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A supply manager works with engineering on an aerospace project. A request for quotation (RFQ) Is distributed to five potential suppliers, three of whom respond that they are not interested In the project. The two remaining suppliers say they are interested, but a high level of risk involving tight tolerances will force them to raise prices significantly, and neither will accept a firm fixed price contract. The supply manager arranges a conference with engineering and both suppliers. During this conference, it is determined that only three of the tolerances are truly critical. Based on this conference, a revised RFQ is issued. This scenario is an example of which of the following aspects of supply management?
Correct Answer: C
* Scenario Overview: The supply manager issued an RFQ to five suppliers; three declined, and the remaining two raised concerns about risk and pricing. * Conference Outcome: A conference revealed that only three tolerances were critical, leading to a revised RFQ. * Value Engineering: This process involves evaluating a project to reduce costs while maintaining quality by identifying essential versus non-essential specifications. * Supply Manager's Role: By facilitating this discussion, the supply manager helped reduce project costs and risks, demonstrating the principles of value engineering. References * CIPS. (n.d.). Value Engineering in Procurement. * ISM. (n.d.). Cost Management and Value Engineering.