CIPS L4M2 Practice Exams
Last updated on Oct 23,2026- Exam Code: L4M2
- Exam Name: Defining Business Needs
- Certification Provider: CIPS
- Latest update: Oct 23,2026
Question #121
A company is planning the procurement of an IT system and wants to agree a through-life contract with the supplier to ensure ongoing system support.
The first step in producing that specification should be to:
- A . Build a design
- B . Prepare tendering documents
- C . Identify the IT system supplier
- D . Define the user requirements
Correct Answer: D
D
Explanation:
Writing a high-quality specification is very crucial in every purchase. In through-life management, it is even more important since the assets often have very high value. Defining user requirement is the first step to write a specification. Without doing this right, many problems may arise in later stages.
Reference: CIPS study guide page 132
LO 3, AC 3.2
D
Explanation:
Writing a high-quality specification is very crucial in every purchase. In through-life management, it is even more important since the assets often have very high value. Defining user requirement is the first step to write a specification. Without doing this right, many problems may arise in later stages.
Reference: CIPS study guide page 132
LO 3, AC 3.2
Question #121
A company is planning the procurement of an IT system and wants to agree a through-life contract with the supplier to ensure ongoing system support.
The first step in producing that specification should be to:
- A . Build a design
- B . Prepare tendering documents
- C . Identify the IT system supplier
- D . Define the user requirements
Correct Answer: D
D
Explanation:
Writing a high-quality specification is very crucial in every purchase. In through-life management, it is even more important since the assets often have very high value. Defining user requirement is the first step to write a specification. Without doing this right, many problems may arise in later stages.
Reference: CIPS study guide page 132
LO 3, AC 3.2
D
Explanation:
Writing a high-quality specification is very crucial in every purchase. In through-life management, it is even more important since the assets often have very high value. Defining user requirement is the first step to write a specification. Without doing this right, many problems may arise in later stages.
Reference: CIPS study guide page 132
LO 3, AC 3.2
Question #121
A company is planning the procurement of an IT system and wants to agree a through-life contract with the supplier to ensure ongoing system support.
The first step in producing that specification should be to:
- A . Build a design
- B . Prepare tendering documents
- C . Identify the IT system supplier
- D . Define the user requirements
Correct Answer: D
D
Explanation:
Writing a high-quality specification is very crucial in every purchase. In through-life management, it is even more important since the assets often have very high value. Defining user requirement is the first step to write a specification. Without doing this right, many problems may arise in later stages.
Reference: CIPS study guide page 132
LO 3, AC 3.2
D
Explanation:
Writing a high-quality specification is very crucial in every purchase. In through-life management, it is even more important since the assets often have very high value. Defining user requirement is the first step to write a specification. Without doing this right, many problems may arise in later stages.
Reference: CIPS study guide page 132
LO 3, AC 3.2
Question #124
What is the output of regression analysis?
- A . Forecasting process
- B . Dependent variables
- C . Line of best fit
- D . Independent variables
Correct Answer: C
C
Explanation:
Regression refers to a quantitative measure of the relationship between one or more independent variables and a resulting dependent variable. Regression is of use to professionals in a wide range of fields from science and public service to financial analysis.
To perform a regression analysis, a statistician collects a set of data points, each including a complete set of dependent and independent variables. For example, the dependent variable could be a firm’s stock price and the independent variables could be the Standard and Poor’s 500 index and the national unemployment rate, assuming that the stock is not listed in the S&P 500. The sample set could be each of these three data sets for the past 20 years.
On a chart, these data points would appear as scatter plot, a set of points that may or may not appear to be organized along any line. If a linear pattern is apparent, it may be possible to sketch a line of best fit that minimizes the distance of those points from that line. If no organizing axis is visually apparent, regression analysis can generate a line based on the least squares method. This method builds the line which minimizes the squared distance of each point from the line of best fit. Line of best fit is one of the most important outputs of regression analysis.
Reference: – CIPS study guide page 99-100
– Line Of Best Fit (investopedia.com) LO 2, AC 2.3
C
Explanation:
Regression refers to a quantitative measure of the relationship between one or more independent variables and a resulting dependent variable. Regression is of use to professionals in a wide range of fields from science and public service to financial analysis.
To perform a regression analysis, a statistician collects a set of data points, each including a complete set of dependent and independent variables. For example, the dependent variable could be a firm’s stock price and the independent variables could be the Standard and Poor’s 500 index and the national unemployment rate, assuming that the stock is not listed in the S&P 500. The sample set could be each of these three data sets for the past 20 years.
On a chart, these data points would appear as scatter plot, a set of points that may or may not appear to be organized along any line. If a linear pattern is apparent, it may be possible to sketch a line of best fit that minimizes the distance of those points from that line. If no organizing axis is visually apparent, regression analysis can generate a line based on the least squares method. This method builds the line which minimizes the squared distance of each point from the line of best fit. Line of best fit is one of the most important outputs of regression analysis.
Reference: – CIPS study guide page 99-100
– Line Of Best Fit (investopedia.com) LO 2, AC 2.3
Question #125
Which of the following problems may be identified as open-ended problems? Select TWO that apply:
- A . Shortage of key medicines in healthcare industry
- B . A cyber attack takes down whole company’s IT system
- C . Engine failures cause flight cancellations.
