PROJ 410 Contract and Procurement_Final Term Exam_All Questions_answers_Set 2 Answer
1. (TCO 1) A cost-plus-percentage-fee contract is a: _______. (Points : 5)
cost-reimbursable contract, the seller pays the buyer’s actual costs, and a percentage of the total project costs
cost-reimbursable contract, the seller pays the buyer’s actual costs, and all of the total project costs
cost-reimbursable contract, the buyer pays the seller’s actual costs, and a percentage of the total project costs
cost-reimbursable contract, the seller pays the buyer’s actual costs, and none of the total project costs
2. (TCO 2) The difference between the project manager and contract administrator is: ______.
(Points : 5)
the project manager is responsible for the project-related coordination, while the contract manager is responsible for administering the contract
the contract administrator has the authority to make all contract-related decisions, like approving a change order. The project manager does not have this level of authority.
the project manager is responsible for the administering of the contract, while the contract manager is responsible for project-related coordination.
the project manager has the authority to make all contract-related decisions, like approving a change order. The contract administrator does not have this level of authority.
3. (TCO 3) Which is a key component in the project procurement management process? (Points : 5)
RFI Request for Issue
RFP Request for Proposal
RFB Request for Buy
RFC Request for Contract
4. (TCO 2) Senior management typically has different reasons for issuing the directive to outsource than management responsible for the business process. Senior management typically decides to evaluate outsourcing because: ______. (Points : 5)
there is a means to focus more resources on business process strategy
there is a means to focus less resources on business process strategy
there is an effort to decrease performance
there is an organization-wide directive to downsize or cut costs
5. (TCO ) When notifying third parties in a transition plan, who would not need to be notified? (Points : 5)
Government or regulatory authorities
6. (TCO ) In International contracts, which industry-specific question does not need to be asked? (Points : 5)
Which country’s standards are used?
What regulatory authorities are called into question?
What regulations are specific to the business process operations?
What notice requirements or approvals are needed before and after a contract signing?
7. If a contract is seen through its full term, list two items that should be completed as part of contract close-out? What is a close out manager? Why is deliverable acceptance documents so important?
8. (TCO 8) What are the two ways to rank the seller’s proposals before selecting a seller? (Points : 12)
9. (TCO 6) Sometimes, a seller is selected based solely on lowest price. However, sometimes this is not always the most efficient or effective way of selecting a seller. What are some of the other evaluation criteria that a buyer may use to help select a seller? (Points : 12)
10. What are some of the common techniques used for establishing service levels?
1. (TCO ) What is benchmarking? Please support your answer. Defend the cost of benchmarking in an industry. (Points : 30)
The general objective of a benchmarking provision is to provide a mechanism by which the parties periodically compare the services being provided and/or prices being charged against similar services being provided and/or prices being charged to a specified customer or industry group. Although the effectiveness of benchmarking provisions is debatable, most customers feel that the inclusion of such a provision will at a minimum give the customer some leverage if the pricing, methodologies, technology, or service levels are significantly different from market standards. Vendors typically resist the inclusion of benchmarking provisions on the grounds that the comparative data are easily manipulated and the results are difficult to interpret.
The potential costs of performing the benchmark may be expensive. The parties will need to discuss how the costs of the internal or third-party resources used to perform the benchmarking are to be allocated. Cost allocation schemes may include:
•The vendor builds the cost of third-party or internal resources into its price.
•The vendor charges the customer on a pass-through basis for the cost of the third-party benchmarker.
•The vendor and the customer share the cost of the third-party benchmarker.
•The vendor absorbs the cost of the benchmarker if it reveals that the vendor’s prices, methodologies, technology, or services are not in line with industry standards.
2. (TCO ) What happens when there is a failure in an SLA? Use an example to analyze a failure in an SLA and how important SLAs are to the buyer in a BPO contract agreement. (Points : 30)
3. (TCO ) What are the elements of a Request for Proposal (RFP)? Please list and discuss five of the elements. (Points : 10)
4. (TCO ) Part 1: Discuss the following types of contract pricing: (a) fixed price, (b) cost-plus price, (c) time & materials, and (d) unit price. Part 2: Explain the appropriate utilization of each contract pricing type and the impact of risk to the contracting parties. Part 3: What type of contract pricing structure misaligns the buyer’s motivations with the seller’s? (Points : 30)
5. (TCO ) List and describe five components of a BPO. Then summarize why each of the items that you chose are important to the BPO process. (Points : 30)
The key components in the BPO process are:
Plan Purchases and Acquisitions stage – This phase starts at the beginning of the project which involves make or buy analysis. At the end of this phase, the project team will have a documented project procurement plan.
Plan contracting – The documented project procurement plan will enter into implementation process here. The project team will prepare the solicitation document called ‘Request For Proposal’ (RFP).
Proposal Solicitation – After acquiring the RFP document from the previous phase, this phase will request for proposals from the suppliers.
Source Selection – The project team will receive a lot of proposals from various sellers. After analysing all the proposals, they will select the best supplier who suits for the project and award the contract.
Contract Administration – In this phase, both the contracted parties have to ensure that they meet their respective contract obligations and at the same time both of their interests are protected legally. The process also reviews and documents the suppliers performance in accordance to the contract and establishes corrective actions if any.
Each of the above items or the components are importnat because they determine the BPO process success and assures that the right vendor is selected as part of the BPO outsourcing. This also makes sure that due diligence has been followed at each of the stage so that there are no roadblocks in the actual execution of the project.
6. What does the outsourcing of the HR function involve? What are pros and cons of HR Outsourcing? What do you think are three critical considerations that you must include in the implementation plan for this outsourcing transition?