Companies that outsource strategically important operations run the risk ofMultiple choice question.assuming too much control over critical operations.reducing operating costs of the company that they partner with.weakening their ability to sustain their competitive advantage in areas vital to the company's success.reducing the capabilities of the company responsible for performing the outsourced activity.
Question
Companies that outsource strategically important operations run the risk ofMultiple choice question.assuming too much control over critical operations.reducing operating costs of the company that they partner with.weakening their ability to sustain their competitive advantage in areas vital to the company's success.reducing the capabilities of the company responsible for performing the outsourced activity.
Solution
The correct answer is: weakening their ability to sustain their competitive advantage in areas vital to the company's success.
Here's why:
Outsourcing strategically important operations can lead to a company losing its competitive edge. This is because the company is giving control of vital operations to a third party. If the third party fails to perform these operations to the company's standards, it can negatively impact the company's ability to compete in the market. Furthermore, the company may become dependent on the third party for these operations, which can also weaken its competitive position.
Similar Questions
What can a company do to reduce the risk of an outsourcing company entering the market and becoming a competitor?Selected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer.aoutsource non-core workberect strategic blockscestablish trustdmonitor the outsource arrangement
What is a disadvantage for a company that outsources jobs?Multiple ChoiceThe need to purchase and update computers and related equipment increases substantially.There is less potential to groom and hire from within an enculturated workforce.The work force size within the company increases, thereby increasing its salary budget.The company's contribution to employee health benefits, retirement, and 401(k) payments increases.
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A German company is considering outsourcing the manufacturing process to Japan. Some of the executive board directors are concerned that the Japanese company may not follow the exact production processes the German company normally uses. Which risk represents this concern?Higher than expected transaction costLoss of controlLoss of organization trustLoss of innovation
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