Quality Performance
182(3)
Ensuring Quality Performance
185(6)
Enforcing Quality Requirements
185(3)
Total Quality Management
188(1)
Employing Quality Systems
189(2)
Summary
191(1)
Exam Essentials
191(2)
Review Questions
193(2)
Answers to Review Questions
195(2)
Maintaining Internal Relations
197(26)
Understanding Key Departmental Roles
198(6)
Administrative and Support Functions
198(3)
Production Functions
201(1)
Sales and Marketing
202(1)
Advertising/Sales Collateral
203(1)
Distribution
203(1)
Engineering and Design Functions
203(1)
Research and Development (R&D)
203(1)
New Product/Service Introduction
204(1)
Developing Good Working Relationships
204(6)
Communicating within the Organization
204(2)
Gaining Early Involvement
206(1)
Participating in Cross-functional Operations
207(3)
Reengineering Supply Management
210(7)
Understanding the Scope of Operations
211(3)
Managing the Change Process
214(1)
Purchasing Policy and Procedures Training
215(2)
Summary
217(1)
Exam Essentials
217(2)
Review Questions
219(2)
Answers to Review Questions
221(2)
Supplier Relationship Management
223(22)
Managing Productive Supplier Relationships
224(5)
Creating Good Working Relations
224(2)
Resolving Relations Issues
226(2)
Certifying New Suppliers
228(1)
Developing Continuous Improvement
229(3)
Gaining Early Supplier Involvement
229(1)
Implementing Small/Disadvantaged Business Programs
230(2)
Pricing
232(4)
Understanding Market Conditions
232(1)
Cost-based Pricing Models
233(1)
Price Analysis Methods
234(2)
Representing the Organization
236(4)
Meeting Sales Personnel
236(4)
Summary
240(1)
Exam Essentials
241(1)
Review Questions
242(2)
Answers to Review Questions
244(1)
Part III Providing Added Value
245(92)
Making Sound Sourcing Decisions
247(20)
Performing Make or Buy Analysis
248(5)
Make or Buy Dynamics
248(2)
Subjective Make or Buy Analysis Factors
250(2)
Outsourcing Business Processes
252(1)
Performing Lease or Buy Analysis
253(3)
Leasing Features
253(1)
Decision-Making Factors
254(2)
Formulating Financial Strategies
256(5)
Organizational Considerations
257(1)
Monetary Considerations
258(3)
Legal Aspects
261(1)
Summary
261(1)
Exam Essentials
262(1)
Review Questions
263(2)
Answers to Review Questions
265(2)
Managing Material and Supply Operations
267(22)
Inventory Control and Management Systems
268(10)
Types of Inventory
268(2)
The Role of Inventory
270(1)
Systems for Managing Inventory
270(7)
Inventory Economics
277(1)
Physical Management and Inventory Accounting
278(2)
Controlling Inventory
278(1)
Reconciling Discrepancies
279(1)
Disposition Surplus Assets
280(3)
Disposal Strategies
280(2)
Disposal Methods
282(1)
Summary
283(1)
Exam Essentials
284(1)
Review Questions
285(2)
Answers to Review Questions
287(2)
Adding Value to the Organization
289(18)
Standardizing Purchased Materials
290(4)
Standardization Considerations
290(2)
Standards Organizations
292(2)
Improving Purchasing-related Processes
294(2)
Measuring Performance Improvement
296(1)
Controlling and Reducing Cost
296(4)
Cost Reduction Considerations
296(1)
Cost Control and Reduction Opportunities
297(3)
Supporting New Product Introduction
300(1)
Summary
300(2)
Exam Essentials
302(1)
Review Questions
303(2)
Answers to Review Questions
305(2)
Strategic Procurement Planning
307(30)
Developing Demand- and Forecast-Based Purchasing Strategies
308(7)
Defining Purchasing Strategies
309(2)
Implementing Procurement Strategies
311(4)
Planning Procurement Requirements
315(4)
Forecasting and Demand Planning
315(2)
Coordinating Forecasted Requirements with Suppliers
317(2)
Developing Market Analysis
319(13)
Developing Market Awareness and Early Involvement
319(2)
Collecting and Distributing Data
321(1)
Forecasting Market Trends
322(10)
Summary
332(1)
Exam Essentials
332(2)
Review Questions
334(2)
Answers to Review Questions
336(1)
Part IV Leading the Procurement Organization
337(62)
Managing the Procurement Organization
339(32)
Planning Procurement Strategies and Objectives
340(5)
Supporting the Organization
341(1)
Supply Management Strategies
342(3)
Developing Departmental Goals and Objectives
345(2)
Defining the Department's Mission
345(1)
Formulating Goals and Objectives
345(1)
Keys to Successful Planning
346(1)
Formulating Operational Policies and Procedures
347(3)
Management Control
347(1)
Workload Distribution
348(1)
Workload Tracking
348(1)
Organizational Structure
348(2)
Preparing Departmental Reports
350(6)
Identifying Relevant Activities
350(2)
Selecting and Managing Data
352(1)
Methods of Presentation
352(4)
Responding to Audits
356(2)
Validating Current Processes
356(1)
Responding to Corrective Actions
357(1)
Conflict Resolution
358(1)
Evaluating Purchasing Department Performance
358(3)
Purpose of the Performance Evaluation
358(1)
Performing the Evaluation
359(1)
Evaluation and Appraisal Criteria
359(1)
Benchmarking Performance
360(1)
Administering Departmental Budgets
361(2)
Budget Functions
361(1)
Budgeting Processes
361(2)
Working with Operational Forms
363(2)
Functional Purpose of Forms
363(1)
Commonly Used Forms
363(1)
Designing and Managing Forms
364(1)
Summary
365(1)
Exam Essentials
366(1)
Review Questions
367(2)
Answers to Review Questions
369(2)
Managing Human Resources
371(28)
Leading the Supply Management Team
372(6)
Understanding Management Theory
373(2)
Principles of Organizational Management
375(3)
Recruiting, Hiring, Promoting, and Terminating Employees
378(3)
Recruiting and Hiring Staff
378(3)
Promoting Employees
381(1)
Training for Professional Competence
381(3)
Determining Training Requirements
381(1)
Employing Training Methods
382(1)
Conducting the Training
383(1)
Encouraging Professional Development
383(1)
Appraising Job Performance
384(2)
Developing Appraisal Factors
384(2)
Handling Employee Performance Issues
386(4)
Identifying Problems and Performance Issues
387(1)
Implementing Corrective Action
387(3)
Preventing Workplace Discrimination and Harassment
390(3)
Administering Equal Opportunity Processes
390(3)
Eliminating Sexual Harassment
393(1)
Summary
393(1)
Exam Essentials
394(2)
Review Questions
396(2)
Answers to Review Questions
398(1)
Appendix A Bibliography 399(6)
Glossary 405(52)
Index 457

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