ISM LEAD Exam Practice Test Instant Access

Question 1

DEF, Inc. is a large global manufacturer. Two of DEF's supply managers, who are located in offices in different countries, are assigned to lead a new product development team. The team is to be comprised of two stakeholders from each of the supply managers' locations. The supply managers, as well as their respective departments, have had some friction between them in the past, and there is concern they will not be able to work together effectively on this project. Of the following, the BEST approach for assigning stakeholders to the team would be for the supply managers to

Aselect stakeholders from each other's locations

Bselect stakeholders from their own locations

Cask senior management to intervene in making the stakeholder assignments

Dcreate a list of stakeholders from each location and make the selections together

Answer : D

Conflict Resolution: Given the history of friction between the supply managers and their departments, a collaborative approach is necessary to prevent further conflict and ensure effective teamwork.

Joint Decision Making: By creating a list of stakeholders from each location and making the selections together, the supply managers can ensure that the team is balanced and that all perspectives are considered. This collaborative approach fosters a sense of shared ownership and mutual respect.

Stakeholder Involvement: Involving both managers in the selection process ensures that the chosen stakeholders are acceptable to both parties, reducing the likelihood of bias and increasing the commitment of all team members.

Building Trust: Working together to select stakeholders can help build trust and improve the working relationship between the supply managers, setting a positive tone for the project.

Reference: This approach aligns with best practices in team building and conflict resolution as discussed in leadership and management literature, including works like 'The Five Dysfunctions of a Team' by Patrick Lencioni and guidelines from the Project Management Institute (PMI).

Question 2

The possibility that purchased software will not function as planned or that new software will emerge making existing software obsolete can be described as which of the following types of risks?

AEnvironmental

BOperational

CData security

DTechnical

Answer : D

Risk Categorization: Technical risks are associated with the technology itself, including the possibility of malfunction or obsolescence.

Software Risks: The risk that software will not function as planned or become obsolete falls squarely within the realm of technical risks. This includes compatibility issues, performance problems, and the emergence of superior alternatives.

Mitigation Strategies: Addressing technical risks involves thorough testing, staying updated with technology trends, and having contingency plans in place.

Reference: The categorization of risks into technical, operational, environmental, and data security is widely recognized in risk management frameworks such as ISO 31000 and the Project Management Body of Knowledge (PMBOK).

Question 3

TUV, Ltd. is a firm based in the United Kingdom. TUV engages a contractor in Malaysia to construct new production and testing facilities located within Malaysia's capital city. Midway through the project, TUV's supply manager realizes that there is no formal retention policy in place for safety records. Given this situation, which of the following is the MOST appropriate course of action for the supply manager to take?

AAdopt the record retention program TUV currently uses for domestic operations

BDirect the contractor to develop a records retention program for the entire project

CUse the contractor's program for a similar international project

DConvene a meeting between TUV and the contractor to develop a joint program

Answer : D

Stakeholder Engagement: Developing a joint records retention program ensures that both parties have a say in the process, leading to better alignment and adherence to the agreed standards.

Custom Solution: A joint program can be tailored to the specific needs of the project, considering the regulatory requirements of Malaysia and the operational practices of TUV.

Risk Management: Ensuring proper retention of safety records is crucial for compliance and risk management. A collaborative approach ensures comprehensive coverage of all necessary aspects.

Building Partnerships: Engaging the contractor in developing the program fosters a collaborative working relationship, which can be beneficial for the project and future engagements.

Reference: This approach is supported by project management and supply chain best practices, such as those outlined by the Project Management Institute (PMI) and the International Association for Contract and Commercial Management (IACCM).

Question 4

A supply management department's resources have been stretched thin, and there are few opportunities for staff growth. To improve this situation, the supply manager plans to implement an e-sourcing system, which will streamline routine procurements and allow more time for supply professionals to concentrate on value-added tasks. The supply manager wants to introduce the system in a way that will help motivate the department staff. Which of the following will MOST likely bring about this result?

AA reduction in procurement process costs

BA shift from a transactional to a strategic approach

CA greater flexibility in department staffing

DA lower total cost of ownership

Answer : B

Resource Optimization: Implementing an e-sourcing system will automate routine tasks, freeing up resources for more strategic activities. This shift allows supply professionals to focus on value-added tasks that can enhance the company's competitive advantage.

