Free and Premium CIPS L5M7 Dumps Questions Answers

Amarket-oriented approachcentres oncustomer needs, designing offerings around satisfaction and experience rather than internal operations.

Short cited extract: “Market-oriented – focus on customer satisfaction and value creation.” (L5M7 Study Guide, p.55)

Open-Book Costingfosterstrust and collaborationby ensuring both parties share detailed cost data and maintain open, transparent communication.

Short cited extract: “Open-book costing requires transparency and communication between partners.” (L5M7 Study Guide, p.193)

Quality assurance (QA)isproactive, including activities such assupplier approval/vetting;inspectionis reactive sampling of outputs. Short extract: “QA—proactive systems e.g., supplier approval; inspection—sampling outputs.” (L5M7 Study Guide, p.123)

ANormal Distributionforms asymmetrical bell-shaped curve, representing probability distribution around a mean.

Short cited term: “normal distribution = bell-shaped curve.” (L5M7 Study Guide, p. 150)

The guide distinguishes a simple chain from a“supply network,”emphasisingmulti-tier interdependencies. Short extract: “supply networks reflect multiple interdependent tiers.” (L5M7 Study Guide, p.4)

Cost-plus pricingis based onactual material and labour costs plus an agreed marginfor overheads and profit.

Short cited extract: “Cost-plus = actual cost + agreed mark-up for profit/overheads.” (L5M7 Study Guide, p.191)

Technology enhancesbuyer access to data, broadening supplier choice and transparency, whichreduces supplier power.

Short cited term: “technology has reduced suppliers’ bargaining power” (L5M7 Study Guide, p. 66).

ThePareto Principlestates that approximately80% of outcomesarise from20% of causes, applied in supply chain analysis to identify key value contributors.

Short cited extract: “Pareto (80/20) – a small number of causes create the majority of effects.” (L5M7 Study Guide, p.141)

Local sourcingoffersenvironmental benefits(lower transport footprint) andeasier access for service or maintenance, enhancing responsiveness.

Short cited extract: “Local sourcing provides reduced environmental impact and proximity for support.” (L5M7 Study Guide, p. 70)

Atightly coupledsupply chain exhibitshigh interdependencebetween members; decisions by one partner affect all others.

Short cited extract: “Tightly coupled = high interdependence between supply-chain partners.” (L5M7 Study Guide, p. 82)

Centralised procurementenables bettercost coordination, standardisation, and leverage through bulk purchasing, ensuring consistency across sites.

Short cited extract: “Centralised structures coordinate savings and achieve economies of scale.” (L5M7 Study Guide, p. 69)

Capital expenditure (CapEx)coverslong-term investmentssuch as equipment or infrastructure that deliver value over time—e.g., MRI scanners. Operating costs (OpEx) include salaries and consumables.

Short cited extract: “CapEx – major assets and equipment; OpEx – running costs such as wages.” (L5M7 Study Guide, Domain 3.2)

ISO 9001focuses oneight principlessuch as customer focus, leadership, and improvement.Environmental protectionbelongs underISO 14001, not 9001.

Short cited term: “environment protection covered by ISO 14001, not 9001.” (L5M7 Study Guide, p. 122)

Trust in supply chains is built on components includingintegrity,competence,loyalty,openness, andfairness. Short extract: “key trust components: integrity, competence, loyalty, openness, fairness.” (L5M7 Study Guide, Domain 3.4 section)

TQMis along-term philosophydemanding sustained commitment; benefits emerge gradually through continuous improvement.

Short cited extract: “TQM is a long-term commitment where results may not be immediate.” (L5M7 Study Guide, p. 118)

Relationship effectiveness is damaged bymistrustand poorfeedback/communication. Spend level alone is not inherently harmful if expectations are aligned. Short cited terms: “trust,” “communication/feedback” (L5M7 Study Guide, p.93).

Differentiation Strategyinvolves offering products withunique attributesthat customers value and are willing to pay more for, thus achieving competitive advantage.

Short cited term: “differentiation – unique product features at premium price.” (L5M7 Study Guide, p. 177)

JIT is aLeantechnique to minimise inventory and produce “only what is needed, when needed,” thereby removing waste from processes. Short cited phrase: “only when needed” (L5M7 Study Guide, p.111).

According toPorter’s Five Forces, new automated competitors represent athreat of new entrants, introducing innovation and market pressure.

Short cited extract: “New entrants increase competition and threaten existing players.” (L5M7 Study Guide, p.56)

On the relationship spectrum,arm’s-lengthis alow-collaborationstyle (onlyadversarialis lower), characterised by limited information sharing and short-term focus. Short cited term: “relationship spectrum … arm’s-length (low collaboration)” (L5M7 Study Guide, p.80).

The guide listsquality,innovation, andtime-to-marketamong ways supply chains createadded value(others include price/cost reduction and risk reduction). Short extract: “added value may be created through quality, innovation and time-to-market.” (L5M7 Study Guide, p.27)

TQM objectives focus oncustomer satisfaction, zero defects, and employee engagement, not financial planning.

Short cited extract: “TQM aims: customer focus, zero defects, continuous improvement – not financial planning.” (L5M7 Study Guide, p. 112)

A downstream supplier influencesmost aspects of qualitybutnot customer perception, which is shaped bymarketing and brand functions.

Short cited term: “except customer perception, influenced by marketing” (L5M7 Study Guide, p. 30).

The5S Methodology—Sort, Set in order, Shine, Standardise, Sustain—originates from Lean philosophy to promote efficiency and discipline in operations.

Short cited extract: “5S – a Lean technique for organisation and cleanliness in the workplace.” (L5M7 Study Guide, p.166)

The hierarchy extendsbeyond Black Belt, includingMaster Black BeltsandChampions, who provide leadership and strategic direction.

Short cited term: “Master Black Belt and Champion above Black Belt.” (L5M7 Study Guide, p. 153)

Value flowsdownstream, originating with suppliers and moving toward the end customer. A typical chain is tiered suppliers → OEM/producer → distributors/retailers → customer. Short cited term: “value moves downstream” (L5M7 Study Guide, p.4).