- D . Logistics costs incur a large portion in wholesale prices
- E . The suppliers don’t comply with the company’s policy on underage labour.
Correct Answer: D, E
D, E
Explanation:
Open-ended problem is something stopping the achievement of an objective or blocking progress. To solve this type of problems, procurement professional should find a way to unblock the block-age. In the above question, high logistics cost is an obstacle to cost cutting objective while supplier’s incompliance prevents the company to achieve its sustainable objective.
Reference: CIPS study guide page 11
LO 1, AC 1.1
D, E
Explanation:
Open-ended problem is something stopping the achievement of an objective or blocking progress. To solve this type of problems, procurement professional should find a way to unblock the block-age. In the above question, high logistics cost is an obstacle to cost cutting objective while supplier’s incompliance prevents the company to achieve its sustainable objective.
Reference: CIPS study guide page 11
LO 1, AC 1.1
Question #126
A drawing is an example of…?
- A . Statements of work
- B . Technical specifications
- C . Output specifications
- D . Outcome specifications
Correct Answer: B
B
Explanation:
A technical specification details the standards that a product or service must meet. Drawings (often called engineering drawings or technical drawings) are complementary to technical specifications
Reference: CIPS study guide page 116-117
LO 3, AC 3.1
B
Explanation:
A technical specification details the standards that a product or service must meet. Drawings (often called engineering drawings or technical drawings) are complementary to technical specifications
Reference: CIPS study guide page 116-117
LO 3, AC 3.1
Question #127
Which of the following factors would mean a buyer had high bargaining power in a competitive market? Select TWO that apply.
- A . Many substitute products are available
- B . Buyers are procuring a low volume of products
- C . High switching costs for the buyer
- D . Buyers are demanding large volumes
- E . Products are highly differentiated
Correct Answer: A, D
Question #128
Which of the following is the new technology that has impact on manufacturing sector?
- A . Social Media
- B . E-commerce
- C . Robotics
- D . Blockchain
Correct Answer: C
C
Explanation:
Robots in manufacturing help to create jobs by reshoring more manufacturing work. Robots protect workers from repetitive, mundane and dangerous tasks, while also creating more desirable jobs, such as engineering, programming, management and equipment maintenance. LO 2, AC 2.1
C
Explanation:
Robots in manufacturing help to create jobs by reshoring more manufacturing work. Robots protect workers from repetitive, mundane and dangerous tasks, while also creating more desirable jobs, such as engineering, programming, management and equipment maintenance. LO 2, AC 2.1
Question #129
XYZ Ltd is a large supermarket chain which operates mainly in the UK and Europe. Their customers are increasingly concerned about sustainability. Therefore, procurement manager is required to source the products from suppliers who have good environmental performance.
Which of the following can be an assurance that the supplier has procedures and policies to enhance its environmental performance?
- A . ISO 14001:2015 certificate
- B . ISO 13485:2016 certificate
- C . ISO 22716:2007 certificate
- D . ISO 9001:2015 certificate
Correct Answer: A
A
Explanation:
ISO 9001:2015 specifies requirements for a quality management system.
ISO 14001:2015 specifies the requirements for an environmental management system that an organization can use to enhance its environmental performance. ISO 14001:2015 is intended for use by an organization seeking to manage its environmental responsibilities in a systematic manner that contributes to the environmental pillar of sustainability.
ISO 22716:2007 gives guidelines for the production, control, storage and shipment of cosmetic products. These guidelines cover the quality aspects of the product, but as a whole do not cover safety aspects for the personnel engaged in the plant, nor do they cover aspects of protection of the environment.
ISO 13485:2016 specifies requirements for a quality management system where an organization needs to demonstrate its ability to provide medical devices and related services that consistently meet customer and applicable regulatory requirements.
Reference: CIPS study guide page 125
LO 3, AC 3.1
A
Explanation:
ISO 9001:2015 specifies requirements for a quality management system.
ISO 14001:2015 specifies the requirements for an environmental management system that an organization can use to enhance its environmental performance. ISO 14001:2015 is intended for use by an organization seeking to manage its environmental responsibilities in a systematic manner that contributes to the environmental pillar of sustainability.
ISO 22716:2007 gives guidelines for the production, control, storage and shipment of cosmetic products. These guidelines cover the quality aspects of the product, but as a whole do not cover safety aspects for the personnel engaged in the plant, nor do they cover aspects of protection of the environment.
ISO 13485:2016 specifies requirements for a quality management system where an organization needs to demonstrate its ability to provide medical devices and related services that consistently meet customer and applicable regulatory requirements.
Reference: CIPS study guide page 125
LO 3, AC 3.1
Question #130
Logistics support stage
- A . 2 and 3 only
- B . 2 and 5 only
- C . 1 and 2 only
- D . 1 and 4 only
Correct Answer: C
C
Explanation:
Writing a specification and then procuring and using the product or service has a number of stages. The further on in the process you are, the less potential there is for cost reductions. Therefore, opportunities for cost reduction will be greatest in the two first stages: planning stage and pre-design stage.
LO 3, AC 3.1
C
Explanation:
Writing a specification and then procuring and using the product or service has a number of stages. The further on in the process you are, the less potential there is for cost reductions. Therefore, opportunities for cost reduction will be greatest in the two first stages: planning stage and pre-design stage.
LO 3, AC 3.1