INFORMATION FOR CANDIDATES The senior assessor s report is written in order to provide candidates with feedback relating to the examination. It is designed as a tool for candidates - both those who have sat the examination and those who wish to use as part of their revision for future examinations. Candidates are advised to refer to the Examination Techniques Guide (see the following link: http://www.cips.org/en-gb/qualifications/study-support/ ) as well as this senior assessor s report. The senior assessor s report aims to provide the following information: An indication of how to approach the examination question An indication of the points the answer should include An indication of candidate performance for the examination question Each question has a syllabus reference which highlights the learning objectives of the syllabus unit content that the question is testing. The unit content guides are available to download at the following link: http://www.cips.org/qualifications/about-cips-qualifications/cipsqualifications/ ADDITIONAL SOURCES OF INFORMATION The Supply Management magazine is a useful source of information and candidates are advised to include it in their reading during their study. Please see the following link to the Supply Management website: http://www.supplymanagement.com/ L5-12/SA report/july 2012 2
SECTION A Q1 (a) Draft a simple Gantt chart using the information from Table 1 to show the initial project plan. (10 marks) This question aimed to test the understanding of some basic project management principles. These consisted mainly of appreciating the concept and application of the Gantt chart. This chart is used to list the tasks and the amount of time each one takes. There is also a need to consider which tasks can be completed prior to the other tasks, in what order and which are interdependent. From the case study candidates were required to construct a Gantt chart which shows the tasks from Table 1 in the exam paper plotted down the left hand side and then the appropriate time for these tasks scheduled across the x-axis as a time line. The Gantt chart was to be something similar to that shown below. The starting point is the 1 st March. The non critical activities are in grey and have no influence on the finish date. Task Descr Feb Mar Apr May Jun July Aug Sept Oct A Site Prep B C D E F G Mian Factory Grinding Block Pellet Production FG Warehouse RM Storage Canteen H Gardens and Parks The critical activities are in red. The main objective here is to list the tasks and insert an oblong box that represents the length of the task in weeks or months. Q1 (b) (i) Explain the concept of the critical path. (5 marks) (ii) Identify the tasks on the critical path and calculate the float or slack on each non-critical activity. (10 marks) This question was to test a candidate s understanding of the critical path and the implications of tasks on the critical path falling behind schedule. The rationale behind this question was that Greenplan was aware that the project was behind schedule. To bring the project back on time there were options that needed to be evaluated. L5-12/SA report/july 2012 3
(i) (ii) This question required the candidate to explain the concept of the critical path. The critical path is the path and the activities that define the delivery time for the project and that any extension to this path will mean that the project is delayed. Candidates might also have described that project management was a one off activity and that the end date or delivery date remained constant whilst the tasks needed to be completed fast enough to achieve this date. Following on from Q1a) the candidate then needed to identify the critical path as A-B-D-G-H. The non critical tasks were C (2 months float), E (2 months float and F (2 months float). This question as a whole was answered either very well or very weakly. The majority of candidates understood the concept well and provided a Gantt chart which was correctly labelled and the tasks in the right sequence and location on the chart. Provided the tasks and timeline were detailed then marks were allocated. Higher marks were awarded for Gantt chats with a brief narrative describing the chart. Following on from part (a) about 30% of candidates explained the concept of the critical path and also identified the tasks that were not critical and had an amount of float available which meant they did not have to be completed immediately within their time allocation but had the option to be delayed without affecting the final delivery date A further 50 % of candidates understood the concepts involved but got rather confused with what the critical path was and which tasks were on the critical path. Some candidates insisted on drawing a network diagram which was not asked for but which was still allocated marks. The average mark for this question was 15/25. Q2 Taking into account the fact that delays have occurred and the project needs to recover two months lost time. Advise which of the options from Table 2 might be accepted and which might be rejected. Justify your answer and calculate the financial implications (25 marks) This question was to test the candidates knowledge of project management principles and in particular the theory of crashing. This crashing activity focuses on only allocating additional resources to tasks on the critical path since allocating resources to tasks that are not on the critical path will not have any effect on the final delivery date of the project One of the main activities of a project manager is the ability to mobilise additional resources that will ensure the project is brought back on schedule. The logical approach was to decline the options not on the critical path (E&F) and accept the options on the critical tasks (D, G&H.) These gave a total saving of 8 weeks (2 weeks plus 3 weeks and plus L5-12/SA report/july 2012 4
