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ISM Exam LEAD Topic 4 Question 10 Discussion

Actual exam question for ISM's Leadership and Transformation in Supply Management exam
Question #: 10
Topic #: 4
[All Leadership and Transformation in Supply Management Questions]

A supply manager conducts a risk assessment of the company's top five suppliers. One of these suppliers---a sole source of an integral component---has just one database location and no cloud storage. Any calamity could put supply of the component at risk. In this situation, which of the following is the BEST long-term course of action for the supply manager to take?

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Suggested Answer: C

Risk Assessment Overview: The sole source supplier has a single database location, creating a risk for the supply of an integral component.

Long-term Solution: Reducing the component's uniqueness to allow for alternate sources is a strategic approach. It mitigates the risk associated with dependency on a single supplier and enhances supply chain resilience.

Collaborative Approach: Working with engineering to modify the component design ensures compatibility with multiple suppliers, broadening the supplier base and reducing supply chain vulnerability.

Importance of Alternative Sources: Diversifying the supplier base is crucial in risk management to avoid disruptions caused by supplier-specific issues.

Reference: Supply chain risk management literature, such as 'The Resilient Enterprise' by Yossi Sheffi and guidelines from the Institute for Supply Management (ISM), supports the strategy of reducing dependency on single suppliers through component standardization.


by Marsha at Sep 18, 2024, 06:25 PM

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Barney
1 days ago
This question is so dry, I could use a glass of water. But option D is the clear choice - gotta protect that supply chain, even if it costs a little extra.
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Rikki
5 days ago
Hmm, I'm leaning towards A. Insourcing could give us more control and flexibility. Who needs a sole source supplier anyway? Let's bring it in-house!
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Omega
10 days ago
I agree with Mindy, having the supplier obtain a backup database facility would mitigate the risk.
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Jodi
10 days ago
B is the way to go. Leveraging existing IT infrastructure is smart and cost-effective. Plus, the supplier won't have to do all the heavy lifting.
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Desirae
10 days ago
But wouldn't it be better to collaborate with IT to offer database capacity at one of the firm's locations? That way we have more control over the situation.
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Laurel
22 days ago
I'd go with C. Reducing the component's uniqueness opens up the field and diversifies the supply chain. Efficiency and redundancy, that's the key!
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Mindy
22 days ago
I think the best long-term course of action is to revise the contract with the supplier.
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Carylon
23 days ago
Option D for sure! Backup database facility is a no-brainer for a sole source supplier. Gotta have that insurance, you know?
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Goldie
3 days ago
But wouldn't it be better to also explore other options like insourcing or collaborating with IT?
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Andra
10 days ago
I agree, having a backup database facility is crucial for ensuring continuity of supply.
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Cassi
13 days ago
Option D for sure! Backup database facility is a no-brainer for a sole source supplier. Gotta have that insurance, you know?
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