SCM 421 Exam 2 UTK Buckley Topic 7

What is the rule for outsourcing and offshoring decisions?

"who" then "where"

The offshoring decision usually takes place in two steps: Where—you pick a location, and how—you decide what kind of operating structure to use

FALSE

A buy decision is also called re shoring.

False

Elimination implies that your process needs significantly fewer human resources.

False

If the best supplier is located outside your home country, the decision to buy overseas is known as outsourcing.

False

Moving to a wholly owned subsidiary is always the best option and allows you to retain control and reduce costs.

False

Reputational impact is a relatively easy concept to quantify.

False

All are reasons for outsourcing except: a. Business process redesign b. High internal capacity c. Accessing qualified personnel d. Competitive pressure e. Taking out cost f. All are reasons for outsourcing

High internal company

In Stage 1 of the outsourcing/offshoring process, what are we what is/are the decisions that we need to think about?

Is the process that we want to outsource critical to our competitive advantage? and Are you giving up any relative capability position?

What are the three statistics that might provide insight into the quality of an offshoring location.

Leading Exporters, FDI Destinations, & AT Kearney's global Offshoring Location Index

What is the "who should do it" question also called?

Make versus buy

You work for a company located in the United States and have decided to buy a customer contact center for services from a company located in India. What is this called?

Offshore outsourcing

Which of the following is not an outsourcing pitfall that you want to avoid? a. Pick a service provider that your competitor is using. b. Outsource a part of your core. c. Shrink your workforce as much and as fast as you can. d. Involve your people in the decision-making process. e. None of the above—they are all pitfalls. f. Only A, B, & C

Pick a service provider that your competitor is using, outsource a part of your core, and shrink your workforce as much and as fast as you can

LEGO's outsourcing issues were driven by the goal of ____ the supply chain but ended up adding _______ to the supply chain as they outsourced to Flextronics

Simplifying and Complexity

Which of the following are costs that are challenging to quantify?

Support Costs

A popular destination to offshore IT services is the Phillipines.

True

Just because outsourcing is viable, that doesn't mean that is your best option

True

Modern purchasing organizations should be fully involved in the make versus buy analysis.

True

Price is an important strategic consideration in the geographic decision-making process

True

The outsourcing decision is really about who can do the job the best

True

Which of the following are among the top three exporter countries?

United States and Germany

Calculate the supplier score given the following parameters: Criteria Weight Score Weighted Score Price 25% 100 25 Quality 30% 50 15 Lead time 30% 80 24 Delivery 15% 100 15 Calculate each supplier's overall score by multiplying the score for each crterion by the associated weight and adding up the results for all of the criteria

79

Which of the following are key criteria to where we should Outsource?

Capabilities to perform the actual work

What criteria should be included in Stage 3 of the outsourcing/offshoring process?

Capabilities, costs, & location attractiveness

Location attractiveness is not influenced by what?

Difficulty in performance measurement

Which is the fourth step to a Multi-criteria analysis?

Evaluate Options

When considering implementation in Stage 4 of the of the outsourcing/offshoring process, what issues should you consider?

When considering implementation in Stage 4 of the of the outsourcing/offshoring process, what issues should you consider? a. How to communicate expectations and monitor performance? b. What level of intensity should the relationship be? c. How will continuous improvement be driven? d. Who will be on the team? e. ALL OF THE ABOVE

What are the strategic drivers behind outsourcing?

a. Access to new markets b. Competitive pressures c. Industry practice d. Quality e. Cost ALL OF THE ABOVE

Which of the following are activities that companies will outsource?

a. Call center services b. Accounting c. Manufacturing d. Payroll processing e. ALL OF THE ABOVE f. None of the above

Which of the following is not part of the Outsourcing/Offshoring process?

a. Capability Analysis b. Vulnerability Analysis c. Location Analysis d. Implementation e. All of the above, i.e. none of these are part of the process f. NONE OF THE ABOVE, i.e. all are part of the process

What are the main areas to look at during the outsourcing decision process?

a. Consider the strategic implications of outsourcing b. Evaluate cost and performance implications c. Decide who are the right decision makers

Which of the following would be a reason for insourcing?

a. New technologies emerge b. New suppliers come to market c. Costs change d. Politics shift e. Only B & C f. ALL OF THE ABOVE

Which of the following activities can be outsourced?

a. Purchasing b. Payment collections c. Risk management d. Design of products e. ALL OF THE ABOVE

Conditions might change from the time your initial offshoring decision was made. What might this require you to do?

a. Top Management b. Finance/accounting c. Production management d. Production engineering e. Suppliers f. ALL OF THE ABOVE

Purchasing play's a key role in the make versus buy decision! Other functions that may play a role include which of the following?

a. Top Management b. Finance/accounting c. Production management d. Production engineering e. Suppliers f. ALL OF THE ABOVE

Which is the last step to a Multi-criteria analysis?

c. CALCULATE RESULTS