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CPSM-Exam-3 : CPSM Exam 3: Leadership in Supply Management - 2025

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ISM


CPSM Exam 3


Certified Professional in Supply Management (CPSM)

CPSM Exam 3: Leadership in Supply Management


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Question: 936


During a cross-cultural negotiation, a team notices that their counterpart is using indirect communication. What should they do to improve understanding?


  1. Ask clarifying questions to ensure comprehension

  2. Challenge the counterpart directly about their communication style

  3. Ignore the indirect cues and focus on the main issues


    er: A


    nation: Asking clarifying questions helps bridge communication gaps and ensures both partie tand each other effectively.


    ion: 937

    of the following strategies is most effective in communicating change to a workforce that h cally resisted new initiatives?


    of jargon-heavy presentations mited disclosure of information quent updates and transparency

    ying solely on written communication er: C

    nation: Frequent updates and transparency can build trust and reduce anxiety, making it easie yees to accept and adapt to change.


    ion: 938


    pplication of RPA to supply chain processes, which of the following is a key factor to cons etermining the return on investment (ROI) for automation initiatives?

    Conclude the negotiation if communication is unclear Answ

Expla s

unders


Quest

Which as

histori


  1. Use

  2. Li

  3. Fre

  4. Rel Answ

Expla r for

emplo


Quest


In the a ider

when d


  1. The number of employees trained

  2. The size of the technology vendor

  3. The overall increase in product pricing

  4. The reduction in processing time and associated labor costs Answer: D

Explanation: The reduction in processing time and labor cost savings are critical components in calculating the ROI of RPA initiatives.

In a risk matrix used for assessing supplier risks, which of the following factors is least likely to be considered when determining the likelihood and impact of a disruption?


  1. Geographic location of the supplier

  2. Supplier's financial stability

  3. Supplier's market share


    nation: While market share may reflect competitiveness, it does not directly contribute to ass elihood or impact of a disruption compared to geographic location, financial stability, or hist mance.


    ion: 940


    of the following scenarios best illustrates the concept of financial risk management within a chain context?


    ompany investing in employee training to improve productivity.

    ompany using hedging strategies to protect against raw material price fluctuations. ompany expanding its distribution network to enhance market reach.

    ompany increasing its marketing budget to boost sales. er: B

    nation: Using hedging strategies is a direct example of financial risk management, as it aims te potential losses from price volatility.


    ion: 941


    ply chain manager is mentoring a junior team member. What is the most effective approach ce the mentee's critical thinking and problem-solving skills?

    Historical performance data of the supplier Answer: C

Expla essing

the lik orical

perfor


Quest


Which supply


  1. A c

  2. A c

  3. A c

  4. A c


Answ


Expla to

mitiga


Quest


A sup to

enhan


  1. Providing direct solutions

  2. Setting strict deadlines

  3. Giving detailed instructions

  4. Asking probing questions Answer: D

Explanation: Asking probing questions encourages the mentee to think critically and explore various solutions, fostering independence and deeper understanding in problem-solving.

In a scenario where an organization aims to improve its talent pipeline for supply management roles, which program would be most beneficial for early career professionals?


  1. A rotational program that exposes them to various supply chain functions

  2. An internship program focused on administrative tasks

  3. A mentorship program with senior executives only


    nation: A rotational program provides early career professionals with diverse experiences acr functions, building a well-rounded skill set and understanding of the supply chain.


    ion: 943


    is using value stream mapping to identify waste in its production process. They find that ive waiting times are a major contributor to inefficiencies. What would be the best approach these waiting times?


    plement cross-training for employees to increase flexibility rease inventory levels before each production stage

    end the production schedule to account for delays mit communication between departments


    er: A


    nation: Implementing cross-training for employees increases flexibility in the workforce, allo cker responses to delays and reducing waiting times in the production process.


    ion: 944


    eholder engagement, it is critical to prioritize stakeholders based on their influence and inter eholder mapping exercise results in four groups categorized as "High Influence/High Interest, nfluence/Low Interest," "Low Influence/High Interest," and "Low Influence/Low Interest,"

    A series of online courses without practical application Answer: A

Expla oss

various


Quest


A team

excess to

reduce


  1. Im

  2. Inc

  3. Ext

  4. Li


Answ


Expla wing

for qui


Quest


In stak est. If

a stak "

"High I which

group should the supply manager engage most actively?


  1. High Influence/High Interest

  2. Low Influence/High Interest

  3. High Influence/Low Interest

  4. Low Influence/Low Interest Answer: A

Explanation: Stakeholders with High Influence and High Interest should be actively engaged to ensure


A team is struggling with the transition to a new performance measurement system. What is the best initial step for leadership to take in addressing this challenge?


  1. Mandate compliance with the new system

  2. Limit discussions about the new system

  3. Provide comprehensive training and support


    er: C


    nation: Providing comprehensive training and support helps employees understand and utilize ystem effectively, addressing challenges and promoting successful adoption.


    ion: 946

    pany has a working capital of $1,000,000. If its current liabilities are $600,000, what is the current nd does this indicate a healthy liquidity position?