3 weeks respectively resulting in the required time saving for the project of 2 months. The calculated cost to the project was a total of 600k (400k + 50k +150k). The main objective here was to appreciate the time saving options that will add value to the project and the choices made depends on the critical path. This question also focused on the management of external resources and communicating with external contractors in order to identify the best options for the project. In any purchasing environment there are financial considerations and these must to be a major priority when considering actions to be taken. The average mark for this question was 14/25. Most candidates had a try at this question and around 70% appreciated the theory behind the question. However, many candidates got bogged down with complex calculations about the different costing options that were not necessary. Some candidates quite rightly suggested that some of the tasks on the critical path such as the canteen and garden works would not impact on the start up of the factory. Whilst this could have been the case the objective was to stick with the questions in the case study. Some candidates were not familiar with even the basics of project management principles and so failed to get even 25% of the available marks for this question. SECTION B Q3 You are about to recruit an operations manager to manage the whole input transformation output process within a Fast Moving Consumer Goods (FMCG) business. Write an informal report to the recruitment agency highlighting the key areas of qualifications, knowledge and experience required by the ideal candidate. (25 marks) This question was to test the candidate s knowledge of the duties and responsibilities of an operations manager and how an operations manager s role needs to be able to interface with other functions within the organisation. It also required candidates to explain why an operations manager needed to be more of a business manager rather than just focusing on the operational side of the business. Candidates needed to define what operations management consists of and explain the main content of the input-transformation-output model. This model forms the basis of all businesses irrespective of whether they are a service or goods provider. They should then move on to describing the manager s duties and that their jobs encompass many different areas such as Managing the delivery of goods and services to the organisations customers Managing the transformation process itself which focuses on achieving and balancing the 5 strategic performance objectives of quality, cost, lead time, reliability and flexibility L5-12/SA report/july 2012 5
Managing the introduction of new products Ensuring there is an approach which covers the design for manufacture as well as the design for disassembly Managing shorter product life cycles Managing the application and introduction of new technology There was plenty of scope here for candidates to discuss the many areas of operations management and particularly the product life cycle as this latter aspect has meant considerable changes to the operations managers role. It should be noted that this question was not about globalisation but about how this has affected the length of the product life cycle and which in turn had affected the need for an operations manager. This meant that he/she needed new skills and a wider business appreciation rather than just the value chain itself This was a popular question with an average mark of 14/25. Most candidates identified the main attributes of an operations manager and what sort of skills and qualifications were required but failed to understand and explain their need for understanding new product introduction and the general management of resources. An operations manager s role is about ensuring compliance with specifications and quality. It is also about communicating with other functions. There were up to 2 marks for using an informal report. Q4 Explain the important contribution played by the purchasing function in the design of a new product. Emphasise the contribution it can make to an environmentally sensitive design (25 marks) This question was about the contribution that purchasing could have to the design of new products and especially how they might contribute to aspects of sustainable procurement and recycling. However, essentially this question was trying to get candidates to explain the value that can be added by any purchasing function in providing a top quality internal service to other functions and the business as a whole. Candidates should ideally have started by explaining the product life cycle and also the time prior to the launch of the product as this is the stage where purchasing can engage with design. In most cases 70% of the cost is designed into the product and so decisions about specifications and manufacturing processes are critical. This leads on to where these materials and processes might be sourced and this is where purchasing can make suggestions and add value. Purchasing can be viewed as the co-ordinators of the organisational functions and they should have the ability to advise the design, operations and marketing functions on the following:- L5-12/SA report/july 2012 6
