APP Strategic Sourcing & Procurement Planning Flashcards
6 cards from real APP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 APP Strategic Sourcing & Procurement Planning flashcards as text
Which metric measures the percentage of an organization's purchases that follow approved procurement channels and contracts?
Answer: Contract compliance / maverick spend rate
Contract compliance (the inverse of maverick spend) tracks what portion of purchases flow through negotiated contracts, directly impacting realized savings.
In procurement planning, 'demand forecasting' is used to:
Answer: Estimate future purchase quantities to plan inventory levels and negotiate volume pricing
Demand forecasting projects future consumption so procurement can plan order quantities, negotiate volume discounts, and maintain appropriate inventory levels.
A 'supplier development' program is initiated when:
Answer: A strategic supplier's performance gaps make it necessary to invest resources to improve their capabilities
Supplier development proactively addresses capability or quality gaps in strategic suppliers through training, process support, or joint improvement projects rather than simply switching vendors.
Which procurement KPI measures the average time from purchase requisition approval to purchase order issuance?
Answer: PO cycle time
PO cycle time tracks internal procurement efficiency — specifically how quickly buyers convert approved requisitions into purchase orders.
The practice of 'early supplier involvement (ESI)' in new product development aims to:
Answer: Leverage supplier expertise during design to improve quality, reduce cost, and shorten time to market
ESI invites key suppliers into the design process to suggest cost-effective materials, manufacturability improvements, and risk reductions that are far cheaper to implement before production.
A 'preferred supplier program' in strategic procurement typically offers suppliers:
Answer: Priority contract consideration and longer-term agreements in exchange for superior performance and pricing
Preferred supplier programs reward high-performing vendors with preferred status — longer contracts, increased volume, and early access to new opportunities — creating incentives for sustained excellence.