    7, yes

    5, no

    7, yes

    0, no er: C

    nation: Current Ratio = Current Assets / Current Liabilities. Current Assets = Working Capit Liabilities = $1,000,000 + $600,000 = $1,600,000. Current Ratio = $1,600,000 / $600,000

    ndicating a healthy liquidity position.


    ion: 947


    pany is exploring disruptive innovation within its supply chain. Which of the following sce xemplifies disruptive innovation in supply management?

    Focus solely on the financial implications Answ

Expla the

new s


Quest A com ratio, a


  1. 0.6

  2. 1.2

  3. 2.6

  4. 1.0


Answ


Expla al +

Current =

2.67, i


Quest


A com narios

best e


  1. Implementing just-in-time inventory systems

  2. Introducing a subscription-based model for products

  3. Upgrading existing software to improve efficiency

  4. Enhancing supplier relationships through negotiation Answer: B

Explanation: Introducing a subscription-based model for products represents a disruptive innovation that can fundamentally change how customers access and pay for products, potentially reshaping the market


In the context of innovation ecosystems, which of the following factors is most critical for fostering a culture of innovation among supply chain partners?


  1. Open communication and shared goals among all partners

  2. Strong leadership commitment from a single partner

  3. Exclusive focus on cost reduction strategies


    er: A


    nation: Open communication and shared goals among all partners are essential for creating a orative culture that fosters innovation.


    ion: 949


    siness plans to allocate $60,000 for marketing in the coming year and expects a revenue incr on current sales of $300,000, what is the expected revenue after marketing expenses?


    40,000

    0,000

    0,000

    40,000


    er: C


    nation: Expected increase = 20% of $300,000 = $60,000. Thus, expected revenue = $300,00 00 = $360,000.


    ion: 950


    a negotiation with a supplier from a low-context culture, which communication strategy is ost effective?

    Limited engagement with external stakeholders Answ

Expla collab


Quest


If a bu ease

of 20%


A. $2 B. $30 C. $36

D. $5


Answ


Expla 0 +

$60,0


Quest


During likely

to be m


  1. Using implicit messages to convey meaning

  2. Focusing on building relationships before discussing terms

  3. Providing clear, direct, and explicit communication

  4. Avoiding formal agreements in favor of verbal commitments Answer: C

Explanation: Clear, direct, and explicit communication aligns with the preferences of low-context cultures, facilitating effective negotiations.

Question: 951


During a conflict resolution meeting, which technique should a leader employ to ensure that all team members feel heard and valued, ultimately leading to a more effective resolution?


  1. Direct confrontation

  2. Avoidance

  3. Authority assertion

    er: D


    nation: Active listening demonstrates respect for team members' viewpoints and encourages o unication, which is essential for reaching a consensus in conflict resolution.


    ion: 952


    multinational corporation recently discovered that one of its suppliers was involved in unet ractices, including child labor and poor working conditions. The company’s leadership is de er to terminate the contract with the supplier, considering the financial implications. What sh dership prioritize to align with ethical standards and corporate social responsibility?


    minate the contract immediately to uphold ethical standards iate a dialogue with the supplier to improve conditions intain the contract to avoid financial loss

    k legal advice to explore options without taking immediate action er: A

    nation: Terminating the contract immediately to uphold ethical standards aligns with the com itment to corporate social responsibility, prioritizing human rights over financial implication


    ion: 953


    eholder engagement, a company conducts a survey where stakeholders rate their satisfaction

    Active listening Answ

Expla pen

comm


Quest


A large hical

labor p bating

wheth ould

the lea


  1. Ter

  2. Init

  3. Ma

  4. See Answ

Expla pany’s

comm s.


Quest


In stak on a

scale of 1 to 10. If the average satisfaction score from 200 responses is 7.5, what is the total satisfaction score calculated across all responses?


A. 1,500

B. 1,600

C. 1,750

D. 1,800


Answer: A

Explanation: Total satisfaction score = Average score * Number of responses = 7.5 * 200 = 1,500.


Question: 954


A manufacturing firm is using cycle time reduction techniques to enhance its competitiveness. Which of the following practices would most likely result in the greatest improvement in cycle time?


  1. Standardizing work procedures

  2. Increasing safety stock levels

  3. Lengthening equipment maintenance intervals


    er: A


    nation: Standardizing work procedures helps streamline operations and minimize variability, nificant improvements in cycle time.


    ion: 955

    rganization plans to integrate new technologies into its supply chain processes. What is the ant consideration during this integration?


    cost of technology alone

    uring alignment with overall business strategy and goals ducing training requirements for employees

    cusing only on technology features without user feedback er: B

    nation: Ensuring alignment with overall business strategy and goals is crucial for the success ation and utilization of new technologies in the supply chain.


    ion: 956

    ness wants to calculate its NPV for a project that costs $100,000 and is expected to generat

    f $30,000 in year one, $40,000 in year two, and $50,000 in year three. If the discount rate is the NPV?

    Reducing employee training Answ

Expla leading

to sig


Quest

Your o most

import


  1. The

  2. Ens

  3. Re

  4. Fo


Answ


Expla ful

integr


Quest

A busi e cash

flows o 5%,

what is


A. $10,000 B. $15,000 C. $20,000 D. $25,000


Answer: C


Explanation: NPV = (30,000/(1.05) + 40,000/(1.05²) + 50,000/(1.05³)) - 100,000 = $20,000.


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