L5M9 Sample exam

✅ Correct Answer: Chase demand strategy

Explanation:
Chase demand strategies adjust capacity in line with fluctuating demand by using methods like temporary labour, overtime, or subcontracting.

Why the other options are wrong:
❌ Level capacity – keeps output constant, leading to stock build-up or shortages.
❌ Hybrid capacity – combines level and chase methods, not purely chasing demand.
❌ Outsourcing strategy – can be part of chase, but the question emphasises demand-driven adjustments.

🧠 Summary: Chase demand adjusts output to match seasonal demand swings.
📖 Source: CIPS L5M9 Study Guide – Capacity management (pp. 35–40).

✅ Correct Answer: To strengthen quality management systems

Explanation:
ISO 9001 is an internationally recognised standard that sets requirements for quality management systems, focusing on customer satisfaction, continuous improvement, and process control.

Why the other options are wrong:
❌ Energy efficiency – linked to ISO 50001, not ISO 9001.
❌ Transport emissions – addressed in environmental standards like ISO 14001.
❌ Occupational health and safety – covered by ISO 45001.

🧠 Summary: ISO 9001 ensures quality management and customer-focused improvement.
📖 Source: CIPS L5M9 Study Guide – Quality management (pp. 70–75).

✅ Correct Answer: Activity-Based Costing (ABC)

Explanation:
ABC allocates indirect and overhead costs to specific products, services, or customers based on activities, giving a clearer picture of profitability.

Why the other options are wrong:
❌ Marginal costing – measures costs of producing one more unit, not overhead allocation.
❌ Standard costing – sets cost benchmarks, not actual allocations.
❌ Break-even analysis – determines when revenues cover costs, not segment profitability.

🧠 Summary: ABC costing shows the true cost-to-serve and profitability of operations.
📖 Source: CIPS L5M9 Study Guide – Operations costs and analysis (pp. 90–96).

✅ Correct Answer: Continuous small improvements

Explanation:
Kaizen focuses on ongoing, incremental changes driven by employees at all levels to improve efficiency, quality, and waste elimination.

Why the other options are wrong:
❌ Radical redesign – describes Business Process Re-engineering (BPR).
❌ Eliminating all risks – unrealistic; Kaizen reduces inefficiencies, not all risks.
❌ Advanced automation – may improve processes, but Kaizen is about people-driven improvement.

🧠 Summary: Kaizen = continuous incremental improvements in operations.
📖 Source: CIPS L5M9 Study Guide – Continuous improvement (pp. 62–68).

✅ Correct Answer: Critical Path Method (CPM)

Explanation:
CPM identifies the critical path in a network of activities, showing the minimum time required and where delays will impact the entire project.

Why the other options are wrong:
❌ Gantt chart – displays timelines visually but does not calculate dependencies.
❌ Value stream mapping – is a lean tool for waste reduction, not scheduling.
❌ Drum-Buffer-Rope – is part of Theory of Constraints scheduling.

🧠 Summary: CPM reveals which tasks are critical for project completion.
📖 Source: CIPS L5M9 Study Guide – Scheduling tools (pp. 48–53).