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CIPS L5M6 Exam Syllabus Topics:
Topic
Details
Topic 1
- Understand Approaches that Can Be Used to Develop Category Management Strategies: This section of the exam measures the skills of Procurement Managers and focuses on understanding how category management strategies are formulated within procurement functions. Candidates are expected to differentiate between strategic and conventional sourcing, evaluate how these approaches support long-term supplier relationships, and align them with organizational goals. The section also emphasizes the role of category management in enhancing sourcing efficiency and achieving cost optimization.
Topic 2
- Understand the Concepts, Tools, and Techniques Associated with Managing Expenditure: This section of the exam measures the analytical abilities of a Category Analyst and focuses on expenditure management techniques within category management. It explores how organizations identify, classify, and analyze different types of spend to enhance procurement efficiency and value creation.
Topic 3
- Understand the Strategic Impact of a Category Management Process: This section evaluates the strategic insight of a Procurement Manager into how category management influences organizational performance. It explores the use of data-driven decision-making and market intelligence to shape sourcing strategies and drive sustainable procurement outcomes.
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CIPS Category Management Sample Questions (Q85-Q90):
NEW QUESTION # 85
Which of the following approaches to managing cost, common in Category Management, results in the most reduced costs from suppliers and increased value?
- A. السعر management
- B. Cost-down
- C. Cost-out
- D. السعر acceptance
Answer: C
Explanation:
Cost-out is the most effective approach for reducing supplier costs while increasing value. It involves redesigning products or services collaboratively with suppliers to eliminate costs before they occur. For example, altering product design to use fewer materials can reduce overall costs without compromising quality. This differs from price acceptance (simply accepting a supplier's offer), price management (controlling or negotiating pricing), or cost-down (gradual cost reduction). Cost-out is proactive and strategic, focusing on long-term value creation rather than short-term savings. For category managers, adopting cost-out strategies requires close supplier collaboration, innovation, and joint investment in process improvements.
Reference: CIPS L5M6 Study Guide, p.79
NEW QUESTION # 86
When completing a tender exercise, in addition to price and quality, which factors may also be considered?
- A. ITT
- B. CSR
- C. PQQ
- D. TCO
Answer: B
Explanation:
The correct answer is CSR [Corporate Social Responsibility]. In modern procurement, tenders are no longer evaluated solely on price and quality. Organisations increasingly consider ethical, environmental, and sustainability performance as part of supplier evaluation. CSR factors include labour practices, carbon footprint, use of sustainable materials, and compliance with ethical trading standards.
Other options represent different procurement tools but are not additional evaluation factors:
* TCO [Total Cost of Ownership]: A financial analysis tool, not a tender factor.
* ITT [Invitation to Tender]: A formal document, not a factor.
* PQQ [Pre-Qualification Questionnaire]: Used for initial supplier screening, not tender evaluation.
Integrating CSR into tenders reflects the wider move towards responsible procurement. It ensures suppliers align with the buyer's values and long-term risk management priorities.
[Ref: CIPS L5M6 Study Guide, p.39 - CSR considerations in tenders]
NEW QUESTION # 87
Servers, hardware and licences are items which may be found in which category of spend?
- A. Professional services
- B. Facilities management
- C. Legal
- D. IT
Answer: D
Explanation:
Items such as servers, hardware, and licences fall under the IT (Information Technology) category of spend. Categories are organised into direct and indirect spend, and IT is a common example of indirect spend
, which includes goods and services that do not directly contribute to production but are essential to operations. IT spend is strategically important as it supports digital transformation, efficiency, and business continuity. Effective management of IT categories involves considering licensing agreements, hardware refresh cycles, cybersecurity, and vendor lock-in risks. Poor IT procurement strategies can lead to high costs, inefficiencies, and security vulnerabilities. Category managers in IT must also keep up with fast- changing technology markets, cloud adoption trends, and vendor consolidation. Recognising IT as a distinct category ensures that procurement strategies address unique risk factors and maximise value.
Reference: CIPS L5M6 Study Guide, p.3
NEW QUESTION # 88
In A.T. Kearney's 7 Step Model of Strategic Sourcing, which of the following should be done first?
- A. Selection of implementation path
- B. Continuous benchmarking of supply market
- C. Supplier portfolio generation
- D. Competitive supplier selection
Answer: C
Explanation:
The first step in A.T. Kearney's 7 Step Model of Strategic Sourcing is Supplier Portfolio Generation. The model provides a structured approach to sourcing, beginning with an understanding of current spend and supplier landscape before progressing to strategy development and implementation.
The seven steps are:
* Profile spend and supply base.
* Develop sourcing strategy and cost comparison.
* Generate supplier portfolio.
* Select implementation path.
* Select competitive suppliers.
* Integrate operations with suppliers.
* Continuously benchmark supply market.
The reason supplier portfolio generation is first is because procurement must identify potential suppliers and the overall supply base structure before choosing strategies or engaging in competitive selection. Skipping this step risks building a strategy without understanding available market options.
Thus, while options C and D are important later in the process, they cannot occur without first mapping the supplier portfolio.
[Ref: CIPS L5M6 Study Guide, Chapter 1.2 - Strategic Sourcing Models, esp. p.31-32]
NEW QUESTION # 89
Sarah is a Category Manager at a shoe manufacturer. She works with a key supplier of raw materials [leather and rubber] and is using a cost-out approach. Which type of relationship is most suited to this approach?
- A. Transactional
- B. Strategic alliance
- C. Arm's length
- D. Closer tactical
Answer: B
Explanation:
The most appropriate relationship type is a Strategic Alliance. The Cost-Out approach involves working closely with suppliers at the design and pre-production stages to eliminate unnecessary costs before they arise.
This requires high levels of trust, transparency, and collaboration.
A strategic alliance provides the framework for this partnership, allowing both buyer and supplier to share information, align objectives, and jointly innovate to reduce costs and increase value. For example, suppliers may suggest alternative materials or design modifications that lower costs without compromising quality.
By contrast:
* Arm's length and transactional relationships are too shallow to support cost-out collaboration.
* Closer tactical relationships allow more interaction but lack the depth of trust and shared strategy found in alliances.
Strategic alliances are therefore essential where the buyer needs suppliers to contribute their expertise, innovation, and commitment to achieving mutual cost savings and long-term value.
[Ref: CIPS L5M6 Study Guide, p.80 - Cost-out strategies and supplier relationships]
NEW QUESTION # 90
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