MIS Test 2 (Chapter 3)

Question 1

What is the procurement process?

Answer 1

• A series of steps that a company takes to obtain or acquire necessary materials (may be raw materials or trading goods)
• Also referred to as “requisition-to-pay” process

Question 2

Key concepts and assumptions of B2C

Answer 2

• Customer has no legal obligation to buy from store and store has no legal or financial obligation to sell to customer or advise him/her if product is not reliable

Question 3

Key concepts and assumptions of B2B

Answer 3

• If supplier cannot provide materials, the buyer must not be able to find materials from another supplier.
• Supplier must be certain that the buyer can pay for products.

Question 4

Importance of standardized processes in B2B

Answer 4

• Because B2B relationship is complex, standardized processes must be put into place to mitigate risk, especially when you are dealing with suppliers/buyers in different countries with different currencies, tax systems, tariffs, etc.

Question 5

The steps of a basic procurement process

Answer 5

1. Warehouse - create requisition (purchase requisition)
2. Purchasing - create and send purchase order (purchase order)
3. Warehouse - receive shipment (packing list, goods receipt document)
4. Accounting - receive invoice (invoice), send payment (payment)

Question 6

What are the key documents on a basic procurement process?

Answer 6

• Purchase requisition
• Purchase order
• Packing list
• Goods receipt document
• Vender invoice

Question 7

What key questions are there regarding the documents?

Answer 7

• What is the purpose?
• What are the key data?
• How does data change across the process?
• Who is responsible for the data?