CIPS Exam L4M3 Topic 2 Question 44 Discussion

Actual exam question for CIPS's L4M3 exam

Question #: 44
Topic #: 2

[All L4M3 Questions]

A procurement manager is preparing a long-term contract with a major supplier. She decides to use the variable pricing arrangement using price indices. The payment terms describe the circumstances and mechanism where the price is allowed to change. In order to successfully manage this type of contract, the buying organisation should have...?

AGood market knowledge

BSelection of base year

CValue for money

DEconomy of scale

Show Suggested Answer

Suggested Answer: C

Performance management framework often consists of KPIs, targets and consequences that arise from achieved scores. To ensure that the framework has binding effect on contracting parties, it should be developed, appended to the main contract document and agreed by both parties. So the answer should be 'Yes, because the framework should have legal standing as a part of contract'.

LO 1, AC 1.1

by Lilli at Sep 18, 2024, 09:37 PM

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