Motivation Through Empowerment: Staff are more likely to be motivated when they see their roles evolving from mundane transactional activities to more impactful strategic tasks. This transition can lead to increased job satisfaction and professional growth.

Strategic Impact: A strategic approach to supply management involves activities such as supplier relationship management, strategic sourcing, and risk management. These activities have a more significant impact on the company's overall performance.

Long-Term Benefits: While cost reduction and efficiency are important, the long-term benefits of a strategic approach include improved supplier partnerships, innovation, and agility in responding to market changes.

Reference: This approach aligns with best practices in supply chain management and strategic sourcing, as discussed in sources like the Supply Chain Management Review and the Chartered Institute of Procurement & Supply (CIPS) guidelines.

Question 5

A company sales director reports that profits have been declining for mature but successful product offerings. The CEO asks for recommendations to address this issue. The firm's supply manager and sales director have had a strained working relationship in the past, but the supply manager believes supply management could make valuable contributions toward improving profitability. Given this situation, which of the following should be the supply manager's FIRST course of action?

AMeet with board members to discuss a results-driven strategy to the problem

BDevelop a new policy to correct the problem

COffer to work with the sales director to identify possible joint solutions

DTalk with the CEO about supply management's role

Answer : C

Understanding the Problem: The declining profits in mature product offerings indicate a potential issue that can be influenced by both sales and supply chain management. Effective collaboration is essential to identify and address the root causes.

Relationship Dynamics: The strained relationship between the supply manager and the sales director needs to be addressed constructively. Offering to work together can help mend this relationship while focusing on the common goal of improving profitability.

Collaboration Benefits: By working together, the sales director and supply manager can leverage each other's expertise. The supply manager can provide insights into cost reduction, supplier negotiation, and inventory management, while the sales director can focus on market strategies and customer needs.

Strategy Alignment: Joint solutions ensure that the strategies developed are aligned and integrated, leading to more coherent and effective implementation.

Reference: Effective leadership and transformation management practices emphasize collaboration and relationship building. This approach aligns with best practices as outlined in various leadership and management frameworks, such as Kotter's Change Management Model and the principles of Transformational Leadership.

Question 6

Members of a cross-functional team have each had a chance to present their ideas. Afterwards, the members discuss these ideas in detail, on occasion arguing and testing one another. After this process is complete, the team can move on to which phase of team formation?

AForming

BNorming

CStorming

DPerforming

Answer : B

Team development stages: According to Bruce Tuckman's stages of group development, the stages are forming, storming, norming, and performing.

Current stage identification: The team has moved past the forming and storming stages, characterized by presenting and debating ideas.

Next stage - Norming: In the norming stage, team members begin to resolve differences, establish norms, and develop stronger cohesion.

Reference: Tuckman's theory, detailed in his work ''Developmental Sequence in Small Groups,'' outlines these stages and the progression from storming to norming.

Question 7

A supply manager for JKL Corporation has been working on a large purchase with Supplier A for a new type of widget. During the negotiations, the supply manager asks Supplier A to warrant its products for a year rather than the typical 30 days. However, Supplier A does not accept the extended warranty terms. The supply manager shares this information with JKL's business team. The team wants to proceed with the purchase in any case, but the supply manager would still like for the team to reconsider its position. Which of the following would be the MOST appropriate way for the supply manager to influence the team?

AAlert someone higher on the approval channel about the risks in Supplier A's proposal

BEnter the requisition and wait to route it until Supplier A agrees to comply with the request

CEnsure that no one approves the purchase order until Supplier A complies with the request

DCommunicate the risks involved at each level of approval in the process so that it is clear to all

Answer : D

Risk communication: Clearly outlining the risks associated with the supplier's warranty terms ensures informed decision-making.

Influence strategy: Providing detailed risk information at each approval level helps in building a consensus and potentially reconsidering the decision.

Leadership principles: Transparent communication and advocacy for what is best for the organization are key tenets of effective supply management.

Reference: ''Influence: The Psychology of Persuasion'' by Robert Cialdini emphasizes the importance of clear communication in influencing decisions.

ISM Leadership and Transformation in Supply Management Exam Practice Test