A Valuable Method of Assessing Supplier Performance Is to Use

question 41

Multiple Choice

A valuable method of assessing supplier performance is to use a supplier performance index.This index is calculated by:

• A) total purchase price ÷ total supplier costs
• B) total supplier costs ÷ total purchase price
• C) average purchase price ÷ average supplier costs
• D) average supplier costs ÷ average purchase price

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Definitions:

Philip Crosby

An influential figure in the quality management field known for his work on improving organizational quality.

Conformance

The act of matching or complying with certain standards, rules, or norms, often to meet requirements or maintain quality and consistency.

Service Characteristics

Service Characteristics are features that differentiate services from goods, including intangibility, inseparability, variability, and perishability.

Intangible

Lacking physical substance, often referring to things that cannot be touched but have value, like brand reputation or intellectual property.