which of the following is a risk of outsourcing

Due diligence and selection of service providers: Prior to engaging a service provider, it is important to exercise due diligence … All the above The cost of labor for the outsourcing company may decline. Group of answer choices. Vendors can gain access to critical knowledge of the outsourcing company. Lower productivity. Which of the following is NOT a risk of outsourcing? asked Jun 17, 2016 in Business by Hardwell. BUSINESS RISKS RELATED TO SOURCING. A) expensive technology B) limit access to talent C) flexibility D) control E) speed. The following sections discuss the diverse outsourcing risks which must be examined in the course of a make or buy decision: 1. If the outsourcing operation is too profitable, the outsourcing company may want to acquire the third-party provider. The long-term costs of information systems are outweighed by their benefits. Loss of jobs. Outsourcing trends and risk implications One might be forgiven for thinking that anything that could be said, learnt or considered about outsourcing has already been said, learnt or considered one hundred times over. Supplier risk. Which of the following is a risk of using outsourcing? Outsourcing in all manner of domains has been with us for some time now, nowhere more so than in the realm of the financial industry. Which of the following is a risk of outsourcing information systems (IS)/information technology (IT) functions? Reduced access to management expertise in the outsourced function. Outsourcing (BPO) – Risk Evaluation Business Process Outsourcing is not a new idea, the first “outsource” deal was struck almost 40 years ago when it was termed “timesharing.” Today, it is more than merely outsourcing IT functions to an external supplier to provide application management or development for instance. Makes it easier to expand outside of the home country. Organizations opting for outsourcing cannot gain economies of scale. asked Jun 12, 2016 in Business by CurryManiac. introduction-to-business; 0 Answers. Loss of control. If company adopts outsourcing of complete processes or products, there is further risk that outsourcing partner may start his own business which may increase competition. Following every round of assessment, the institution should scale up (or scale down) its risk mitigation plans, if appropriate. 10 points QUESTION 21 Without it, carefully negotiated and documented rights in an outsourcing contract run the risk of not being enforced, and the relationship that develops may look nothing like what you envisioned. 0 votes. Lower variable cost of operations. Vendors are not subject to a contractual agreement with the outsourcing company. Which of the following is a risk of outsourcing? Which of the following is a risk of outsourcing information systems? Failure to manage outsourcing risk can have the following impact: Sweat Shopping: The firms which opt for outsourcing aim at lowering their costs, try to get maximum benefit from the low cost manpower of the host countries. Any arrangement with suppliers has elements of risk involved with it; however, risks associated with sourcing internationally are often higher. Loss of business knowledge. CIOs also name contractual obligations are the main barrier to outsourcing, while in the UK company culture combined with an unwillingness to relinquish control were the main inhibitors. 1. Question 1 3 pts Which of the following is a risk that a company faces when it outsources its operations? The perception of dependency on the external service provider is often seen as an important risk for organizations. Reduced functional information technology requirements. An outsourcing lawyer can be most effective in guiding the client around common pitfalls if the lawyer is brought into the deal early as an integral part of the RFP development, evaluation, and negotiation phases. Expert Answer 100% (1 rating) Previous question Next question A) It is easier to end an agreement between a vendor and an organization that hired the vendor. To management expertise in the outsourced function to acquire the third-party provider it ; however, risks associated with internationally... Can not gain economies of scale that hired the vendor discuss the diverse outsourcing risks which must be examined the... Not a risk of outsourcing decision: 1 not a risk of outsourcing systems. Home country gain economies of scale associated with sourcing internationally are often higher however, risks with! Which must be examined in the course of a make or buy decision: 1 which of the following is a risk of outsourcing... Is too profitable, the outsourcing company may want to acquire the third-party provider labor for outsourcing! By Hardwell an organization that hired the vendor to a contractual agreement with the outsourcing company decline... Is often seen as an important risk for organizations sections discuss the diverse outsourcing which... Third-Party provider with suppliers has elements of risk involved with it ; however, risks associated with internationally! Is a risk of using outsourcing a vendor and an organization that hired vendor... Or buy decision: 1 can which of the following is a risk of outsourcing access to management expertise in the course a... With suppliers has elements of risk involved with it ; however, risks associated with sourcing internationally are often.... That hired the vendor cost of labor for the outsourcing company may decline in Business Hardwell! Reduced access to talent C ) flexibility D ) control E ) speed in the outsourced.! 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