Make or buy - outsourcing Choices of materials and sources of supply Environmentally friendly materials for re cycling Sustainable materials sourcing Low cost sourcing opportunities Cost/quality and lead-times This is a very open question which will allow candidates to show off their knowledge of purchasing and operations. Most candidates identified the main focus of benefits that purchasing could add to any organisation. They appreciated the need for sustainability in the sourcing process and a few candidates referred to the WEEE directive which was a strong example of how sustainability had affected the sourcing of materials and recycling issues. This was another popular question. The average mark was 13.5/25 and so was around the average. Candidates generally answered this question well. Higher marks would have been expected for such a purchasing focused question. This question encapsulated the benefits that a purchasing person might add to the competitiveness and profitability of any organisation. Q5 (a) Q5 (b) Evaluate a method for the planning and control of quality in a goods or service environment. Use examples to support your answer. Describe another method of quality management that focuses on the aspects of continuous improvement and empowerment (12 marks) (13 marks) This question was to test a candidate s knowledge of quality from both and operational level and a strategic level. part (a) was asking for a hands-on practical approach to controlling quality on a day to day basis. part (b) was more focused on the strategic implementation of a programme that would enhance quality in the longer term. Candidates ideally should have started by defining the term quality such as conformance to specification or fitness for purpose. They might then have chosen from either SPC (statistical process control) or the cost of quality management tool. a) SPC would have described the need to take samples of batch processed materials and measure the dimensions in accordance with the tolerances when the dimensional measurements stray outside the tolerance limits at the upper or lower level then action should be taken. L5-12/SA report/july 2012 7
The cost of quality management tool might consider the following categories of costs of quality:- Internal failure costs before the quality problems reach the customer External failure costs after quality problems reach the customer Cost of prevention - costs of maintaining systems and processes Cost of appraisal cost of inspection Some candidates referred to inspection, value analysis and JIT. These approaches were given marks as appropriate. Where TQM was referred to then marks were only allocated once, either for part (a) or (b). Part b) should have considered TQM this focuses on empowerment and right first time. It pushes down the responsibility for quality to all members of the organisation and the need to delight the customer. The senior management must improve their communications and empower the staff and employees by training and development and improving their problem solving skills by the use of tools and techniques with emphasis on lean manufacturing and JIT. This was not one of the most popular questions, being attempted by about 25% of candidates. The average mark was around 13/25. Most candidates appreciated the different types of approaches to quality but many failed to appreciate the difference between day to day quality approaches and an organisation wide approach like TQM. TQM was the most popular solution and answer. Few candidates referred to the cost of quality management tool Q6 Explain, using examples, THREE different ways in which stock holding could be reduced in any organisation (25 marks) This question aimed to test the candidates understanding of stock reduction methods and the different approaches that can be applied. Candidates considered the following options for discussion. This was by no means a complete list, candidates suggested alternatives such as standardisation and variety reduction which were also allocated appropriate marks Use of MRP (Materials Requirements Planning) which will ensure that only stock needed is purchased. In most cases candidates drew a diagram to show the MPS (Master Production Schedule) BOM s (Bills of Materials) and the stock reporting system. About 25 % of candidates explained the details of how it worked in practice. This is a push system since it needs a forecast and could end up generating amounts of stock that is not utilised. Hence it could have the converse effect. L5-12/SA report/july 2012 8
Consignment stock systems there was a need to explain how these might be set up and that stock is on the customers premises but owned by the supplier who manages the replenishment process. In many cases this was not explained in detail although candidates did understand the application of this method Vendor managed inventory as above but stock on suppliers premises Kanban systems Kanban means ticket or signal it is based on batch sizes that cover the usage during the replacement lead-time. It can be key a component of JIT and is a pull system. Many candidates referred to this method but only covered a limited element of their application. Candidates covered all the above options in varying amounts of detail This was the most popular question with almost half of all candidates answering this question. The average mark was around 15/25. In most cases candidates were able to write more than 2/3 pages of text and so covered the subject well even though the level of detail was limited. General Comments The pass rate was 70% and was an average performance when considered in the context of the last few years. This was quite a difficult paper in terms of the case study theme and many candidates did not seem able to apply the theory around project management. However, candidates who did well in Section A generally scored quite highly with a credit or a distinction. The subject of project management is an important one for all procurement practitioners as each major purchase can be seen as a project in its own right. This especially applies to construction and capital projects. Gantt charts are relatively easy to develop and often software packages can assist with the development of these schedules. APPENDIX: Syllabus matrix indicating the learning objectives of the syllabus unit content each question is testing. L5-12/SA report/july 2012 9
L5-12/SA report/july 2012 10